Leaked Amazon slides instruct employees to ‘double down on frugality’ in all-hands meeting
- Amazon urged frugality in an all-hands meeting this week, according to excerpts reviewed by Insider.
- “There are no extra points for growing headcount, budget size, or fixed expense,” a leaked slide said.
- The comments signify the tone shift at Amazon, as it tightens its belt in the face of a looming recession.
Amazon’s leadership team urged employees to “double down on frugality” in an internal all-hands meeting this week, according to slides and excerpts viewed by Insider.
The slides instructed employees to “accomplish more with less,” meaning to adjust hiring, reduce costs, and inventory levels.
“Constraints breed resourcefulness, self-sufficiency, and innovation,” one of the slides said. “There are no extra points for growing headcount, budget size, or fixed expense.”
Specific strategies outlined in the slides included:
- Maintain cash balances and liquidity
- Adjust inventory levels to meet demand
- Reduce discretionary costs not tied to customers
- Adjust hiring based on business needs and priorities
- Prioritize customer experience over new initiatives
- Double down on frugality
Amazon Chief Financial Officer Brian Olsavsky during the meeting said the company nearly doubled its operational capacity from 2020 to 2021, and must now be more frugal to manage costs, according to an employee who was present.
The comments signify a tone shift at Amazon, as the giant retailer tightens its belt in the face of slowing growth and a deteriorating economic climate. Amazon has always had a reputation for being more penny-pinching than its lavish tech peers, but the recent economic downturn has put more pressure on the company to cut costs.
At the meeting, Amazon CEO Andy Jassy conveyed a similar message when asked about the economic downturn and its effect on Amazon’s future investments. He said Amazon will be more thoughtful about its spending, though it will continue to invest in long-term bets, according to a recording of the meeting obtained by Insider.
“It’s on a lot of people’s minds, and of course, none of us know for sure what’s gonna happen, but there are a lot of signs that point to this being a difficult and rough economy ahead of us,” Jassy said. “And I don’t know how long it’ll last, but I think one of the things that we are thinking about and we’ve decided is that we’re going to be more streamlined in how we expand in 2023.”
Jassy pointed to several long-term initiatives, like Alexa and groceries, that will keep getting funded, but warned that Amazon will have to find the right balance by being “strategically patient and tactically impatient.”
“One of the things that people sometimes get wrong is they forget that healthy, long-term oriented, sustainable businesses don’t always expand really broadly every year,” Jassy said.
In the past few months, Amazon has shut down an array of high-profile projects, including its Amazon Care telehealth service and stopped testing the Scout self-driving robot. It’s significantly downsizing its robotics team and Grand Challenge moonshots lab, as Insider previously reported. The company is also scaling back expansion plans for its warehouses and delivery partners.
“This is Day 2 s–t,” an Amazon employee who viewed the all-hands meeting told Insider, referring to Amazon’s “Day 1” mindset, a common refrain from Jeff Bezos that the company should always act like a startup no matter how old it becomes. Concerns about Amazon entering “Day 2,” in reference to a slowing culture, extra management layers, and rising red tape, has been a growing concern among the company’s corporate workforce, as Insider previously reported.
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