Why Amazon’s executives are heading for the door

Amazon When Amazon was looking to build its second headquarters in Queens, it was not Jeff Bezos who flew to meet Andrew Cuomo, the New York governor, but a man known internally as “the other Jeff”. Jeff Wilke, the head of Amazon’s retail business and Bezos’s second-in-command, had already taken […]

Amazon

When Amazon was looking to build its second headquarters in Queens, it was not Jeff Bezos who flew to meet Andrew Cuomo, the New York governor, but a man known internally as “the other Jeff”.

Jeff Wilke, the head of Amazon’s retail business and Bezos’s second-in-command, had already taken on much of the day-to-day running of the US titan at that point.

Finding a site for a second HQ was part of that.

In recent years, tasks had increasingly fallen to Wilke. Battling counterfeit goods and integrating Amazon’s Whole Foods purchase all came under Wilke’s remit.

“He was really the lynchpin to the success that Amazon has seen,” says Dan Ives, an analyst at Wedbush.

With Bezos’s focus turning to futuristic bets, such as his space exploration venture, many inside Amazon saw “the other Jeff”, a man who had been at Amazon for 21 years, as the heir apparent.

Yet, last month, that changed. Wilke abruptly announced he would be retiring at the start of 2021. The 53-year-old said he did not have another job to go to. Instead, he just wanted to “explore personal interests”.

“Why leave?” Wilke wrote in an email to staff. “It’s just time.”

He was far from the first to exit the giant. In recent months, Amazon has suffered a spate of departures. The retail portion of the business, in particular, has seen a procession of significant departures.

In June, Amazon’s UK boss Doug Gurr said he would be stepping down from his post. Earlier this month, Xavier Garambois, the European head of Amazon and Gurr’s boss, announced his resignation.

Other parts of Amazon’s sprawling business have also experienced personnel losses.

Brad Porter, the company’s vice president of Robotics, left the business in the past few weeks, whilst Tim Bray, a vice president at Amazon Web Services and a long-time Amazon engineer, quit in May. These are all “big shoes” to fill, says an Amazon insider. It means “major change”.

Some at Amazon have been taken aback by the pace of a few of the departures. Gurr, for example, “was on the way up, had a great platform to work from and plenty of headroom to go further in the business,” a source says, adding that it’s “interesting” that these moves have happened in quick succession.

Amazon itself maintains that it has “had and continues to have remarkable retention and continuity of leadership at the company”.

“As with any company, people leave from time to time for personal or professional reasons – many return to the company – we call them boomerangs.”

Amazon says its vice presidents stay for an average of 10 years, and senior vice presidents for an average of 18 years. Yet, while its track record may be strong, quite clearly, since the Covid-19 pandemic took hold, churn appears to have increased.

In part, the pandemic itself may have been one of the reasons. “Amazon under Bezos has always been a high-stress environment,” says Bill George, who teaches leadership at Harvard Business School. “Historically there’s been a lot of turnover, but the turnover seems to be accelerating now. Some people can only stay so long in a tense environment. The crisis intensifies that.”

Yet, others say those leaving may have been lured by the possibility of large payouts. A surge in demand for Amazon’s entertainment and retail services has sent the company’s share price to record highs.

Even after last week’s tech stock rout, Amazon is still trading almost 70pc higher than it was at the start of the year, as investors pile into the ultimate “stay at home” stock.

“My hypothesis is that the stock drove extreme wealth for these individuals,” says Neil Ackerman, a former Amazon executive. This, “combined with an opportunity to spend more time doing things they enjoy”, likely drove some to consider leaving the firm, he says.

There are plenty of opportunities for Amazon staff. Many companies, seeking to shift their operations online rapidly, are on the hunt for Amazon staff to parachute in.

“Every corporation I know is trying to become more digital, and Amazon has become a prime target for talent,” George says.

Back in March, for example, Unilever poached Sunny Jain, the head of Amazon’s “core consumables” division, to lead its beauty and personal care business. Financial services firm Stripe, meanwhile, tapped Mike Clayville from AWS to serve as its chief revenue officer.

“I don’t think there’s a rebellion inside Amazon against Bezos, but executives like Wilke are in pretty high demand,” says Alex Kantrowitz, author of Always Day One: How the Tech Titans Plan to Stay on Top Forever. “They know the insides of power players and can typically do whatever they want afterwards.”

Rivals circling its talent pool is not the only issue Amazon has had to cope with during the pandemic.

The company may have already been a leader in many of the fields which are now in demand – cloud, streaming and online retail – yet coping with the surge in customer numbers at the same time as trying to curb the spread of the virus among staff has proved a tricky task.

At the start of the pandemic, it had to limit purchases to only essential items in some regions. It faced criticism in a number of warehouses by staff who warned not enough safety precautions were being taken – claims which were rejected by Amazon.

Jeff Bezos | A carefully cultivated public image
Jeff Bezos | A carefully cultivated public image

As its operations were tested, Bezos was said to have taken a more hands-on approach at the company. According to a profile piece in The New York Times, the billionaire began holding daily calls over testing and inventory, entered into discussions with government officials and, in April, visited his first warehouse in years.

Some senior executives took it as an encouraging move. “There had been a lot of disgruntlement when Bezos started to get distracted by his other ventures,” says one insider.

The fact that Bezos’s attention is now on Amazon was reassuring for many, especially given the increased regulatory scrutiny over the company.

Yet, experts say the decision likely changed the dynamics of the business. Further oversight across regions and different portions of the business was “inevitable”, says George. “A leader has to step in and take charge in a crisis, but it’s disorienting for others when they step back in.”

Up until this year, many had assumed Bezos may be out the door relatively soon.

“Bezos has been saying for years that his top priority is getting to space,” says Kantrowitz.

“Anyone watching that would have believed there would be an opening at Amazon for someone to lead in the next few years”.

But, now, he says, “this is an extraordinary time for Amazon, and it’s not a time when Bezos is going to go anywhere”.

Before Covid-19, Bezos started to take a step back from Amazon. Now, as others exit, his position at the company is as crucial as ever.

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Stoller

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