“Working Backwards” (Book Review)

MAA1
5 min readFeb 17, 2023

It feels like a lifetime ago when I first wrote about product management practices at Amazon. Nine years ago I write a post about product management at Amazon. Since then I’ve come across a number of valuable practices that have out of Amazon, and the thinking behind them. Reading “Working Backwards” by Colin Bryar and Bill Carr therefore provided a number of deja vu moments. “Working Backwards” covers several Amazon ways of working practices that the company has become well known for:

Bar Raiser — To avoid the risk of personal bias and hiring urgency, Amazon has created its “Bar Raiser Program” to create a scalable, repeatable, formal process for consistently making successful hiring decisions. The term “bar raiser” refers to both the hiring process and, famously, a group of individuals who are central to that process.

As a Bar Raiser, your role is to make sure that the person that gets hired is better than the existing team members in at least one area. Neither the hiring manager nor a recruiter can fulfil this role, and the person taking on this role will have to go through dedicated training. The Bar Raiser is brought into the interview process and can veto any hire and override any hiring manager.

Single threaded leadership — To continue to innovate at speed and — despite its enormous company size — remain as nimble as possible Amazon has developed “single threaded leadership”. A single threaded leader owns a single, major initiative, and therefore isn’t affected by competing responsibilities. This person runs a separable, autonomous team that’s dedicated to deliver specific goals.

Narratives and the Six Pager — In the book, Bryar and Carr describe the end of the usage of PowerPoint at Amazon. It was felt that PowerPoint slides were insufficient in getting an idea across effectively and quickly. Instead, ‘Amazonians’ use six-pager narratives. These Word documents can take many different forms, but the point is that they’re designed to drive meaningful discussion in a meeting. ‘Tenets’, for example, are a critical part of a six-page narrative; the foundation(s) that a proposal or a recommendation relies on.

Working backwards — Instead of starting product thinking with considering technology challenges or business projections, ‘working backwards’ starts with the customer. When writing a press release to explain the product, the focus is on the what would be great for customers. In the book, Bryar and Carr mention the press release for the Kindle as the first time that Amazon applied the working backwards approach: “When we wrote a Kindle press release and started working backwards, everything changed. We focused instead on what would be great for customers. An excellent screen for great reading experience. An ordering process that would make buying and downloading books easy. (…)” Iain McAllister, a former Product Leader at Amazon, has written a great article about the Amazon press release and its components.

As the press release format became more popular within Amazon, a second element was added: FAQs. The FAQ section includes both external and internal frequently asked questions. External FAQs are the ones that consumers or press would normally ask about the product. “Where can I purchase a new Amazon Echo?” or “How does Alexa work?” Internal FAQs are the kinds of questions that your team and executive leadership would ask. “How can we make a 44-inch TV with an HD display that can retail for $1,999 at a 25% gross margin? or “How will we make a Kindle reader that connects to carrier networks to download books without customers having to sign a contract with a carrier?”

The number and type of FAQs will naturally depend on the type of product and customer base, but there are a number of common topics that are covered as part of the internal FAQs:

Customer Needs and Total Addressable Market (TAM)

  • How many customers have this need or problem?
  • How big is the need?
  • For how many consumers is this problem big enough that they’re willing to spend the money to do something about it?
  • If so, how much money would they be willing to spend?
  • How many of these consumers have the characteristics / capabilities / constraints necessary to make use of the product?

Economics and P&L

  • What are the per-unit economics of the product? That is, what is the expected gross profit and contribution profit per unit?
  • What’s the rationale for the price point you’ve chosen for the product?
  • How much will we have to invest up front to build this product in terms of people, technology, inventory, warehouse space, and so on?

Dependencies

  • What are the dependencies on e.g. other systems, suppliers, regulators, content providers, etc.
  • What third-party technologies will the product rely on in in order to function as promised?

Feasibility

  • What are the challenges product engineering problems we will need to solve?
  • What are the challenging customer UI problems we’ll need to solve?
  • What are the third-party dependencies we’ll need to solve?
  • How will we manage the risk of the up-front investment required?

Managing inputs metrics — In 2001, Jeff Bezos — Amazon’s Founder and then CEO — drew this diagram to illustrate the “Amazon flywheel”:

Image Credit: Sam Seely

The Amazon flywheel contains a set of controllable input metrics such as customer experience and sellers which drive a single output metric: growth. The point here is to identify the correct, controllable input metric. This is a metric that can be controlled and that will impact the right output.

For example, the metrics for customer experience, could include speed of shipping, breadth of selection and ease of use. So when customer experience is improved, the flywheel is set in motion, leading to an increase in growth (the main output metric):

  • Better customer experience leads to more traffic.
  • More traffic attracts more sellers seeking those buyers.
  • More sellers lead to wider selection.
  • Wider selection enhances customer experience, completing the circle.
  • The cycle drives growth, which in turn lowers cost structure.
  • Lower costs lead to lower prices, improving customer experience, and the flywheel spins faster.

Main learning point: Over the years Amazon has developed a number of valuable ways of working, which in turn have been adopted and adjusted by other companies globally. Even if you feel that your company doesn’t have the right size and structure to apply these Amazon practices, it’s worth reading “Working Backwards” and learning about how you can apply the principles that underpin Amazon’s ways of working.

Related links for further learning:

  1. https://www.edwardtufte.com/tufte/powerpoint
  2. https://www.aboutamazon.eu/news/working-at-amazon/what-is-a-bar-raiser-at-amazon
  3. https://www.duarte.com/resources/books/slideology/
  4. https://www.forbes.com/sites/forbescommunicationscouncil/2022/08/30/why-and-how-every-company-should-use-amazons-six-page-memo-format/
  5. https://www.inc.com/justin-bariso/amazon-uses-a-secret-process-for-launching-new-ideas-and-it-can-transform-way-you-work.html
  6. https://www.linkedin.com/pulse/working-backwards-press-release-template-example-ian-mcallister/
  7. https://asq.org/quality-resources/dmaic

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MAA1

Product person, author of "My Product Management Toolkit" and “Managing Product = Managing Tension” — see https://bit.ly/3gH2dOD.