Amazon.com was founded in 1995 as an online book retailer. In the decades since, it has expanded to become an e-retailer giant, selling everything from electronics to groceries and household items, and earning over $280 billion in annual revenue. The company is well known for its sophisticated storage and delivery methods as well as its emphasis on earning profits through sales volume. Jeff Bezos, Amazon's founder and CEO, knew from the beginning that he wanted Amazon to be "an everything store." Many attribute Amazon's success to Bezos's visionary leadership style, as well as his exceptionally high standards for innovation and customer service. Bezos's entrepreneurial spirit is evident in Amazon's company culture, which he describes as "friendly and intense, but if push comes to shove we'll settle for intense." This intensity is infectious. Those who do best working for Amazon are those who are not afraid to be adversarial. According to Nadia Shouraboura, Amazon's former head of supply chain, this is not an accident. Rather, it is by design she says, noting, "When everybody's arguing and fighting and not afraid to talk, the end decision will be the best one." In order to ensure an environment that is conducive to constructive conflict, Bezos created the "Two Pizza Rule." That is, keep teams small enough that members can be fed with two pizzas.

Teams that can be fed with just two pizzas are able to support healthy debate and avoid the trap of false consensus that comes as team sizes increase and each person is less likely to participate in discussions and disagreements. Amazon's culture of creative conflict is embodied by one of the company's 14 leadership principles. Number 13 is "Have Backbone; Disagree and Commit." According to this principle, "Leaders are obligated to respectfully challenge decisions when they disagree, even when doing so is uncomfortable or exhausting. Leaders have conviction and are tenacious. They do not compromise for the sake of social cohesion . . ." While this conflict-oriented leadership style has sparked some controversy for Amazon, an argument can be made that the company's unparalleled success is founded upon this principle. Amazon is not alone in their belief that conflict can be healthy. For example, Intel has a constructive confrontation training course module for new employees. In fact, some scholars have found that high-pressure work environments can lead to more creative work under the right circumstances. Thus, perhaps Amazon owes its success to its visionary leader who favors healthy, creative conflict versus cross-team communication, which he believes leads to too much agreement within the organization. On the other hand, perhaps a culture that encourages employees "to tear apart one another's ideas in meetings" leads to potential unintended consequences. Which way you see it probably depends a great deal on how well you fit a culture of conflict. Amazon's Leadership Principles (https://www.amazon.jobs/en/working/working-amazon/# leadership-principles) include 14 statements regarding how effective leaders at Amazon behave including:

1) Customer Obsession Leaders start with the customer and work backwards. They work vigorously to earn and keep customer trust. Although leaders pay attention to competitors, they obsess over customers.

2) Ownership Leaders are owners. They think long term and don't sacrifice long-term value for short-term results. They act on behalf of the entire company, beyond just their own team. They never say, "That's not my job."

3) Invent and Simplify Leaders expect and require innovation and invention from their teams and always find ways to simplify. They are externally aware, look for new ideas from everywhere, and are not limited by "not invented here." As we do new things, we accept that we may be misunderstood for long periods of time.

4) Are Right, A Lot Leaders are right a lot. They have strong judgment and good instincts. They seek diverse perspectives and work to disconfirm their beliefs.

5) Learn and Be Curious Leaders are never done learning and always seek to improve themselves. They are curious about new possibilities and act to explore them.

6) Hire and Develop the Best Leaders raise the performance bar with every hire and promotion. They recognize exceptional talent, and willingly move them throughout the organization. Leaders develop leaders and take seriously their role in coaching others. We work on behalf of our people to invent mechanisms for development like Career Choice.

7) Insist on the Highest Standards Leaders have relentlessly high standards-many people may think these standards are unreasonably high. Leaders are continually raising the bar and driving their teams to deliver high-quality products, services, and processes. Leaders ensure that defects do not get sent down the line and that problems are fixed so they stay fixed.

8) Think Big Thinking small is a self-fulfilling prophecy. Leaders create and communicate a bold direction that inspires results. They think differently and look around corners for ways to serve customers.

9) Bias for Action Speed matters in business. Many decisions and actions are reversible and do not need extensive study. We value calculated risk taking.

10) Frugality Accomplish more with less. Constraints breed resourcefulness, self-sufficiency, and invention. There are no extra points for growing headcount, budget size, or fixed expense.

11) Earn Trust Leaders listen attentively, speak candidly, and treat others respectfully. They are vocally self-critical, even when doing so is awkward or embarrassing. Leaders do not believe their or their team's body odor smells of perfume. They benchmark themselves and their teams against the best.

12) Dive Deep Leaders operate at all levels, stay connected to the details, audit frequently, and are skeptical when metrics and anecdotes differ. No task is beneath them.

13) Have Backbone; Disagree and Commit Leaders are obligated to respectfully challenge decisions when they disagree, even when doing so is uncomfortable or exhausting. Leaders have conviction and are tenacious. They do not compromise for the sake of social cohesion. Once a decision is determined, they commit wholly.

14) Deliver Results Leaders focus on the key inputs for their business and deliver them with the right quality and in a timely fashion. Despite setbacks, they rise to the occasion and never settle.

Questions

1. Do you believe that conflict can be healthy or that conflict is always a problem? Please defend your answer.
2. Have you experienced a situation where conflict led to improved team performance or creativity? Explain.
3. Do you think it is feasible for most companies to follow the “Two Pizza Rule”? Why or why not?
4. What do you think about Amazon’s Leadership Principle #13 around disagreement? Do you think leaders should be obligated to challenge decisions when they disagree?
5. Which other of the 14 Leadership Principles do you think stimulate a culture of conflict over ideas?

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