Amazon CTO Werner Vogels has been at the helm of the technology revolution at the ecommerce major for the last 14 years and is widely acknowledged as one of the key architects behind Amazon’s cloud computing approach, Amazon Web Services. Here are excerpts from a recent fireside chat.
While he has played a key role in driving the technology vision of one of the world’s most valuable companies, Werner Vogels also has certain regrets from his journey at Amazon. Speaking at a fireside chat at European technology conference Slush 2018 in Helsinki last month, he said one of his biggest regrets was not starting Amazon’s cloud approach a few years earlier.
“I wish we did it (AWS) a few years ago. My regret is that we did not move fast enough, and that still continues to haunt me. We had no idea how it would evolve over the years.”
Amazon Web Services (AWS) continues to be one of the retail giant's most successful bets. In Q3 of 2018 alone, Amazon’s cloud business generated close to $6.11 billion in revenue and accounted for over 11 percent of Amazon's profitability. For the past two quarters, its top line has been growing at about 48 percent.
Vogels also emphasised the importance of investment in R&D. In 2017, Amazon reportedly invested close to $23 billion in innovation and R&D efforts. According to him,
“The more you invest in R&D, the more your competitiveness increases, and the companies in the US are increasingly realising that.”
A couple of years ago, Amazon announced its intention to bet big on voice for its future through the launch of its intelligent speaker range, Echo, and the voice-controlled intelligent personal assistant, Alexa. Today, the vision for Amazon is that voice will be ubiquitous, helping you control much more than just your appliances.
“I think what we were looking for was a natural approach to technologies. And voice was the answer. I truly believe that voice will be the access to digital ecosystems, especially to those who don’t have access to them. For the first time, the interaction with a digital system will be natural and not through another digital system.”
During the fireside chat, Vogels also touched upon the use of Machine Learning at Amazon’s retail arm, which is meant to help customers make better buying decisions. Today, every customer has a different Amazon homepage, and this personalisation is achieved through the machine learning algorithms, which are constantly at work. But beyond customisation, Machine Learning is essential for its fraud-detection capabilities, which evolve by understanding the patterns of fraud.
When asked if these recommendations had been effective at Amazon, Vogels said,
“We have good recommendations and are committed towards the privacy of our customers, while helping them make smarter buying decisions. We would not want others to use that data.”
Vogels added that experimentation is key to Amazon’s culture, and individuals are encouraged to see failure as a stepping stone to success.
“If you stop innovation, you will soon be out of business. People will do things better than you and they will have better convenience, good deals and better transportation. So, experimentation and innovation is the key. And things will go wrong, that’s just the nature of experimentation.”
So, how does Amazon enable innovation for its half a million employees?
Vogels said the organisation had taken a decentralised or flat approach by removing the hierarchy and pushing teams to communicate with each other to fuel innovation.
“We are trying to remove every barrier from the experimentation process. If someone is blocking the process or objects objections to an idea, then they are asked to work on it with the person (on the idea). But the Amazon culture speaks of failing fast, and that doesn’t stunt anyone’s growth but rather is treated as a badge of honour.”
So, what does Vogels, who hails from the Netherlands and has a PhD from Vrije Universiteit Amsterdam, think about the upcoming Nordic and European technology ecosystem? Vogels said that although it wasn't as mature or as high-risk-taking as the US, companies in Europe were nonetheless exceptional. He also pointed out that Europeans are more adaptive and suited for worldwide businesses because of the diversity the continent offers in terms of language and culture.