Innovation at Amazon

Innovation at Amazon

Today I would like to talk about the culture of innovation. Customers often ask me how can their companies innovate like Amazon. From its humble beginnings as the "World's Largest Bookstore," Amazon has not only innovated across e-commerce and adjacent segments within e-commerce, but also introduced new businesses that seem (and sometimes are) unrelated to e-commerce. Over the years Amazon has gotten very good at taking hard problems (often times esoteric), and made them easier for the masses to use. AWS is a great example of that. We have taken something so central and specialized as operating and managing technology data center, and pushed to the edges in form of a utility. When technology becomes a utility, it becomes ubiquitous, and therefore, more people can participate in the innovation.

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Frank Munz

April 13, 2019
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  1. © 2018, Amazon Web Services, Inc. or its Affiliates. All

    rights reserved. 1 Dr. Frank Munz Senior Technical Evangelist, AWS Amazon’s Culture of Innovation Enabling Everyone to Innovate
  2. © 2018, Amazon Web Services, Inc. or its Affiliates. All

    rights reserved. 2 Dr. Frank Munz Senior Technical Evangelist, AWS Amazon’s Culture of Innovation Enabling Everyone to Innovate
  3. © 2018, Amazon Web Services, Inc. or its Affiliates. All

    rights reserved. 3 Dr. Frank Munz Senior Technical Evangelist, AWS Amazon’s Culture of Innovation Enabling Everyone to Innovate
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    rights reserved. 4 4 About me • Software Architect / DevOps Engineer • Technical Evangelist @ AWS • Published an AWS book (some years ago) • Containers, and a sprinkle of ML & big / fast data @frankmunz
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    rights reserved. 5 5 Innovation at Scale
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    rights reserved. 6 6 Innovation at Global Scale 40.007.860 meters
  7. Amazon Global Network • Redundant 100GbE network • Redundant private

    capacity between all Regions except China Over 150 Global CloudFront PoPs 89 Direct Connect Locations a e o q i h Paris Sweden AWS GovCloud East First 5 years: 4 regions 2016–2020: 13 regions Next 5 years: 7 regions A W S REGIONAL EXPANSION 2 0 R e g i o n s 6 1 A Z s d m c g b n s k v i i i i i i i i Milan i Cape Town
  8. None
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    rights reserved. 9 9 Innovation at Scale 0,005 meters
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    rights reserved. Amazon Confidential and Trademark
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    rights reserved. 11 11 Our Mission to be Earth’s most customer-centric company
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    rights reserved. 12 12 Our Commitment we make our customers’ lives easier
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    rights reserved. 13 13 Where innovation begins we start with the customer and work backwards
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    rights reserved. 14 14 Amazon’s Growth Flywheel > Value > Selection > Convenience
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    rights reserved. 165+ Cloud Services
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    rights reserved. 16 16 Amazon’s Growth Flywheel > Value > Selection > Convenience
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    rights reserved. 17 17
  18. AWS Pricing Philosophy Ecosystem Global footprint New features New services

    More AWS usage More infrastructure Lower infrastructure costs Reduced prices More customers Infrastructure Innovation 69 price reductions since 2006 Economies of scale
  19. AWS Console: Convenience & Selection

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    rights reserved. 20 20 Stubborn on the Vision but flexible on the details
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    rights reserved. 21 21
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    rights reserved. 22 22 45 % lower cost for scale-out workloads Up to 45% lower cost for scale-out workloads Custom built AWS Graviton Processor (ARM)
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    rights reserved. 23 23 Willingness to be Misunderstood for a long period of time
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    rights reserved. 24 24 69 Price Reductions 1,957 New Services and Features introduced in 2018 Millions of Monthly Active Customers
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    rights reserved. 25 How do we organize for innovation? » Mechanisms » Architecture » Culture » Organization
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    rights reserved. 26 26 Mechanisms
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    rights reserved. 27 27 Who is your customer? Be specific about their context and needs
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    rights reserved. 28 28 Image: Unsplash People don't want to buy a quarter-inch drill, they want a quarter- inch hole. Theodore Levitt
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    rights reserved. 29 29 Working Backwards is a process Use it to get clarity, not to document what you’ve already decided to do. Customer Press Release FAQ User Manual
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    rights reserved. 30 The 5 Questions
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    rights reserved. 31 31 The FAQ • Include both customer FAQs and stakeholder FAQs • Include the hard questions • Share your Press Release early to gather questions
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    rights reserved. 32 Artifacts from the Working Backwards process Press Release FAQ Visuals
  33. We read, discuss, debate and ask questions.

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    rights reserved. 34 34 Most companies write the software, they get it all working, and then they throw it over the wall to the marketing department, saying ‘here is what we built, go write the press release.’ That process is the one that’s actually backwards.” Jeff Bezos Founder and Chief Executive Officer Amazon.com, Inc. © 2018, Amazon Web Services, Inc. or its Affiliates. All rights reserved.
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    rights reserved. 35 35 Architecture
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    rights reserved. 36 36 Self-service platforms without gatekeepers “We are creating powerful self-service platforms that allow thousands of people to boldly experiment and accomplish things that would otherwise be impossible or impractical.”
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    rights reserved. Amazon Confidential and Trademark 165 AWS Services
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    rights reserved. 38 38 Culture
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    rights reserved. 39 39 Amazon hires builders and lets them build
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    rights reserved. 40 40 Every one of us is a leader on our mission
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    rights reserved. 41 41 Organization
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    rights reserved. 42 42 Experiment early & frequently
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    rights reserved. 43 43 Is it a one-way or a two-way door?
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    rights reserved. 44 To invent you have to experiment, and if you know in advance that it’s going to work, it’s not an experiment To our shareowners (2015) This year, Amazon became the fastest company ever to reach $100 billion annual sales. Also this year, Amazon Web Services is reaching $10 billion in annual sales. One area where I think we are especially distinctive is failure. I believe we are the best place in the world to fail (we have plenty of practice!), and failure and invention are inseparable twins. To invent you have to experiment, and if you know in advance that it’s going to work, it’s not an experiment. Most large organizations embrace the idea of invention, but are not willing to suffer the string of failed experiments necessary to get there. Outsized returns often come from betting against conventional wisdom, and conventional wisdom is usually right. Given a ten percent chance of a 100 times payoff, you should take that bet every time. But you’re still going to be wrong nine times out of ten. We all know that if you swing for the fences, you’re going to strike out a lot, but you’re also going to hit some home runs. The difference between baseball and business, however, is that baseball has a truncated outcome distribution. When you swing, no matter how well you connect with the ball, the most runs you can get is four. In business, every once in a while, when you step up to the plate, you can score 1,000 runs. This long-tailed distribution of returns is why it’s important to be bold. Big winners pay for so many experiments.
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    rights reserved. 45 45 Learn from failures…
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    rights reserved. 46 46 Two-Pizza teams are fast and agile, foster ownership and autonomy Small, decentralized teams are nimble Own and run what you build
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    rights reserved. 47 47 https://blog.crisp.se/author/henrikkniberg
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    rights reserved. 48 You Build It, You Run It “This brings developers into contact with the day-to-day operation of their software. It also brings them into day-to-day contact with the customer.” – Werner Vogels, CTO
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    rights reserved. 49 49 Service-oriented Single-purpose Connected with APIs Highly decoupled Microservices
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    rights reserved. 50 50
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    rights reserved. 51 51 Innovation (and Democratization): ML
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    rights reserved. 53 53 AWS Rekognition
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    rights reserved. 55 55 Machine Learning Unsupervised Learning
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    rights reserved. 56 56 https://hub.packtpub.com/introduction- clustering-and-unsupervised-learning/
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    rights reserved. 57 57 Machine Learning Supervised Learning
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    rights reserved. 58 58 https://twitter.com/teenybiscuit
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    rights reserved. 59 © 2017, Amazon Web Services, Inc. or its Affiliates. All rights reserved. 59 Here be dragons
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    rights reserved. 60 60 Reinforcement Learning
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    rights reserved. 61 61 How does Reinforcement Learning work? https://gym.openai.com/
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    rights reserved. 62 62
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    rights reserved. Amazon Confidential and Trademark HD Video Camera Gyroscope for direction and orientation Accelerometer for measuring change in speed Two batteries: one to power on-board compute, one to drive motors Dual-core Intel Atom® Processor Introducing AWS DeepRacer All wheel drive, monster truck chassis Suspension mounted high for a view of the road Both accelerometer and gyroscope useful in the future for building more sophisticated models such as finding the perfect racing line or path finding
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    rights reserved. Amazon Confidential and Trademark AWS DeepRacer: How does it work? 3D simulator with virtual car and track Rewards RL algorithm
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    rights reserved. 66 66 Democratization of ML
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    rights reserved.
  66. N E W ! Easily control satellites and ingest data

    with fully managed Ground Station as a Service AWS Ground Station Low Earth Orbit (LEO) Medium Earth Orbit (MEO) Simultaneous narrowband S-band, X-band and UHF downlink Receive satellite data into Amazon VPC and Process data in AWS Cloud
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    rights reserved. Amazon Confidential and Trademark 69 We had three big ideas at Amazon that we have stuck with for 20+ years, and they are the reason we are successful: put the customer first, invent, and be patient. Jeff Bezos Founder and Chief Executive Officer Amazon.com, Inc.
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    rights reserved. 70 70 Thank you! frankmunz @frankmunz