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Sunday, July 25, 2021

Jeff Bezos’ successor: What investors need to know about new Amazon boss Andy Jassy

The internet giant Amazon will no longer be managed by the company’s founder: Jeff Bezos has appointed Andy Jassy as his successor at the top of the group. That the choice fell on Jassy hardly surprised observers, as he is no stranger.

• Jeff Bezos is withdrawing from the top of the Amazon group
• Successor Andy Jassy is in the starting blocks
• What is in store for Amazon?

One of the most valuable corporations in the world has a new CEO: Jeff Bezos, who founded Amazon on July 5, 1994 and led it from an online bookseller to a global corporation, will no longer serve as CEO . The entrepreneur announced this in the context of the latest balance sheet presentation . Bezos clears the way for a man who has been traded as his Crown Prince for some time – a man who is already responsible for the majority of Amazon’s profits.

Andy Jassy is an Amazon veteran

Just three years after it was founded, in 1997, Andrew R. Jassy, ​​known as Andy Jassy, ​​joined Amazon. He witnessed how the online bookseller was continuously expanding and rapidly expanding its business. The now 53-year-old not only stood on the sidelines observing, but also played a key role in shaping the development of Amazon himself.
Jassy initially worked as Marketing Manager at Amazon, with the aim of building the music CD business on the company’s platform. His area of ​​expertise shifted over the years, and from 2003 he was given responsibility for the cloud business – a division that was neither particularly profitable at the time, nor was Amazon identified as a possible business driver. But only three years later, in 2006, the cloud segment, in which Amazon had originally focused solely on providing other companies with their own unused server capacities for rental costs, became an independent division within the group as a whole. Andy Jassy was put in charge of Amazon Web Services, AWS.

While Amazon moved away from being a pure e-commerce channel over the years and created its own Amazon universe with its own hardware and numerous service offerings in the Prime area, the cloud division became increasingly relevant for the entire group. Under Jassy’s leadership, the division became Amazon’s most important profit maker: Around half of the total result comes from this division, while AWS only accounts for around ten percent of the group’s income at the same time. The cloud sector is therefore highly profitable and one of the reasons why Amazon can now boast a market capitalisation worth trillions on the stock exchange.

Jassy as Bezos’ shadow

That Jeff Bezos not only gave his confidante Andy Jassy responsibility for the most important business area at Amazon, but also brought him into play as a potential successor, became clear when Jassy was appointed “technical assistant” and thus acted as the shadow of Jeff Bezos as the Bloomberg news agency put it. In this position he followed his boss for two years in discussions and meetings and accompanied him during his working day. He also acted as an advisor to Jeff Bezos and took with him numerous insights into the management style of the Amazon CEO and his focus on what is probably the most central Amazon topic – customer satisfaction.

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What will now change at Amazon

The news that Andy Jassy will become the new boss of the internet giant after Jeff Bezos’ retirement as CEO was taken rather calmly on the stock exchange. Not only because the rise of Jassy was foreseeable for many observers after the developments in recent years, but especially because it is unlikely that Amazon would have to expect dramatic changes under the new leadership.
In fact, Jassy is likely to continue the shift from an e-commerce company to a technology company, with his background as AWS CEO nothing else can be expected. In addition, Jeff Bezos will not leave the group completely, but rather, as chairman of the board of directors, will continue to have an enormous influence on the fortunes of the company he founded. Bezos himself also recently emphasised that it is not about turning his back on the company, instead he wants to focus his attention on new products and initiatives and also devote more time to other projects for which less time is spent as part of the CEO work for Amazon stayed. Bezos heads several foundations, owns his own space company, Blue Origin, and owns his own newspaper, the Washington Post.

Bezos and Jassy are similar

Bezos will have more time for all of these projects starting July 5th, when Jassy will take over as CEO. And yet it doesn’t have to worry that Amazon will develop under new leadership in a direction that it would not approve of as a founder.
Bezos and Jassy are said to have a similar work ethic – both are probably always meticulously prepared, their management style is considered strict, objective and with an unconditional focus on customer satisfaction. They also experienced the rise and expansion of Amazon up close and should share a similar vision for the future of the company.
After all, Jassy will also want Amazon to remain profitable, but the new boss will have to deal with problems that Jeff Bezos no longer has – including the fact that Amazon’s market power is controlled by authorities in the USA and Europe is viewed more and more critically. A possible restructuring of Amazon now falls into Jassy’s area of ​​responsibility.
The fact that Jassy – unlike Bezos – has a business background, as he graduated from Harvard Business School, should help rather than hurt him against this background. The fact that he also has an enormous affinity for technology should also have become clear to critics in his role as head of AWS.
All in all, the change in boss at one of the world’s most valuable internet companies is unlikely to have any major consequences for Amazon’s direction or future business development. The challenge for Jassy is big, because the charismatic founder leaves big footsteps. But Jassy and Bezos are similar in many ways, on a professional as well as private level, which should make the transfer of items easier.

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