Andy Jassy’s Shareholder Letter Highlights Efforts to Revive Amazon’s Startup Culture

In his annual letter to shareholders, Amazon CEO Andy Jassy emphasized his ongoing efforts to refocus the company on the innovative, fast-moving mentality that characterized its early days as a startup.

Joining Amazon in 1997, Jassy has been part of the company almost since its inception, and nearly three decades later, he remains determined to rekindle the startup ethos that helped propel Amazon to its current status as a global tech giant.

Jassy’s latest push, as outlined in the letter published on Thursday, is to transform Amazon into “the world’s largest startup.” To achieve this, he has outlined strategies aimed at reducing bureaucracy, fostering speed, and encouraging a more entrepreneurial approach within the organization. One of these initiatives includes the creation of an internal hotline to help employees identify and remove red tape that can slow down decision-making processes. The goal is to accelerate the company’s ability to innovate, adapt, and meet customer needs more efficiently.

This vision for Amazon’s future marks a significant shift for the company, which now employs over 1.5 million people and is valued at nearly $2 trillion. However, Jassy’s push to return to Amazon’s roots as a nimble and dynamic organization is driven by concerns that the company’s rapid growth, particularly in the past decade, has led to cultural and operational challenges. As highlighted by Fortune’s investigation last year, the pandemic’s shift to remote work and the company’s rapid hiring practices have strained Amazon’s famed leadership principles (LPs) and its overall organizational structure.

In response, Jassy has taken steps to reinforce the company’s leadership principles and rebuild the company’s culture. One of his major moves was releasing an extensive video guide to help employees better understand and apply Amazon’s 16 LPs, which form the foundation of its decision-making framework. Additionally, Jassy’s decision to bring corporate staff back to the office five days a week was driven by his belief that new employees cannot fully absorb these principles unless they experience them in action.

Furthermore, Jassy has sought to streamline Amazon’s management structure by cutting layers of middle management and increasing the proportion of individual contributors relative to managers by 15%. This, he believes, will enable faster decision-making, reduce bureaucracy, and ultimately drive Amazon’s continued growth and innovation.

Despite these internal adjustments, Amazon continues to perform well financially, with strong revenue growth and record profits. The company is also making significant investments in artificial intelligence, which Jassy sees as crucial to remaining competitive in an increasingly technology-driven landscape.

However, Jassy remains focused on preserving Amazon’s startup spirit in a world where it must compete against both established players and emerging competitors.

“We have a disproportionate need for builders,” Jassy wrote in his shareholder letter. “These are inventors, people constantly dissecting customer experiences, asking why they can’t be better.”

His vision is to foster a culture that embraces speed, high standards, and a relentless focus on customer experience.

With input from Fortune, PYMNTS, and the Street.