Adaptive cultures minimize predictability and encourage innovation.
“The Amazon culture is characterized by frugality, decentralized decision-making, and taking risks outside their core business. If you think about the culture that develops in most large successful firms, you can see how what’s required for success in mature businesses is almost the opposite. That is, an emphasis on making your numbers, not taking risks, staying focused on today’s customers, incremental improvement, and increased centralization,” he explains. “In these circumstances, managers and systems reward behaviors that while successful in the short term don’t encourage the experimentation that’s needed for long-term success. The result? We see companies like HP missing new markets.”