How Frugality Creates Innovation in Products and Apparently Movies
Frugality isn't simply about saving money. It's about focusing your attention on what matters.
Welcome to the Scarlet Ink newsletter. I'm Dave Anderson, an ex-Amazon Tech Director and General Manager. Each week I write a newsletter article on tech industry careers, and specific leadership advice.
I was early in the days of running the Amazon kids devices teams. We had limited resources, and frequently used the word “scrappy” to describe our approach to problems. We also used swear words to describe the corners we had to cut to meet our deadlines. Such is life.
One thing our engineering team was excited about for years was building a product on Android. See, our main product was a kid’s secure experience on Amazon’s tablets. While it was a large and profitable business, we knew that the number of Android devices dwarfed the number of Amazon tablets in the market. Our engineering team was particularly interested in the technical challenge of seeing if we could build parental controls on a device where we didn’t literally own the operating system.
The issue was that we were a tiny team in comparison to our product space. We asked for a team to investigate Android, and the response was that it was not a priority. Reasonably (looking back on things), our focus was rightly on growing our primary business.
However, the engineering team was still enthusiastic about investigating this potential space. A few senior engineers came up with a plan. One of them would briefly break off from our primary project for a few weeks, and quickly test a few specific ideas they had. In essence, he would test a prototype as quickly as possible, with the idea of either verifying or eliminating some hypothesis. I agreed with the plan.
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The whole project went along rather brilliantly. We got daily demos and reviews of what had been tested, what worked, and what didn’t. Those few weeks of investigation enabled the team to have a clear grasp of what was possible, and what wasn’t. It eventually opened the door for funding an Android project.
Looking back at things, one conclusion stood out. We originally asked for something like 8 engineers to build an Android app. We ended up getting 3 weeks from one engineer.
Yet if we’d gotten 8 engineers to build the Android app, what would we have surely done? We would have had a product manager break down a list of requirements. We would have had some engineers building the core app, some investigating content, and others investigating the parental controls.
Along the way, we would have all been distracted with execution. We would have plowed forward without taking the time to think carefully and invent the best way forward.
I’ve concluded that throwing resources at a problem isn’t simply expensive. It’s literally the wrong approach. I’ve seen projects fully funded, and I’ve seen them start off with a single employee. And I’m convinced that slow starts isn’t simply better financially, but better for the product.
Threads (a Twitter clone which appears to be still growing) was built at Meta with a peak headcount of around 60 engineers. They absolutely got a boost by being able to leverage Meta’s infrastructure. But what else did they point at which enabled them to launch early? Keeping things simple. They cut the basic product they wanted to build down to the core things customers would value.
I’m going to walk through the Amazon Frugality leadership principle, and explain why it’s not simply about saving money. And that’ll include some digression due to a quote from Ryan Reynolds, where he says that his limited budget (and the related constraints) is what made Deadpool a great movie.
Frugality — the least respected leadership principle.
Frugality is one of my favorite leadership principles, but it’s not highly respected within Amazon. I mean, it’s absolutely followed, but respected? I think when it’s referenced by employees, more than 50% of the time it’s using a sarcastic voice.
Frugality — Accomplish more with less. Constraints breed resourcefulness, self-sufficiency, and invention. There are no extra points for growing headcount, budget size, or fixed expense.
Let me start with a digression. Part of that leadership principle is absolutely incorrect at Amazon. That whole statement about there being no points about growing headcount? Lies.
For any management role, headcount is absolutely listed at the top of the first page of your promotion document. It is repeatedly referenced as part of your career growth, and plays a considerable role in your ability to grow at each stage in your career.
Ok, getting back on topic.
When people hear about frugality within Amazon, they usually assume it’s simply about spending money. “We asked for 30 headcount, but we only got 5. Frugality bites us again.”
You’ll notice that the leadership principle doesn’t mention profitability. It doesn’t say that constraints breed higher profit margins.
Why would constraints do anything positive, beyond saving money? If you had infinite funds, shouldn’t you simply fund everything? I say no.