Filling Your Headcount — Hiring at Amazon
How Amazon allocates and uses headcount, the importance of treating hiring as a skill as a manager, and how to use efficient effort to fill your headcount.
Many articles on Medium are written to appeal to a broad readership group. “How to be successful!”, “5 ways to cross the road!”, “7 Things Jeff Bezos said to Elon yesterday, the 3rd one will surprise you!”. Today I felt like writing an article on a very specific topic. While I hope it does appeal to a few more people, this is not meant for mass consumption. I had a free afternoon and felt like writing.
For background purposes related to this article, I was a Director at Amazon until recently, having worked there for over 10 years. One of my strengths was filling headcount on my teams, and this served me well over the years.
How Amazon Runs Businesses
As a Director at Amazon, I owned part of Amazon’s business. What this generally means is that you are responsible for success for that part of Amazon’s business, you make most of the decisions for that part of the business, you get credit when that business does well, you need to explain yourself when that business does poorly, and so on.
At each level of management from SVPs down to line managers, every leader has an area of ownership they can stake a claim to. This might be “AWS” for Andy Jassy (not for long!), or “The add-to-cart button for purchasing t-shirts” for an entry level manager.
For the sake of being able to use concrete examples, lets pretend that I own the product called “Subscribe & Save”. If you’re not familiar with it, essentially you can re-order products regularly at a discount. A superb feature.
As the Director of Subscribe & Save, I would have the title of “General Manager” (GM) of the business. This means I own the technology teams, business teams, marketing teams, and any other teams specifically allocated to this business. As a side note, plenty of people do not own full businesses, they own a part of some business(s). Everything still works the same way, you just end up with some grey areas and slightly more confusion in your examples.
As the leader of this business (or part of a business), I would be allocated a certain number of people I could hire to run my business, aka headcount. This headcount is determined yearly via a complex process I can’t possibly explain in this article, but it involves a fantastic number of 6 page documents. These 6 page documents (which I would have owned writing, as the leader of this business), would outline both my headcount requests, as well as the goals I wished to take on. For example, I might ask for 120 headcount as an increase from my current 90, and say that I would (among other things), grow the Subscribe & Save business by 23% in 2021.
In general, this process would conclude with my leadership team agreeing with my fantastic plans. Except for the slight modification which would increase my goal to 27%, and lower my approved headcount to 100. I say this in jest, but it is not entirely inaccurate. Regardless, you don’t work at Amazon if you want an easy job.
How Business Leaders Deliver to their Plans
In my example, I now have headcount, and some goals to deliver on.
Within the Subscribe & Save world, I would have multiple teams. Each team would have a manager, and a clear-as-possible ownership boundary. To keep things simple, lets say I have a retail website team which owns what the customer can see on the website, I have a business team which is responsible for picking what products we should sell, and a purchasing team which needs to get those items in stock. I think this specific solution I just outlined is a poor way to organize the group, but I won’t try to fix my example right now. Good enough.
Each manager would have a portion of the current headcount, and ownership over all or part of several of our annual goals. In the new yearly plan for Subscribe & Save, I would portion out the headcount to the managers of each of those teams as needed to accomplish the goals they’re responsible for. These needs were all discussed during the yearly planning cycle, but now need to be adjusted based on our current goals and approved headcount.
As a quick note, for managers who have managers working for them, they would go through the same process, allocating a portion of their approved headcount to their own sub-managers, based on their need to accomplish all their goals, until all the headcount is accounted for.
In the end, I have now allocated 20 headcount to the “Retail Website team”, which we can pretend had 16 headcount before this process. They know about a set of goals they need to help deliver, they have some hiring to do, and they need to get to work.
How Team Leaders Deliver to their Plans
The retail website team now has 20 headcount and a bunch of work to accomplish in the next 9 (or likely fewer) months. This is because the goals are all going to be due long before the end of the year, the annual process doesn’t actually finish until the year is well underway, and in general we will be behind on projects before we start them. This means we need to move quickly.
To add yet another challenge, the leader of the retail website team may have started the year with an approved 16 headcount, and was granted an increase to 20 headcount, but it is entirely likely that they actually had only 14 people working on the team at the time. This is because of people leaving Amazon, people internally transferring to other groups, the team grew for other reasons during the year, or they may even have not hired all their headcount from the previous year. So they’re behind on their project schedule, and they’re starting from a deficit on their resourcing.
The punch line for leaders at Amazon is that you’re only as successful as your ability to hire people onto your team. If you can fill your headcount quickly every year, your team will deliver on many of your goals, and you’ll be successful. If you cannot fill your headcount, your team will repeatedly fail many of their goals, and you will not succeed. In the end, one of the most important skills for an Amazon leader is to figure out how to hire quickly.
9 Ways to Fill Your Headcount
(you won’t believe #7!)
I could not resist turning this into a list. Everyone loves lists.
Never rely on the recruiting team.
As the leader of your group, you need to believe that you’re the only person responsible for hiring. The recruiting team is awesome, but you can’t hand the success of your job to someone else.