As the upheaval on Wall Street continues, Amazon has been making headlines for other reasons. Recently, company founder and CEO Jeff Bezos has announced his intention to step down, and his replacement tapped in Andy Jassy. Beyond that, a historic union vote is occurring in Alabama, setting off a scuffle between the company and potential employee unions, garnering international attention for its broad implications for corporate unions.
Bezos Stepping Down as CEO, Leaving Quite the Legacy
Bezos is well known as one of the richest people in the world. With his successful Amazon empire, the soon-to-be former CEO will be stepping away from a legacy of immense success. Biography.com writes, “Entrepreneur and e-commerce pioneer Jeff Bezos is the founder and CEO of the e-commerce company Amazon, owner of The Washington Post and founder of the space exploration company Blue Origin. His successful business ventures have made him one of the richest people in the world.
Born in 1964 in New Mexico, Bezos had an early love of computers and studied computer science and electrical engineering at Princeton University. After graduation, he worked on Wall Street, and in 1990 he became the youngest senior vice president at the investment firm D.E. Shaw. Four years later, Bezos quit his lucrative job to open Amazon.com, an online bookstore that became one of the Internet’s biggest success stories. In 2013, Bezos purchased The Washington Post, and in 2017 Amazon acquired Whole Foods.”
Bezos opened Amazon, an unlikely bet, in 1995. When Amazon.com first started, it launched out of Bezos’ garage, and people doubted the online-only retailer would be able to stand up to comparable brick and mortar peers with online options. But of course the internet revolution was just beginning, so Bezos’ bet quickly paid off in a big way. Without any intentional promotion, sales soon reached $20K per week, prompting people to rethink the way they viewed online-only retailers. Bezos, with a history in finance, quickly learned to diversify and grew the company exponentially. Since it’s inception in the mid-90’s, Amazon.com has risen to the ranks of one of the top five biggest companies in the world, lagging behind only Walmart and China Petroleum & Chemical Corp.
The business world was rocked by news that Bezos would be stepping down in 2021’s Q3, and his successor was tapped as Andy Jassy.
Who is Andy Jassy?
Bezos tapped Jassy in company letter. Per CNBC, “‘I’m excited to announce that this Q3 I’ll transition to Executive Chair of the Amazon Board and Andy Jassy will become CEO,’ Bezos said in a letter to employees. ‘In the Exec Chair role, I intend to focus my energies and attention on new products and early initiatives. Andy is well known inside the company and has been at Amazon almost as long as I have. He will be an outstanding leader, and he has my full confidence.'”
But who is Andy Jassy? Jassy joined Amazon in 1997, and has been an integral board member ever since. Jassy, a Harvard Business School graduate, has been instrumental in growing Amazon’s cloud and web services, later founding Amazon Music and helping Bezos grow from nearly the beginning. Jassy was often called Bezos’, “shadow,” in their early years together as he stuck to the business guru and learned his clever ways.
And Jassy has earned big with his bet to learn from Bezos. CNN writes, “In 2019, his total compensation was $348,809. But a year earlier, his pay totaled more than $19.7 million, thanks to a nearly $19.5 million stock award that vested that year. By contrast, Jeff Bezos’ base salary was $81,840, and total compensation in 2019 was nearly $1.7 million, though Bezos owns a larger share of the company’s stock (nearly 15% of the total, as of the 2020 Proxy statement).” It has not been announced whether Jassy’s pay will change now that he’s becoming head honcho.
Jassy was born on January 13th, 1968, in Scarsdale, New York. Destined to be a business great, he graduated first from Harvard, and then with an MBA from Harvard Business School. Shortly after earning his MBA, Jassy immediately locked on to Amazon as the source of his future. Jassy is married to Elana Caplan, a fashion designer for Eddie Bauer. The couple has two children together. The soon-to-be CEO of one of the world’s most successful businesses lives in Seattle but also owns a house in Santa Monica.
Historic Union Vote in Alabama
As this CEO shuffle occurs at the top, Amazon may be facing a restructure from the bottom up. In Alabama, a historic vote is being held on whether or not to unionize a factory in the state often called, “the heart of Dixie.”
Conditions in Amazon warehouses are historically poor and the company has received bad press in recent years about how workers are often pushed past reasonable physical limits and are expected to work long, often last-minute shifts in highly demanding roles. In order to push back against this treatment, a facility opened in Alabama last March may become the first unionized Amazon factory in the world. This has far-reaching implications for both Amazon and the business world. Unions are the friend of the worker but often the bane of the corporation, levying for fairer and safer conditions for employees but often costing corporations in concessions.
The BBC shares the experience of a local worker, Joseph Jones, and his resulting actions; “‘It’s a very adversarial relationship with the supervisors and the staff,’ says the 35-year-old, who started working part-time at the company’s warehouse in Bessemer, Alabama in October. ‘You’re a cog in the system… and it’s very obvious.’
During the busy season between Thanksgiving and Christmas, for example, he says Amazon required staff to extend their shifts – typically with little notice. Once, he says he didn’t even know he had been asked to put in extra time until he arrived for work and the company app informed him he was an hour late.
Last year, the treatment prompted him to join a petition that sought an official vote on creating a union at the warehouse.
In December, state labour officials ruled the request had garnered enough support to warrant an election – the first such vote Amazon has faced in the US since 2014. Ballots were mailed this week.”
The same officials have warned that the company needs to give their workers the space to have this vote and respect the outcome. Is Bezos’ stepping down related to this possible bottom-up upheaval? Signals from the top suggest no; Bezos is just ready to step back and let Jassy have the helm. However, the timing is suspicious. If this factory chooses to unionize, other states with strong labor laws could see their Amazon factories choosing a similar course and the company could be forced to reckoned with a slew of unionized factories and warehouses. While unions are generally good for company health in the long run, the transition period can be expensive. Time will tell what will happen in Alabama as the votes are collected, but for now Bezos is enjoying his last two quarters at the top. Soon, Andy Jassy will be the one making headlines as Amazon’s CEO.