Andy Jassy is the perfect Amazon CEO for the looming Gen AI cost-cutting era
Amazon CEO Andy Jassy told hundreds of thousands of his employees on Tuesday that generative AI is coming for their jobs and that their best bet is to embrace the technology.
“Those who embrace this change, become conversant in AI, help us build and improve our AI capabilities internally and deliver for customers, will be well-positioned to have high impact and help us reinvent the company,” he wrote in a company-wide email that was also published on Amazon’s corporate blog.
But no matter how geeked Amazon employees get over new AI tools, Jassy also made a point to note that there’s not room on the bus for everybody: “We expect that this will reduce our total corporate workforce as we get efficiency gains from using AI extensively across the company.”
As I read this note – and I recommend reading the whole thing – some questions quickly came to mind. Are some parts of Amazon’s vast organization highly resistant to the new technology and perhaps in need of a public nudge (or, kick in the butt), in Jassy’s view? Seems likely. Is the public memo a wink-wink to Wall Street that the company’s heavy AI investments will eventually pay off by delivering significant cost reductions? I suppose.
Is the note meant to provide some glossy AI cover for imminent or future mass layoffs that may have nothing, or just something, to do with AI actually eating some corporate tasks? I guess that’s possible too, though I find it less likely.
And are the parts of the essay where Jassy methodically outlines the various ways Amazon already uses Gen AI (a ritutal he has performed publicly on more than one occasion this year), designed to thrust Amazon into AI-dominated news cycles that often feature many other companies not named Amazon? Perhaps.
No matter the exact goal or impetus, and Amazon isn’t saying what exactly the impetus for this public memo was, Jassy seems like the right leader for the current job – especially on the cost-cutting or, as he referred to it in his annual shareholder letter in April, the “cost avoidance and productivity” bucket of Gen AI impact.
I don’t mean to discount Jassy’s ability to lead on the innovation front. He transformed and led Amazon Web Services after all, from its infancy, into the behemoth cloud provider it is today.
But ever since taking over as CEO from Jeff Bezos in 2021, Jassy has also become the company’s chief cost-cutter and has appeared comfortable in the role.
He has overseen the largest corporate layoffs in company history in recent years (joining other Big Tech companies like Meta, Alphabet, and Salesforce which all slashed headcounts after over-hiring in the pandemic).
His logistic teams have rejiggered the U.S. warehouse network and inventory systems to reduce the cost of getting each product to a customer.
And he’s also pushed teams to accelerate the automation of some warehouse tasks, which over time could allow the company to do more with less—or at least more with the same.
Some of these moves were necessitated by Bezos handing over to Jassy a bloated and sometimes wasteful company when the CEO transition happened nearly four years ago. But it also appears to this close observer of the company that Jassy is quite comfortable in the role; though whether he enjoys it or simply accepts it I don’t know.
So, whether Amazon’s AI jobs shakeout turns out to be a painful retrenching, a gradual recalibration, or something else entirely, recent history seems to suggest the company, if nothing else, has the right man for the job.
This story was originally featured on Fortune.com