Jeff Bezos has long maintained that one single attribute separates people of high intelligence from everyone else: the ability and courage to change their minds.
Last week, for example, at Amazon's re:MARS conference in Nevada:
"People who are right a lot listen a lot, and they change their mind a lot....
They wake up and reanalyze things and change their mind. If you don't change your mind frequently, you're going to be wrong a lot."
And a few years ago, while visiting the offices of Basecamp:
"[T]he smartest people are constantly revising their understanding, reconsidering a problem they thought they'd already solved.
They're open to new points of view, new information, new ideas, contradictions, and challenges to their own way of thinking."
Of course, it's one thing to say that in the abstract. It's another entirely to act on it -- especially when changing your mind could cost you money (sunk costs) or cause other people to think less of you..
But now, almost as if on cue, Amazon has provided an amazing example of Bezos's observation in action.
After investing four years in a restaurant delivery service Amazon said this week that in effect, the company has changed its collective mind. While the company isn't saying why it's closing down Amazon Restaurants, we can surmise a few logical reasons:
- Intense external competition, as DoorDash, Grubhub and Uber Eats control 80 percent of the restaurant delivery market.
- Internal internal competition from other delivery services within Amazon -- think PrimeNow, delivery from Whole Foods, and even Amazon's recent investment in London-based delivery service, Deliveroo.
- The simple truth that Amazon never really marketed its service much in the first place, and launched it in a fairly limited number of U.S. cities.
- Related: the fact that Amazon had already shut down its United Kingdom-based restaurant delivery service last year.
Now, does this count as a business failure, or as a corporate level example of mind-changing as a sign of high intelligence?
The Wall Street Journal went with the former characterization:
"The demise of Amazon Restaurants is a rare logistical misstep by a company that is a dominant force in e-commerce and prides its delivery prowess.
It also adds to a list of failed projects for the online behemoth that includes its Amazon Fire smartphone blunder, a travel site named Destinations and Amazon Local, an extinct online hub to find local deals."
But, I don't think that's right.
As the Journal went on to explain, food delivery is turning into a "cutthroat market" in which margins are as thin as can be imagined.
- Grubhub, which has seen its stock price fall 50 percent since its IPO in 2014, and that reported its profits were down 78 percent in the most recent quarter.
- Uber lost $1 billion in the first quarter of this year.
- DoorDash is supposedly worth $7 billion but hasn't turned a profit.
So sure, you could say Amazon that tried and failed -- or that it simply didn't execute effectively.
Or else, you could say that it entered the market with fervor in 2015, but learned that it's not all it's cracked up to be. Then, just perhaps, the company decided to practice what its founder preaches.
Make the smart decision. And be willing to change your mind.