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The need for speed: Inside the cloud innovation engine at AWS

With analysts citing Amazon’s speedy product release cycles as a major source of competitive difference for the cloud firm, AWS CEO Andy Jassy opens up about how it keeps its innovation engine ticking over

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Every day that developers use the Amazon Web Services (AWS) cloud platform, they gain access to an average of three new services or features, according to the firm’s CEO, Andy Jassy.

Over the past three years, the company has accelerated the expansion of functionality in its cloud platforms. During 2013, the company added 280 new features to its cloud platform – this year it added 1,000.

In just two days at the AWS Re:Invent customer conference in Las Vegas, the company debuted 24 new products and services, while talking up how its ability to innovate at such pace is helping it stay ahead of the competition in the cloud infrastructure services market.

“If you look at the AWS platform, we’ve built a very robust and fully featured infrastructure platform,” said Jassy during his Re:Invent keynote. “We have more than 70 services, and we have a more services than you’ll find anywhere else by a large amount.

“So [we have] a fully featured, very robust technology infrastructure platform – with a lot more capability than you’ll find anywhere else – and we’re also iterating at a faster clip than anybody.”

Gartner’s August 2016 Magic Quadrant report, which charts the runners and riders of the cloud infrastructure services market, suggests few of AWS’s competitors are currently in a position to match it and its pace of product innovation.

The report pegs Microsoft and Google as AWS’s main competitors, and describes Azure – the former’s cloud platform - as “neither as feature-rich nor as mature as AWS” but adds: “Many organisations now consider it ‘good enough’.”

Google, meanwhile, comes in for a similar critique by the report’s authors, who also raised the fact the firm is still in the “rudimentary stages” of learning how to engage with enterprise and mid-market customers.

Cross-functional culture

While likes of Google and Microsoft play catch-up in the cloud, Amazon is enjoying a “significant market segment leadership”, said Jassy during a press Q&A at Re:Invent, before explaining how the firm has managed to speed up its product release rate year on year.

Key to this has been the company’s decision to create highly autonomous, cross-functional teams of people who are all jointly responsible for finding new ways to improve the customer experience.

This approach will sound familiar to agile and DevOps practitioners, and ensures all members of the team develop a sense of ownership and personal investment in the problems they are trying to solve, said Jassy.

“We have product managers in the same teams as engineers and operations, and the reason is we really want to alleviate the finger point you sometimes see between different people and different functions when they are not on the same team,” he said.

“Having them on the same team gives them inordinately high amounts of ownership, so they believe they own the problem together, they are not reliant on anybody else, and they completely own their roadmaps.”

The teams are encouraged to regularly spend time with customers to inform their product designs, and – by encouraging the teams to work independently – they can set about incorporating their feedback as quickly as possible.

“If they are hearing feedback consistently from customers that something else is more important than they had thought, they can make that change,” said Jassy. “We get to use the same AWS building blocks our customers get to use, and that allows us to move very quickly.”

Feedback mechanisms

Gavin Jackson, managing director of AWS in the UK and Ireland, told Computer Weekly that the company also has feedback mechanisms built into its platform so users can share their thoughts and frustrations about using it in real time.

“Within the AWS console, users can actually ask for feature requests,” he said. “This is a great way for us to get an active feedback loop in the moment when someone is experiencing some pain or opportunity.

“When I have internal management meetings and when I’m part of the executive meetings we have in Seattle, we always have customers representing us. And we don’t have customers who are going to say great things all the time – we always have customers we know are going to be challenging.”

Ensuring the customer view is represented in senior management meetings is something that is encouraged across all Amazon’s businesses – not just AWS, said Jackson.

“You always reserve a seat for the customer – it’s a cultural thing,” he said. “It’s also another good way for us to collect feedback from people who are really hammering the platform and are very progressive in their use of it.”

These elements ensure AWS’s development teams are always on the receiving end of feedback from users that can be incorporated into whatever they are working on.

“Everybody [at Amazon] is an inventor and everyone in every part of the world is thinking about what services we can offer, and we do – under non-disclosure agreements – speak to customers as well as part of our standard feedback procedures,” said Jackson.  

Scale-up constraints

There is a tendency for technology companies to become more conservative and risk-adverse as they get bigger, which can slam the brakes on their ability to innovate, said Jassy during the Q&A.

AWS’s reliance on cross-functional teams means the firm can pursue product launches and features in several areas at once, which is not always possible in companies that are more “centrally organised”, he added.

“In a lot of companies, as they get bigger, the senior people walk into a room when they’re going to hear a new idea and are looking for ways to say no to the idea,” said Jassy. “Not because they are evil or ill-intended, but as they get big, they get conservative and it’s harder to do things in a simultaneous fashion.

“We don’t say yes to every idea, and we rigorously assess them all on their own merits, but we are problem-solving and collaborating with the people proposing the ideas to find ways to say yes. We say yes more than others do.”

Jassy admitted that not every project given the green light succeeds, but the company is careful with how it treats abortive endeavours to help sustain its culture of experimentation.

“We hope that most of the things we do aren’t going to be failures, but if you are innovating enough, you will have things that don’t work, and that’s OK,” he said. “As long as the inputs into that initiative were executed well, [the staff] don’t get degraded or somehow have their careers clipped.”

Experiment with new ideas

This knowledge ensures that its development teams feel comfortable and confident enough to experiment with new ideas, even during periods of downtime, said Jassy.

“When you have a [business] culture that has the pieces I just mentioned, what you find is that everyone in the company – even at the most entry levels – will spend some of their free cycles thinking about new ideas, because they know that if they come up with a good idea and it is viable, they will be able to try it out.”

Taken together, all this has given AWS a sizeable competitive advantage so far, but – given that the cloud market is still in its infancy – the game is not necessarily up yet.

Higher education-focused software and services provider Ellucian now uses AWS to deliver its offerings as a cloud-based service to 2,400 institutions in about 40 countries across the world.  

Speaking to Computer Weekly at Re:Invent, Toby Williams, the firm’s chief product and strategy officer, said the company had chosen AWS over its competitors because of the breadth and depth of its product portfolio.

The company’s assessment of the market around this time essentially mirrored the findings of Gartner’s previously mentioned cloud-focused Magic Quadrant report, said Williams.

Read more about AWS Re:Invent

Amazon Web Services used Re:Invent 2016 to stake its claim as an early adopter of machine learning, while revealing details of its plans to boost the technology’s take-up among everyday developers.

AWS CEO Andy Jassy hits out at “old guard” enterprise IT suppliers, while talking up his company’s ability to outsell and out-innovate them.

However, the company constantly reviews the state of the cloud market to ensure the services it offers meet the needs of its growing and global client base as part of its ongoing due diligence processes.

“We are a software company and constantly, on a daily basis, we are looking at what’s new and different and keeping our eyes open for better ways to deliver value to clients,” said Williams. “It’s a daily refresh in the market of who is doing what and what’s new and different.

“We continue to do competitive reviews, and every time we’ve done so, it has come back the same. In virtually every respect we have found AWS to be the superior offering.”

Ellucian is not alone in keeping tabs on what the rest of the market is up to, despite having nailed its flag to the AWS mast, and Jassy said it is unlikely that, as the market matures, there will be one cloud giant to rule them all.

“If you look at the market segments that AWS’s platform and services address – infrastructure, software, hardware, datacentre services worldwide – it’s trillion of dollars,” he said. “I don’t think there will be one successful player in this space that captures trillions of dollars.

“I don’t think there will be 30 [successful players], but I think there will be a smaller handful because scale really matters here, and the breadth of functionality makes a big difference to customers.”

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