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How Jeff Bezos built an A.I.-driven “cyber contraption” that puts customers first

May 19, 2020, 10:04 AM UTC

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The latest issue of Fortune magazine—on newsstands now—showcases our new Fortune 500 list of the biggest companies in the U.S. Rocketing from fifth place to No. 2 on the list this year, with $280 billion in sales, is Amazon.

The e-commerce behemoth was on a tear even before the coronavirus pandemic, but—in a fascinating profile featured in the magazine and online here—Brian Dumaine argues that Amazon is perfectly “designed” to capitalize on the health and economic crisis created by the outbreak.

Since the company joined the Fortune 500 in 2002, annual sales growth has averaged 28%, while Amazon’s market value has risen more than 22,000%. Brian attributes Amazon’s extraordinary longterm success and its post-pandemic growth prospects to “the flywheel.”

The flywheel—a concept popularized by management guru Jim Collins—is a virtuous circle that keeps turning and turning. As Brian explains, rather than worrying about competitors, Amazonians obsess over pleasing customers, which they do mainly by lowering prices.

Lower costs increase the number of customers who shop on Amazon, which attracts more independent sellers, which helps Amazon boost traffic, which generates more revenue for Amazon and helps the company achieve greater economies of scale and lower prices again.

With the help of A.I. and tens of thousands of engineers, data analysts, and programmers, Bezos has turbocharged his flywheel into a vast learning machine. Or, as Brian puts it: “a cyber contraption with its own intelligence that takes all the data that Amazon collects on its customers and then analyzes it in minute detail.”

Rather than rely on humans to decide what to purchase, how much to charge, where to keep stock, Bezos’s A.I.-enabled flywheel can now make those decisions automatically. That ability is sure to improve as the pandemic boosts online shopping, bringing in ever more data for Bezos’s flywheel to digest.

Brian’s profile is a great read and well worth the time of anyone with an interest in design. Amazon is a prime (I know, horrible pun) example of how companies, for better or worse, are using data and technology to get inside the heads of millions of customers at once and serve them at lightning speed.

More design news below!

Clay Chandler
clay.chandler@fortune.com

NEWS BY DESIGN

An EasyMile autonomous shuttle being tested in Colorado (Photo by Hyoung Chang/MediaNews Group/The Denver Post via Getty Images)
Hyoung Chang—MediaNews Group/The Denver Post via Getty Images

Buckle up

An autonomous shuttle company has had to install seatbelts in its vehicles in order to resume operations within the U.S. after one passenger fell from their seat during a sudden stop. This basic safety feature is often overlooked on public transport, but why it would be excluded on experimental AVs is beyond me.

Car of the past

Dyson revealed what its electric vehicle would have looked like. The 7-seater SUV was scrapped last year because it was too expensive. The EV would have been “5 meters long, two meters wide and 1.7 meters tall,” featured a windscreen that “rakes back more steeply” than a Ferrari and sat on wheels almost one meter in diameter. The interior was more uniquely Dyson, with segmented cushions on seats and a dashboard that “floats in front of your face like a hologram.”

Walk on by

Researchers at the University of Maryland have created a gait-recognition algorithm that helps a robot suss whether a person is happy, sad, angry or just fine. The robot then manages how much personal space it gives the pedestrian based on their mood. The tech could be useful for creating more socially integrated robots—like the sort that deliver our food. Bonus: here’s how researchers taught robots to avoid meddling kids.

Who holds the key?

The FBI unlocked the iPhone of a gunman months after attempting to get Apple to do it for them. This is the second time the FBI has claimed it needs Apple’s help to access the phone of a terror suspect. Both times, the FBI has ultimately unlocked the phone itself. Apple refuses to help law enforcement crack into iPhone; analysts say to do so could risk the security of all iPhones.

Back to work

Apple outlined how it plans to improve the safety of workers across its supply chain as laborers return to factories during the pandemic. The measures include fairly standard things, such as mandating employees wear PPE in all common areas, as well as implementing flexible work hours and “staggered work shifts.” It’s unclear whether that would simply mean having day and night shifts for factory workers.

Hej!

Ikea released a series of fort designs to keep children entertained during lockdown. The seven strongholds, constructed using Ikea products and household items, are a delight. No complaining if you still can't figure out the instructions. 

EVENTS BY DESIGN

May, delayed: An extremely pertinent conference on the integration of technology and health care due to convene in Manchester, U.K. this week has been postponed until after the summer. The Lodz Design Festival, also scheduled for this week, has been postponed until November.

The Venice Biennial has postponed both its architecture and its art editions by a year. The Architecture Biennial, scheduled originally for this month, will now be in May 2020. The art biennial will be in April 2022, rather than 2021.

June: The month-long London Festival of Architecture is running a stripped back event online this year, with the core public program moved to (hopefully) later this year. The San Francisco Design Week, which starts June 16, has gone digital too. Also, London Fashion Week: Men’s would have walked June 12-14. Instead, it will sit online.

July: Christie's is planning a semi-virtual auction for July 10. The "first of its kind" event will livestream auctions from four cities—Hong Kong, New York, Paris and London.

Ongoing: Virtual Design Festival, a collaborative effort from Dezeen, Dutch Design Week and Design Indaba continues to exhibit work from a global roster of designers.

QUOTED BY DESIGN

“I think there is a model [of Internet regulation] coming out of countries like China that tend to have very different values than Western countries that are more democratic…The best antidote is having a clear regulatory framework that comes out of Western democratic countries and can become a standard around the world.”

Mark Zuckerberg appears to have abandoned his yesteryear ambitions of courting China. The 36-year-old CEO has grown increasingly vocal about China’s policy of Internet censorship while, at the same time, positioning Facebook as the paragon of democracy. Zuckerberg made the above comment while talking with European Union Industry Commissioner Thierry Breton on Monday.

Breton and Zuckerberg have disagreed before about where Internet regulation should come from—is it governments or the social media giants that provide platforms for mass-misinformation?

 

This week's edition of BxD was edited by Eamon Barrett. Email him at eamon.barrett@fortune.com