Leadership experts say Jeff Bezos' comfort with failure should be a model for all managers

Jeff BezosAlex Wong / Getty Images

Jeff Bezos spent much of his annual letter to shareholders saying that Amazon, one of the world's most valuable companies, will fail.

While telling Amazon stakeholders that the company isn't perfect seems counterintuitive, talking openly about failure is a common leadership tactic. Leaders at Google, for instance, spend as much time talking to employees about failures as they do successes. "By making conversation about misses normal, you end up actually driving lots of improvement in the organization," Google executive Laszlo Bock said in 2016.

Read more: Amazon's Jeff Bezos highlights the importance of 'wandering' and failing big in his annual shareholder letter

In fact, leaders who reveal struggles or failures to employees come across as more authentic, according to a Harvard Business Review report. The tactic not only decreases internal competition among coworkers, the report says, but motivates employees to strive harder for success.

Many CEOs, meanwhile, believe talking openly about failure can lead to more success down the line. Jean Case, CEO of the Case Foundation, says failure can not only teach you what went wrong, it can inspire creativity and provide motivation for working to succeed. "If you examine the life of anyone who has achieved something extraordinary, chances are you'll find a story of failure somewhere along the way," Case said.

Bezos' note on failure follows a year of growth for Amazon. The company became the second in the world to reach a $1 trillion valuation. The company reported record profits earlier this year, as brick-and-mortar retail stores continue to decline.

Bezos, on the other hand, had a tumultuous year. After Bezos announced he would be divorcing his wife of 25 years, MacKenzie Bezos, in early January, he accused the National Enquirer of extortion for threatening to leak explicit photos he sent to former news anchor Lauren Sanchez.

Amazon contract and warehouse employees also spoke about "brutal" working conditions, claiming to work long hours without fair compensation. Bezos, in his shareholder letter, touted the way the company invests in employees. He mentioned how Amazon raised minimum wages to $15 an hour for all full-time, part-time, and temporary workers, then encouraged competitors to do the same.

"Better yet, go to $16 and throw the gauntlet back at us," Bezos said. "It's a kind of competition that will benefit everyone."
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