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“What's going to create really durable brands and enterprise value is those companies that play the long game and allocate the right time and attention towards the big bets that they need to be taking.”—John Rossman, Co-Author, “Big Bet Leadership: Your Transformation Playbook in the Hyper-Digital Era”
In life and business, you often don’t get the big reward unless you take the big risk. But far too often, companies are afraid to make that leap.
It’s understandable, considering what’s at stake, but ecommerce expert and Amazon veteran John Rossman argues that placing big bets is what ultimately separates the winners from the losers.
Rossman is a writer, business advisor, and leadership keynote speaker. He was an early Amazon executive who played a critical role in launching the Amazon marketplace business in 2002. He has served as the senior technology advisor at the Gates Foundation and senior innovation advisor at T-Mobile. He is the author of "The Amazon Way," which explores Amazon Leadership Principles and "Think Like Amazon: 50 ½ Ideas to Become a Digital Leader."
His new book, "Big Bet Leadership: Your Transformation Playbook for Winning in the Hyper-Digital Era," is an actionable guide for leaders who want to succeed in complex transformations and big bets.
With massive realignment after a global pandemic and paradigm-shifting technology advancements like generative artificial intelligence (AI), it’s now more important than ever for companies to embrace big bets — but they need a framework to do it.
Rossman joined a recent episode of the Unpacking the Digital Shelf podcast, “How to Be a Big Bet Legend,” to share a road map for how leaders can make big bets that drive lasting organizational change.
Rossman says a big bet is a strategy, initiative, plan, or objective that encompasses two critical things:
“Incremental, straightforward projects [are] super important — nothing wrong with them — but they're not a big bet. They don't have that type of complexity and that tension between high ambition and multi-sided risk,” Rossman says.
To make a big bet, leaders can’t just leap before they look. They have to be tactical and thoughtful. In his book, Rossman provides a series of steps leaders can take and questions they can ask to usher in significant organizational change.
Using a real-world example of a brand trying to evolve into an omnichannel organization, Rossman explains that it’s crucial to first reframe the issue and view it from an outside-in perspective.
“[What] I would really want to start with is understanding how that gets manifested to the customer or to some operator external to us,” he says. “What I'm trying to do is kind of size the prize here and really understand the size and the scope of this issue.”
Rossman adds that sizing the issue can help companies better understand the root of the problem and the internal and external forces that contributed to the situation. From there, a company can start to unwind them.
One of the challenges with big bets is that they can seem so audacious that people quickly lose their will and ambition to pursue them, Rossman explains. This is why having a clear-eyed vision, approach, and defined outcomes at the outset is so important.
“What we're trying to solve for is how to both amplify the ambition, but to de-risk it before we make the big commitments relative to it,” he says.
Rossman adds that making big bets is really about “thinking big, but betting small.”
“The ‘big’ is the ambition. The ‘bets’ are intended to be placed very small and de-risked until the point it's just a great investment,” Rossman says.
To see a big bet through, it’s crucial not only to create clarity but also to maintain velocity — or the energy, vigor, and commitment — to this action. Rossman says leaders also need to plan ahead for how they’ll navigate potential roadblocks.
“[It’s] about predicting the predictable things that are going to try to slow down and force our big bet to act like other incremental run-the-business projects,” he says.
Leaders can take three steps to overcome these specific obstacles:
Communication is so important for leaders to share and engage others in their vision. However, this is usually where they fail to truly lead.
“Too often, senior leaders [are] inconsistent in their communication about what we're trying to do. They are vague about the problem we're solving. They're especially vague about why we're doing it and what the future path is,” Rossman says.
Rossman advises leaders to “be much more specific about the future of where we're going and why, and then be accurate and very clear about where we are on that journey.”
Effective communication is critical: “That is something that big bet legends do extremely well is be that chief repeating officer,” Rossman says.
Big bet legends also accelerate risk and value by encouraging experimentation.
However, Rossman admits this is easier to do in principle than in practice. Many leaders will say they embrace a “fail fast” mentality, but when failure comes, someone is often punished for it, which ultimately stifles innovation and creates “an incrementalist, play-it-safe organization,” Rossman says.
“Think big, but bet small is all about that experimentation process of how [to] actually identify the critical high-value, high-risk assumptions,” he adds.
“How do you find ways to accelerate learning and testing and adapting those assumptions before you invest in other things? And there's a real skill and art to identifying what those high-value, high-risk things are and then finding ways to test them.” — John Rossman, Co-Author, “Big Bet Leadership: Your Transformation Playbook in the Hyper-Digital Era”
Whether it’s through experimentation, clearly and consistently communicating a compelling long-term vision, or planning for potential roadblocks, leaders can take several actions to propel big organizational change. Making big bets is crucial for their organizations to not just survive, but thrive. Rossman’s framework gives them both permission and a roadmap to take big, bold steps in this direction.
“What's going to create really durable brands and enterprise value,” Rossman says, “is those companies that play the long game and allocate the right time and attention towards the big bets that they need to be taking.”
To hear more of Rossman’s insights on how leaders can place big bets, listen to the full episode.
