Unions, regulatory scrutiny await new Amazon CEO
Andy Jassy, the 53-year-old tapped to take over the CEO spot at Amazon from the company’s billionaire founder Jeff Bezos, is an Amazon company-man through and through.
With the tech giant since graduating from Harvard Business School back in 1997, his greatest achievement so far is Amazon Web Services. That’s the cloud unit he launched and grew into the market leader ahead of Google and Microsoft.
When you’re taking over one of the most valuable companies in the world, it helps that you’re running the fastest-growing side of the business, says Sophie Lund-Yates, an equity analyst at Hargreaves Lansdown.
"He (Andy Jassy) comes from a really interesting part of the business. Amazon Web Services is much smaller than the retail operation at the moment, but the key thing to remember is it's much more profitable. That's because adding an extra customer to a cloud storage facility takes a lot less manpower than, say, a massive increase in retail sales. So, the reason that is significant is that the new CEO is going to be used to a more efficient process and may be looking at ways that he can and can translate that over into the retail side.”
It’s Amazon’s massive retail operation that presents the most challenges for the anointed CEO.
Jassy will step in at a time of increased regulatory scrutiny especially when it comes to how Amazon deals with third-party sellers. Amazon has been accused of stealing ideas and then undercutting on pricing.
He also has to grapple with an ever-increasing workforce. Amazon is the second biggest private employer in the U.S., behind only Walmart. It’s been aggressively trying to put down worker efforts to unionize.
And he has to patch up the company’s relationship with employees, frayed by the health crisis. Workers in France and Germany staged a walkout in protest to what they called unsafe working conditions and in the U.S., Amazon doled out a half-a-billion dollars in employee bonuses to front-line employees who kept on working during the holidays and the health crisis
Even with the challenges, Jassy has one thing going for him – Wall Street credibility. Word of his ascension barely moved the stock, which surged 76 percent last year – a sign that at least for Wall Street, Jassy is seen as the right person for the job.
