How Does Amazon Push the Envelope?

July 01, 2016


Knowledge assets are the critical inventions, patents, or personal expertise that catapults your innovations to market. This could be a collaborative discussion or the discovery of a new formula leading to your company’s most competitive product. In an increasingly innovative world, companies must stay ahead of the curve by sharing knowledge assets systematically. Amazon is a great example of how to leverage internal and external knowledge to drive innovation.

How is Amazon Leading Innovation?

Knowledge assets are crucial ingredients to Amazon’s success as their competitive advantage lies in data mining and digitalization rather than physical goods. As a result, Amazon has over 5,000 patents according to WIPO[1]. The algorithms that determine their shopping recommendations and recent advances in drone technology for shipping are a few examples of knowledge assets that drive innovation by optimizing the shopping experience. The company continues to innovate at a rapid pace, as Amazon recently filed a patent enabling customers to pay by selfie, which could transform online purchases[2].

According to Crunchbase, Amazon has made a total of 64 acquisitions and over 52 investments. Recently, they have invested in Ionic Security, a data security platform in its Series D venture round[3]. These types of investments allow Amazon access to new technologies and give companies the ability to benefit from Amazon’s internal R&D through a mutual knowledge share. Leading innovation is more than protecting intellectual property, rather it is about leveraging knowledge assets to establish leadership and benefit the company in the long-term. Amazon is able to push the boundaries of innovation by investing in knowledge assets to offer a unique shopping experience for their customers, regardless of where the knowledge originated.

Work Smarter by Increasing Visibility

It was predicted that by 2016, 30% of manufacturers would invest substantially in increasing the visibility and analysis of information exchange within the company and with partners[4]. How do you work with other teams in your organization? Do you share information internally and with external partners?

By increasing visibility, organizations can go beyond just getting work done to aligning their work with their growth strategy. Visibility empowers teams to be more responsive while staying focused on execution of strategic goals. This allows managers to quickly make fact-based decisions with confidence.

Moreover, transparency gives you the ability to identify areas of improvement. It furnishes a structure that supports high growth. When another department suggests looking into a technology, how do you assess if it was previously developed internally or externally? Sharing knowledge assets internally saves duplicated effort and increased visibility crucial to accelerating innovation, but what are the best practices on sharing with external collaborators?

Best Practice Case Study in Collaborating with External Partners

It should be no surprise that as companies grow collaborations with external partners– even competitors – to expand their product offering, they must define rigorous standards for how they collaborate. In an AIM research study, the telecommunications scouting unit in Silicon Valley evaluated between 800 and 1,200 companies per year[5]. Of those 1,200 companies, they only met with approximately 200-250 for sit-down visits. That being said, there must be a process in place to make sense of these efforts.

Run a Preliminary Search

For instance, the telecommunications firm had a preliminary internal search before their external search. This was for the purpose of understanding what they should be looking for externally based on their company needs. Internal scouting wasn’t just a step in their process of collaboration, but an ongoing activity to inform different units what was being evaluated[5]. The reality is that priorities change and various units have different initiatives, thus understanding internal priorities is fundamental to collaborating with external partners.

Standardize Information Gathering and Assessment

The telecommunications firm example also shares a best practice after internalizing what their strategic goals are, they gather information. After identifying a potential opportunity and codifying their knowledge, the tech scouts would fill out a “transfer memo” with 28 fields describing how the technology would be relevant to the company’s initiatives. Most companies are given a pitch deck with little applicability, so it is important to narrow in on the opportunity from a strategic lens on the company’s priorities using a standardized document to make relatable evaluations.

Senior management received quick recommendations with color-coded responses in their reports rather than twenty-page documents. Management could make decisions instead of being overloaded. The information was used to aid knowledge transfer and facilitate actionable innovation follow through.

Therefore, knowledge assets are the key to driving innovation at your company. In order to be a leader in innovation, it not only takes process and organization but sharing information internally and externally. Companies such as Amazon push innovation by entering major markets like music streaming to expand their offering to create a 360-degree buying environment. Not only do they enter new markets, but they leverage knowledge assets to acquire or invest in what they think could be the next game-changer. In an increasingly innovative world, companies must stay ahead of the curve by defining a process for collaboration.

What do you think is important for companies to consider as they collaborate, enter new markets, and share their knowledge assets?

Read the 3 ways to manage collaboration in a safer environment.



(1) "World Intellectual Property Organization." WIPO -. N.p., n.d. Web. 10 June 2016.

(2) Weise, Elizabeth. "Amazon Files Patent for Pay by Selfie."USA Today. Gannett, 15 Mar. 2016. Web. 10 June 2016.


(4) IDC FutureScape: Worldwide Manufacturing Supply Chain 2015 Predictions

(5) Birkinshaw, J. and Monteiro, F. (2007). External knowledge sourcing: Uncovering the technology scouting process. AIM Research Working Paper Series, 1744-0009.



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