The concept of a flywheel, as originally designed, was never about spinning faster to achieve exponential growth. It was about stabilizing energy output—ensuring a steady, reliable flow of power to balance fluctuating forces. This principle is far removed from the way companies like Amazon have co-opted the term to represent a spiraling mechanism of ever-accelerating growth. Their so-called “flywheel” is closer to a runaway spinning wheel, driven by relentless pressure to expand at any cost.
The Problem with Amazon’s Misinterpreted Flywheel
Amazon’s version of the flywheel metaphor has become synonymous with a cutthroat approach to business. This model prioritizes eliminating competitors, forcing partners to slash prices, exploiting workers, and evading taxes—all in pursuit of shareholder maximization.
While Amazon’s rhetoric emphasizes customer obsession, their actions suggest otherwise. Their focus on customer insights isn’t rooted in care or genuine service; it’s a strategy to manipulate consumer behavior, luring people into a purchasing funnel designed to maximize profits, irrespective of whether those purchases are necessary or affordable.
In fact, Amazon’s flywheel doesn’t fundamentally invent a new principle—it optimizes and scales what is already well-understood in economics and business: the power of economies of scale. What makes Amazon’s execution stand out is not the originality of the idea but the scale and precision of its application in a digital marketplace where it acts as an intermediary rather than a producer.
Yet, its highly extractive approach to business benefits shareholders at the expense of stakeholders. It undermines employees, partners, and society at large, while contributing to environmental degradation. Such practices, while profitable in the short term, erode trust, resilience, and sustainability—qualities essential for long-term success.
The True Flywheel: A Model for Sustainable Growth
Our interpretation of the flywheel returns to its original purpose: stabilizing output and building momentum over time. Instead of extracting value to “feast shareholders,” our approach focuses on contributing—to employees, partners, communities, and the environment. By reinvesting returns into impact creation, we build a resilient workforce, a stronger society, and a healthier planet.
This isn’t a call for philanthropy (though companies are welcome to pursue it). Instead, we advocate for businesses to develop an Impact Strategy alongside their Profit Strategy. This dual approach ensures that investments in impact remain aligned with the company’s goals, creating enduring value rather than short-lived profits.
The Flywheel of Shared Success illustrates the interplay between the short-term Value Cycle and the mid- to long-term Impact Cycle, both of which work together to create sustained growth and resilience.
- Blue Elements: Represent the short-term activities that drive immediate results, including Value Creation, Value Delivery, and Value Returns. These elements ensure that value is captured efficiently and distributed equitably through Shared Value, which bridges the Value and Impact Cycles.
- Green Elements: Represent the longer-term focus on creating, realizing, and returning impact. The Impact Cycle gradually releases its returns over time, performing as a flywheel, contributing to Resilience Building, which strengthens the organization’s capacity to create future value.
The key to this flywheel’s success is the shared interplay between the cycles:
- Shared Value acts as the bridge from captured value to impact creation, ensuring that the benefits are equitably distributed among all stakeholders, not just shareholders.
- Resilience Building acts as the bridge from impact returns to future value creation, using the momentum from past impact to smoothen fluctuations in the Value Cycle and provide a stabilizing effect.
Together, the Value and Impact Cycles form a self-reinforcing system that balances immediate results with sustainable, long-term contributions to society, stakeholders, and the environment. This model moves beyond extraction to create enduring organizations built on equity, adaptability, and shared success.
Building Enduring Organizations
A genuine flywheel effect is not about spinning harder or growing faster at all costs. It’s about creating balance and resilience. Our model focuses on a contributive, not extractive, approach to business. By prioritizing long-term impact and aligning investments with purpose, companies can build stronger organizations, more cohesive societies, and a thriving environment.
Amazon’s misinterpretation of the flywheel has driven a form of capitalism that is hailed by shareholders but detested by stakeholders. It’s time to reclaim the true flywheel—a principle rooted in balance and sustainability, not extraction and exploitation. Only then can we build businesses that not only survive but thrive in harmony with the world around them.
