By Dana Mattioli and Sebastian Herrera

Tuesday's announcement that Jeff Bezos will become executive chairman of Amazon.com Inc. after more than 26 years as its chief executive was a public jolt.

Behind the scenes, the founder had been laying the groundwork for such a move for years, according to people who work closely with him. So much so, that when Mr. Bezos signaled to the board around six months ago that he was ready to move to a new role, the directors weren't surprised. He had already been involving himself less and less in day-to-day management, said one of the people.

Among the most successful entrepreneurs in history, the famously driven Mr. Bezos developed a hard-charging work culture in Amazon. Over the past several years, the 57-year-old has focused much more on high-level strategic decisions, and has made clear he would like to build a legacy for himself that goes well beyond Amazon.

Tech founders are often succeeded by their opposites, typically older executives with greater managerial experience. Mr. Bezos wanted someone more like him.

Andy Jassy, whom Mr. Bezos promoted five years ago to CEO of Amazon's cloud business and who will take over as CEO of the company later this year, fit the bill. He started his career at Amazon in 1997, acted as Mr. Bezos's technical assistant early on, and drove the creation of Amazon Web Services, which dominates cloud computing and accounts for the bulk of Amazon's operating income.

"Jeff always made clear that his greatest fear is that 'if I got hit by a bus, you would pick somebody to succeed me who was unwilling to take risks and launch new efforts,' " said Tom Alberg, a longtime director who retired from the board in 2019. Amazon's board has a succession planning meeting every year to discuss major moves at the company.

Mr. Bezos was front and center in the CEO role last year in ways he hadn't been for a while, as he publicly guided the company's response to Covid-19 and was drawn into intensifying U.S. government scrutiny of Amazon's competitive practices.

The pandemic initially disrupted Amazon, putting new demands and risks on its huge workforce of warehouse and delivery workers. It has since proven to be a boon to the company, propelling revenue for 2020 up 38% to $386.1 billion.

Mr. Bezos accelerated hiring, and Amazon increased its employee count by 63% last year to 1.3 million. People close to Mr. Bezos said he was involved every day in guiding Amazon's pandemic response during the crisis.

Strategic guide

Mr. Bezos likely reversion to his role as Amazon's strategic guide has left many Amazon shareholders sanguine that the company's trajectory won't change much. Amazon's stock, which rose 76% last year was up nearly 4% so far in 2021 before sliding 2% in Wednesday trading.

"I don't worry about this as a major change in the direction of Amazon, or that it will lose its way," said Trip Miller, managing partner of Gullane Capital LLC, which he said owns roughly $25 million in Amazon stock. "This has been in the works for a while obviously. [The pandemic] was one more challenge Amazon faced in the last year, and it performed quite well in a struggling economy."

In Amazon's first decade or two, Mr. Bezos was involved in the minutiae of its operations. "There is no rest for the weary," he wrote in a shareholder letter reviewing 1998. "I constantly remind our employees to be afraid, to wake up every morning terrified."

As the company grew, Mr. Bezos was drawn to specific projects that fascinated him, including the 2014 Fire Phone, which flopped, and the Echo smart speaker, powered by a virtual assistant called Alexa, which was a success. The idea came from Mr. Bezos's vision of a home equipped with a device like the spaceship computer on "Star Trek."

In April 2016, Mr. Bezos gave bigger titles to his two top lieutenants. Mr. Jassy, who had been senior vice president, was named CEO of Amazon Web Services, and Jeff Wilke, who ran the better-known retail operation, became CEO of Consumer Worldwide.

The move was widely seen as an indication of succession plans, something the board had become especially attentive to the previous decade, after Mr. Bezos survived a helicopter crash in Texas in 2003.

The appointments also underlined that Messrs. Jassy and Wilke had more authority over day-to-day decision making, enabling Mr. Bezos to spend more of his time on nascent Amazon businesses, including its Hollywood arm, Amazon Studios. He was less visible in the company's routine operations.

Mr. Bezos would quip that the only time he really knew all that was going on at Amazon was in its annual budget meetings.

"He's not super involved in the day-to-day operations," Matt Garman, a veteran of Amazon's cloud-computing division and top lieutenant to Mr. Jassy, said of Mr. Bezos in a 2019 interview. "I met with him more in the first 18 months than I probably have since."

In an interview on stage at the Economic Club of Washington, D.C., in 2018, Mr. Bezos emphasized his hands-off approach, saying he rarely took meetings before 10 a.m. or after 5 p.m., and focused on strategy over detail. "If I make, like, three good decisions a day, that's enough," he said.

He had long championed innovation and reinvention, exhorting his employees to treat Amazon as a startup long after it had become a colossus.

In that spirit of reinvention, he increasingly became fixated on projects and goals beyond Amazon. He purchased the Washington Post in 2013, and had started rocket company Blue Origin in 2000.

Founders of the tech giants have shown a penchant for taking on ambitious new projects. Bill Gates stepped aside as Microsoft CEO after 25 years and devoted himself to reinventing philanthropy. Google co-founder Larry Page, even before stepping back from his management role in 2019, had devoted his time and wealth to side projects developing flying cars.

Mr. Bezos has taken particular interest in Blue Origin, which competes with Space Exploration Technologies Corp., or SpaceX, run by Elon Musk -- Mr. Bezos's rival for the title of world's wealthiest person.

Mr. Bezos for years has funded Blue Origin, whose annual budget tops $1 billion, by selling some of his shares in Amazon. He devotes every Wednesday to Blue Origin, using a conference room to take meetings and get updates.

In a public appearance in 2018, Mr. Bezos described Blue Origin as perhaps more important to him in the long run than Amazon because it would help keep human civilization dynamic and avoid stasis.

Other changes were happening in Mr. Bezos's personal life. In 2018 he surpassed Mr. Gates to be declared the world's richest man. The father of four, who had long depicted himself as low-key despite his wealth, started spending more time at Hollywood parties and events, as Amazon's entertainment business grew.

In January 2019, Mr. Bezos announced he and MacKenzie Scott, his wife of 25 years, would divorce. Mr. Bezos, often with his girlfriend, Lauren Sanchez, appeared at concerts and flashy beach clubs like Club 55 in St. Tropez, hanging out with celebrities and yachting around with other billionaires.

In April, members of the U.S. House Judiciary Committee's Antitrust Subcommittee demanded he testify after a Wall Street Journal article showed that Amazon employees had used proprietary data on outside vendors that use its platform to create rival products -- something the company had publicly denied doing.

At a subcommittee hearing in July where Mr. Bezos testified with three other Big Tech CEOs -- his first such appearance before Congress -- Mr. Bezos often appeared uncertain about how Amazon and its products worked, and pledged to find answers later.

In August, Amazon announced that Mr. Wilke would retire. He told the board months earlier, one of the people familiar with the matter said. The move left Mr. Jassy as the heir apparent.

About six months ago, Mr. Bezos told the board he was ready to make the move to executive chairman. The news was a closely guarded secret within Amazon, with some senior executives not knowing until they saw the press release Tuesday, according to other people familiar with the situation.

Several of Mr. Bezos's latest Instagram posts have been related to Blue Origin. On Jan. 14, he posted a picture of himself stepping into a space capsule.

About a week ago, he shared a picture of a "hotfire test" of a Blue Origin engine. "Perfect night!" he wrote in the caption.

Write to Dana Mattioli at dana.mattioli@wsj.com and Sebastian Herrera at Sebastian.Herrera@wsj.com

(END) Dow Jones Newswires

02-03-21 1955ET