I recently spent two days immersed in Zappos at their Las Vegas HQ and this post follows up on my description of Zappos’ world-class customer service. The two day Zappos Insights programme starts with a tour round the office. (This is the same tour that anyone can get for free). On the tour round we met team after team of happy, smiling people. We were greeted by a group of people singing, blowing on whistles or party toys. Everyone has their own, very personalised desk area and there’s all sorts of stuff you wouldn’t expect to see in an office, which makes the whole place feel more like a college dorm room than a place of work. But that’s the point about Zappos, work doesn’t have to be dull!
If you have seen some of the many zany videos available on YouTube you may think that Zappos isn’t serious about anything. They are, it’s just that for obvious reason it’s mainly just the fun and weird stuff that makes it on to the web, it’s more entertaining!
Why the focus on culture?
By the time Zappos CEO Tony Hsieh sold his first business to Microsoft in 1998 for $265M he had come to realise something was no longer right with the culture at Link Exchange. Work had ceased to be fun and this he puts down to the type of people they hired, the best for the job but not the best for the atmosphere; many were “assholes”.
Culture and values
Zappos is different, it’s been carefully built over the years by only hiring people with the right cultural fit. Regardless of how much they need staff, if they can’t find the right people with the right attitude, they won’t hire them, no matter how talented that person may be or how badly they need to fill the position. We were given an example from Zappos’ recruitment manager, “right now we would hire 30 software developers if we could find them”. That’s commitment.
These are the ten core values:
1. Deliver WOW Through Service
2. Embrace and Drive Change
3. Create Fun and A Little Weirdness
4. Be Adventurous, Creative, and Open-Minded
5. Pursue Growth and Learning
6. Build Open and Honest Relationships With Communication
7. Build a Positive Team and Family Spirit
8. Do More With Less
9. Be Passionate and Determined
10. Be Humble
These were carefully assembled over the course of about a year when Tony Hsieh emailed everyone in the company asking for a list of their personal core values; it was a truly democratic process. Says Tony, “The individual values are not what is important, but alignment of everyone to the core values”.
Why does culture matter?
As the culture evolves in a company such as Zappos amazing things happen, and the business benefits enormously. Here are some striking examples from Zappos of the benefits of the highly aligned culture:
- Productivity increases by anywhere from 20% to 100%
- Staff churn is incredibly low; just 6% voluntary churn within the Customer Loyalty Team (call centre)
- Ideas are generated from the ground up and this innovation keeps the company ahead of its rivals
- There is a clear framework for delegated decision making which means that the most junior employees, the call centre reps can do things like spend company money on ad-hoc gifts to customers, (which increases customer loyalty), and, by giving people autonomy, job satisfaction vastly increases too
Culture in action
The job satisfaction, sense of family and loyalty to the company is evident when visiting, whether it’s the graffiti wall where members of staff have written various glowing comments about Zappos or just the genuine friendly way people in the corridors make eye contact, smile and say “hello” when they pass each other.
The outpouring of employee-love for Zappos is documented every year in a the “culture book“. In the book are unedited responses from all staff explaining what the Zappos’ culture means to them. Here’s one I like:
“We all share the quality of wanting to provide service through excellence in anything that we do. It’s that spirit that continues to allow us to grow to what we are today. In this family, we all strive to develop and improve, not just one person but the entire company as a whole. Our culture here is compiled by all of us sharing beliefs, values, goals, attitudes and practices that characterise us as a family”.
For more real-life examples of company’s with extraordinary cultures and the benefits which accrue I recommend books including Good to Great, Built to Last and Tribal Leadership. (Thanks to Zappos you can download a free audio version of Tribal Leadership here; listen to it and then pass it on!).
[Update: my visit to Zappos Insights was covered by Business Week]