Zappos.com
The business world was taken by surprise when, on July 22nd 2009, it was announced Amazon would be buying Zappos in a deal worth approximately $847 million.
What does Zappos have to offer that is worth that much money? As per Zappos’ CEO, in an email to all staff, “[a] big part of the reason why Amazon is interested in us is because they recognize the value of our culture, our people, and our brand”.
On their website, one can read:
“Our goal is to position Zappos as the online service leader. If we can get customers to associate the Zappos.com brand with the absolute best service, then we can expand into other product categories beyond shoes. And, we’re doing just that.”
Zappos mission is about “delivering happiness to customers, employees, and vendors”. It’s “to provide the best customer service possible”. They want to WOW all of them at every single interaction with the company.
Zappos is not really an online shoe retailer. Zappos is a company which offers a great customer service… and, as they say, happens “to sell shoes. And clothing. And handbags. And accessories. And eventually anything and everything.”
And it is not just their mission which is distinctive. Their culture is also unique.
Imagine a company where the management team are known as the monkeys; where staff members have “aka”s (e.g. the CEO’s admin assistant who, according to her email signature, is also known as “Time Ninja”); that financially compensates people who, after the initial training, decide it is not the company for them; which publishes a book made of unedited quotes from their staff. That is Zappos.
Zappos.com Culture Book
““[t]he Zappos CULTURE means different things to different people, so I thought the best way for people to learn what the Zappos CULTURE was all about was to hear from our employees directly.”, writes Tony Hsieh on the book’s introduction.
Find out more about the book here.
We got in touch with Zappos to ask some questions about their culture, their processes and their use of social media tools.
Tony Hsieh, Zappos’ CEO, kindly answered some of our questions and got us in touch with Hollie Delaney, Senior HR Manager, and Christa Foley, Head of Recruiting, who clarified how Zappos’ HR procedures are key to creating and maintaining their unique culture.
Tony Hsieh at his desk
(Unless stated, the answers below were provided by Tony Hsieh.)
Culture and branding
“Your company’s culture and your company’s brand are really just two sides of the same coin.” (Tony Hsieh at the Web 2.0 Summit, San Francisco, USA, Nov 2008 - watch video)
Zappos culture is very unique and seems to be its main asset. Many organizations go through cultural change management programs in order to create the culture they want but this is not easy and many do not succeed. Zappos, however, seems to be dealing with this matter in a different way: by only recruiting and maintaining staff who fit Zappos culture. Has it been like that since the beginning?
We’ve always made sure that culture fit was part of the recruiting process, but it wasn’t until a few years ago that we formalized the definition of our culture into 10 core values:
- Deliver WOW Through Service
- Embrace and Drive Change
- Create Fun and A Little Weirdness
- Be Adventurous, Creative, and Open-Minded
- Pursue Growth and Learning
- Build Open and Honest Relationships With Communication
- Build a Positive Team and Family Spirit
- Do More With Less
- Be Passionate and Determined
- Be Humble
You can read more about our core values here.
Zappos core values
Core value #8: Do more with less
Watch video of how this value gets translated at Zappos.
Once we had our list of values, we evolved our recruiting process with various interview questions for each of the core values.
Christa Foley complemented the answer saying:
For the culture interview, we basically frame our interview around our 10 core values and spend about an hour asking specific questions about each value to assess a candidate’s fit. For example, we are all about service at Zappos so, in looking at core value #1, Deliver WOW through service, we ask questions about the best and worst service a person has received and why? We ask for examples to illustrate their view of customer service and how they’ve exhibited great customer service in the past.
Or, for Adventurous, Creative and Open-Minded, we ask candidates to rate themselves on a scale of 1-10, how lucky they feel they are. We pulled this question from a study that was done showing a correlation between people who feel they are lucky and people who are creative and can think outside the box.
Or, for Create Fun and a little Weirdness, we ask on a scale of 1-10, 10 being highest, how weird you are. Now, there is no right or magic number we are looking for. But, if someone says 0, they probably would hate working at Zappos. If they say 10, they are probably too weird for us. It’s more the way the person responds to the question. Someone who gets upset and flustered at having to give a number is probably not right for us. Someone who laughs and then responds, probably is.
Or lastly, for our core value of “Build a positive team and family spirit” we ask candidates if they ever socialize with people they work with outside the office. A standard or canned interview response is either “no” or if “yes” it’s only within reason and keeping in mind there is a professional line that can’t be crossed. For us, this is a potential red flag as we expect employees to socialize to build that team spirit.
Actually getting to see the true person is always a challenge for us because most people come to interview with canned responses. We don’t typically hire those people. So, to try and get to see the real person, we incorporate offices tours, themed interview rooms and games on our application along with fun questions, like if you could be any superhero who would you be and why?
Into the interview. Our hope is candidates will realize we are not a traditional corporate company and be themselves. During the tour we look at the candidate’s reaction to what they are seeing, their body language, and what questions they ask.
Also, since everyone we hire, regardless of department, role, or level will go through our CLT/New Hire Training – we have incorporated the same skills testing that we do for CLT reps for all candidates. This has been a really great screener for our core value “Be Humble.” Many people say they think our training of all new hires is great, or that they wish their company did something similar, but when you actually sit them down to do an internet navigation test, sometimes their true feelings come out – if they feel it’s wasting their time or that it is beneath them. Again, you can see that in tone, body language, and commentary.
We actually partner very closely with the training team and in some ways, our CLT/New Hire class is an extension of our screening process. There has been a lot of press and PR about our hiring process, which is great. So, in the event that someone makes it through our screening process and we missed red flags, it’s very difficult for someone to fake that they are a culture fit for 4 weeks of training, 7am to 4pm.
CLT/New Hire class
The CLT/New Hire class lasts 4 weeks and includes an intro to the company’s history and culture and taking calls for two weeks as a way of talking and getting to know the customers (all about customer service, remember?). If, after the training, a new recruit feels they will not fit into the company’s culture, Zappos pays them for their time and gives them $2000. Despite that, only 2 to 3% takes that offer.
I heard Tony say at a presentation, that performance reviews at Zappos are 50% about technical skills and delivery and 50% about culture fit. What sort of behaviors do you look for during these reviews?
Hollie repplied:
Our August review is made up of four parts: Core Values, Performance, Leadership and Growth Potential. When looking at reviews and calculating the overall scores the core values section is weighted at 50% of the total score.
Different managers have different ways of tracking their employees performance. There is not a set “right way” for managers to rate their employees. Each manager has processes that work for them and that is what is used.
Zappos: Powered by Service
“It’s a wonderful day here at Zappos. My name is Genna. How may I help you today?” (on one of the videos produced by Zappos - watch video)
Would you say that Zappos shapes its staff or that Zappos’ staff gradually shape the corporate culture?
I think like any culture (not just corporate cultures), it ends up being a combination of both.
Alfred Lin, Zappos’ CFO and COO, was the most loyal customer at the pizza business you set up while still at University. He would buy pizzas from you and sell them, by the slice, to his colleagues. How do you encourage this sort of creative and entrepreneurial spirit at Zappos?
One of our core values is to Be Adventurous, Creative, and Open-Minded. We’ve found that if employees are passionate about what they’re doing, then their individual creativity naturally comes out.
You are proud of not having scripts for reps to follow on the phone with clients, and you also seem to have minimal processes and procedures. How do you transfer the knowledge and the experience from one person to another?
We have a training team that we internally refer to as the Pipeline Team.
The goal of the Pipeline Team is to develop the future leaders of Zappos through various management and leadership classes.
This is an internal video that was put together for the entire company that gives more insight into the Pipeline Team.
We look for employees that live and inspire the core values in others.
How do you deal with operational innovation, i.e. with new ways of working more effectively and efficiently?
We don’t really have a formal process for a lot of this. A lot of it ends up coming from ideas that our front line employees have.
Zappos has been investing a lot on social tools (e.g. blogs) and social sites (e.g. Facebook, Twitter). Why did you decide to go down this route?
Initially, we started getting the entire company more involved with Twitter/Facebook because we saw it as a great way to help build our company culture. But then we discovered it was also a great way to connect with customers as well.
For Zappos, part of delivering a great customer experience means developing personal emotional connections, both with employees and customers. Our primary way of doing so is through the telephone, which is why we have our 1-800 number at the top of every page of our web site. Twitter and blogging are just additional ways for us to connect with people on a more personal level.
Zappos and social tools
Zappos uses Twitter to:
- find the best talent to recruit
- connect staff members
- know what the world is saying about them
- allow people to ask questions (by direct message).
Besides, Zappos uses:
- blogs - there are many blogs at Zappos. One is the CEO and CFO blog
- media sharing - on YouTube they host the Zappos channel where the company answers some of the questions asked via Twitter and Facebook
- social networks - they have developed an a Facebook application for users to share their favorite products and brands from Zappos.com; they also have a group of fans on Facebook which helps reinforce the brand
- user generated content - they encourage customers to review their products.
If you could have just one of those social media tools (and sites) you have been using, which one would you choose?
Our primary focus has been on Twitter. We have over 400 employees on Twitter, and you can view their tweets here.
As you can see, most of the tweets are not about business or marketing, but it’s a great way for us to connect on a more personal level with both employees and customers. It gives people a glimpse into our company culture, which is ultimately what our brand is all about.
Great service…
… even on Twitter… even for non-customers
When I was preparing this interview, I wrote on Twitter “having a great time finding more about Zappos”. Zappos “replied” to me “let us know if you have any specific questions”.
I read that Zappos guidelines for the use of public social sites by its employees are just be real and use your best judgment. Is that enough? What do you do to minimize the chances of Zappos people saying something they shouldn’t or spending too much time on these tools and sites during work hours?
We do offer Twitter classes, but those are optional and are more for employees to learn how to sign up for Twitter and use various features and third party applications. We really don’t give any specific guidelines except to tell them to be real and use their best judgment.
It’s up to employees what they want to Twitter about. As I mentioned earlier, the primary focus was to get employees to connect with each other, so the vast majority of the posts are about their personal lives.
In terms of what an employee would have to tweet in order to get fired, it would be if they did something that was not consistent with our core values.
But this is not Twitter-specific: If an employee does anything that’s not consistent with our core values, whether through Twitter, telephone, or in person, then we need to consider whether that employee is Zappos material for the long term.
Zappos.tv
Zappos.tv produces funny videos to promote the desired behavior.
Like this one about the use of Twitter
People make mistakes. Have you ever had to deal with awkward situations caused by staff members activity on public sites?
I can’t think of anything that’s happened off the top of my head.
You have carefully introduced tools (e.g. blogs and Twitter) into the work environment in order to create stronger bonds between staff. Have you consciously planned / created your office space in a way that helps with that objective and is conducive to knowledge sharing?
We haven’t consciously planned anything, but we do give our employees the freedom and encouragement to decorate the space. If you come take a tour of our offices, you’ll see that every cubicle and aisle is different and every conference room is different, which ends up making employees feel more at home (as opposed to being in a sterile office environment that isn’t conducive to knowledge sharing, etc.).
Zappos welcomes tours to its offices. It helps build the brand and it also helps other organizations learn from the way you work. How does Zappos learn from (the good and bad) of other organizations?
When other organizations come and tour our offices or meet with us, many times we can learn from them as well. We don’t really have a formal process for this.
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