The CEO and Organizational Culture Profile
In 1999, Nick Swinmurn founded the online shoe retailer Zappos.com. Zappos was created when Swinmurn was walking around in a San Francisco mall looking for a pair of shoes. One store had the right style, but not the right color another store had the right color but not the right size. Nick left the mall empty-handed and frustrated. Nick decided to quit his day job and start an online shoe retailer, and Zappos began (Zappos.com). Additional investment became necessary for the success of the business after it was already started. Swinmurn teamed up with investor Tony Hsieh, later naming him the CEO of Zappos. Zappos’ started making money after committing its business to customer service. Swinmurn and Hsieh built a successful company with a new culture. This new culture has been preserved by Zappos’ new owner, Amazon.com, which acquired Zappos in a $1.2 billion deal. Zappos’vision states one day at 30% of all retail transaction in the U.S. will be online, people will buy from that company with the best service and best selection, and Zappos.com will be that online store (Zappos.com). This paper will examine the culture of Zappos.com, determine how Zappos showed the signs of culture, the factors that demonstrated the culture, the type of leader that would be best suited for the company culture, and the culture change needed to if there was a decline in the sales.
Zappos’ has branded their culture as the value of happiness. Zappos’ provides happiness to happy employees and happy customers. CEO Tony Hsieh says its “unconventional culture, based on happiness, is what drives its success” (Financial Management, 2012, pg. 13). Zappos’ key success is “Deliver Wow through Success." Hsieh defines “Wow” service in terms of doing “something that is beyond what's expected and has an emotional impact on the receiver” (Kopelman, Chiou, Lipani, Zhu 2012, pg. 66). Hsieh goes on to explain that“[Zappos is not an average company, and our service is not average, and we do not want our people to be average. We expect employee ever to deliver “Wow” ](Kopelman, Chiou, Lipani, Zhu 2012, pg. 66). Culture is not just what a business runs off it is what a business eats and breath.
Zappos is so successful because they have masters the solution on how to become a good company with a great culture. Hsieh says, “By focusing on company culture everything else, such as building a brand with sustained revenue growth and passionate employees will fall into place (Financial Management, 2012, pg. 13). Zappos’ organizational culture reflect values, beliefs, and employee's action. If Zappos’ does not have an item in stock they recommend a competitor that has the item in stock. Zappos’ believes even though they are losing the sale in the end its best for Zappos because the customer appreciates the help and will spread the good news by word of mouth.
Hsieh believes in giving employees permission and encourages them to be themselves. Zappos encourages staff to “create fun and a little weirdness” in the workplace (Financial Management, 2012, pg. 13). If employees enjoy working in the company, they will offer the better customer service to clients, and this is the key success to Zappos delivering the WOW service (Kopelman, Chiou, Lipani, Zhu 2012 pg. 66). Hsieh believes it is important for managers and supervisors to get to know their employees on a personal basis. Zappos tried this method and communication has improved. This method opened up better communication between employers, and supervisors, improved relationships, encourage people to do favors, and established a high level of trust. Employees decide what is best for the customer instead of having specific policies for each case. Trust can go a long way with customer service representation.
Zappo’s examines every new applicant for a cultural match. Every new Zappos employee goes through the same five-week training process. At training, they learn the company strategy, the culture and why it is important, and the customer service philosophy. They also spend two weeks in the call center. During the four weeks, Zappos can see if they care about the customers (Perschel, 2010, pg. 29). Zappos offers new employees $4,000.00 to quit after the first week of training to weed out those who are there just for money (Financial Management, 2012, pg. 13). Zappos’approach to offering an incentive to quit is to make sure everyone there is for the love and not the money.
Zappos’ approach is paying off- Zappos consistently ranks as one of the best places to work in annual workplace surveys from industry monitors, including Fortune magazine (Financial Management, 2012, pg. 13). Customer satisfaction is the ultimate goal for Zappos, providing the best customer service possible is a requirement for the company. (Kopelman, Chiou, Lipani, Zhu 2012, pg. 66). Zappos actively encourages customers to reach out to them. Zappos encourages customers to post product reviews and recommendations not only as a form of word-of-mouth communications, but also as indications of their involvement with the firm and brand (Cowles, Owens, Walker, 2013, pg. 58). Zappos webpage proclaims a 24/7 customer service via telephone, also using social media to solve a problem 24/7; there is 365-day return policy (Kopelman, Chiou, Lipani, Zhu 2012, pg. 66). Zappos also provides free shipping on both sent and returned items. The decision to offer free shipping and free returns has made Zappos a billion dollar brand (Gringarten, 2012 pg. 96). Zappos wants to expand their customer base through innovation in customer service (Cowles, Owens, Walker 2013 pg.57).
Zappos’ core values speak to the company culture. Zappos’ core values are: Deliver the Wow through services, embrace and drive change, create fun and a little weirdness, be adventurous, creative, and open-minded, pursue growth and learning, build open and honest relationship with communication, build a positive team and family spirit, do more with less and be passionate and determined.Zappos’ core values are what they live by as a company. The core values speak to the flow-state characteristics of having the opportunity to challenge and stretch one skill (Perschel, 2010, pg. 29). Encouraging people to learn, grow, and embrace change
Zappos’ employees are free to do what they like. Employees are free to choose from 25-skill set and how many to learn regardless of whether the skill set needed is in their current role. Having the opportunity to choose gives the employees a sense of control. Empowered frontline employees make decisions that delight the customers. Zappos is to “WOW” with service and experience, not with anything that relates directly to monetary compensation. Employees experience a sense of control as they stretch their skills to meet the challenges at hand (Perschel, 2010, pg. 29). Shared values and the right training, rather the strict rule or management approval inform their decision and behavior of employees (Perschel 2010, pg. 29). Zappos’ seek to “WOW” our customers, our co-workers, our vendors, our partners, and in the end, our investors.
Encourage Creativity, individuality, and fun within the Zappos’ community. Zappos’ allows employees to express their individuality (a little weirdiness), to try new approaches, have a sense of play, and be open to the ideas of others and encourages employees to act from their essence and passion (Perschel, 2010, pg. 29). This infuses the workplace with fresh ideas, which is essential to Zappos to remain creative and innovative as a business (Perchel, 2010, pg. 29). Rewarding behavior aligns with the values of Zappos. Living the Zappos core values accounts for 50 percent of each employee’s performance reviews that provides significant feedback about the person efforts and help them set near-term behavioral goals (Perschel, 2010, pg. 29). Zappos’ is all about their employees having fun and enjoying working coming to work daily.
Zappos’ embodies their culture from their CEO Tony Hsieh. Hsieh had a clear vision of what he wanted the company to embodied “Happy employees." Hsieh wanted his company to have a culture where employees got along; people were happy and friendly, enjoyed coming to work and wanted the best for the company. Hsieh studied the norms on what made customers happy. He brought these four key attributes to Zappos’s: Perceived control people do not want to feel like they have lost control, perceived progress people need to feel like they are making progress, connectedness having strong social ties, and lastly vision/meaning bring part of something bigger than yourself. Hsieh’s first entrepreneurial venture at the age of nine defined convention through playful experimentation and creativity. These two ideas left a marked on his life and has been his approach to life and business.
Hsieh brought the ides of experimentation and creativity to Zappo’s culture and have marked the essence of the business (Perschel 2010, pg. 20). He believed that developing a positive and unique company culture was the integral to the success: “Zappos.com is more than electronic shoes store. It is a supportive community that happens to put you in a great pair of looking shoes” (Cowles, Owens, Walker, 2013, pg. 20). Hsieh brough what he learned and experience from his childhood and research and form a company built off of creativity, playfuessm and happiness.
To establish the culture early for Zappos Hsieh interviewed every job applicant. This way Hsieh was protecting the culture and ensuring the right people were hired at the beginning of Zappos. Candidates would have to pass a normal interview and would need to be a person Hsieh would like to know personally. Each applicant was asked questions pertaining to the company values. Hsieh believes “it does not matter what your values are, what matters is that you have them and that you align the organization around them.” (McDonald 2011, pg. 128). If a person attitude does not align with the Zappos company culture person may be he or she cannot be hired (McDonald 2011, pg. 128). Zappos has empowered their employees to be able make the right decisions, to solve problems, and serve their customers offering them excellent quality service.
The transformational leader would be best suited for Zappos. Transformational is a leader who broaden and elevate follower’s interest and stir followers to look beyond their interest to the good of others. The leader identifies the needs of change, creates a vision to guide the change through inspiration, and executes the change with the commitment of the members of the group. Transformational leadership has four dimension: charisma, inspirations, intellectual stimulations, and individualized consideration.
Charisma provides vision and a sense of mission, and it instills pride along with followers respect and trust (Schermerhorn, Osborn, Uhl-Bein, Hunt, 2000 pg. 311) Inspiration communicates high expectations, using symbols to focus on efforts, and expresses important purposes in simple ways (Schermerhorn, Osborn, Uhl-Bein, Hunt, 2000 pg. 311). Intellectual stimulation promotes intelligence rationality and careful problem solving, for example, encouraging employees to look at a difficult problem in a new way (Schermerhorn, Osborn, Uhl-Bein, Hunt, 2000, pg. 311). Individualized consideration provides personally attention, to treat each employee individually, and coaches and advises him or her (Schermerhorn, Osborn, Uhl-Bein, Hunt. 2000 pg. 311). A transformational leader is one that many employees look up.
I think if Zappo’s products decline, they should still stick to their same culture. Zappo’s culture of offering excellent customer satisfaction and happiness will result in customers being happy with the service they have received from Zappos. With Zappos, putting customer first word-of-mouth from loyal customers would spread, and this will bring new customers to the business. Product sales would soon start to rise again from customer loyalty. Zappos culture is a culture that all business should try to embody. With a positive culture like Zappos, if products should go down they would be ok with the culture they have embraced. The culture that CEO Hsieh has established in the company stimulate creativity, positivism, innovation, teamwork, trustworthy environment, build strong relationships between employees, empowerment to solve problems and to take initiatives. In my opinion Zappos culture is the culture for the organization in which managers cares about employees, customers, happiness and what is most important the people. Zappo’s should not change their culture if its culture has been successful.

Work Cited
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