After 20 years, Tony Hsieh retired from CEO and left Zappos. There is a leadership learning opportunity in analyzing this period. You could find the details in this article. I also included this news section in one of my past newsletter issues.
Since I read his book Delivering Happiness in 2011 (a book that I always recommend), I’ve been interested in Tony and the multiple learnings from his career. I also wrote a post in my blog about him and his previous entrepreneurship.
Zappos is very well known for its culture and core values, and its wow customer service. Hsieh’s effort building and growing them will no doubt leave a lasting impression.
Company Culture and Core Values
As Tony explained, culture and brand are two sides of the same coin. Your culture is your brand. And in their pursuit of company culture, they defined it in terms of 10 core values. I already wrote about them in this post.
Many companies have core values, but they don’t really commit to them. They usually sound more like something you’d read in a press release.
We believe that it’s really important to come up with the core values that you can commit to. And by commit, we mean that you’re willing to hire and fire based on them.
How to build and maintain the culture you want? Culture starts at the hiring process, based on company values over talent. It continues with training, the same training for all, with 4 basic pillars: company history, customer service, company vision, and company culture.
It is very well known that they offer money to the people who want to leave. The idea is as risky as amazing. They want people to stay for more than a paycheck.
Also, they build a yearly culture book with a digital version. Check it out!
The very best Customer Service
Jim Collins, in Good to Great, talks about what separates good companies from great companies. He realized that great companies share a greater purpose and a bigger vision in the long term than just making money or being market number 1. Somehow, focusing only on making money is a trap never to become a great company.
In Zappos’s concrete case, they realized that their biggest vision would be to build the Zappos brand to be about the very best customer service. Customer service was important, but they moved it to make it the focus of their brand.
An example of committing to their vision would be the following one. Drop shipment business was 25% of overall sales at Zappos, but 5% of the orders weren’t fulfilled, and delays provided a bad experience. So following their vision to provide the very best Customer Service, they made the hardest decision and turned off that part of the business.
Maybe by chance, but it worked. Leaders are expected to develop and share a vision, but how many have the courage to commit to its vision like this?
Training vocational leaders
As I shared before, training was a crucial part of the onboarding process at Zappos. But training was a constant, a pipeline. Their vision was to provide all the training and mentorship necessary so that any employee has the opportunity to become a leader.
Without continually growing and learning both personally and professionally, it’s unlikely that any individual employee will still be with the company ten years from now. Our goal at Zappos is for our employees to think about their work not as a job or career, but as a calling.
Recently, their teams were all trained to be self-organized, based on the Holacracy model. Adopting Holacracy, a decentralized management model, and organizational governance method. But the experience didn’t work as expected and made leave more than 18% of the company people.
Time for a leadership change
Maybe it was necessary for a leadership exchange at Zappos. As I shared recently in another post, there are different leadership styles, and depending on the moment, it is necessary to be able to switch from one style to another.
But it also arrives a moment where leaders may be able to step aside and give the command to somebody more appropriate given the company’s conditions and needs.
If you’re interested in reading about Tony’s leadership lessons, you could read this Forbes article. And as I said at the beginning of the post, I recommend you to read his book, which was included recently as one of the books you need to read if you want to start a business.
Who knows where the road will take Tony. It seems that Utah will be his next step and that he is taking a digital detox hiatus, but also, he is investing in real estate.
Update: Bad and sad news
This is an addition to the original article. Unfortunately, Tony’s adventure in Utah ended in the worst way possible. Tony passed away at the age of 46 in a house fire.
I prefer to not dive deep into details, but something was wrong with Tony. He was truly and fully dedicated to delivering happiness to customers, workers, and colleagues, but it seems that he didn’t achieve the happiness he was looking for him.
But I don’t want to finish this post only with this bad news. Tony’s legacy is there, he really believed in delivering the best customer service possible, influencing hundreds or thousands of entrepreneurs and companies all over the world. So he deserves to be remembered for his achievements and the happiness he successfully delivered. And I hope Tony will find peace and happiness wherever he is.
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Also published on Medium.
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Also published on Medium.