The New York Times recently interviewed Tony Hsieh, the CEO of Zappos. He shared his thoughts on leadership and how he worked to build a forward-thinking culture at Zappos.
The journey to crafting the Zappos culturebegan while Hsieh worked for a company called LinkExchange, which was an internet advertising cooperative. Founded by Hsieh and a fellow Harvard student, LinkExchange used new technology to do something that hadn’t been done before. Although Hsieh was in possession of a cutting-edge idea that was exciting and innovative, he was filled with ennui about his company. Like many employees out there, he dreaded going to the office and was dispassionate about his career. Hsieh admits to snoozing his alarm clock repeatedly so he could sleep for five more minutes before going to work.
Hsieh sold LinkExchange to Microsoft and eventually joined Zappos, where he partnered with his management team to define ten core values. Those values are now part of the hiring and employee development process, and all candidates are measured against those ten benchmarks. Once you are hired, you are expected to perform in your job and meet the criteria of those values. You can be a competent employee who delivers against goals and objectives, but if you’re not measuring up against the core values, you will be fired.
Mr. Hsieh is quoted in The New York Times as saying, “We decided that if we get the culture right, most of the stuff, like building a brand around delivering the very best customer service, will just take care of itself.”
Implementing a culture-driven organization is no easy task. In order to follow in the footsteps of Zappos, a Human Resources team would need to lead executives, leaders, managers and workers through discussions to create a common understanding of what it means to be an employee at your company. The concept of success for employees would need to be clarified n a way that correlates to personal development, profitability, and organizational growth. Then HR would be tasked to quantify the culture and values, with the goal of incorporating the sum of those efforts into job descriptions. The ultimate goal would be to create a valid and reliable hiring process.
This is a big deal, and while Zappos is known for having spontaneous employee appreciation parties and allowing for creatively decorated conference rooms, Hsieh and his leadership team worked hard to capture the essence and the core of what makes the company work. It’s bigger than foosball and free lunches in the cafeteria, although tabletop games and free food do have a place at the Zappos headquarters.
HR works best when it plays devil’s advocate to trendy business concepts, and it’s critical to ask if culture is an important concept that deserves time and attention from your management team. Unfortunately, the answer isn't clear. Anthropologists and historians have studied the concept of culture for hundreds of years, and if one thing can be learned from their research, it’s that time and distanceare critical in deconstructing the reasons behind successful human endeavors. As recently as November 2008, Zappos laid off eight percent of its workforce. Although Amazon acquired the organization during the summer of 2009, the company is yet to turn a profit.
For the average HR practitioner, it’s important to note that you cannot have a discussion about culture until your leadership team first agrees that it matters. Most senior leaders in America have a traditional employment background where nothing happens, not even a company picnic, without a direct correlation to revenue and profit. Culture is a luxury that is not discussed during a recession. Still others leaders hail from environments where culture is determined by external forces such as unions or the federal government. In those environments, culture cannot be controlled or contained by the corporation.
At some point, investors and executives will look back at Zappos’s cultural experiment and decide if the employees who were hired three, four, and five years ago are making a difference to the bottom line. As Human Resources practitioners, it is important to pay attention to the concept of culture in the workforce and stay on top of this trend. More importantly, pay attention to Tony Hsieh as an important thought-leader when it comes to managing people and businesses in an innovative way.
Laurie Ruettimannis a seasoned and cynical HR professional with over a decade of experience in Fortune 500 organizations. A cutting edge, social media maven and newly minted entrepreneur, Ruettimann is a sought after speaker, writer and thought leader. She received her SPHR certification in 2001 from The Human Resources Certification Institute and is an active member of The Society for Human Resources Management. Laurie is also a certified recruiter and trainer through various credentialed organizations.