Have you heard of the American company Zappos? I hesitate to call it a shoe and clothing retailer because it is so much more than that. Zappos is actually more known for its legendary customer service and staff engagement than they are for their shoes. Their practices are revolutionary, to say the least, and more than a little thought-provoking (I just wish I’d thought of them first!). This innovative culture has largely been led by Zappos visionary founder Tony Hsieh.
The Zappos website is a huge success, with sales topping more than $1 billion annually when Amazon bought in in 2009. Tony still heads the company but he is now focused on investing $350 million of his own money in making over downtown Las Vegas, the neighbourhood surrounding Zappos’ headquarters. His plans include houses, restaurants, tech start-ups, a school, a health center, music and even a, er, 40-foot metal praying mantis that breathes fire during a nightly drum circle…
Tony Hsieh recently sat down with Playboy magazine for quite a revealing interview (not in that way… and no I am not an avid reader of Playboy, someone sent me the interview link – thanks Deb!) and I had so many light-bulb moments when reading it online. You can read the full interview here (http://www.playboy.com/playground/view/playboy-interview-tony-hsieh-zappos) but below I’ve pasted the business-related titbits that caught my attention. Read them – I think they’ll be valuable to your business.
ON STAFF ENGAGEMENT:
“Work isn’t about being chained to your desk, staring at a screen. What we’re focused on is employee engagement. Plenty of studies show that the more engaged employees are, the happier and more productive they are. And the best predictors of engagement are things like whether you have a best friend at work and how much freedom you have on the job. It’s a powerful thing to know you can turn your work space into a tiki lounge and invite everybody to happy hour at five o’clock.”
* “We trust our employees to use good judgment, which 99.9 percent of them do. We’d rather not create policies to address the 0.1 percent at the cost of fun for the other 99.9.”
* “We encourage managers to spend 10 to 20 percent of their time outside the office with their team and the people they work with. When new managers hear this, they go, “What? How? Why? Where?” It’s one of those bad habits we have to untrain out of our employees. And productivity and efficiency go up anywhere from 20 to 100 percent. It’s because communication within departments is better and people are willing to do favors for each other, not just as co-workers but as friends.”
* “People ask me what’s a good market to get into where they can make a lot of money. My advice to them is, rather than having money be your primary motivator, think about what you’d be happy doing for 10 years even if you didn’t make a cent. That’s what you should be doing. I think if you do that, ironically, it’ll greatly increase your chances of making more money, because your enthusiasm will rub off on employees and customers and have this ripple effect on your whole business.
ON CORE VALUES:
*”We have 10 core values that serve as a formalized definition of our company culture, and everything is driven by those ideals. They bond us like a family; they guide us through good times and bad. Some of our core values: Embrace and drive change. Build open and honest relationships with communication. Be passionate and determined. Be adventurous. Be open-minded. Embrace growth and learning. Have fun. Be humble.”
ON HOW TO WOW CUSTOMERS:
* “You have to go above and beyond. You’re going for spine tingling, earthshaking. You’re shooting for emotional impact. It’s why we have this thing in our call centers called PEC, or personal emotional connection. You don’t want to think of your customer as a dollar sign. You want to truly and authentically connect to their humanity. That’s why our reps have the freedom to send flowers or handwritten notes or cookies just as a friendly thank-you or follow-up. It’s why one employee spent 10 hours on the phone with a customer in 2012.”
* “Our reps don’t have quotas. They don’t have scripts. They never up-sell. What matters is using each interaction with a customer to build a customer-service brand, to let our reps shine in each interaction. That way, we’re creating a moment, a memorable and favorable experience, and yes, that does bring customers back for more.”
* “Listen to the customers. With brick-and-mortar retail in general there hasn’t been much innovation in a very long time. Buying from a store today is not that different from buying from a store 30 or 50 years ago. But if you look at the innovation at the Apple Store, let’s say, you see that success comes in figuring out how to take the customer experience to the next level. That’s true online and offline. That’s certainly where we found success.”
ON WORKPLACE INTERACTIONS:
* “We’ve always taken the view that we have to physically be together from an employee perspective. People don’t work as well remotely. We want employees all in the same physical space to have more collisions. For instance, in our new building everyone enters through a central courtyard plaza, which becomes a daily congestion point. You see almost everybody in the company at some point every day. Also, there used to be a sky bridge from a parking garage leading to the former city hall where our office is now. The city employees all used to park and walk across the bridge and into the building. When we moved in, we shut down that bridge, which forces all the employees out into the streets. That builds connection not just within the company but between Zappos and the surrounding neighborhood and city.
ON OPERATING A “HOLACRACY”:
* “Holacracy is a different way of organizing a company. Most companies are organized from high to low, where a boss commands people and so on, whereas a holacracy operates more like an urban environment and less like a bureaucratic institution. Everyone is together, and yet they don’t order each other around. In a pure holacracy, you do away with all job titles, managers and levels. We’re still experimenting with the form, and it will have a unique Zappos flavor, but the key is to enable employees to act more like entrepreneurs. Instead of being told what to do by managers, we trust that employees will know what needs to be accomplished and then figure out the best way to make that happen.”
It’s always a concern as a company grows—and we’re approaching 2,000 employees—that you remain innovative. When companies get bigger, productivity and innovation per employee generally go down. From the Zappos perspective, we’re trying to avoid that fate. So the model we’re using isn’t a corporate one. Rather, it’s the city. Every time the size of a city doubles, innovation and productivity increase by 15 percent.”
ON THE SIMILARITIES OF PLAYING POKER AND BUSINESS:
* “Realize that poker is very similar to business. Don’t play if you don’t understand it. If you’re not winning at your table, you have to think about switching to another table. If there are too many competitors, even if you’re good, success is going to be harder. Don’t cheat. Be patient. Be humble. Be nice. Be prepared for the worst. And the guy who wins the most hands isn’t the guy who makes the most money in the end. Also, have fun. You don’t want to be up all night worrying.”
ON GETTING GOOD AT SOMETHING:
* “Just like anything else, to get proficient at something, whether it’s playing piano, playing a sport or being an entrepreneur, you need to put in 10,000 hours of practice.”
ON STRIVING FOR HAPPINESS:
* “Happiness is about four things: perceived control, perceived progress, connectedness — meaning the number and depth of your relationships — and being part of something bigger than yourself that gives you meaning or purpose. On a daily basis I’m conscious of which of those areas are present and which need work, whether it’s for myself or how we think about making employees happy or making customers happy.”
ON HIRING THE RIGHT STAFF:
* “We do two sets of interviews. The hiring manager will interview for the standard stuff like fit within a team, relevant experience, technical ability and so on. Then our HR department does a separate set of interviews purely for culture fit, and those can get interesting. Applicants have to pass both assessments to be hired. We’ve said no to a lot of smart, talented people we knew could make an immediate impact on our top or bottom line. If they didn’t get the job, it could have been because they weren’t nice to the Zappos shuttle-bus driver on the way from the airport. And you have to like living in Vegas.”
Let’s work on your workplace engagement and customer service – we’ll take it to the same level that Zappos operates in. Get in touch for business coaching, consulting and inspiration: firstname.lastname@example.org