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4 Questions With Tony: What Other Businesses Can Learn from Zappos

Zappos is possibly the most debated organization today. The business world stands back in awe of Zappos’ uniquely rapid growth. In February 2010 Zappos earned #15 on the 2010 Fortune 100 Best Companies to Work For List — sales exceed 1 billion dollars annually. And CEO Tony Hsieh is not stopping there.

This year Hsieh and his team set out to physically “deliver happiness” via the “Delivering Happiness” bus in support of Hsieh’s New York Times Bestseller Delivering Happiness.

Good news from Zappos headquarters continues to make headlines. Last week plans were announced for a Zappos Downtown Campus where Zappos hopes to move into the Las Vegas City Hall and adjacent expansion land downtown sometime in 2012 or 2013.

Today Hsieh joins CMSWire to discuss what other companies can learn from Zappos, the customer service company that happens to sell shoes.

Blake Landau: Some argue that there is nothing in the way a Zappos operates to which an existing business can relate.

Can you comment on this statement?

Tony Hsieh: Zappos Insights is actually a separate business and web site (www.zapposinsights.com) where we help other companies develop their own strong cultures by helping them figure out the values that are right for them. As I wrote about in my book "Delivering Happiness" (www.deliveringhappinessbook.com), research has shown that companies that have strong cultures generally outperform companies that don't. What's interesting about the research is that it actually doesn't matter what the core values of a company are. What matters is that companies have them, and they commit to them and base their actions on them (vs. just talking about them). It's the alignment that's important.

For us, it's been rewarding to have companies from completely different industries go through Zappos Insights and report back that as a result, their cultures are stronger, their employees are happier, and their revenues and profits are up as a result.

I can't speak as to whether there is anything that ZDNet can learn from Zappos, but we're excited about the companies that have gone through Zappos Insights and improved their businesses as a result.

BL: What is the biggest misconception about Zappos by the business world?

TH: This is a hard one for me to answer since we aren't really focused on what other businesses think about us. We're primarily focused on our customers, employees, and vendor partners.

BL: In Peak: How Great Companies Get Their Mojo with Maslow Chip Conley, CEO of boutique hotel chain Joie De Vivre, which you wrote the forward for, Conley quotes Malcolm Gladwell (New York Times) in his book:

[Maslow] created a new psychology of business based on not just meeting the tangible, foundational needs of our key stakeholders, but more importantly, focusing on their intangible, self-actualizing needs.

Why is it hard to for people to imagine that focusing on the business stakeholders self-actualizing needs would be profitable?

TH: I think because the payoff is usually at least 2-3 years down the road, and usually most businesses focus more on the current quarter or the current year.

BL: Do you think most companies still manage fear-based cultures? If yes, do you think it would be in their best interest to change, why or why not?

TH: I think fear-based cultures will work as long as employees don't have better alternatives. I think we're at the beginning of a changing world, and 20 years from now, fear-based cultures will be a lot less prevalent than they are today.
 

 
 
 
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