Culture and Core Values: The Zappos Family Way

People Culture and Committable Core Values Recruiting, Managing, and Motivating The Zappos Family Way

Delivering Happiness

Tony Hsieh, CEO

© 2009 sunnibrown.com

1200 in Shepherdsville

1023 in Las Vegas

ZAPPOS AT A GLANCE

2000 plus employees

Founded in 1999


ZAPPOS AT A GLANCE

4 million warehouse

items

100% inventoried

BEST SELECTION!


Zappos is powered by SERVICE!

Fast, FREE shipping

FREE return shipping

365-‐day return policy

Fast fulfillment

Fast, friendly expert customer loyalty team



“100 Best Companies to Work For”

“50 Most Innovative Companies”

“Top 25 Customer

Service Champs”


Zappos is committed to WOWing every customer.

365-day returns!


Then they come back.

Then they order more and more often!

Customers come.


The Power of WOW

‘01 ‘02 ‘06 ‘03 ‘04 ‘05 ‘07 ‘00 ‘08

Gro

ss S

ales

$M

M

$1,000

800

600

400

200


What customers notice first SERVICE

800 number on every page

Free shipping

Free return shipping

24/7 customer service

365-‐day return policy


What customers experience next SERVICE

Redirection to competitors’ sites

Fast, accurate fulfillment

Surprise upgrades to overnight shipping

Above-‐and-‐beyond customer service


How we ensure it with our employees SERVICE

5 weeks of training

No call times

No sales-‐based performance goals

$2000 incentive to quit


How we ensure it through our policies SERVICE

50% of interviews and performance reviews based on values and culture fit

Culture Books

24/7 warehouse

All products inventoried – no drop shipping

Use of the telephone and Twitter



COMMITTABLE CORE VALUES

ulture =


ZAPPOS CORE

VALUES


Deliver

through service.


Embrace and drive change.


Create fun and a little weirdness


Be adventurous, creative and open-minded.


Pursue and learning.

growth


Build open and honest relationships with communication.


Build a positive team and family spirit.


Do more with less.


Delivery!

Be passionate and determined.


Be humble.


That’s great for Zappos but it

would never work at my company…


“It doesn’t matter what your core values are…

as long as you commit to them.


Figure out values

and culture.


Live the brand!

personal company

Culture

Values

Align!


HAVE A VISION. Whatever you’re thinking, think bigger.


Don’t chase the paper; chase the DREAM.

Sean Combs, a.k.a. “Puff Daddy”

Biggie Smalls, a.k.a. “Notorious B.I.G., ”

WORDS OF WISDOM


What’s the greater vision and purpose of employees’ work?

Go beyond the profit motive.


Motivation is different from inspiration.


BUILD RELATIONSHIPS.

Don’t “network.”


Hire slowly, fire quickly. BUILD YOUR TEAM.


If you want to go quickly, go alone. If you want to go far, go together.

– African proverb


How do we recruit for Culture & our Core Values?

•  How do we recruit for culture? –  Technical fit – do you have the technical skills to do the job?

•  Skills & Experience assessments –  Culture fit – do you have the same values we do?

•  Culture Interview –  It’s all about the Core Values

•  Wow! Can you roll the way Zappos does? •  Adventurous & Creative! Do you feel lucky!? •  Fun & Weird! You gotta be, but don’t get crazy… •  Team & Family! Workin’ 9 to 5?

How do we get around canned responses?

Shake ‘em up before you sit ‘em down! –  “A three hour tour” –  What’s your theme song? –  New York City or Cher’s dressing room?

I know you said you know… but do you really know or believe

it? –  CLT Training –  Testing

Culture & Recruiting

100% Certified and Guaranteed!?

–  Continual evolution •  Peak Questions •  Top Grading

–  Students have the exam ahead of time? •  Applicant to hire ratio = Less than 1% •  Training is an extended screening process

Employee Relations – Zappos Style

HR is not the final say, we are simply advisors. Managers

make the decisions. –  We act as true advisors and explain the risk around

situations –  If the manager does not take our advise, that is fine, we

are here to help them in any way we can Being Proactive

–  Building Relationships (HR and Management too)

Employee Relations – Zappos Style

Annual Performance Reviews

–  No Annual Reviews. Our managers are encouraged to provide performance feedback regularly and often

–  Maintaining our culture is key, Managers provide a Culture Assessment for each team member, based on our Core Values.

Employee Handbook

–  Make it something people want to read –  Employee Handbook: Policies for Employees by Employees

Infuse Culture in everything!

Benefits are Hot!

•  Strive to have the best benefits possible for employees –  We provide Medical, Dental, Vision, STD, LTD, Life

Insurance, AD&D Insurance, 401K

–  Employees pay no premiums

–  All annual visits, check ups / preventative care is free (no out of pocket for employees)

–  Employees have an HRA that is fully funded by us. It covers all deductibles plus more.

P.E.A.C.E.

P.E.A.C.E.

Programs

Events

Activities Charity

Engagement

Put a little Zappos in your day… …some links to check out…

–  http://twitter.zappos.com (public mentions, employees)

–  http://blogs.zappos.com (photos & videos of culture)

–  http://about.zappos.com (more information about us & core values)

–  http://www.zapposinsights.com (to schedule a tour, video Q&A from different depts)

Put a little Zappos in your day… …some links to check out…

Follow me on Twitter @electra

Email me – [email protected] •  A copy of this presentation •  Answers to any additional questions not addressed today

Check out our jobs! jobs.zappos.com

Legal and Financial Disclaimer P.S. You might be wondering why we need to have a legal and financial disclaimer in this presenta;on, but you are s;ll reading, so our lawyers, auditors and accountants would really like to make sure we make the following clarifica;ons.

Although an audit was underway and almost done, the financial informa;on presented in this slide show was unaudited. We made every effort to present the best informa;on we had at the ;me.

Gross merchandise sales is a non-‐GAAP metric. We use it to express the total demand across all of our web sites and stores. This number measures the dollar value of the orders placed in the year before accruing for certain items such as returns, and it ignores certain ;ming cut-‐offs that are required by GAAP for revenue recogni;on purposes. If we were a public company, we would have to reconcile gross merchandise sales to the nearest GAAP metric (net sales), but we are currently a private company so the gross merchandise sales number should be viewed just as an interes;ng number that we want to share with our friends.

This presenta;on contains forward-‐looking statements that involve risks and uncertain;es, as well as assump;ons that, if they ever materialize or prove incorrect, could cause our results to differ materially from those expressed or implied by the forward-‐looking statements and assump;ons. These risks and uncertain;es include, but are not limited to, the risk of economic slowdown, the risk of over or under-‐buying, the risk of consumers not shopping online or at our web site at the rate we expected, the risk of supplier shortages, the risk of new or growing compe;;on, the risk of a natural or some other type of disaster affec;ng our fulfillment opera;ons or web servers, and the risk of the world generally coming to an end. All statements other than statements of historical fact are statements that could be deemed forward-‐looking statements, including statements of expecta;on or belief; and any statement of assump;ons underlying any of the foregoing. Zappos.com assumes no obliga;on and does not intend to update these forward-‐looking statements.

Congratula;ons on making it through all the fine print. If you enjoy fine print, look for openings on our legal and finance team at jobs.zappos.com.

Culture and Core Values: The Zappos Family Way

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