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  

©  2009  sunnibrown.com  

ZAPPOS AT A GLANCE

4  million  warehouse  

items  

100%  inventoried  

BEST  SELECTION!  

©  2009  sunnibrown.com  

Zappos is powered by SERVICE!

Fast,  FREE  shipping  

FREE  return  shipping  

365-­‐day  return  policy  

Fast  fulfillment  

Fast,  friendly  expert  customer  loyalty  team  

©  2009  sunnibrown.com  

©  2009  sunnibrown.com  

“100  Best  Companies  to  Work  For”  

“50  Most  Innovative  Companies”  

“Top  25  Customer  

Service  Champs”  

©  2009  sunnibrown.com  

Zappos is committed to WOWing every customer.

365-day returns!

©  2009  sunnibrown.com  

Then  they  come  back.  

                 Then  they  order  more  and  more  often!  

Customers  come.  

©  2009  sunnibrown.com  

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

©  2009  sunnibrown.com  

What customers notice first SERVICE

800  number  on  every  page  

Free  shipping  

Free  return  shipping  

24/7  customer  service  

365-­‐day  return  policy  

©  2009  sunnibrown.com  

What customers experience next SERVICE

Redirection  to  competitors’  sites  

Fast,  accurate  fulfillment  

Surprise  upgrades  to  overnight  shipping  

Above-­‐and-­‐beyond  customer  service  

©  2009  sunnibrown.com  

How we ensure it with our employees SERVICE

5  weeks  of  training  

No  call  times  

No  sales-­‐based  performance  goals  

$2000  incentive  to  quit  

©  2009  sunnibrown.com  

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  

©  2009  sunnibrown.com  

©  2009  sunnibrown.com  

COMMITTABLE CORE VALUES

ulture =

©  2009  sunnibrown.com  

ZAPPOS CORE

VALUES

©  2009  sunnibrown.com  

Deliver

through service.

©  2009  sunnibrown.com  

Embrace and drive change.

©  2009  sunnibrown.com  

Create fun and a little weirdness

©  2009  sunnibrown.com  

Be adventurous, creative and open-minded.

©  2009  sunnibrown.com  

Pursue and learning.

growth

©  2009  sunnibrown.com  

Build open and honest relationships with communication.

©  2009  sunnibrown.com  

Build a positive team and family spirit.

©  2009  sunnibrown.com  

Do more with less.

©  2009  sunnibrown.com  

Delivery!

Be passionate and determined.

©  2009  sunnibrown.com  

Be humble.

©  2009  sunnibrown.com  

That’s great for Zappos but it

would never work at my company…

©  2009  sunnibrown.com  

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

as long as you commit to them.

©  2009  sunnibrown.com  

Figure out values

and culture.

©  2009  sunnibrown.com  

Live  the  brand!    

personal    company  

Culture

Values

Align!  

©  2009  sunnibrown.com  

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

©  2009  sunnibrown.com  

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

©  2009  sunnibrown.com  

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

Go  beyond  the  profit  motive.  

©  2009  sunnibrown.com  

Motivation is different from inspiration.

©  2009  sunnibrown.com  

BUILD RELATIONSHIPS.

 Don’t  “network.”  

©  2009  sunnibrown.com  

Hire  slowly,  fire  quickly.  BUILD YOUR TEAM.

©  2009  sunnibrown.com  

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

– African proverb

©  2009  sunnibrown.com  

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 – cfoley@zappos.com •  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.