zappos case study operations management

Zappos: How Excellent Customer Service Can Drive Growth Case Study

• To find inspiration for your paper and overcome writer’s block
• As a source of information (ensure proper referencing)
• As a template for you assignment

Zappos.com is the largest online shoe retailer in America and it is owned by Amazon.com. The company is based in Henderson, Nevada. It was founded in 1999 by Nick Swinmurn. 1n 2009, the company was acquired by Amazon. Tony Hsier is the current CEO.

Zappos mission is “to provide the best customer service possible”. Its core values are captured by what it refers to as the “ten Commandments”, which employees are supposed to study, internalize, and practice. The company believes that the right corporate culture is the foundation of exceptional customer service.

Zappos is a rapidly growing company that is also profitable. It has made a significant contribution to Amazon’s profitability. Since 2005, Amazon had been toying with the idea of starting an online retailer of shoes and that is why it started endless.com. The company, however, decided to acquire Zappos. The decision to acquire Zappos was an inspired one because growth prospects are exceptionally bright under the leadership of Tony Hsier.

Zappos is a reputable company to work for. It was listed among the top companies that treat employees well. The company does not only treat employees well, it also it also compensates them handsomely. Employees are trained under a program of continuous self improvement and handed countless other challenges that are motivating.

Zappos is involved in number of activities aimed at protecting the environment. The company also provides direct job opportunities to almost 2000 employees and indirectly to hundreds. This is good for the American economy. When many companies in the US are outsourcing jobs to India, Zappos has made the conscious decision to locate its call centre in United States.

The company was not hugely affected by the 2007 financial crisis, but it had to offload 5% of its workers at some point. Looking at its revenue figures, Zappos growth has been impressive. This has been due to its commitment to exceptional customer service. Future prospects for the company are significant because it is now a trusted brand. Secondly, almost all of its first customer buyers make repeat purchases. As long Zappos maintain its excellent and innovative customer service, it will continue to gain more market share.

Organization and continuity

Operational process.

A company such as Zappos that ships shoes and other accessories to clients once they buy online requires considerable operational processes to be reliable (DiJulius, 2008). For activities to be performed in a standard way, there is a need for operational processes and procedures. Common activities in a firm can be accomplished in several ways, but there that single way that is both cheap and efficient. Documenting operational processes help a firm avoid failures and other costly mistakes.

Training new employees includes educating them on operational processes. Most firms do not provide formal training as such, but new employees are put under more experienced workers to mentor and transfer the required knowledge on operational processes and procedures (DiJulius, 2008). Operational processes are essentially documented best practices that have been adapted from elsewhere or developed in-house.

Operations are harmonized by integrating processes and people to drive reliability and improve capacity. When Zappos was incorporated, it faced a number of operational challenges in their quest to ensure that they ship products to their customers successfully (Laseter & Rabinovich, 2012).

To deal with the problems, Zappos adopted a highly sophisticated computer system called Genghis. Gengis manages the operations of the company. It manages the following key areas of operations: order entry, warehouse management, e-commerce system, and inventory (Zappos.com). If a customer wants a certain size of a particular shoe, he can be able to check its availability and the total number of shoes in the store of that size and their colors.

The system also reminds employees to call back customers and also coordinates reboot system of the warehouse. The management gets reports on profit contribution of selling a certain product in their online store. This way, the management can be able to assess whether it’s profitable to sell a certain product or not before stocking.

Management style

Management style refers to ways decisions are made in an organization and relating to subordinates. Management styles can be autocratic, paternalistic, or democratic. According to management experts, management style should be adapted to fit the prevailing circumstances. In a modern organization, democratic management style has been found to give the best results.

Democratic or participative management style is suitable for employee motivation because they feel appreciated and part of the organization.

They also feel that they own the final decision reached, and this inspires them to cooperate towards the realization of what has been decided. This type of management style is best when working as a team. It is the best where quality of what will be produced is more essential than speed.

Tony Hsier has distinguished himself as a great manager. He realized that Zappos needed to offer a excellent service stay ahead of the competition.

Towards that end, he developed a work environment where employees work as a team all committed to offering delightful service to customers. One of the decisions Tony, together with his employees, made at Zappos was to adopt casual dressing style (DiJulius, 2008). Also, during the early days of the company, the whole team collectively developed organizational culture and key values.

One of the reasons that have made Zappos a dominant company is the management style of its CEO, Tony Hsier. The vision of the CEO was to make a successful company that, despite size, could still offer customers exceptional service. That is why the company invests so much on training new employees. New hires on training is given full salary and a $2000 for those who wish to opt out.

Employee involvement which contributed to their growth over the years

According Tony, zappos is a company that is committed to delivering happiness to all the stakeholders (Hsieh, 2011). He is focused on making customers happy. This singular focus on the customer’s happiness is largely responsible for the company enormous success. It is also from this focus that informs its corporate culture.

Tony Hsier believes that when a company is able to attract talented people who also enjoy their work, it is possible to offer exceptional service and develop a strong brand in the process (Hsieh, 2011). The people who are recruited by the company is committed to offering delightful service to customers. New Employees, who feel that they cannot cope, or lack sufficient motivation to work there, are encouraged to leave the company and are given a $2000 reward (Zappos.com).

During interviews, employees are sometimes asked to rate their weirdness on a scale of 10. Interviewers sometimes push job applicants to extreme situations so that they can gauge their reactions when under pressure (Laseter & Rabinovich, 2012). During the early days of the company, workers would stay late into the night to socialize.

The goal was to create an organization where everyone is friendly. A test of innovation is given to prospective employees. Innovation is critical to the company, and it is indeed its hallmark, since it was founded. It is now even more urgent because of emerging vendors who have copied Zappos strategy and business models. Zappos, therefore, has been able to reach this far by relying on the employee’s innovativeness and commitment to excellent service.

Companies may be large, but it is real people that can give individual customers enjoyable and memorable service that they are able to identify with. Eighty per cent of all Zappos customers are repeat customers. They come back, again and again, due to the great service they get from employees. Therefore, by committing themselves to making customers happy, they have made Zappos the excellent company it is.

Marketing practices

Marketing is a crucial aspect of any business. Proper marketing involves not only physical goods but also puts into consideration services surrounding those goods. Proper marketing requires proper understanding of the key factors that would enable a business get customers and keep them. Keeping customers is as important as getting them. This is essential getting a new customer is more expensive than keeping an existing one.

Zappos is aware of what customers are looking for when they go online to shop. According to Tony, they are not only looking for a pair of shoes, but also after a pleasant buying experience. That experience can only be achieved by integrating personalized service and excellent operations management.

Good marketing practices include the following: developing a marketing plan, budget, securing necessary resources and; lastly, establishing metrics to assess the impact of marketing on business (Laseter & Rabinovich, 2012).

Zappos relies on, among other things, word of mouth marketing. This strategy has worked because stories of their superior customer service abound, and this drives customers to their website to make purchases. This has propelled the store to number one online shoe retailer.

Zappos strategy and motto is “customers are kings”. The company, therefore, goes out of its way to meet customer needs and ingratiate itself to buyers to retain their loyalty. Service helps Zappos standout from the crowd and differentiates itself. Although their shoes are not necessarily cheaper than what their competitors are offering, their efficiency, free shipping, and 365 day return policy is particularly attractive to prospective customers.

Zappos also incorporates hiring in its marketing strategy. The only people given the job are those whose personality fits the work culture at Zappos. Together with the four Ps of marketing, customer service complements marketing efforts and it’s what brings all the difference.

Area of focus they manage their operation under

Zappos, like other companies, is a complex organization. It has been able to grow at such a rate by adopting the right strategies in areas such as marketing, supply chain management, proper operational planning, good management, employing innovative human resource management, and making customers the central focus of all operations.

However, Zappos is totally committed to providing customers a excellent service. For instance, the company has adopted the following strategies to provide customers with a great service:

Call centre employees do not follow a preset script in dealing with customers queries. Zappos requires them use as much time as may be required to solve customers’ problem or make a positive impression.

Employees are allowed to send customers gifts and later bill the company. According to Tony Hsier, the company does not have a policy of dealing with customers (Hsieh, 2011). Employees are expected to make a decision based on the circumstances of their interactions with the client. The only guide an employee has is that they should offer outstanding service to the client.

All goods are shipped to customers free, and customers can return the products, if they are not happy, at the cost of the company.

Customers are provided with a 365 days warranty. This allows customers to return faulty items. The corporate culture and commandments are developed around the need for make customers happy. Tony elaborated more on Zappos philosophy of making customers in his recent book. What he has emphasized is the need to serve customers well and make them happy.

That has been Tony’s vision for the company since incorporation of Zappos (Hsieh, 2011). Amazon attempt to acquire the company in 2005 was rejected because the CEO felt that the company would lose its unique culture. As noted elsewhere in this paper, Genghis system was adopted to make it easier for customers to shop at Zappos.

How Zappos improved market share/Profits

Zappos was a pioneer online shoe retailer. Nick got the idea of starting an online shoe retailer after unsuccessfully trying to purchase a pair of shoes in his hometown (Hsieh, 2011). In 2001, Zappos posted 1.6million dollars in revenue. Ten years later, the company’s revenue has jumped to around 2 billion dollars.

By all accounts, the company’s growth has been extremely impressive. The shoe market is estimated to be around 40 billion dollars. Zappos, a shore retailer, therefore, controls around 5% share of the market (Laseter & Rabinovich, 2012). This is notable for a single company because the industry has all type of shoe vendors (small and large) operating offline and a few online.

The secret to Zappos success is customer service. Zappos commitment to customer service is becoming legendary. There is a story about a woman who had ordered a pair of shoes for her husband but, unfortunately, the man died shortly after the order for the pair of shoes was placed. The lady called the company to cancel the purchase. The following day, she received a bunch of flowers instead. Stories of exceptional service, such as this, have enhanced the reputation of the retailer.

Although it costs Zappos a lot of money to provide exceptional service, the company considers the expenses as marketing costs. As already noted, 80% of the company sales are to repeat customers. Clearly, customers notice and appreciate the good service they are given by Zappos.

The outstanding reputation Zappos has acquired is responsible for its growth. Right now, the company is expanding to include online sales of other products, such as shoes, in addition to shoes.

Zappos is a case study on how excellent customer service driven by robust corporate culture can drive growth. Indeed all managers who care about customer service have visited the company’s headquarters to understand how the company executes its happiness vision for its customers.

The success of the company also highlights the importance of leadership in laying the foundation for success. The incredible service that is behind the success of the company is the brainchild of one man, Tony Hsier. He has driven the company through changes in its operational process to achieve its current excellence.

DiJulius, J. R. (2008). What’s the secret?: to providing a world-class customer experience . Hoboken, N.J.: Wiley.

Hsieh, T. (2011). Delivering happiness: a path to profits, passion, and purpose. . New York: Grand Central Pub, 2011. Print.

Laseter, T. M., & Rabinovich, E. (2012). Internet retail operations: integrating theory and practice for managers . Boca Raton, FL: CRC Press.

“Zappos Milestone: Timeline | about.zappos.com.” Home | about.zappos.com . N.p., n.d. retrieved < https://www.zappos.com/about/?utm_campaign=zappos&utm_medium=zappos-home&utm_source=footer&utm_content=text >.

• Strategic Analysis of Target Corporation
• Managing Communication Channels
• Success of Zappos in National and International Markets
• Zappos Company Culture Analysis
• The Aspects of the Zappos' Company Success
• Final Strategic Plan and Presentation-Spaans Cookie Co
• Best Buy’s Organization Strategies
• Social Media as an Effective Marketing Tool
• Discount Pricing Strategy
• McDonald's: Planned Change Project
• Chicago (A-D)
• Chicago (N-B)

IvyPanda. (2018, June 21). Zappos: How Excellent Customer Service Can Drive Growth. https://ivypanda.com/essays/operation-process-of-zappos/

"Zappos: How Excellent Customer Service Can Drive Growth." IvyPanda , 21 June 2018, ivypanda.com/essays/operation-process-of-zappos/.

IvyPanda . (2018) 'Zappos: How Excellent Customer Service Can Drive Growth'. 21 June.

IvyPanda . 2018. "Zappos: How Excellent Customer Service Can Drive Growth." June 21, 2018. https://ivypanda.com/essays/operation-process-of-zappos/.

1. IvyPanda . "Zappos: How Excellent Customer Service Can Drive Growth." June 21, 2018. https://ivypanda.com/essays/operation-process-of-zappos/.

Bibliography

IvyPanda . "Zappos: How Excellent Customer Service Can Drive Growth." June 21, 2018. https://ivypanda.com/essays/operation-process-of-zappos/.

IvyPanda uses cookies and similar technologies to enhance your experience, enabling functionalities such as:

• Basic site functions
• Ensuring secure, safe transactions
• Secure account login
• Remembering account, browser, and regional preferences
• Remembering privacy and security settings
• Analyzing site traffic and usage
• Personalized search, content, and recommendations
• Displaying relevant, targeted ads on and off IvyPanda

Please refer to IvyPanda's Cookies Policy and Privacy Policy for detailed information.

Certain technologies we use are essential for critical functions such as security and site integrity, account authentication, security and privacy preferences, internal site usage and maintenance data, and ensuring the site operates correctly for browsing and transactions.

Cookies and similar technologies are used to enhance your experience by:

• Remembering general and regional preferences
• Personalizing content, search, recommendations, and offers

Some functions, such as personalized recommendations, account preferences, or localization, may not work correctly without these technologies. For more details, please refer to IvyPanda's Cookies Policy .

To enable personalized advertising (such as interest-based ads), we may share your data with our marketing and advertising partners using cookies and other technologies. These partners may have their own information collected about you. Turning off the personalized advertising setting won't stop you from seeing IvyPanda ads, but it may make the ads you see less relevant or more repetitive.

Personalized advertising may be considered a "sale" or "sharing" of the information under California and other state privacy laws, and you may have the right to opt out. Turning off personalized advertising allows you to exercise your right to opt out. Learn more in IvyPanda's Cookies Policy and Privacy Policy .

• Newsletters
• Best Industries
• Business Plans
• Home-Based Business
• The UPS Store
• Customer Service
• Black in Business
• Your Next Move
• Female Founders
• Best Workplaces
• Company Culture
• Public Speaking
• HR/Benefits
• Productivity
• All the Hats
• Digital Transformation
• Artificial Intelligence
• Bringing Innovation to Market
• Cloud Computing
• Social Media
• Data Detectives
• Exit Interview
• Bootstrapping
• Crowdfunding
• Venture Capital
• Business Models
• Personal Finance
• Founder-Friendly Investors
• Upcoming Events
• Inc. 5000 Vision Conference
• Become a Sponsor
• Cox Business
• Verizon Business
• Branded Content
• Apply Inc. 5000 US

Inc. Premium

Uncommon Service: The Zappos Case Study

An excerpt from the book 'uncommon service: how to win by putting customers at the core of your business,' by frances frei and anne morriss..

Clarity: Know Where You're Going

Zappos will take an order as late as midnight and deliver it to the customer's doorstep before breakfast. It has the world's largest selection of shoes, and its service includes free returns. If it doesn't have the shoe you want in stock or in your size, a Zappos call center employee will go to three competitors' sites to try to help you locate what you want to buy. Seventy-five percent of its business comes from repeat customers, despite the fact that its prices are far from the lowest. (Price is an area where Zappos has made a conscious trade-off in its service model in order to deliver exceptional service.)

It's not surprising, then, that managers from other companies--including many from service and quality leaders like Southwest and Toyota--make regular pilgrimages to Zappos facilities to learn how the company pulls it off. Everyone wants to know what the heck is going on. A quick look around reveals that part of its success is the company's IT strategy, including a real-time inventory management system that is 99 percent accurate, compared with accuracy rates as low as 40 percent in other areas of retail. But what gets visitors every time are the clues to Zappos's true competitive advantage: its culture. And no one inside the company is surprised.

The most visible champion of Zappos's culture, naturally enough, is president and CEO Tony Hsieh (pronounced "Shay"). Hsieh is crystal clear on the culture he needs to make the company thrive, and he and his team have broken it down into ten core company values:

 1. Deliver wow through service.

 2. Embrace and drive change.

 3. Create fun and a little weirdness.

 4. Be adventurous, creative, and open-minded.

 5. Pursue growth and learning.

 6. Build open and honest relationships with communication.

 7. Build a positive team and family spirit.

 8. Do more with less.

 9. Be passionate and determined.

 10. Be humble.

Hsieh embodies these values. He is passionate, positive, fun, humble. And a little weird. As the fearless leader of a high-profile shoe company, Hsieh unapologetically wore the same pair of shoes every single day for two years. He then replaced them with the exact same pair. Hsieh's definition of weird, however, is closer to authentic or real. He's betting that the "real you" will be more valuable to Zappos than the safe, watered-down version that usually shows up in a work environment. So go ahead, be a little weird.

Early in his career, Hsieh had a breakthrough about how much culture mattered to the performance and motivation of employees. He sold a software company he had founded when he realized that even he no longer wanted to come to work, primarily because of the culture. Now Hsieh does many things you'd expect from an enlightened CEO, like taking calls at the call center on holidays to give his employees a break and staying in direct touch with his customers.

But what really sets Hsieh and his team apart is their deep awareness that culture is the company's most important asset. "Service is a by-product of culture," says former chief financial officer Alfred Lin, as are things like supplier behavior and employee turnover. In 2005, when the company's call center moved from the Bay Area to Las Vegas, an astonishing 80 percent of its California employees relocated--for a $13-an-hour job. In 2008, a year in which the average turnover at call centers was 150 percent, turnover at Zappos was 39 percent (including turnover owing to promotions). Managers attribute the loyalty to a culture that cultivates the passion, purpose, and humanity of its employees.

But it's not just management that gets it. The conviction that culture is key is embraced throughout the ranks at Zappos. It's so central to the company's belief system, in fact, that the company publishes the Zappos Culture Book , which is updated regularly and contains hundreds of unscripted comments and essays written by Zappos employees and vendors about the company's culture, why it matters, and how it affects what they do every day. It was conceived as a training tool for new hires and partners, but consumption of the book has gone way beyond that internal circle. Ringing in at 348 pages in the 2009 edition, it's a moving and persuasive testament to the power of employee engagement ("happiness" in Zappos-speak), and the role of culture in eliciting it. We recommend buying it and just paging through.

Here's a taste, from Abbie "Abster" M., an employee who had been working at the company for three-plus years:

The Zappos culture to me is unlike anything I've ever experienced before. It's always fun and weird, we're all creative and open-minded, passionate and determined, but most of all, we're humble. I think it's because most of us have worked in horrible dead-end jobs before and can cherish our Zappos culture for what it is. It's what makes me want to come to work every day, even my weekends.  . . . I hear so many horror stories from friends about the places they work and it only makes me feel that much more fortunate to be a part of the Zappos family. I can't imagine my life without Zappos, and the amazing people that I work with.

The quote that moved us most was from Ryan A.: "At my last job I was afraid to be anything: right, wrong, smarter, dumber . . . At Zappos being yourself is the best thing you can do." Perhaps the cultural feature we observe most often is unproductive fear, fear of looking bad or doing something wrong. If organizations did nothing else but address that part of their environment, we're confident that the creativity and engagement of their people would have a real chance of being unleashed. Human beings are not at their best in a defensive, self-distracted crouch.

Hsieh named his book on building Zappos Delivering Happiness , but he and his team didn't just deliver happiness for its own sake. Like IDEO's relationship with creativity, Zappos understood that the happiness of its employees, partners, and customers was a deadly serious endeavor, the most reliable route to sustaining excellence in the industry in which Zappos chose to compete. Everyone inside Zappos, from the CEO to the front line, understood the link between its culture of happiness and the company's daily performance. What's the cultural analog in your own business? What's your version of happy?

Reprinted by permission of Harvard Business Review Press. Excerpted from Uncommon Service: How to Win by Putting Customers at the Core of Your Business. Copyright 2012, Frances Frei and Anne Morriss. All rights reserved.

The Daily Digest for Entrepreneurs and Business Leaders

Privacy Policy

• SUGGESTED TOPICS
• The Magazine
• Newsletters
• Managing Yourself
• Managing Teams
• Work-life Balance
• The Big Idea
• Data & Visuals
• Case Selections
• HBR Learning
• Topic Feeds
• Account Settings
• Email Preferences

How I Did It: Zappos’s CEO on Going to Extremes for Customers

In 2004 the biggest problem the online shoe retailer Zappos faced was how to staff its customer call center with dedicated, high-caliber service reps. The company’s headquarters were in San Francisco, where the high cost of living—and the upwardly mobile Silicon Valley mentality—deterred people from making customer service a career. Although it is an internet company, Zappos finds that most customers telephone at least once at some point. Its philosophy is to view every one of the thousands of phone calls and e-mails it receives daily as an opportunity to build the very best customer service into the brand.

To do that, Zappos would need to find call center reps elsewhere. But the outsourcing possibilities were disappointing, and the company’s previous experience with using vendors for warehousing and shipping had been poor. Hsieh and his team realized that customer service should permeate the whole company, not just one department. So they decided to move their headquarters to Las Vegas, a 24/7 city where employees are used to working late hours and the economy is focused on hospitality. Surprisingly, more than 75% of the staff was willing to relocate, and the company culture became even stronger as a result of the move.

Although Amazon now owns Zappos—which has expanded into clothing, housewares, cosmetics, and other items—Hsieh’s customer service still strives to make a personal connection with shoppers. He calls the Zappos reps the best in the world.

In search of high-caliber employees to staff its call center, Zappos relocated the entire company from San Francisco to Las Vegas in 2004. Here’s why the move made sense.

In the 11 years since Zappos was founded, we’ve had to make some big decisions. One of the most significant came in early 2004, over lunch at Chevys, a chain Mexican restaurant in San Francisco. We hadn’t expected to make a life-changing choice over a plate of fajitas, but when you’re part of a fast-growing company, a lot of decisions arise at unlikely moments.

• TH Tony Hsieh is the CEO of Zappos.com, Inc. During the past 10 years, the company has grown from almost no sales to more than $1 billion in annual gross merchandise sales, driven primarily by repeat customers and word of mouth.

Partner Center

Technology and Operations Management

Mba student perspectives.

• Assignments
• Assignment: The TOM Challenge: TOM…

Zappos: Best in Class Customer Service

Zappos's operating model supports its mission to provide superior customer service.

Zappos is a company that has a strong alignment between its business and operating models. Zappos is an online shoe and clothing retailer that has over $2 billion in annual revenue. After reading Delivering Happiness by Zappos’s CEO, Tony Hsieh, it is clear to me that the decisions that Zappos makes about how it operates are in full support of the overall strategy of the firm.

Business Model

Zappos started off with a strategy of having the best online selection of shoes.  However, over time, Zappos’s strategy has changed, and it now strives to be the company with the best customer service.  This has allowed Zappos to solve the issue of customers not being able to try on products before buying products online, and Zappos has made the customer shopping experience easy and painless.  Zappos offers its customers many different features that have helped Zappos become best in class in customer service:

• Free Shipping – Customers are not charged for shipping when they buy or return a product.
• Excellent Call Center Service – Zappos’s customer service representatives are not compensated on their call volume or how quickly they complete calls. Instead, their goal is to create a personal emotional connection with the customers, and they take time to listen to the customers’ problems and give them recommendations.
• 365-Day Return Policy – Customers can order multiple shoes at a time and return the pairs of shoes that they do not want free of charge. Returns account for a third of the firm’s revenues.
• Special Moments – Customer service representatives do things like sending flowers to a customer because the customer had a death in the family.

While all of these features are additional costs, Zappos views these as expenses that the firm incurs in place of advertising and maintaining physical store locations.  Additionally, all of these build Zappos’s brand of superior customer service, and this drives additional sales volume.

Operating Model

Pathways to Just Digital Future

Zappos has set up its operations to fully support its strategy of being the company that provides the best customer service through a variety of ways:

• Supply Chain – Zappos has intentionally made the decision to insource all operations.  By doing this, Zappos is able to ensure the best customer experience.  Early on, when Zappos was unprofitable as a company, some of its only profitable items were items fulfilled with drop shipments (manufacturers shipping directly to customers).  However, these items usually had a lot of late shipments and unfulfilled orders, so Zappos made the decision to purchase inventory from the manufacturers.  They continued to outsource warehousing, but this again resulted in bad customer experiences with incorrect orders and late shipments.  Therefore, Zappos decided to operate its own warehouse because Zappos workers will ensure customers are satisfied with their experience.  Even within the warehouse, Zappos intentionally operates inefficiently in some areas so that it can provide better customers service.  Zappos’s warehouse workers will work orders immediately to get orders out to customers as soon as possible instead of letting orders pile up to increase pick density.  Additionally, they will work return shipments from customers and upgrade customers to overnight delivery, and the warehouse is open 24 hours a day, which is extremely costly.  Zappos will take on all of these additional expenses in order to improve customer satisfaction.
• Customer Loyalty Team – The call center (later named Customer Loyalty Team) is extremely important to Zappos’s business model because it directly works with customers. However, it was tough to find the right people to work in the call center out of their San Francisco location because of the cost of living.  Zappos again thought about outsourcing the call center or opening a second office.  Ultimately, Zappos decided that it needed to move its entire headquarters to Las Vegas because that is a city that would be a good fit for its call center.  Zappos did this because this move showed that customer service is a priority for the entire company, and it is not just a priority for one department.
• Culture – Zappos has core values that have shaped its culture.  Zappos believes that its culture allows the superior customer service to happen because happier workers will deliver superior service.  Zappos only hires people that it believes will fit in with the company, and culture is a part of yearly performance reviews and monthly surveys.  Additionally, all employees go through culture training in the first four weeks of working at Zappos.
• Holacracy – Zappos is at a point where it believes that it needs to innovate in order to continue to grow.  In order to do this, it is changing its internal operating model.  Now, when a problem arises, a new team is formed to develop a solution.  Once a problem has repeatedly come up, multiple different teams have developed solutions to this problem for different customers.  At this point,  executives analyze the different solutions to determine what makes the most sense from a customer experience and financial standpoint.  This is not the most efficient way to solve problems, but it should generate solutions that please customers.

Zappos’s business and operating models are closely aligned, and this has allowed Zappos to thrive.  From its warehouse to headquarter operations, everything that Zappos does is with the intention of providing the best possible customer service and improving customer satisfaction.

Hsieh, Tony. Delivering Happiness: A Path to Profits, Passion, and Purpose . New York: Business Plus, 2010. Print.

Hsieh, Tony. “How I Did It: Zappos’s CEO on Going to Extremes for Customers.” Harvard Business Review . 1 Aug. 2010. Web. 5 Dec. 2015. < https://hbr.org/2010/07/how-i-did-it-zapposs-ceo-on-going-to-extremes-for-customers >.

Richards, Dick. “At Zappos, Culture Pays.” Strategy + Business . 24 Aug. 2010. Web. 5 Dec. 2015. < http://www.strategy-business.com/article/10311?gko=c784e >.

Vazquez Sampere, Juan Pablo. “Zappos and the Connection Between Structure and Strategy.” Harvard Business Review.   3 June 2015. Web. 5 Dec. 2015. < https://hbr.org/2015/06/zappos-and-the-connection-between-structure-and-strategy >.

Zappos.com. 5 Dec 2015.

Student comments on Zappos: Best in Class Customer Service

Great summary Matt. Reading through several of these TOM Challenges I’ve seen a trend of quite a few companies differentiating themselves with great customer service. For Zappos I think it’s particularly important to continue this emphasis on customer service given such competitors as large as Amazon in the space. Aside from a profitability and logistics standpoint, I want to say it’s easy for any company to offer free shipping or free returns on orders – and many new clothing retail companies do that now. It’s a lot harder to offer the excellent customer service through call centers as you mentioned in the summary, let alone additional personal item recommendations. This involves people – which requires training and culture reinforcement. I think that’s where Zappos should continue to spend its time and energy. It could set it apart from competitors like Amazon who just won’t be able to offer the same personalized experience given the scale and breadth of different products it offers.

Great post, Matt, and great observation, Armand. I agree that, at first blush, it’s hard to imagine why Zappos would be able to compete against the likes of a behemoth like Amazon, which offers much the same type of service. And although competing on customer service is valuable, I wonder how many customers actually interact with an employee of Zappos (and thereby experience their superior customer service), versus just interacting with their website in a click-and-buy type scenario. If it is the case that most customers actually do not interact with Zappos employees in a typical transaction, then I think what Zappos is actually competing on first of all is their reputation as trusted curator of quality and fashionable shoes and clothing. This differs from Amazon, which is generally seen as simply playing a middle-man role in facilitating online shopping transactions. So the value added by Zappos is that they are offering a curated selection that enables customers to know that they’re buying a good product, because Zappos approves it. In my view, the operating model that Matt described serves both to offer great customer service but also to enable Zappos to inhabit that position of trusted curator.

Armand and Jeff – Both of you made very strong points. The one point that I wanted to address (only because Zappos’s CEO pointed it out specifically in his book) is the comment on how many consumers interact with an employee of Zappos. Tony Hsieh actually said that most customers will talk to a customer service representative at least once in their time of being a Zappos customer. Zappos’s philosophy on this is that this is an opportunity for the customer service representative to build the Zappos brand by providing exceptional customer service. Their philosophy is that if the customer service representative can create a personal emotional connection with the customer, than that person will be a customer for life.

Leave a comment Cancel reply

You must be logged in to post a comment.

• Work & Careers
• Life & Arts

Case study: Zappos

Limited time offer, save 50% on standard digital, explore more offers..

Then $75 per month. Complete digital access to quality FT journalism. Cancel anytime during your trial.

Premium Digital

Complete digital access to quality FT journalism with expert analysis from industry leaders. Pay a year upfront and save 20%.

• Global news & analysis
• Expert opinion
• FT App on Android & iOS
• FT Edit app
• FirstFT: the day's biggest stories
• 20+ curated newsletters
• Follow topics & set alerts with myFT
• FT Videos & Podcasts
• 20 monthly gift articles to share
• Lex: FT's flagship investment column
• 15+ Premium newsletters by leading experts
• FT Digital Edition: our digitised print edition

FT Digital Edition

10% off your first year. The new FT Digital Edition: today’s FT, cover to cover on any device. This subscription does not include access to ft.com or the FT App.

Terms & Conditions apply

Explore our full range of subscriptions.

Why the ft.

See why over a million readers pay to read the Financial Times.

About Stanford GSB

• The Leadership
• Dean’s Updates
• School News & History
• Commencement
• Business, Government & Society
• Centers & Institutes
• Center for Entrepreneurial Studies
• Center for Social Innovation
• Stanford Seed

About the Experience

• Learning at Stanford GSB
• Experiential Learning
• Guest Speakers
• Entrepreneurship
• Social Innovation
• Communication
• Life at Stanford GSB
• Collaborative Environment
• Activities & Organizations
• Student Services
• Housing Options
• International Students

Full-Time Degree Programs

• Why Stanford MBA
• Academic Experience
• Financial Aid
• Why Stanford MSx
• Research Fellows Program
• See All Programs

Non-Degree & Certificate Programs

• Executive Education
• Stanford Executive Program
• Programs for Organizations
• The Difference
• Online Programs
• Stanford LEAD
• Seed Transformation Program
• Aspire Program
• Seed Spark Program
• Faculty Profiles
• Academic Areas
• Awards & Honors
• Conferences

Faculty Research

• Publications
• Working Papers
• Case Studies

Research Hub

• Research Labs & Initiatives
• Business Library
• Data, Analytics & Research Computing
• Behavioral Lab

Research Labs

• Cities, Housing & Society Lab
• Golub Capital Social Impact Lab

Research Initiatives

• Corporate Governance Research Initiative
• Corporations and Society Initiative
• Policy and Innovation Initiative
• Rapid Decarbonization Initiative
• Stanford Latino Entrepreneurship Initiative
• Value Chain Innovation Initiative
• Venture Capital Initiative
• Career & Success
• Climate & Sustainability
• Corporate Governance
• Culture & Society
• Finance & Investing
• Government & Politics
• Leadership & Management
• Markets and Trade
• Operations & Logistics
• Opportunity & Access
• Technology & AI
• Opinion & Analysis
• Email Newsletter

Welcome, Alumni

• Communities
• Digital Communities & Tools
• Regional Chapters
• Women’s Programs
• Identity Chapters
• Find Your Reunion
• Career Resources
• Job Search Resources
• Career & Life Transitions
• Programs & Webinars
• Career Video Library
• Alumni Education
• Research Resources
• Volunteering
• Alumni News
• Class Notes
• Alumni Voices
• Contact Alumni Relations
• Upcoming Events

Admission Events & Information Sessions

• MBA Program
• MSx Program
• PhD Program
• Alumni Events
• All Other Events
• Operations, Information & Technology
• Organizational Behavior
• Political Economy
• Classical Liberalism
• The Eddie Lunch
• Accounting Summer Camp
• California Econometrics Conference
• California Quantitative Marketing PhD Conference
• California School Conference
• China India Insights Conference
• Homo economicus, Evolving
• Political Economics (2023–24)
• Scaling Geologic Storage of CO2 (2023–24)
• A Resilient Pacific: Building Connections, Envisioning Solutions
• Adaptation and Innovation
• Changing Climate
• Civil Society
• Climate Impact Summit
• Climate Science
• Corporate Carbon Disclosures
• Earth’s Seafloor
• Environmental Justice
• Operations and Information Technology
• Organizations
• Sustainability Reporting and Control
• Taking the Pulse of the Planet
• Urban Infrastructure
• Watershed Restoration
• Junior Faculty Workshop on Financial Regulation and Banking
• Ken Singleton Celebration
• Marketing Camp
• Quantitative Marketing PhD Alumni Conference
• Presentations
• Theory and Inference in Accounting Research
• Stanford Closer Look Series
• Quick Guides
• Core Concepts
• Journal Articles
• Glossary of Terms
• Faculty & Staff
• Subscribe to Corporate Governance Emails
• Researchers & Students
• Research Approach
• Charitable Giving
• Financial Health
• Government Services
• Workers & Careers
• Short Course
• Adaptive & Iterative Experimentation
• Incentive Design
• Social Sciences & Behavioral Nudges
• Bandit Experiment Application
• Conferences & Events
• Get Involved
• Reading Materials
• Teaching & Curriculum
• Energy Entrepreneurship
• Faculty & Affiliates
• SOLE Report
• Responsible Supply Chains
• Current Study Usage
• Pre-Registration Information
• Participate in a Study

Zappos.com: Developing a Supply Chain to Deliver WOW!

Zappos was founded in 1999, during the Internet boom, to sell shoes online. The company’s founding premise was to provide the ultimate in selection to its customers—all brands, styles, sizes, and colors. Zappos organized all aspects of its business (including recruiting, culture, call center, inventory, website, and supply chain) to provide the best possible service—it wanted to “wow” everyone who interacted with the company, from customers to employees to corporate partners. Zappos grew rapidly, and by 2008 was profitable with net sales (after returns) of about $650 million. The company faced a number of issues as it looked forward. While it had penetrated only about 3 percent of the U.S. market for shoes, Zappos had expanded its product lines to items such as camping gear and video games. It needed to determine those elements of its strategy had contributed to its success in shoes, and whether it would be able to duplicate that success in other product lines. It also needed to determine how it could scale its business—much of the effort it had made to “wow” its customers was labor intensive and expensive—could this be scaled to a company with revenues of tens of billions? Finally, the economic landscape changed dramatically in late 2008, with the financial market collapse and recession. The service-intensive Zappos.com business was based on sales at little to no discount, unlike many websites that relied on selling at the lowest possible price. Would the company need to make changes to respond to the changed economic environment, and if so, what were those changes? The case provides an opportunity to evaluate the core competences of an Internet retailer that has experienced rapid, initial success. The case enables students to consider supply chain issues, which are critical to the company’s success, in the broader context of the business: the bases of Zappos’ success, its core competencies, culture, and competitive environment.

• See the Current DEI Report
• Supporting Data
• Research & Insights
• Share Your Thoughts
• Search Fund Primer
• Affiliated Faculty
• Faculty Advisors
• Louis W. Foster Resource Center
• Defining Social Innovation
• Impact Compass
• Global Health Innovation Insights
• Faculty Affiliates
• Student Awards & Certificates
• Changemakers
• Dean Jonathan Levin
• Dean Garth Saloner
• Dean Robert Joss
• Dean Michael Spence
• Dean Robert Jaedicke
• Dean Rene McPherson
• Dean Arjay Miller
• Dean Ernest Arbuckle
• Dean Jacob Hugh Jackson
• Dean Willard Hotchkiss
• Faculty in Memoriam
• Stanford GSB Firsts
• Annual Alumni Dinner
• Class of 2024 Candidates
• Certificate & Award Recipients
• Dean’s Remarks
• Keynote Address
• Teaching Approach
• Analysis and Measurement of Impact
• The Corporate Entrepreneur: Startup in a Grown-Up Enterprise
• Data-Driven Impact
• Designing Experiments for Impact
• Digital Marketing
• The Founder’s Right Hand
• Marketing for Measurable Change
• Product Management
• Public Policy Lab: Financial Challenges Facing US Cities
• Public Policy Lab: Homelessness in California
• Lab Features
• Curricular Integration
• View From The Top
• Formation of New Ventures
• Managing Growing Enterprises
• Startup Garage
• Explore Beyond the Classroom
• Stanford Venture Studio
• Summer Program
• Workshops & Events
• The Five Lenses of Entrepreneurship
• Leadership Labs
• Executive Challenge
• Arbuckle Leadership Fellows Program
• Selection Process
• Training Schedule
• Time Commitment
• Learning Expectations
• Post-Training Opportunities
• Who Should Apply
• Introductory T-Groups
• Leadership for Society Program
• Certificate
• 2024 Awardees
• 2023 Awardees
• 2022 Awardees
• 2021 Awardees
• 2020 Awardees
• 2019 Awardees
• 2018 Awardees
• Social Management Immersion Fund
• Stanford Impact Founder Fellowships
• Stanford Impact Leader Prizes
• Social Entrepreneurship
• Stanford GSB Impact Fund
• Economic Development
• Energy & Environment
• Stanford GSB Residences
• Environmental Leadership
• Stanford GSB Artwork
• A Closer Look
• California & the Bay Area
• Voices of Stanford GSB
• Business & Beneficial Technology
• Business & Sustainability
• Business & Free Markets
• Business, Government, and Society Forum
• Second Year
• Global Experiences
• JD/MBA Joint Degree
• MA Education/MBA Joint Degree
• MD/MBA Dual Degree
• MPP/MBA Joint Degree
• MS Computer Science/MBA Joint Degree
• MS Electrical Engineering/MBA Joint Degree
• MS Environment and Resources (E-IPER)/MBA Joint Degree
• Academic Calendar
• Clubs & Activities
• LGBTQ+ Students
• Military Veterans
• Minorities & People of Color
• Partners & Families
• Students with Disabilities
• Student Support
• Residential Life
• Student Voices
• MBA Alumni Voices
• A Week in the Life
• Career Support
• Employment Outcomes
• Cost of Attendance
• Knight-Hennessy Scholars Program
• Yellow Ribbon Program
• BOLD Fellows Fund
• Application Process
• Loan Forgiveness
• Contact the Financial Aid Office
• Evaluation Criteria
• GMAT & GRE
• English Language Proficiency
• Personal Information, Activities & Awards
• Professional Experience
• Letters of Recommendation
• Optional Short Answer Questions
• Application Fee
• Reapplication
• Deferred Enrollment
• Joint & Dual Degrees
• Entering Class Profile
• Event Schedule
• Ambassadors
• New & Noteworthy
• Ask a Question
• See Why Stanford MSx
• Is MSx Right for You?
• MSx Stories
• Leadership Development
• How You Will Learn
• Admission Events
• Personal Information
• GMAT, GRE & EA
• English Proficiency Tests
• Career Change
• Career Advancement
• Career Support and Resources
• Daycare, Schools & Camps
• U.S. Citizens and Permanent Residents
• Requirements
• Requirements: Behavioral
• Requirements: Quantitative
• Requirements: Macro
• Requirements: Micro
• Annual Evaluations
• Field Examination
• Research Activities
• Research Papers
• Dissertation
• Oral Examination
• Current Students
• Education & CV
• International Applicants
• Statement of Purpose
• Reapplicants
• Application Fee Waiver
• Deadline & Decisions
• Job Market Candidates
• Academic Placements
• Stay in Touch
• Faculty Mentors
• Current Fellows
• Standard Track
• Fellowship & Benefits
• Group Enrollment
• Program Formats
• Developing a Program
• Diversity & Inclusion
• Strategic Transformation
• Program Experience
• Contact Client Services
• Campus Experience
• Live Online Experience
• Silicon Valley & Bay Area
• Digital Credentials
• Faculty Spotlights
• Participant Spotlights
• Eligibility
• International Participants
• Stanford Ignite
• Frequently Asked Questions
• Founding Donors
• Program Contacts
• Location Information
• Participant Profile
• Network Membership
• Program Impact
• Collaborators
• Entrepreneur Profiles
• Company Spotlights
• Seed Transformation Network
• Responsibilities
• Current Coaches
• How to Apply
• Meet the Consultants
• Meet the Interns
• Intern Profiles
• Collaborate
• Research Library
• News & Insights
• Databases & Datasets
• Research Guides
• Consultations
• Research Workshops
• Career Research
• Research Data Services
• Course Reserves
• Course Research Guides
• Material Loan Periods
• Fines & Other Charges
• Document Delivery
• Interlibrary Loan
• Equipment Checkout
• Print & Scan
• MBA & MSx Students
• PhD Students
• Other Stanford Students
• Faculty Assistants
• Research Assistants
• Stanford GSB Alumni
• Telling Our Story
• Staff Directory
• Site Registration
• Alumni Directory
• Alumni Email
• Privacy Settings & My Profile
• Success Stories
• The Story of Circles
• Support Women’s Circles
• Stanford Women on Boards Initiative
• Alumnae Spotlights
• Insights & Research
• Industry & Professional
• Entrepreneurial Commitment Group
• Recent Alumni
• Half-Century Club
• Fall Reunions
• Spring Reunions
• MBA 25th Reunion
• Half-Century Club Reunion
• Faculty Lectures
• Ernest C. Arbuckle Award
• Alison Elliott Exceptional Achievement Award
• ENCORE Award
• Excellence in Leadership Award
• John W. Gardner Volunteer Leadership Award
• Robert K. Jaedicke Faculty Award
• Jack McDonald Military Service Appreciation Award
• Jerry I. Porras Latino Leadership Award
• Tapestry Award
• Student & Alumni Events
• Executive Recruiters
• Interviewing
• Land the Perfect Job with LinkedIn
• Negotiating
• Elevator Pitch
• Email Best Practices
• Resumes & Cover Letters
• Self-Assessment
• Whitney Birdwell Ball
• Margaret Brooks
• Bryn Panee Burkhart
• Margaret Chan
• Ricki Frankel
• Peter Gandolfo
• Cindy W. Greig
• Natalie Guillen
• Carly Janson
• Sloan Klein
• Sherri Appel Lassila
• Stuart Meyer
• Tanisha Parrish
• Virginia Roberson
• Philippe Taieb
• Michael Takagawa
• Terra Winston
• Johanna Wise
• Debbie Wolter
• Rebecca Zucker
• Complimentary Coaching
• Changing Careers
• Work-Life Integration
• Career Breaks
• Flexible Work
• Encore Careers
• Join a Board
• D&B Hoovers
• Data Axle (ReferenceUSA)
• EBSCO Business Source
• Global Newsstream
• Market Share Reporter
• ProQuest One Business
• RKMA Market Research Handbook Series
• Student Clubs
• Entrepreneurial Students
• Stanford GSB Trust
• Alumni Community
• How to Volunteer
• Springboard Sessions
• Consulting Projects
• 2020 – 2029
• 2010 – 2019
• 2000 – 2009
• 1990 – 1999
• 1980 – 1989
• 1970 – 1979
• 1960 – 1969
• 1950 – 1959
• 1940 – 1949
• Service Areas
• ACT History
• ACT Awards Celebration
• ACT Governance Structure
• Building Leadership for ACT
• Individual Leadership Positions
• Leadership Role Overview
• Purpose of the ACT Management Board
• Contact ACT
• Business & Nonprofit Communities
• Reunion Volunteers
• Ways to Give
• Fiscal Year Report
• Business School Fund Leadership Council
• Planned Giving Options
• Planned Giving Benefits
• Planned Gifts and Reunions
• Legacy Partners
• Giving News & Stories
• Giving Deadlines
• Development Staff
• Submit Class Notes
• Class Secretaries
• Board of Directors
• Health Care
• Sustainability
• Class Takeaways
• All Else Equal: Making Better Decisions
• If/Then: Business, Leadership, Society
• Grit & Growth
• Think Fast, Talk Smart
• Spring 2022
• Spring 2021
• Autumn 2020
• Summer 2020
• Winter 2020
• In the Media
• For Journalists
• DCI Fellows
• Other Auditors
• Academic Calendar & Deadlines
• Course Materials
• Entrepreneurial Resources
• Campus Drive Grove
• Campus Drive Lawn
• CEMEX Auditorium
• King Community Court
• Seawell Family Boardroom
• Stanford GSB Bowl
• Stanford Investors Common
• Town Square
• Vidalakis Courtyard
• Vidalakis Dining Hall
• Catering Services
• Policies & Guidelines
• Reservations
• Contact Faculty Recruiting
• Lecturer Positions
• Postdoctoral Positions
• Accommodations
• CMC-Managed Interviews
• Recruiter-Managed Interviews
• Virtual Interviews
• Campus & Virtual
• Search for Candidates
• Think Globally
• Recruiting Calendar
• Recruiting Policies
• Full-Time Employment
• Summer Employment
• Entrepreneurial Summer Program
• Global Management Immersion Experience
• Social-Purpose Summer Internships
• Process Overview
• Project Types
• Client Eligibility Criteria
• Client Screening
• ACT Leadership
• Social Innovation & Nonprofit Management Resources
• Develop Your Organization’s Talent
• Centers & Initiatives
• Student Fellowships

Zappos: A Case Study into Company Culture 

July 17, 2024

Matt Gainsford

Today, we are diving deep into the enigma that is Zappos, a company whose work culture is practically legendary and has become the yardstick by which success is measured. So, what is their secret sauce? Let's break it down.  

Company culture. It is a term that has been on the lips of every hiring manager and business leader. For many companies, it is a major selling point and something designed to wow potential candidates into joining them. 

The key to building a happy workplace is to create a thriving culture. But what does it mean, how is it quantified, and why has it become so satirized?  

From pizza parties and ping-pong tables to unlimited PTO policies and chances to get involved in altruistic service projects, a great culture can mean many things to many people.   

At Titus Talent, we think we know what it takes to build culture, and for those of you reading this, you might see many similarities between us and the company we will focus on.  

If you are reading this and unfamiliar with who we are, you will likely recognize the subject of our cultural exploration. Today, we are diving deep into the enigma that is Zappos, a company whose work culture is practically legendary and has become the yardstick by which success is measured. So, what is their secret sauce? Let’s break it down.  

Who are Zappos and Why Focus on Them?  

Zappos, an online shoe and clothing retailer founded in 1999, is renowned for its exceptional customer service and innovative corporate culture. Their model has influenced thousands of businesses through numerous case studies and management programs. Zappos empowers customer service representatives to make decisions that best serve customers, often exceeding standard service expectations. They adopted holacracy, a management philosophy replacing the traditional hierarchy with a flat, team-based structure, promoting flexibility, autonomy, and employee empowerment. Operating under ten core values like “Deliver WOW Through Service” and “Create Fun and A Little Weirdness,” Zappos integrates these principles into hiring, training, and daily operations, ensuring a vibrant culture. 

We are focusing on Zappos as a case study in culture because their approach to customer service and employee empowerment sets a benchmark for organizational excellence. Their innovative practices provide valuable insights into building a strong, adaptable company culture. 

Customer Service: The Heartbeat of Zappos  

Zappos did not just put customer service on the map—they redefined it. From day one, their mission was clear: to deliver happiness. It was not just a marketing tagline; it was a core value they lived and breathed. Happiness within (employees) leads to happiness experienced (customers) policies (which are now the norm for many companies, thanks to Zappos) like free shipping and returns, a 365-day return policy, and 24/7 customer support were not just strategic moves. They were expressions of Zappos’ deep-seated belief in putting the customer first. It is a principle woven into the fabric of the company and a big part of why they have been so influential.  

Holacracy: Breaking Down the Hierarchy  

Now, this is where Zappos gets interesting. In 2013, they adopted holacracy—a radical, self-managing system that threw traditional hierarchies out the window. Imagine a company with no rigid job titles, and everyone can take initiative. It is not without its challenges, but this structure fosters an environment of flexibility and autonomy. Employees were empowered to make decisions, innovate, and drive change without the usual bureaucratic red tape. It was a game-changer for Zappos, pushing them to the forefront of organizational innovation. 

Core Values: The DNA of Zappos  

At Zappos, core values are not just words on a wall—they are part of the company’s DNA. They have ten core values, including gems like “Deliver WOW Through Service” and “Create Fun and A Little Weirdness.” These values are exemplified every day. They shape the behavior, decisions, and culture at Zappos. You can feel it when you walk into their offices. There is a palpable energy and alignment from everyone pulling in the same direction. 

Employee Happiness: The Zappos Way  

Tony Hsieh, the late CEO of Zappos, firmly believed that happy employees lead to happy customers. Zappos invests heavily in creating an engaging and fun work environment. We are talking about themed office spaces, wild parties, wellness programs, and continuous learning opportunities. This is not just about perks—it is about creating a workplace where people genuinely love to be. The result? High levels of job satisfaction, loyalty, and productivity that any company would envy. 

Training and Development: Building a Strong Foundation  

Zappos’ commitment to training and development is another cornerstone of their culture. New hires go through an intense four-week training program where they learn about the company’s culture, values, and customer service ethos. It is not just onboarding; it is an immersion into the Zappos way of life. By investing in their people from day one, Zappos ensures that everyone is set up for success and fully integrated into the company culture. 

This dedication to training is backed by compelling data: companies with strong onboarding processes see a 70% improvement in new hire productivity and an 82% boost in retention. Furthermore, organizations that invest in comprehensive training programs report 218% higher income per employee and 24% higher profit margins. It is no wonder that 94% of employees would stay at a company longer if it invested in their career development. By prioritizing training and development, Zappos enhances individual growth and drives organizational success and longevity. 

Transparency: Open and Honest Communication  

Transparent communication is a big deal at Zappos. They believe in sharing information openly, whether it is about the company’s performance, goals, or challenges. This level of transparency builds trust and fosters a collaborative environment where everyone feels informed and involved. Companies with high transparency are more likely to retain 94% of their employees, whereas a lack of transparency can lead to mistrust and a disengaged workforce. It is a refreshing approach that many companies could learn from. 

Creativity and Innovation: Encouraging Bold Ideas  

Zappos champions creativity and innovation. They encourage their employees to think outside the box and are not afraid of failure. This culture of experimentation has led to some incredible ideas and improvements over the years. By giving their team the freedom to innovate, Zappos stays ahead of the curve in a fiercely competitive industry. 

Diversity of thought is crucial for fostering a culture of creativity. It takes an environment where different perspectives are welcomed and actively sought out. This diversity prevents groupthink, which can be dangerous as it leads to uniformity inthinking and stifles innovation. To cultivate this environment, leaders must be mindful of the weight their words carry.When leaders are unaware of their influence, they can unintentionally stifle the ideas of less senior employees, preventing valuable contributions from emerging. Companies that embrace diverse perspectives and encourage open communication are 3.5 times more likely to outperform their peers in generating innovative ideas. Zappos’ inclusive culture ensures that all voices are heard, promoting a dynamic and innovative workplace where creativity thrives. 

The Wrap Up  

So, why has Zappos’ work culture been so influential and esteemed? It is a combination of putting customer service at the core, embracing innovative structures like holacracy, living their core values, focusing on employee happiness, investing in training and development, promoting transparency, and encouraging creativity and innovation. Zappos has shown us that when you prioritize culture, you create a powerful foundation for success. At Titus, we share a similar approach to that of Zappos and believe the “People First” term is a potent reminder of how to develop culture, as opposed to a hollow value used to virtue signal to potential Partners and future employees.  

Building a culture takes time, and a successful culture is entirely dependent on the foundations laid and the commitment to living them out. Zappos has been something of a lighthouse in this arena and is worth exploring if you are exploring the creation of your company culture. If you are serious about developing your company culture, recovering from layoffs, or counting the cost of how your hiring strategy affects your growth strategy, check out our talent optimization opportunities. 

Learning & Development  

At Titus Talent, we have talent optimization services specifically designed with culture, leadership, and growth in mind.We believe that hiring great people is the starting point, but to truly thrive, people need continuous growth and development. Our TO experts empower leaders to enhance their people strategies, driving performance and satisfaction within their teams. For our customers, this means working with an organization that is not only invested in attracting top talent but also committed to nurturing and developing that talent, ultimately leading to higher productivity, innovation, and long-term success. Learn more here: https://www.titustalent.com/talent-strategies/talent-optimization/

Let's Start a Conversation

TITUS INSIGHTS

Refreshing perspectives and practical expertise from the Titus team.

Committed To Radical Generosity

Our dedication to radical generosity keeps us focused on what matters most, and it allows us to make a trusted and lasting impact on the world around us. It’s the foundation of our culture and our partnerships.

Advancing Talent Acquisition with Skills-Based Hiring

Talent Talks: The Truth About Accountability with Marshall Krupp

Your are not logged in

• Top results
• News and Events
• Case Studies

Case Study: Ravi Lola, Finance Manager, Bowling & Co

Thank you so much Ravi, for giving us your thoughts on the ILFM and how we have helped you in your role.

Ravi Lola, Finance Manager, Bowling & Co

Life of a Legal Finance Compliance Officer

Guest writer, ILFM Member and Finance Compliance Officer, Christine Hirons from Pinsent Masons LLP I recently reached the milestone of working for 35 years at Pinsent Masons LLP which, when I think about it, seems a very long time ago… ...

Advice for Working and Studying at the same time

Guest writer and ILFM Member and Award Winner, Jess Davis ILFM(Dip) Walking across the stage for my university graduation, and receiving my Bachelors with Honours degree in psychology in October 2021, I would never have expected that only a few...

• Legal Finance Professionals
• Study Advice

The route to becoming a Legal Accounts Manager in a Law Firm

By guest writer, Nichola Macciocchi FILFM, a Fellowship ILFM member and Legal Accounts Manager at a leading law firm in Northumberland . Always a driven child, I was really into my sport and loved art at school and quite competitive! Like many of my...

• Solicitors Regulation Authority

Life as the Head of Residential Property at a firm of Solicitors

Guest writer Heather Gaffney, Partner and Head of Residential Property at Lewis Denley, an ILFM Member Firm Heather Gaffney, who is a Partner and Head of Residential Property gives us some insight into a day in her life. As legal finance and...

Case Study of a Legal Finance Director

In the life of Legal Finance - 25 years and Counting Guest writer, Marc Pegg, ILFM Member and Finance Director at Actons Solicitors. My first position at a law firm would begin in the summer of 1997 at the tender age of 17. Careers Advice! ...

How to become a Law Firm Finance Manager

How I Became a Finance Manager in a Law Firm in England Charlotte May FILFM is a guest writer for the ILFM, a Finance Manager at Nalders Solicitors  and an ILFM Award Winner with her Fellowship studies. My name is Charlotte May and I...

ILFM Studies and Law Firm Finance Director Roles

How the ILFM studies helped me become the first non-solicitor board member of a 200+ year-old law firm Guest post from Peter Adams, Finance Director at GA Solicitors. I am in my mid-fifties. I started my ILFM studies five years ago. I have...

A Day in the Life of an Operations Director

  Guest blog from ILFM Member, Karen Edwards. A day in the life of an Operations Director in a regional law firm. A Day in the Life of an Operations Director and Compliance Officer Being Operations Director at Hedges Law, I have a varied and...

Job spotlight: The Legal Cashier

Totum Consultant Carolyn Beckford Balogun takes a look at the role of Legal Cashier and the vital part it plays in the law firm finance team.  Legal cashiers don’t have to wait long for a job to come along. It’s one of those roles for...

Member Support

• Recruitment & Job Vacancies
• Member Events
• Click here to see or download our ILFM Information Pack
• Call us on 020 8302 2867
• Send us an email
• Members login
• icon-instagram

We use essential cookies to make our site work. We'd also like to set analytics cookies that help us make improvements by measuring how you use the site. Clicking Reject All only enables essential cookies. For more detailed information about the cookies we use, see our Cookies page . For further control over which cookies are set, please click here

Our use of cookies.

You can learn more detailed information in our Privacy Policy

Some cookies are essential, whilst others help us improve your experience by providing insights into how the site is being used. The technology to maintain this privacy management relies on cookie identifiers. Removing or resetting your browser cookies will reset these preferences.

Essential Cookies

These cookies enable core website functionality, and can only be disabled by changing your browser preferences.

Google Analytics cookies help us to understand your experience of the website and do not store any personal data. Click here for a full list of Google Analytics cookies used on this site.

Third-Party cookies are set by our partners and help us to improve your experience of the website. Click here for a full list of third-party plugins used on this site.