Case Analysis: Zappos: They Do It with Humor

Case Analysis: Zappos: They Do It with
Humor
Zappos.com is an American online
shoe and clothing retailer based in Las Vegas, Nevada, United States. The
company was founded in 1999 by Nick Swinmurn and launched under the domain name
Shoesite.com. In July 2009, Amazon acquired Zappos in an all-stock deal worth
around $1.2 billion at the time.
If you are not familiar with this retail store, visit their
website https://www.zappos.com/ (Links to an external site.)
After reading case 14 ( I’ll add after quastion list) answer the following questions:
1. What leadership traits and
style does Tony Hsieh demonstrate at Zappos? What aspects of his leadership can
you criticize, if any? Is his successful leadership approach transferable to
other leaders and other organizations, or is it person and situation specific?
2. Can you find examples of
where House’s path-goal theory of leadership can be confirmed or disconfirmed
in the Zappos setting? Explain your answer.
3. Problem
Solving . Tony Hsieh is a big thinker, and Zappos is
clearly his baby. But he’s also into philanthropy and community development
activities that are taking up more of his time. Perhaps he’ll come up with
other new business ideas as well. As a leadership coach, what steps would you
recommend that he take now to ensure that his leadership style and vision lives
on at Zappos long after his departure? What can a strong and secure leader like
Hsieh do to ensure a positive leadership legacy?
4. Further
Research. Check the latest on Zappos and Tony Hsieh. How
and what are each doing at the present time. Do some research to compare and
contrast the leadership style and characteristics of Tony Hsieh with those of
his boss at Amazon, Jeff Bezos. How are the leadership styles of the two CEOs
alike? In what ways do they differ? For whom would you rather work? Is one
better than the other in its situational context?

Case 14 Zappos – They Do It with
Humor
Zappos.com customers are known for
fierce loyalty, and it’s easy to see why. CEO Tony Hsieh has built a
billion-dollar business by providing happiness to customers and employees. Even
fellow businesspeople get happy while seeking to learn more about Zappos’s
unique blend of humor, compassion, and high-quality customer service. How does
Zappos do it?
When Zappos CEO Tony Hsieh was the
featured guest on The Colbert Report, host Stephen Colbert grilled him about
Zappos’s phenomenal success and rabid customer loyalty. Hsieh replied that it’s
Zappos’s goal to deliver “WOW” in every shoe or clothing box. Today, the
company is consistently ranked highly as one of Fortune’s “Best Companies
to Work For.?
Unusual Leader, Unusual Employer
Zappos.com was launched in 1999 as
the brainchild of Hsieh and founder Nick Swinmurn. Within just a few years, the
Las Vegas-based firm caught the eye of Amazon’s Jeff Bezos. He liked what he
saw so much that he bought the firm for Amazon’s business stable, pledging not
to interfere with Hsieh and Zappos’s unique way of doing business.
The blog search engine Land called
Zappos “the poster child for how to connect with customers online.”
And under Amazon, Zappos has maintained its focus. The company’s relentless
pursuit of the ultimate customer experience is the stuff of legend. Zappos
offers extremely fast shipping at no cost and will cover the return shipping if
you are dissatisfied for any reason at any time, For Hsieh, the Zappos brand is
less about a particular type of product and more about providing good customer
service. He has said, “We could be in any industry that we can
differentiate ourselves through better customer service and better customer
experience.”3 He has even ventured that he could see the Zappos name on
things as large as airlines or hotels, as long as the service was up to his
exacting standards.
A Culture to Thrive In
Zappos’s success comes down to the
company’s culture and the unusual amount of openness Hsieh encourages among
employees, vendors, and other businesses. “If we get the culture
right,” he says, “most of the other stuff, like the brand and the
customer service will just happen. … We want the culture to grow stronger and
stronger as we grow.”
Named “The Smartest Dude in
Town” by business magazine Vegas Inc., Hsieh believes employees have to be
free to be themselves.
That means no call times or scripts for
customer service representatives, regular costume parties, and parades and
decorations in each department. Customer service reps are given a lot of leeway
to make sure every customer is an enthusiastic customer.
Sharing the Fun
Hsieh believes so strongly in the
Zappos culture that he’s on a mission to share it with anyone who will listen.
In a program called Zappos Insights, “Company Evangelists” lead tour
groups of 20 around the Las Vegas head- quarters. Office cubicles often
overflow with kitschy action figures and brightly colored balloons, giving
participants a glimpse of a workplace that prizes individuality and fun as much
as satisfied customers. Staffers blow horns and ring cowbells to greet
participants in the 16 weekly tours, and each department tries to offer a more
outlandish welcome than the last. “The original idea was to add a little
fun,” Hsieh says, but it grew into a friendly competition “as the
next aisle said, “We can do it better?”
The tours are free, but many
visitors actually come for paid one. and two-day seminars that immerse
participants in the Zappos culture. Want to learn how to recruit employees who
are committed to your company culture? You’ll get face time with Zappos HR
staff. Yearn to learn what keeps customers coming back? Ask their Customer
Loyalty Team. Hungry for a home-cooked meal? The capstone of the two- day boot
camp is dinner at Tony Hsieh’s house, with ample time to talk customer service
with the CEO himself,
Those who want to learn Zappos’s
secrets without venturing to Las
Vegas can subscribe to a
members-only community that grants access to video interviews and chats with
Zappos management. Ask nicely, and the company will send you a free copy of
their Zappos Family Culture Book, an annual compilation of every employee’s
ideas about Zappos’s mission and core values. Hsieh has his own tome, too –
Delivering Happiness.
Zappos’s Next Act
So, what comes next? As Zappos grows
within the Amazon umbrella, which is constantly growing as well, and as Hsieh
devotes more time to community service and his writing and speaking
engagements, can the Zappos culture survive growth and a possible leadership
transition?
Will Zappos continue to remain
prosperous and keep its reputation as a great employer? Is Hsieh’s unique brand
of leadership so built into the firm’s practices that Zappos will stay the same
even under a new CEO?

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