Zappos.com Teams and Employee Empowerment and Organizational Adaptability and Response to Change Innovation

Zappos.com Teams and Employee Empowerment and Organizational adaptability and response to change, innovation

Zappos: Team Empowerment

The online shoe company Zappos is famous for its low prices -- and also for its commitment to hiring the best employees and creating an atmosphere in which they can thrive. Fast Company's case study of Zappos says that the organization promotes a 'happiness culture.' Zappos is committed to promoting the happiness of customers by promoting the happiness of its employees. It is characterized by a strong ethos of teamwork and a unified corporate culture. "It's about giving employees permission and encouraging them to just be themselves" (Rosenbaum 2010).

According to CEO and founder Tony Hsieh: "when we hire people we do two sets of interviews. The hiring manager and his or her team will do the standard fit within the team, relevant experience, technical ability and so on. But then our HR department does a second set of interviews purely for culture fit" (Rosenbaum 2010). The new employee must feel at home within the culture of the organization, not simply seem willing and able to do his or her job in an individualistic fashion. Zappos' HR department estimates that cultural fit counts for 50% of Zappos' hiring decisions (Heathfield 2012). In fact, Hsieh is such a believer in the idea that the employee must support the company's core values and fit in, he will actually pay employees to leave if they decide they are a bad fit for Zappos during the training period. "At the end of that first week of training we make an offer to the entire class that we'll pay you for the time you've already spent training plus a bonus of $2,000 to quit and leave the company right now" (Rosenbaum 2010). Few new employees, however, accept this offer.

All employees receive the same training, to orient them to the needs of customers. Regardless of whether the new employee is a lawyer or works in the stock room, every employee during training spends time "actually on the phone for two weeks taking calls from customers" (Rosenbaum 2010). Throughout the employee's duration at the company, understanding the customer's perspective is seen as just a vital component of the employee's value to the company as his or her technical knowledge. Employees engage in teambuilding and problem-solving activities during the training and must pass a quiz on the company with an average above 90% (Shuster 2010).

Zappos tries to foster an atmosphere of fun for all employees, spanning from everything from "smoothie fests, Pop-a-Shot contests, and hip-hop fitness classes" (Shuster 2010). As well as enabling employees to 'blow off steam,' these activities blur the line between work and play. Zappos engineers its organizational culture so employees want to come to work because of the quality of social life they enjoy at the company. A priority is placed on employees getting to know one another. "Employees are encouraged to interact with not just the customer but also one another" (Schuster 2010). Unlike some other technological companies like Best Buy, despite its dot.com roots, Zappos does not allow telecommuting. The focus is on having employees bond as a community, so they can feel comfortable being themselves at work. "So many people when they go to the office, they leave a little bit of themselves at home, or a lot of themselves at home," but not at Zappos (Rosenbaum 2010). Zappos strives to create a home-away-from home.

Zappos could be said to embody a 'Theory Y' culture, according to the Theory X / Theory Y managerial theory of Douglas Macgregor. A Theory X authoritarian approach assumes that people dislike work and can be motivated only with 'carrots and sticks.' Theory Y managers assume that employees can be internally as well as externally motivated and encourages managers to listen to employees and give employees responsibilities to foster a commitment to the organization and draw upon their creativity. Theory Y managers believe that "the capacity to use a high degree of imagination, ingenuity and creativity in solving organisational problems is widely, not narrowly, distributed in the population" (Chapman 2010). Zappos uses Theory Y motivations such as using work teams, making work enjoyable, and honoring employees' creative potential. It allows workers to Twitter freely about their work rather than operates with great secrecy like companies such as Apple (Schuster 2010). However, it should be noted that Zappos enhances Theory Y's efficacy by specifically selecting employees are likely to be more motivated than the general population by such intangible aspects of their work life. It also has a specific system in place determining how workers are valued. "Raises at Zappos come from building skills and capabilities. Employees pass skill tests and receive pay raises. Raises do not come from schmoozing with managers or other preferential, not measurable actions" (Heathfield 2012).