Zappos.com Founder Used Employee Ideas to Create Company Culture

03Feb10

In a recent New York Times interview, Tony Hsieh, founder of Zappos.com, gave some insight into how he built the Zappos company culture. Tony sold his first company, LinkExchange, to Microsoft in 1998 for $265 million. Why did he sell the company? Sure, he made a boatload of money on the deal. But what actually pushed him to sell was LinkExchange’s depressing company culture. Tony had reached the point where he dreaded getting out of bed in the morning – the snooze button could only be hit so many times before had to leave for work.

With his newfound wealth, Tony decided to take a different approach when founding Zappos one year later. He decided to form a culture where employees were actually excited to go into the office.

“I wanted to make sure that I didn’t make the same mistake that I had made at LinkExchange, in terms of the company culture going downhill. So for us, at Zappos, we really view culture as our No. 1 priority. We decided that if we get the culture right, most of the stuff, like building a brand around delivering the very best customer service, will just take care of itself.”

Tony’s first step in creating the incredible Zappos company culture was to form a list of 10 core values. He then determined that recruits would go through two sets of interviews. The first set was with the hiring manager and his or her team to determine relevant experience and technical ability – these are the interviews that 99% of companies do. The second set was done solely by the H.R. department with a focus on determining culture fit.

And what did Tony cite as the most important thing he did to reinforce and build the Zappos culture? He said it was encouraging his employees to come up with their own ideas on how to improve the culture.

“I think of myself less as a leader, and more of being almost an architect of an environment that enables employees to come up with their own ideas…”

Referring to company culture, Tony says, “The actual ideas that I’ve personally come up with are few and far between.”

Hopefully with the assistance of enterprise 2.0 technologies, more leaders will take an active role in fostering innovative, collaborative, and enjoyable cultures. Soliciting employee ideas about improving culture leads to a more engaged workforce; the culture is more significant to employees when it becomes something they took part in creating.