Customer Service, where good is not enough
Zappos came to life in 1999, when its founder, Nick Swinmurn, failed to find the shoes he was looking for at his local mall. From the very beginning, the company has focused on delighting customers. Of course, every company will tell you that customers are important, but when it comes to money, the revenue wins. In Zappos delivering WOW through service is the first core value. The company was always offering free delivery and returns. Customer Support (called Zappos Customer Loyalty Team) seems to be the most important department in Zappos, and employees can do anything they think they should to “reduce customer anxiety” as our host called it. In practice, it means you won’t find many things other companies believe are critical for running a helpdesk. There are no scripts to follow, no expectation to upsell products, no talk time limit or target on how many calls an employee must do per day. The only metrics that matter? How fast the customer call is answered and how fast the problem is being solved. Therefore, every employee is empowered to do anything that should be done to delight the customer. Someone ordered a pair of shoes for his vacation starting tomorrow, but received the wrong ones? Send them overnight, and make sure they’ll be delivered by 9 am. No managerial approval is needed. We’ve helped build self-organizing Customer Support teams in inFakt and Codewise, but never seen this level of empowerment before.
“We want our customer to call us,” said Jean, our host. Therefore the free number is visible on the zappos.com website and you can call them whenever you like and about whatever you like. They want to build long-lasting relationships, so if you happen to have a similar hobby, feel free to talk about them. Even if it will be an hour, two, three, or ten hours fifteen minutes, as the current record is. Our second host spent over five hours talking about fantasy authors and sci-fi books.
Every new employee joins the helpdesk for a week to better understand company clients. And, during the holiday season – all hands on deck – everyone join the Loyalty Team. That includes HR, finances and even the company CEO, Tony Hsieh. I wish more companies implement that approach, so every developer or manager could hear their customers.
Hiring for cultural fit
Every large company has a list of core values somewhere on its website and office walls, but only a few live them every day. Zappos seems to be one of these rare exceptions. People are talking about 10 Core Values on a daily basis. When hiring, they say they’re doing a “culture screening“. And that applies not just to full-time employees, but everyone including seasonal workers, security, cleaners or a company serving the cafeteria. They’d rather spend twice as much time looking for the right person than select the wrong one. The search for “cultural fit” is not limited to formal recruitment conversations. When they’d fly you in for interviews, they’d observe how you interact with the driver, who’d come to pick you up from the hotel, or with other people during lunch.
If you pass the screening and are offered the job, you will spend the next four weeks learning about the organization and its culture. At the end of this period, together with your colleagues, you’ll prepare a presentation. However, it won’t be about your new job, or about how great Zappos is. You’re expected to get on stage and present one of the Core Values.
After your training, Zappos one more time will check if you want to work there. You’ll be offered a monthly compensation in case you decide to leave the company. This is to ensure only people who buy into Zappos’ way of working stay.
Happy Employee = Happy Customer
After successfully passing the recruitment process, Zappos will give you all you need, plus a bit more. This includes free gym and fitness classes, mini-golf, basketball court, and ping-pong tables. You can choose from a variety of free (or reduced-price) food. A side note: I liked the idea of giving healthy food for free and making junk food pay. You’re also provided with health insurance, paid vacation, maternity leave or the opportunity to use the life coach. Sure, we’ve seen these (and even more) in hi-tech companies we worked with, so the long list of benefits didn’t shock us. However, what was impressive, was that these things are not provided to highly-paid IT specialists, but to call-center workers. People who in many other companies are treated as low-cost employees with high turnover, who will be gone in less than 6 months.
And Zappos does not stop there. It allows learning through training or shadowing other people at their work, just like our second host did during our visit. Six times a year, Zappos shut down the whole company for a party or a town hall. Yes, no one is answering the call during that time, but Zappos says, having everyone treated fairly and equally is critical. All this is done to make sure that happy employees stay with the company and ensure customers get a great experience.
The largest experiment with Holacracy
If you’re interested in Frederic Laloux’s concept of Teal Organizations, then you’ve probably heard about Zappos’ CEO’s decision to move the whole organization to Holacracy in 2014. It is the largest company which chose the organizational structure without any formal managers. Of course, we took the opportunity to ask about the details. Our host was working in Zappos at that time, so we could hear the story first-hand. As a supervisor she was directly impacted, losing her role. This was a difficult time for the organization as some people thought that no bosses meant no responsibility. I’ve mentioned before that the key metric for Zappos is response time. The goal is to have over 80% of incoming calls answered under 20 seconds. When the organization moved to Holacracy, there were so many situations when people didn’t show up to work, that the metric went down to 30%! So Zappos struggled and many managers left the company – some sources talk about 20% of the whole senior staff. Of course, Zappos respected their decision and provided them with decent compensation. Among them was our host, having challenges with defining her role in a new structure. Some time later she picked a job in a credit card company. She was shocked by the cultural difference as everything was controlled by management (“except maybe how much water was flushed in the toilet by employees” as she told us). After nine months, she decided that she couldn’t stand it any longer and that working in Zappos’ call centre is more rewarding than a supervisor position in the traditionally managed company. She quit her job and joined Zappos again sometime later as a seasonal hire and stayed with the company since then.
Over five years some parts of Holacracy proved themselves to be working well for Zappos. There are almost no private offices, except for legal and life coaches. Even the CEO doesn’t have one and is sitting in a small room on the ground floor, so you can see him from the company’s inner court. Some things had to be adapted and more explicit, such as customer support workers’ schedules and responsibilities. When we asked what she’d do differently with her current knowledge, she said she’d invest more time in training and mentoring everyone about the change and the reasons behind it. Something we’re always telling every customer who decides to adopt a new way of working.
Where to learn more
If you want to learn more about Zappos culture then I’d recommend starting with reading Delivering Happiness book by Tony Hsieh, Zappos CEO. You can also sign up for a tour during your next stay in Las Vegas.