Zappos Is Very Interesting From an HR View

The May 2009 issue of Inc. Magazine has Tony Hsieh (pronounce Shay) on the cover. Apparently Mr. Hsieh is a favorite of Inc. because searching on their site produces 216 or so articles written on him in the past 5+ years. And I have heard of Zappos, but never really paid attention to them. (In fact I must confess that I thought they were a brand of shoe rather than an online retailer of a multitude of shoes.) This time however, I took time to read the article on him and Zappos. So here is my "Johnny-come-lately" HR view of some of the things that Zappos has done and currently does.

Tony Hsieh runs his company by going against much conventional wisdom. Zappos has a quirky culture that encourages alot of individuality. The interview process starts off with cultural fit questions in an hour long interview. Questions include "On a scale of 1-10, how weird are you?" Apparently you have to be sufficiently weird to work at Zappos. After that you go to the department that is interested in hiring you. Disputes between HR and the department are decided by Hsieh himself.

The company provides alot of training for both new hires and current employees. That is not all that unusual, but what distinguishes Zappos is that, for new hires, after two weeks of training and two weeks on the job the employees are offered $2000 to quit. Yes quit! This lets the company keep people who are committed and get rid of the ones not suited to the culture or the job. The company actually found that this is a cheaper way than retaining non-productive employees and then terminating them for performance later. I really like this idea, and may think of clients that this may work for as a solution to turnover.

Each employee contributes to a "culture" book. And with more than 1500 employees the book has grown quite large. But all employees have a "piece" of the company that way. I like that too.

A last anti-conventional wisdom point is that the company does not pay the highest wages out there, in fact somewhat lower than other companies may pay. But to help offset this the company moved from San Francisco, with its high cost of living and high tax rate, to Henderson, Nevada (Las Vegas area) where there are no taxes and a lower cost of living. Additionally, Hsieh wanted a place where bars and restaurants were open 24 hours so that late working employees would have places to unwind after work. Pretty employee-friendly thinking.

Hsieh is very concerned with happiness. In fact he is doing a current study on happiness. This concern seems to show in his treatment of employees.

So I encourage you to pick up this month's Inc. and read the article (or wait until next year and you can read it at your doctor's office). Tony Hsieh and Zappos.com is a very interesting study. I may even buy some shoes from them, though the pair I wanted was not available when I checked. Oh well.