Last night I was lucky enough to spend nearly 90 minutes listening to Tony Hsieh, the CEO of Zappos, discuss how he got his start, his company, and why his number one priority is getting the company culture right. According to Tony, if Zappos gets the company culture right then everything else will turn out right.
Tony is currently on a multi-city bus tour aptly titled the “Delivering Happiness Bus Tour” which meshes with the recent launch of his best-selling book “Delivering Happiness: A Path to Profits, Passion, and Purpose”. According to the tour web site, the mission of the tour is to “inspire and be inspired.” He certainly did that last night at the Milken Institute.
Tony started his talk recounting when and why he sold his first company LinkExchange to Microsoft for $265 million back in 1999 at the age of 24. He had co-founded the company with a friend and they in turn hired more friends. After about 20 hires, according to Hsieh, they ran out of friends and then started hiring people who were going to make the company really grow and be successful. But that’s when it stopped being fun for Tony. The company culture had changed and it was no longer fun to get out of bed.
His next move was joining Zappos originally as an investor and adviser and eventually as CEO. Tony was determined that the most important thing to make the company successful in the long term was to get the company culture right. And equally important to Tony is to make sure the company is making an emotional connection to their customers.
Tony’s mantra at Zappos is “Wow. How do we wow our customers and our vendors?” And to Tony that means taking the money that they would spend on advertising and folding it into customer service, because, “we just want to be about customer service and maximizing the customer experience.”
In order to make sure they are “wowing” their customers, Zappos throws out a lot of the accepted industry practices around call centers. Many call centers’ mission is to get customers on and off the phones as quickly as possible to decrease the average handle time and thereby maintain their profits. Zappos is the opposite. Tony boosted that Zappos Call Center had recently broken a company record by having a 7 ½ hour customer conversation.
Although 95% of all the sales go through the Internet Tony believe that the telephone is one of the company’s best branding devices. Tony reported that since every customer calls at least once it was extremely important that they get this one call right. And this is one of the reasons that the call center is really at the heart of their business.
Everyone that is hired at Zappos—no matter their position—goes through a four week call center training period with two of those weeks being on the phone as call center agents. But getting hired is even trickier. To Tony there is nothing more important than hiring the right people who are going to fit into the culture and not disrupt it. And to get hired you must be a fit with everyone including the driver that brings you to and from the airport for your interview. Every voice matters.
Tony spoke a great deal about the science of happiness and how he has rolled that into his own company’s mission. Back in 1999 Zappos defined their brand and vision as providing “selection”. In 2003 the company defined their brand and vision as “customer service.” Today the company sees their brand and vision as “delivering happiness.”
Tony stressed the importance of “chasing the vision and not the money.” He believes that you can use happiness as a business model and that businesses with a higher purpose make money in the long term.
You can learn more about the “Delivering Happiness Movement” at http://www.deliveringhappinessbook.com/jointhemovement/.
Can his ideas work in your company?