The Right Fit at Zappos

Posted: October 17th, 2013

The Right Fit at Zappos

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The Environment Influencing Zappos Strategy

Introduction

Zappos is an American online shoe retailer that came into being in 1999 when Nick Swinmurn founded it. After the establishment, there was persistence towards its growth and by 2009; it became a global online retailer alongside Amazon.Com Inc. Due to its achievements, it underwent reorganization to form ten companies. The Zappos Family of Companies manages the ten companies. The popularity of Zappos Family is because of its astounding image accredited to favorable employment conditions and appealing customer service. The company’s HR planning and implementation is influenced by its internal environment through a performance culture. The organization’s culture reflects the ten core values that define both the management and employees’ cooperation and coordination.

Core Values and Culture

            The core values cater for organization’s definition and the welfare of its employees. Both the management and the employees cooperated to derive and determine the best values, which would team work efforts towards the realization of the organization’s goals. The CEO’s observation of employees’ good performance conduct in the organization prompted him to develop numerous organizational values. The whole organization received of proposed values by Tony Hsieh, the company’s CEO. This shows the importance of communication between the management and employees and amongst them in a company. Information is passed within the organization through newsletters, memos and verbal communication Therefore, any strategic plan by the HR manager must be achieved through the consensus of employees and involve every staff member in the organization[1]. Maximum output in the organization is possible with teamwork, which is evident in good information and feedback systems in the internal environment.

The organization’s culture requires the management and employees to respect each other and this involves all the new ideas suggested for the benefit of the organization. When people in the organization respect each other’s ideas, they work together to realize the best HR planning and implementation strategies[2]. These strategies will be in the interest of the organization, its staff and clients. Zappos Family is a good employer and this attracts new personnel who contribute to its immense growth. The ten core values direct the managers to recruit the best applicants who will add value to the organization. The company employs a rigorous interview process when recruiting personnel to ensure that it chooses best candidates in accordance to the company’s performance culture. The incorporation of employees in determining the fit candidates reflects leadership skills among the company’s managers[3]. Zappos Family maximizes its efforts on training recruited personnel to be well equipped with customer care knowledge because clientele feedback determines its success.

In Zappos Family, every employee regardless of the job title goes through call center and warehouse training. The training process is effective because through familiarization with company’s systems, culture and core values, employees are able to perform their tasks with efficacy. They sharpen their skills and apply them as required in their specific job descriptions. The company’s HR planning and implementation focuses on employee learning and development programs to enhance performance and overall productivity. In addition to the training process, the company values its customers by sending them greeting notes through its Customer Loyalty Team (CLT). Zappos Family also monitors employee development and this enables it to assess the strengths and weakness and develop strategies for further improvement. The main aim of the annual culture review is to examine employee behavior and check whether it tallies with the core values. The organization also observes personal emotional recognition to encourage and motivate employees as they perform their tasks. H.R individuals who attempt to have positive impact on the personal lives of employees characterize the P.E.A.C.E team.

HR Practices at Zappos and the HRM Model

            The HR practices at Zappos fit within the Human Resource management model. The model shows that people in the organization are very important because they help it to realize efficiency and to achieve its objectives[4]. The functions of the HR department include change management, staffing, performance assessment and administration. The human resource management model comprises of the internal and external environments, the organization, human resource functions that encompasses employees and organizational outcomes. Zappos Family applies a soft human resource management model because it is concerned with the welfare and performance of employees whereas its core values and culture are matched with the organizational goals. Employees are given encouragement and they respect each other. Therefore, employees contribute new and sound ideas for the organization’s development. As a good employer, Zappos Family employs critical thinking in recruitment and retention of employees. The Harvard model in human management resource shows how the management of an organization should determine policies and practices of the human resource and assess their effectiveness in the organization.

Zappos fits in the model because it explores the determinants and consequences of human resource management. Its strategy is characterized by human resource flows, employee influence, reward systems and work systems[5]. Candidates or job applicants go through a rigorous interview process before they are recruited by the company. Employees are deemed as valuable assets in Zappos Family and therefore the best must be chosen. Its core values require it to employee the right people to perform tasks and steer it towards success. Human resilience is also vital in the human resource flow because as Zappos shows with its recruitment strategy. The candidates are interviewed based on their technical capabilities and the compatibility of their behavior with the company’s culture. Therefore, the employees must be flexible and must possess the expertise required for Zappos success. Candidates are given a tour of the company after they respond to the open-ended questionnaires in line with company’s 10 core values. Once they are selected, they are taken through a training process to orient them with the culture and business practices. The recruitment team assesses the interview processes and links the assessment with employee feedback concerning the orientation of the applicants when they interact.

The HR practices at Zappos Family reflect commitment, congruence, cost effectiveness and competence[6]. Every member of staff is determined to realize the best human resource policies. The ten core values were developed from the consensus reached by both the employees and management. Employees are also involved in candidate assessment and the training process is undertaken by every employee regardless of the position. The culture of the organization promotes teamwork and exhibits commitment and congruence of each member of staff. According to the company’s HR Director, Hollie Delaney, Zappos practices the Offer, where the hired candidates are given a considerable amount of money so that they remain committed to the company. Due to this, the company has been able to retain a large percentage of employees and the employee turnover is as low as 7%. The induction process after recruitment is based on communication[7] that ensures the corporate culture of Zappos Family is absorbed into the organization’s system and upheld accordingly. This is made possible by the company’s monthly newsletter and the culture book. Queries of employees and answers related to them are addressed by the management in reference to the culture book and the newsletter publications to clarify any ambiguity or contentious issue. This follows the Harvard’s model that inscribes commitment in the human resource flow and employee influence.

Zappos Family is also consistent in examining employee competency. The human resource policies target both short and long-term goals. By linking the communicated strategies of the organization to the human resource policies, the senior management ensures that line managers respond to short-term issues and deliver strategic goals. The HR department at Zappos Family aligns the company’s competitive advantage with the performance of employees. The Customer Loyalty Team (CLT) is committed to satisfy customers at the call center. In addition to the performance of this team, Zappos Family focuses on training all its employees in customer service. A four-week training process on customer care is employed on every employee regardless of the position in the company. It is the responsibility of every employee to satisfy and maintains the customer’s loyalty[8]. The organization’s success is determined by the number of clients and their loyalty. Therefore, the human resource in Zappos is important because it ensures this. This strategic plan is effective in obtaining maximum productivity it reflects Harvard’s model that views employees as significant stakeholders in the organization. The Customer Loyalty Team is highly considered by the HR department despite their demanding work. A greater fraction of the time is allocated to them to specialize in their work while they are still expected to attend technical seminars and participate in development training programs.

The learning and development programs at Zappos Family target the development of skills among the employees. Employees learn how to use Microsoft office, public speaking and other progression plans in the departments. The annual culture review and personal connection activities enable employees to evaluate their performances in accordance to the company’s ten core values[9]. The HR department notes that there is a distinction between employee performance appraisal and culture feedback because the culture review highlights the strengths and weaknesses of employees in the core values to develop improvement strategies. The personal connection involves both clients and employees. Zappos Family engages and rewards its employs through the personal emotional connection strategy  the company’s P.E.A.C.E team organizes programs and activities to engage and motivate the employees towards better task performance. Employees’ personal events are considered by the team and this makes them feel appreciated in the company. The Zfrogs program helps employees to feel empowered.

SWOT Analysis of Zappos Practices

            Zappos’ HR practices have strengths and weaknesses. However, since it applies the soft human resource management model, its strengths are weighty. There are also opportunities for the company to achieve its strategic goals. Zappos Family exhibits teamwork, which is necessary for achieving the organization’s goals. The management incorporates employees in major decisions and every employee participates in the training and development programs. This elicits togetherness and encourages innovation because the core values dictate respect towards each employee’s new ideas. Employ motivation through its reward system enable Zappos to realize and adopt competitive advantage since the workforce maximizes its efforts on the tasks[10]. Long-term collaboration between employees and the management directs them towards development of new and effective strategies. Employees experience democratic leadership and this creates a supportive environment for executing business projects and realizing achievements. Decentralization in the structure of the organization increases productivity and eliminates monotony, creating room for beneficial change. Zappos family has a well-defined communication system and the addressing of feedbacks from employees develops the company further. Its recruitment strategy is efficient and it maintains a corporate culture that guides employ performance.

Despite the company’s efforts in harnessing employee performance and its growth, various weaknesses are tied to it. Employee promotion is not clearly defined in the company’s culture. Employee promotion sets the pace for other employees to put more effort in their tasks, encouraging healthy competition. This competition is necessary for Zappos growth since it works to increase productivity. Loyal employees in Zappos expect promotion apart from other incentives on account for the loyalty to the company. Although it is impossible to promote every employee, the senior management should develop clear strategies on promotion. It is admirable that Zappos manages the workforce through other strategies but employee promotion will eliminate job dissatisfaction and also prevent turnovers[11]. The decentralization in Zappos’ organizational structure can be a limiting factor if the dispersed managers perform their tasks contrary to the company’s policy[12]. Therefore, managers from different lines should work diligently and align their approaches with the core objectives of the business.

Opportunities for Zappos Family include, introducing new products apart from shoes, increased profit margins and better supplier deals. Zappos Family empowers employees and encourages new ideas. New ideas may include new products to surprise customers and give it competitive advantage among peer competitors in the market. New products would break the monotony of supply and attract more clients who will in turn increase the company’s output. Profit margins are likely to widen if strategies are followed to the letter and if Zappos continues to encourage employee performance. Recruiting the best employees, retaining them appropriately and helping them develop their skills will increase their efforts. Since core values show the culture of the organization, routine and viable change will increase employees’ performance and productivity. Favorable ideas will also attract better suppliers and improved deals resulting to a reduction in costs.

Conclusion

The organization’s culture reflects the ten core values that define both the management and employees’ cooperation and coordination. Both the management and the employees cooperated to derive and determine the best values, which would team work efforts towards the realization of the organization’s goals. Maximum output in the organization is possible with teamwork while the training process is effective because through familiarization with company’s systems, culture and core values, employees are able to perform their tasks with efficacy. The Harvard model in human management resource shows how the management of an organization should determine policies and practices of the human resource and assess their effectiveness in the organization. . Human resilience is also vital in the human resource flow because as Zappos shows with its recruitment strategy. The candidates are interviewed based on their technical capabilities and the compatibility of their behavior with the company’s culture. Recruiting the best employees, retaining them appropriately and helping them develop their skills will increase their efforts. Since core values show the culture of the organization, routine and viable change will increase employees’ performance and productivity.

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