Zappo's Holocracy

Topics: Management, Customer service, Culture Pages: 17 (6731 words) Published: April 12, 2014

Zappos to ZAPP Away the Fat to Become Leaner and Meaner
Introduction
Zappos.com, Inc. (Zappos) is generally known for selling shoes and accessories; however it has now grown into much more than that. Established in 1999 and acquired by Amazon in 2009, Zappos has grown to become the world’s largest online shoe store. This company is not only known for its wide variety of shoes and accessories, but also for its unparalleled return policy. Zappos actually encourages its customers to buy shoes in multiple sizes and just send back the ones that don’t fit. This company prides itself on being a service industry, first and foremost, rather than just a mere retailer. Furthermore, this particular business can be described as timeless, because ‘shoe purchasing’ will essentially always be in demand. Zappos focuses on the customer experience, not just creating a better product. Zappos also has a unique culture, where staff members can be seen in comfortable clothes and tennis shoes, possibly mid-parade around the office premises, but rarely will there be someone in formal wear. Even so, Zappos aspires to always deliver superior customer service, which begins with employees, and the company’s CEO, Tony Hsieh, has always been extremely enthusiastic and passionate about this concept, and has worked tirelessly to bring this dream to fruition (Zappos Insights, 2014). In addition, Zappos has been rated one of the top companies to work for in America, because of its exemplary customer service policies and the company’s dedication to its employees (McDonald, 2011). Zappos has a unique selling platform that has taken online retail by storm, and has gone above and beyond the call of duty with respect to its management approaches. Toward the end of 2013, the company announced an effort to rise to the next level, with its intentions to overhaul its previous management structure. Zappos will now practice something called Holacracy in an effort to make employees more accountable and empowered. This strategy would entail a manager-free system that will enable Zappos to adapt and become one of the largest companies to implement this management system. The future of Zappos just might depend upon how well this innovative way of thinking is received, implemented and executed. Many industries will be observing this new management technique in action and its success rate, and if all goes well, Zappos could conceivably have a new management system to impart to other companies (Groth, 2013). Innovative Managerial Practices

There are key components for having successful management skills. These components consist of planning, organizing, leading and controlling (Jones & George, 2009). Zappos is an organization that has incorporated these managerial skills in order to build a successful team oriented empire. Zappos works as a team, innovating and empowering both their employees and clientele. According to Jones and George (2009), “to further promote innovation, managers can empower teams and make their members fully responsible and accountable for the innovation process. Members of teams are likely to be more satisfied than they would have been if they were working on their own.” Zappos has been rated one of the top companies to work for in America due to their customer service policy and dedication to its employees (McDonald, 2011, p. 127). Tony Hsieh, one of the innovators behind the success of Zappos, is widely regarded as one of the most inventive Internet marketers of all time. He really cares about making Zappos’ employees and customers feel really good. Other business innovators work with software code or circuit boards or molecular formulas. Hsieh prefers to work with something altogether more complex and volatile: human beings themselves (Chafkin, 2014). Often times, management is more focused on product and functionality of an organization. In order to have a completely successful company, managers must remember that their employees...

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