Tony Hsieh in 2009

Wow, I’m having a lot of feelings about the death of Tony Hsieh, retired CEO of Zappos.

A lot of my friends would think it’s silly and pretty bougie of me to mourn the loss of a retired CEO, but Hsieh was a management hero of mine, and I don’t think we’ll see another one like him in my lifetime, or maybe ever. 46 is a very young age to die, and as a person in their forties, it’s also a stark reminder of my own mortality. So I’m going to take a few moments to remember what I knew about Hsieh, and what I admired about him.

He Was an Innovator

Tony Hsieh was a bold visionary, and he wasn’t afraid to try something new. This is one of his qualities that I have most wanted to emulate, but remains the furthest from my grasp. It’s hard to try something new, and to accept that in innovation, even a failure is a type of success. It is a milestone on the road to your goal; it is a part of the process of elimination. It was the willingness to try something new that made Zappos into a success; after all, buying shoes online felt, at the time, risky to customers. Not being able to try shoes on before making a purchase was a new kind of shopping. But Hsieh implemented ways to make customers feel more comfortable taking that risk, making that purchase, knowing that the returns process and customer service experience would be as painless as possible.

He instituted holacracy at Zappos, which at the time was the largest company to flatten its hierarchy to that extent. It had its problems, and the company later instituted more hierarchy, but it’s an incredible thing to try such a risky (there are benefits and risks to implementing flattened hierarchies) management structure at a large firm. Large firms are inherently less agile, so that switch must have been messy and difficult. I’m sure he had a lot of non-believers, in fact many people left Zappos as a direct result of the holacracy move. But to try, to do, and to fail and try again, that’s a beautiful thing that I wish I was more capable of.

He Understood the Value of Joy

Employee happiness was a big part of growing Zappos from its humble beginnings as shoesite.com. This was a revolutionary idea in the 2000s and early 2010s, even though it’s now commonplace for companies to at least pay lip service to valuing employee well-being. He dedicated himself to making Zappos a happy place to work, to the point that he offered new hires a $2,000 payout if they thought the job was not working out. This way, he gently weeded out those who would not thrive in that office culture.

Hsieh understood that happy employees, even when they spent time socializing on the clock, meant more productive employees and happier customers. As someone who spent ten years working in customer service call centers, their reputation for being efficiency focused is well earned. But this wasn’t Hsieh’s focus in customer service. His primary metrics for customer service performance had more to do with customer satisfaction than with cost efficiency. I can tell you from experience that a drive for call center efficiency is directly at odds with the goal of satisfying customers. I can tell you from experience that watching my call time climb distracted me from my real purpose on the phone; helping people. I can tell you from experience that miserable employees give poor service.

Were there downsides to the culture of happiness? Absolutely. But he understood that happiness had value in the workplace, and that’s important. His work at Zappos helped to shape the focus on employee happiness that companies now pay lip service to at every opportunity. Zappos appeared on Fortune’s list of best places to work several times as a result of Hsieh’s dedication to happiness.

He Understood Company Culture

The first thing I learned from Tony Hsieh was that you couldn’t train culture; you had to hire for it. And he did this over and over again throughout his tenure as CEO at Zappos. During the holacracy experiment, he offered several months severance to those who didn’t want to be in a workplace without job titles. I think this piece of learning is key for me; because we live in a capitalist system in which we must have jobs to live, anyone will adopt a company culture on the outside. Finding people that naturally vibe with the culture that you want to create is challenging, but it’s worth it in the long run. These people will thrive at your company, reaching higher levels of productivity and self-management.

Company culture is a thing that a lot of large companies talk about, but which few understand. Company culture percolates from the top down; if your managers don’t feel the company culture, they won’t hire for it and they won’t encourage it. Company culture is vital for both management and worker to understand; both must be able to determine what is and is not positive behavior in the workplace, because engaging in positive behavior boosts the morale of others. The definition of positive behavior, with the exception of some universals, varies from company to company and is communicated through company culture.

Workers thrive in the right culture, they will be more productive, more social with their teams, and more likely to help one another out and cross-work. Teams become more cohesive, employees become more engaged. It becomes easier to communicate team and company goals because everyone is using the same language.

He Chased Vision, Not Money

Well, he said he did, anyway. One can never know what’s in a man’s heart, and I have a hard time believing that someone could become that wealthy without chasing the money a little bit. But the bottom line was not his immediate focus, or he would not have engaged in such risky behavior as CEO.

Innovation is risky. This is why it’s easy to talk about but difficult to do; innovative failures can be expensive, and innovative failures in marketing or customer service have a very direct impact on the bottom line through sales revenue. But Hsieh showed us that the rewards that can be reaped through innovative success can be huge, and you absolutely do not have innovative success without innovative failure.

This is why large companies often espouse modern, innovative values, but are managed through philosophies that are fifty to a hundred years old. They are dedicated to pleasing shareholders, so they dare not risk the bottom line.

This is why the things I learned from Tony Hsieh pushed me toward small businesses in my career path. There’s more creativity there, there’s more room to grow, to try new things, and to remain on the cutting edge of whatever your career is. That’s the creative side of my work, and it’s what I love.

Goodbye, Tony Hsieh. You left your mark.

 

 

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