Answer questions

Managing Culture and Change – 21926 (SPR2021)

Week 7 Tutorial: Organisational culture change and how to make it stick

Before class preparation:

 Essential: Go through Activity 1 (Zappos – cultural ‘shoe’ that fits) and prepare your responses to five questions

 Optional: Do an extra online search about the company Zappos to help you answer the questions. You might consider going to their website: https://www.zappos.com/

ACTIVITY 1: ZAPPOS – CULTURAL ‘SHOE’ THAT FITS

Before class Learn about organisational culture in Zappos (the world’s largest online

shoe retailer) by reading the case study ‘Organisational culture at Zappos’

and by watching the video (both provided below). Prepare answers to five

questions listed below.

In class

(ZOOM

Live

Session)

Break-out room session & class discussion 1

Step 1: Go to your break-out rooms and discuss – 10 minutes

In small groups of 5-6 students, you will work in Zoom break-out rooms to

answer the Zappos case questions. Access the answer sheet provided to

you in the class. Use this sheet also to write down the team role of the

Speaker.

1. The organisational culture at Zappos can be considered as strong. By watching the video and reading the case study, describe what elements

of organisational culture in Zappos make it strong. Use the Cultural

Web model, which is covered in the textbook (page 116) and also

outlined in Figure 1 below

2. Why do you think Zappos offers a $2,000 incentive to quit?

Step 2: Class discussion – 15 minutes

In class

(ZOOM

Live

Session)

Break-out room session & class discussion 2

Step 1: Go to your break-out rooms and discuss – 15 minutes

3. What are possible problems with a strong organisational culture in general?

4. Why do you think Zappos’ approach is not utilised more often? In other words, what are the challenges to these techniques?

5. Would you be motivated to work at Zappos? Why or why not?

Step 2: Class discussion – 15 minutes

Figure 1: 7S Framework (apply this framework when answering question 1)

1. Embrace and Drive Change 2. Create Fun and A Little Weirdness 3. Be Adventurous, Creative, and Open-Minded 4. re With Less 5. Be Passionate and Determined

6. Be Humble

Organisational culture at Zappos

Watch the video (2:53 min): The Zappos Family – How they work:

https://www.youtube.com/watch?v=axlWBn7YQA4&ab_channel=ZapposFamilyCareers

Tony Hsieh woke up one workday morning

with a weird realisation: he didn’t want to go to

work at the internet advertising start-up

company he had cofounded. The company had

expanded rapidly, and some of the new hires

had transformed the friendly team-focused

culture into a less desirable place. Hsieh and the

other co-founder sold that company to

Microsoft, and Hsieh vowed to give

organisational culture more attention at his next

company.

That next start-up company, Zappos, has

become the world’s largest online shoe retailer

and a poster child for the power of a strong

organisational culture. Recruitment and

selection are central to Zappos’ cultural

strength. ‘As long as we hire people whose

personal values match our corporate values,

you don’t need to tell them how to behave. They

can just be themselves’, says Hsieh. Zappos

actively describes its culture in recruiting

material, so job applicants quickly learn about

the online retailer’s core values such as ‘Deliver

WOW through Service’, ‘Embrace and Drive

Change’ and ‘Create Fun and a Little

Weirdness’.

The company carefully selects applicants whose personal values are aligned with those of the

company. The line manager looks for technical skills and experience, whereas the human

resource department ‘does a separate set of interviews purely for culture fit’, says Hsieh.

Unusual methods are sometimes applied to estimate an applicant’s cultural fit. For example, to

determine an applicant’s humility (one of Zappos’ core values), staff ask the Zappos-hired

driver how well the applicant treated him or her during the drive to the company’s headquarters.

New recruits attend a four-week customer service program that also reinforces the company’s

values and employees’ role as culture carriers. ‘We talk about it with our new hires, that every

single one of us is responsible for our culture’, says Zappos’ training manager, Rachael Brown.

Zappos also makes an unusual offer to the new recruits: it will pay $2,000 in addition to their

regular pay to anyone who quits before the end of the training program. (Less than 1% have

accepted the offer.)

Work is structured differently

at Zappos as well. For

example, there is no limit to

the time customer service

representatives spend on a

phone call. They are

encouraged to make personal

connections with the

individuals on the other end

rather than try to get rid of

them.

Moreover, while Zappos has over 1,300 employees, the company has been able to maintain a

relatively flat organisational structure and prides itself on its extreme transparency. For

example, after being acquired by Amazon in 2009, Hsieh sent an exceptionally detailed and

lengthy letter to employees to explain what the new partnership with Amazon would mean for

the company, what would change, and what would remain the same.

Although Zappos pays its employees well and offers attractive benefits such as employees

receiving full health-care coverage and a compressed workweek, the desire to work at Zappos

seems to go beyond that. As Hsieh would say, happiness is the driving force behind almost any

action an individual takes. Whether your goals are for achievement, affiliation, or simply to

find an enjoyable environment in which to work, Zappos strives to address these needs. The

company delivers above and beyond basic workplace needs and addresses the self-actualisation

needs that most individuals desire from their work experience. CEO Tony Hsieh believes that

the secret to customer loyalty is to make a corporate culture of caring a priority.

Adapted from: McShane, S., Olekans, M., Newman, A. and Travaglione, T. (2016),

Ensuring the culture shoe fits at Zappos, Organisational Behaviour – Emerging knowledge, global insights, McGraw Hill Education: Sydney; Bauer, T. and Erdogan, B. (2012), Introduction to

organisational behaviour. Images: linkedin.com ; fortune.com ; zappos.com