The Importance of Office Culture – Insight from Tony Hsieh of Zappos #in

This interview with Tony Hsieh, the chief executive of Zappos.com, was conducted and condensed by Adam Bryant.

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Marilynn K. Yee/The New York Times

Tony Hsieh is C.E.O. of Zappos.com, the shoe seller that Amazon acquired last year. A core Zappos value, he says, is to “create fun and a little weirdness,” so he values individuality in hiring.

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Q. What are some of the most important leadership lessons you’ve learned?

A. After college, a roommate and I started a company called LinkExchange in 1996, and it grew to about 100 or so people, and then we ended up selling the company to Microsoft in 1998. From the outside, it looked like it was a great acquisition, $265 million, but most people don’t know the real reason why we ended up selling the company.

It was because the company culture just went completely downhill. When it was starting out, when it was just 5 or 10 of us, it was like your typical dot-com. We were all really excited, working around the clock, sleeping under our desks, had no idea what day of the week it was. But we didn’t know any better and didn’t pay attention to company culture.

By the time we got to 100 people, even though we hired people with the right skill sets and experiences, I just dreaded getting out of bed in the morning and was hitting that snooze button over and over again.

Q. Why?

A. I just didn’t look forward to going to the office. The passion and excitement were no longer there. That’s kind of a weird feeling for me because this was a company I co-founded, and if I was feeling that way, how must the other employees feel? That’s actually why we ended up selling the company.

Financially, it meant I didn’t have to work again if I didn’t want to. So that was the lens through which I was looking at things. It’s basically asking the question, what would you want to do if you won the lottery? For me, I didn’t want to be part of a company where I dreaded going into the office.

So when I joined Zappos about a year later, I wanted to make sure that I didn’t make the same mistake that I had made at LinkExchange, in terms of the company culture going downhill. So for us, at Zappos, we really view culture as our No. 1 priority. We decided that if we get the culture right, most of the stuff, like building a brand around delivering the very best customer service, will just take care of itself.

Q. So how do you do that?

A. About five years ago, we formalized the definition of our culture into 10 core values. We wanted to come up with committable core values, meaning that we would actually be willing to hire and fire people based on those values, regardless of their individual job performance. Given that criteria, it’s actually pretty tough to come up with core values.

Q. Tell me what happened.

A. We spent a year doing that. I basically sent an e-mail out to the entire company, asking them what our values should be, and got a whole bunch of different responses. The initial list was actually 37 long, and then we ended up condensing and combining them and went back and forth and came up with our list of 10.

Today, we actually do two separate sets of interviews. The hiring manager and his or her team will interview for the standard fit within the team, relevant experience, technical ability and so on. But then our H.R. department does a separate set of interviews purely for culture fit. They actually have questions for each and every one of the core values.

Q. Can you give me an example of the value and the question?

A. Well, some of them are behavioral questions. One of our values is, “Create fun and a little weirdness.” So one of our interview questions is, literally, on a scale of 1 to 10, how weird are you? If you’re a 1, you’re probably a little bit too strait-laced for us. If you’re a 10, you might be too psychotic for us.

It’s not so much the number; it’s more seeing how candidates react to a question. Because our whole belief is that everyone is a little weird somehow, so it’s really more just a fun way of saying that we really recognize and celebrate each person’s individuality, and we want their true personalities to shine in the workplace environment, whether it’s with co-workers or when talking with customers.

I think of myself less as a leader, and more of being almost an architect of an environment that enables employees to come up with their own ideas, and where employees can grow the culture and evolve it over time, so it’s not me having a vision of “This is our culture.”

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A version of this article appeared in print on January 10, 2010, on page BU2 of the New York edition.

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