How Tony Hsieh inspired a focus on workplace culture

The former Zappos CEO, who died suddenly last week, set the bar for how organizations should treat their employees.
By: | December 3, 2020 • 3 min read
(Photo by Charley Gallay/Getty Images for CinemaCon)

Tony Hsieh, the former Zappos CEO who died last week at the age of 46, didn’t leave a legacy just on the office culture at Zappos, but on how employers view workplace culture in general.

During his 20-year tenure at the helm of the online retailer, Hsieh elevated efforts on office culture, embraced rare employee perks and forged out-of-the-box policies to foster innovation and productivity. His efforts made “office culture” part of the business vocabulary and inspired countless other companies to adopt similar strategies around employee engagement.

Jaime Klein of Inspire Human Resources

“Hsieh famously set cultivating a positive culture as the top priority at Zappos, and the company flourished because of it,” says Jaime Klein, founder and CEO of consulting firm Inspire Human Resources. “He designed a human-centric company that championed inclusion and decency, and the result was a billion-dollar valuation, best-in-class customer-service and a brand aspired to by just about every market.”

Related: The new potentials in workplace culture: humanization, empathy

Hsieh notably adopted a self-management system called Holacracy, which is designed to create a dynamic workplace where everyone has a voice and bureaucracy doesn’t stifle innovation. For Hsieh and Zappos, that meant the company’s 1,500 employees define their own jobs, managers don’t exist, and workers set their own agendas and decide which projects to work on.

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When new employees join Zappos, they start a five-week training program. At the end, the new hires are offered $2,000 to quit to make sure they wanted to be at the company not just for the paycheck, but because they truly believed it was the right place for them.

The company’s employee perks are plentiful, too, and designed to keep employees happy. In addition to more traditional benefits like comprehensive medical coverage, paid leave, an onsite fitness center and wellness programs, the company also provides pet adoption reimbursement, adoption reimbursement, monthly team outings, nap pods, financial workshops, onsite counselors and more. Last year, it launched a music program called Strum for the Sole, which allows workers to rock out in the company’s so-called jam room, a space in Zappos’ Las Vegas office that is outfitted with instruments.

Related: Why employers are thinking more about financial wellness

Hsieh often talked about workplace culture and his unique leadership approaches as a motivational speaker. He also authored the 2010 book “Delivering Happiness” about his philosophy. “You want to create a stronger company culture, which will make your employees and coworkers happier and create more employee engagement, leading to higher productivity,” Hsieh wrote.

Although progressive and sometimes radical, Hsieh’s leadership and focus on building a strong workforce inspired other organizations and company leaders to prioritize culture and employee engagement.

“At Inspire, we advise HR leaders at companies of all sizes that human-centric culture is the secret sauce that separates thriving companies from the rest,” Klein says. “Hsieh proved it as he grew Zappos from start-up to industry leader.”

Melanie Tinto, chief human resources officer at WEX, says Hsieh’s insights provide inspiration at WEX as “we ensure we sustain our culture and what makes our company great for our customers, shareholders and employees.” When Tinto worked at  Walmart in global talent management, she spent a week or so working in the stores, walking the floor with the store managers, and talking with employees to experience the company culture and the work employees do—a lesson inspired by Zappos.

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Hsieh’s—and Zappos’—relentless focus on what is important and on its core values is an important, and lasting, lesson for organizations, she says.

“Tony created a playbook for the types of challenges that companies are facing today,” Tinto says. “Today, employers need to focus on ensuring that employees feel included, and Tony did that through ensuring that the culture created at Zappos allowed employees to bring their authentic self to work.

“Additionally, employers today need to have a clear culture in place—what they stand for—and need to understand what culture will best fit them, their values and the way in which they want to approach work. The key to happiness for the employee’s side is finding the right culture fit, while the key for employers is to be clear on that value proposition to ensure retention and satisfied employees.”

Kathryn Mayer is HRE’s benefits editor and chair of the Health & Benefits Leadership Conference. She has covered benefits for the better part of a decade, and her stories have won multiple awards, including a Jesse H. Neal Award and honors from the American Society of Business Publication Editors and the National Federation of Press Women. She holds bachelor’s and master’s degrees from the University of Denver. She can be reached at kmayer@lrp.com.