Up to this point in our exploration of Zappos, we have analyzed the way the company highlights the importance of its corporate values to prospective applicants, how it creates multiple levels of screening to sift not only for technical skill but for culture fit, and ways leaders design informal and formal aspects of the selection process to assess the likelihood that a prospective employee will thrive at Zappos. But what happens once it is determined that an applicant either fits or does not fit with the Zappos culture? This chapter demonstrates important next steps in what is a continuing gauntlet of new hire orientation and values education. It then shows how this critical piece fits into the big picture, by outlining the constant care and feeding of the Zappos culture that occurs daily at all levels of the organization. By focusing on the Zappos onboarding process at the Nevada location, you will be given an opportunity to examine your own new hire orientation strategies and compare them to one of the most involved, novel, and effective enculturation programs in business today.

I don't fit—what size do I need to be?

Many great and talented people seek employment at Zappos, but few are selected. Christa Foley, Zappos recruiting manager, reports that the actual applicant-to-job ratio for positions in Nevada hovers at around 30,000 applications annually for about 450 filled positions. In essence, 1.5 percent of all applicants make it through the rigorous cultural and technical hurdles. At many businesses, applicants have to conclude that they weren’t selected simply because the “offer letter” never arrives in their mailbox. However, consistent with the Zappos values, leadership makes a point of letting unsuccessful applicants know the results of the application process. This may seem like a small courtesy, but it speaks to the company’s willingness to act in a way that is consistent with values such as “build open and honest relationships with communication” and “deliver wow through service.”

Andrew Kovacs, sourcing specialist, shares, “We aren’t just here to serve customers who are in a transaction buying our products. We serve all stakeholders, including all applicants, some of whom may even be our actual customers. Communicating with applicants to let them know their status is simply a way of being respectful and serving them. Therefore, we provide applicants an automatic reply that we received their résumé, and we follow up again to let them know whether or not we are moving forward with their application. That takes time. But, come on; we’re Zappos.” Christa Foley suggests that closing the communication loop with unsuccessful applicants also gives those individuals an opportunity to grow. She notes, “If we’ve talked to someone, interviewed them and ended up not moving forward, we will be as direct as we can concerning why they weren’t chosen. We could just say thanks for your time, but we try to high-light what was missing on the technical side or things they can do to improve the way they interview.”

It is easy to get so busy with the people who “fit” your organization that your HR department fails to provide respectful and helpful communication to those who were not chosen. However, at Zappos, values matter, and they are of the utmost importance when people might otherwise accept shortcuts. For Zappos leaders, it’s critical that values be adhered to in both pleasant and less-than-pleasant business circumstances, including the way Zappos handles unsuccessful applicants.

I'm in—Zappos chose me

After everything applicants go through to be offered a job at Zappos, and given the small percentage that are actually chosen, you would think that an invitation to employment would be the end of the “culture fit” process. In truth, it is the first leg of a rather long trek.

To give you a feel for the challenges and the significance of the journey, let me offer a real-life example of a highly skilled professional who was hired to lead a non-customer-facing business division at Zappos. Because of the technical and leadership nature of the position, Zappos executives had left the job unfilled for over a year, waiting for the “right person” to be selected. Thinking they had found that person, Zappos relocated the successful applicant to Nevada. In most businesses, a leadership-level new hire might experience an expedited orientation, with minimal to moderate focus on cultural values, so that the person can immediately jump into departmental leadership responsibilities. Not so at Zappos. This leader, like all other new hires, was required to go through four weeks of customer service training (referred to as new hire/CLT training) originally designed for Customer Loyalty Team members (Zapponians who answer calls when people place an order by phone, have a product question, need to process a return, etc.). Zappos does not exempt leaders from this training because the training is viewed as an opportunity to create a common experience around a core customer-facing function. Leaders are also expected to encounter the joys and challenges of serving customers in the call center environment.

As suggested in Chapter 2, the screening process at Zappos is designed to select employees who will be eager to dive into a culture and service orientation process. However, in the case of our unnamed executive, the individual participated in the new hire/CLT class only reluctantly and somewhat marginally. After several attempts to encourage him to embrace the process, the new hire was deemed to not truly fit the Zappos culture and was terminated. After a year of waiting, extensive recruiting costs, a significant investment of time and money in the interview process, and substantial relocation expenses, Zappos leaders determined that this highly sought-after executive was not right for their culture.

Breaking down the Zappos onboarding process

From my perspective, onboarding at Zappos achieves a wide range of beneficial outcomes. For example, it clearly communicates and demonstrates the core values while highlighting the importance of service at Zappos. In addition, it extends the opportunity to assess the fit of employees, and it establishes interdepartmental collaboration and empathy. Let’s take a look at how these types of benefits emerge from what many might see as an unnecessarily costly process of orientation.

Déjà Vu—Culture, Values, and Service

Can you really imagine employees throughout your organization going through a month of training that would typically be offered for an entry-level service job? Can you see an accountant, an IT professional, and the new CFO all actively participating alongside a new hire who may be entering the workforce for the first time? All of these individuals would be learning about the company’s history, philosophy, and values. They would gain insights into the importance of customer service, understand the company’s long-term vision, and even spend two weeks taking real calls from real customers. How humbling would that be? What would that suggest about the importance of service or your expectation that everyone is responsible for your company’s culture?

Rather than squeezing orientation into a single day and trying to pack that day full of information on policies and procedures, a discussion of key elements of the employee handbook, a mini-version of corporate history, and a cursory review of the company’s mission, vision, and values, the Nevada Zappos month-long process represents a well-designed cultural immersion. In their book Onboarding: How to Get Your New Employees up to Speed in Half the Time, George Bradt and Mary Vonnegut define onboarding as “the process of acquiring, accommodating, assimilating and accelerating new team members, whether they come from outside or inside the organization.” Zappos fully demonstrates enculturation, as defined by Bradt and Vonnegut. The authors write that the leadership at Zappos has developed a process that takes “new hires they acquired through a well-crafted selection process and accommodates them with tools they will need to be successful at Zappos. Additionally the onboarding month assimilates new hires into the Zappos culture and accelerates their readiness to step into their formal job responsibilities.”

The extended onboarding process at Zappos includes, but is not limited to, an overview of the 10 core values, the history behind each value, and presentations from 10 managerial-level representatives from different departments, each of whom shares what a specific value means personally and to the business over-all. Technical training and customer service information provided during the course culminates with hours of direct phone contact between the new hires and actual Zappos customers. As you might imagine, this wealth of real-life experience creates an added advantage when the company needs the entire Nevada workforce to pitch in during periods of extremely high call volumes.

Christina Colligan, CLT manager, reflects, “I don’t know another business that has every employee go through such an involved orientation process. It costs Zappos a great deal when it comes to productivity and salaries, but it is worth it in terms of grounding all of us on the importance of the Zappos values. The process really is an immersion in culture. Everyone at Zappos gets the same rich introduction to values and to customer service. We are all in orientation together, and we are all Zappos together.” David Hinden, a merchandising assistant at Zappos, notes, “Of all the things I learned in that initial four weeks of training, the piece that was of the utmost importance to me was how Zappos expects us all to do business. I had to switch gears from prior experiences, where I’d learned to be suspicious of customers or strive to protect the company at all costs. Instead, I started thinking about the value of doing the right thing for customers and for my peers so they can do the right thing for our customers as well. The CLT training helps you let go of the old ways and align with the Zappos way.” Cognitive psychologists talk about a concept they refer to as “proactive interference,” which refers to the difficulty people have in letting go of information they previously learned in order to acquire new skills. Effective onboarding often helps new hires “unlearn” behaviors that may interfere with the way things are or need to be done in your culture.

Brandis Paden, recruiting supervisor, notes, “During that four weeks of training, the new team members realize we do a lot of work here. We expect them to understand customer service, culture, and the core values and contribute to all of those things. I think it does catch people off guard. They realize how serious we are about our culture.” As values are slowly presented through weeks of orientation, staff members develop deeper connections to the company and more seriously internalize those values through their own experience.

When talking about the protracted orientation process, individuals throughout Zappos, particularly those who are working as members of the CLT, often share how the onboarding validates the importance of service and the role of the CLT. Derek Carder, CLT supervisor, notes, “In a lot of businesses, call center staff are not held in esteem. We are often more of a cost center than a revenue center in the minds of many leaders. Even at Zappos, only a small portion of the company’s sales comes through the CLT; the rest is through online purchases. Despite the fact that we are not driving the money, everyone in the company has to experience our job. That really tells you how important personal service is here.”

Having every new hire handle customer calls sends a clear message that service is everyone’s business. It is the common objective of all Zapponians. In the end, everyone in the company must be equipped to make connections with customers across all Zappos contact channels. For many companies, there are two cultures: the one that affects the executives, and the one in which the rest of the organization operates. Despite the obvious cost of the Zappos orientation process, the all-inclusive nature of the training contributes to a single and unified Zappos culture. In and of itself, this is a significant return on investment.

Screening and Teaming

By offering a monthlong training course for all Nevada employees, Zappos has essentially extended the opportunity to screen for the culture fit of new hires. While a candidate may interview well over a series of calls and even during a day of onsite formal and informal contacts, it is difficult to sustain a façade of openness, creativity, passion, or humility for a solid month.

Sourcing specialist Andrew Kovacs shares the screening power of new hire/CLT training: “We hired a manager from an industry that is often contentious, although we thought we had hired a guy who was more collaborative than the industry norm. Maybe he would have been if he actually got into the job, but we never found out because he didn’t make it through the call center training program.” Andrew explains, “Throughout recruitment and selection, all applicants are told that they will be involved in the call center training class from 7 a.m. to 4 p.m. Monday through Friday. No ifs, ands, or buts. People who ultimately go on to work in the call center, of necessity, are relied upon to show up as scheduled and be on time, so we set that expectation in the training class. Even those who won’t later be CLT members are held to these standards during training, and we tell people you cannot be a minute late. Depending on the case, we might ask a person to come back to the next class if they were late, or we will simply let them go.” In the case of the newly hired manager, Andrew notes, “He showed up late on more than one occasion. It is such a basic requirement for employment, and he didn’t deliver. In addition, he became indignant when the issue was raised, as if the training were beneath him. Fortunately, he was let go before he could contaminate our culture. As recruiters, we look at those situations to see if there was anything we could have done to screen the person out during the selection process, but it’s great to have the CLT training there as a continuation of the culture fit evaluation.”

While the new hire/CLT training process reduces the number of people who slip through and “contaminate” the Zappos culture, it also helps to forge interdepartmental relationships and build positive team spirit. Ashley Perry, newly hired CLT member, gives a sense of how training sets the stage for fun and family spirit. “When I went through the training, I’d update my social media pages with everything we did, and my friends would say, ‘I can’t believe they call that work and you are getting paid!’ We had a maple syrup chugging contest as part of an obstacle course activity. We did a variation of rock-paper-scissors that we called wizards-warlocks-monsters, and we even sang karaoke. Don’t get me wrong; we worked a lot. But the fun brought new people from across the entire company into what I can best call a family environment.” At the end of the new hire training, the class participants work together on a project that is associated with the Zappos core values. An example of one such project, “you got faced,” will be outlined in detail in Chapter 10. Suffice it to say that these projects further engage participants in culture-related team building and set the tone that culture is the responsibility of every employee. The activities further suggest that culture is not an abstract or amorphous phenomenon. Rather, it is the foundation of successful business and can be enhanced by the efforts of dedicated individuals working collaboratively.

In addition to encouraging camaraderie and teamwork, the Zappos orientation journey helps individuals throughout the organization hear the “voice of the customer” and understand what it takes to meet or exceed the customer’s wants, needs, and desires. In essence, it helps even non-customer-facing staff understand what is required to “deliver wow through service.” Many organizations struggle to address customer needs effectively because of rigid organizational boundaries or limited trust across departments. The process of bringing new employees on board can send the message that “we are all working together for a common purpose.” Furthermore, it can place new hires in a setting with individuals from across the organization to learn and serve the transcendent needs of the customer.

Mark Madej, software engineer, articulates the team and customer experience benefits of new hire/CLT onboarding: “From day one, it’s such a great vibe. In CLT training, they get you so excited about everything. It’s different from anywhere else. They allow us to take that time. Any other company would think it’s such a waste, but it really isn’t. As developers, we were able to see all the software tools from the customer’s perspective and the CLT rep’s point of view. As a result of being in CLT training and having to answer customer calls, developers like  me saw the complexity of the software involved in a process that the CLTs were using. So, we created a tool to automate the whole mess and make the process easier on the CLT member and the customer. We wouldn’t have come up with that fix if we hadn’t been on the phone with customers and seen the problem for ourselves. That’s how you invest money in training and see real-time results.”

How can employees truly embrace a culture unless they are immersed in it? Have the “let’s make orientation quick” approaches really proved to be less costly in the end? For Zappos, a lengthy and involved orientation is a “pay now or pay later” proposition, where the leaders at Zappos view culture and service as too valuable to neglect at the front end. How about you?

CLT training is ending—now what?

Let’s assume you have successfully completed the Zappos new hire/CLT training. What’s next for you? Well, first and foremost, you have a decision to make. At this point, you will be asked to decide whether you want to take a sizable payout (something on the order of $4,000) and leave Zappos or head to your job area. Let me restate that so you don’t think you misread it. You’ve completed the orientation class, and you are asked to decide whether you think you are a culture fit. If you decide the Zappos culture is not for you, Zappos will give you a substantial amount of walking money to move on and seek employment elsewhere.

How revolutionary! Zappos offers new hires an incentive to engage in a thoughtful self-assessment of their “goodness of fit” with the company. When Jack Welch was the head of General Electric, he championed the practice of differentiation, in which the “bottom 10 percent” of the organization was routinely asked to leave. He noted that “one of the best things about differentiation is that people in the bottom 10 percent . . . very often go on to successful careers at companies and in pursuits where they truly belong and where they can excel.” By contrast, Zappos prompts, encourages, and supports new hires as they decide whether they are likely to thrive at Zappos or are better suited to excel elsewhere.

But why would you offer someone so much money to leave? Leadership at Zappos wants to provide an amount that enables prospective candidates to make the right decision and not feel they need to stay in a culture that does not fit them just to avert a lengthy period of unemployment. The amount of money attached to the offer has increased over time and is likely to vary with the economy. Similarly, the amount of time new hires have to take the buyout has also changed. In the early days, an em-ployee had to take the offer before leaving the orientation class. Now new employees have up to three weeks after being in their actual jobs. Essentially, this gives new hires an opportunity to decide whether they are a fit based on their collective experiences in the orientation training and in their specific work area. According to Rebecca Henry Ratner, director of HR, approximately 2 percent of all new hires ultimately take the money and seek employment elsewhere.

The novel nature of the Zappos approach in paying employees to leave has received widespread attention in established business publications like The Economist and Harvard Business Review, as well as in countless blog posts. A number of blog articles on sites like The Consumerist and VisionWiz focus exlusively on the buyout. Without sufficient detail, the notion of paying your employees to leave after orientation can sound like a bad management practice. In fact, it’s difficult to appreciate the full genius of the offer unless one places it in the context of everything that Zappos does to screen for fit. With the perspective you have gained from these two chapters, the $4,000 walking money can easily be seen as a well-positioned last step in a very involved process of protecting the Zappos culture.

It is hard to imagine that even 2 percent of new hires—those who have experienced the richness of the Zappos culture and passed all of the screening hurdles—would walk away within the first couple of months of employment. However, those who do would not have “served a perfect fit.”

Joseph Michelle, The Zappos' Experience, Copyright 2011, McGraw-Hill Professional; reprinted with permissions of the publisher.

Published on: Apr 28, 2010