Culture of Ethicalness in Zappos Company

Published: 2022-12-09
Culture of Ethicalness in Zappos Company
Type of paper:  Case study
Categories:  Company Management Psychology United States Law
Pages: 6
Wordcount: 1535 words
13 min read

The Zappos Company is online outfit retail started by Nick Swinmurn in the year 1999 and which has over time gained the trust of its customer in terms of the service delivery (About Zappos Culture |, 2019). The company incorporates several strategies as well as policies which help to improve both the customer as well as stakeholder satisfaction. There are values that are upheld by the company and which might be necessary to other companies. First and foremost, the value of positivity and family spirit has been exercised in the company with the involvement of all the three parties (staff, customers, and stakeholders) in the activities of the company. Incorporating the positivity in the company helps to build the staff motivation which in return improves the services of the company. Positivity can be enhanced in a company through a number of ways such as: improving the work standards where staff members operate comfortably and openly with the management. In addition, there are team activities which enhance the relationship among the staff members. Also, positivity can be built through rewarding positive actions in the company from all the sides involved. The value of family brings together stakeholders of the company which motivates openness and creates a room for a better relationship between the management and the employees of the company. Secondly, the company values creativeness, innovation, adventure and open-mindedness which helps the company to improve its sales and at the same time provide quality service which improves the happiness of the stakeholders. Innovation and creativeness are key prospects of an organization or company as it poses the competitive advantage of the company to the market. A company which promotes open-mindedness and creativity is most likely to receive brilliant ideas and thoughts of the stakeholders which can as a result of help in product development or the general development of the company. To mimic the above ethical practices, other companies should introduce activities and initiatives t-aimed at developing positivity at the work place. In addition, other companies should emulate and encourage creativity among the stakeholders for product improvement purposes.

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Impacts of the Company Ethics to the Stakeholders

The leadership of the Zappos Company, as well as the core values of the company, has contributed to major impacts upon the activities in the company. First, through the values of the company, it has been able to establish long term relationship with the affiliate customers ("Four Lessons on Culture and Customer Service from Zappos CEO, Tony Hsieh", 2019). The values alongside the company's policy and services have attracted customers who are loyal and through a commendable sopping experience, the company creates an addictive shopping habit to its customers. It is important to understand that the company believes in selection and services rather than price as most of the company's customers focus more on the products and services of the company. Among the measures employed by the company is the free shipping of the products under the terms of the company which makes it easy to access the products of the company. The values of the company hold that the services offered are supposed to meet the customer satisfaction hence making it a top priority of the company. The client-centeredness approach, therefore, contributes to the sustenance of the company's customers and reputation. The positive working environment of the company definitely creates the effectiveness of the company as seen in the company's web page which is among the most efficient online retails. Once an object has been put to display on the page then the item is available and once it's out of stock it is removed from the page. This kind of openness with the stakeholders builds a long lasting relationship with the customers as well as trust. Therefore, the transparency of the company and the integrity levels has attracted more interest of investors as well as shareholders in the company which is for the best interests of the company. The company provides insights into the necessary lessons and tips of success by the company as seen from its own experience. Through the insights of the values owned by the company, then the knowledge is shared to other companies interested.

Ethical Challenges of Zappos Company

Being a company just like any other, Zappos has faced ethical challenges which through critical examination, the company has been able to address. First, the company was faced with the challenges of lying off some of the employees who were valued by the company. The company has been known to uphold the presence of its employees through the outstanding treatment in terms of insurance among other motivation advances. However, due to a fixed economic situation in 2008, the company had to release the employees who accounted for eight percent of the total employee population in the company. However, to deal with the situation, the company compensated the laid-off employees by putting them under medical cover which the company took care of. The leaders of the company should, however, take the necessary post-precautions in the prediction of a crisis such as the one above in order to deal with it more profusely without necessarily having to risk its assets (How a Radical Shift Left Zappos Reeling, 2019). Secondly, in 2009 there was a merger between the Zappos Company and the Amazon which was an incident that for a while had left the loyal customers confused on what was happening. In the effort of increasing the sales of the company, the then board initiated the merger with Amazon but there was the change in the new approach to be adopted. The focus would be on the product sale rather than the customer satisfaction which was the initial intention of the company. However, through the public address, Tony Hsieh explained to the company what was happening and the intended mission of the merger. For a company like Zappos, it is important to involve the direct stakeholders such as the loyal customers in the company actions and reforms. This is because of the big role they play towards the success of the company. The third challenge faced by the company was the 2011 income loss that accounted for an average of 1.6 million dollars lost as a result of the system failure. Just after enduring the tough financial times, the company got struck by the system malfunction which led to the delayed delivery of the products as well as the confusion of product delivery. Some of the retail products had not been accounted for at the end of the incident. In such as a situation, a company is supposed to always have a backup technical team that is supposed to be reliable. The team is supposed to quickly respond to situations such as this which would prevent much loses by the company.

Effectiveness of the Core Values

The core values of the Zappos Company have been effective in ethical culture development through the satisfaction of the involved stakeholders. The values of the company have helped it to act in relation to the customer and employee satisfaction. Through the core values of positivity and creativeness, the company has been able to give out the best services to the customers which explain s the loyalty of the customers towards the company over time. The values have also ensured the cohesion of the company structure in terms of relationships of the stakeholders (About Zappos Culture |, 2019). Through creating a family way of connection, the company has had few internal reports of unethical decisions and actions and has established a community with a common purpose thus explaining the productivity of the company. The expectations of the stakeholders towards the company have also been upheld through the values of a hard-working community of the Zappos family. This is explained through the actual integration of the stakeholders in events organized within or outside the company and hence issuing them with the first-hand involvement in the company's activities.

Resolving Ethical Issues of the Zappos Company

Different approaches have been used by the company to address the ethical challenges that it has faced over time. However, there are other means that could be employed to resolve the challenges discussed.

In the first case of laying off employees in the company as a result of a financial problem, the company should have made the involved employees as well as other stakeholders aware of the company's situation. This could have helped them to prepare on getting another work opportunity or planning on the next step after getting laid-off.

In the second case of merging with Amazon company, the company should have involved the stakeholders such as the loyal customers in the big decision instead on leaving them to mere confusion state and thus the stakeholder integration could have been solved easily.

In the third situation of the big loss endured by the company in 2011 as a result of the system, failure could have been avoided if the company has a backup technical team specifically meant to address such situations which would have saved the company from the loss.


About Zappos Culture | (2019). Retrieved from Lessons on Culture and Customer Service from Zappos CEO, Tony Hsieh. (2019). Retrieved from a Radical Shift Left Zappos Reeling. (2019). Retrieved from

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