Tony Hsieh, Happiness, and Resetting Expectations

Tony Hsieh, the CEO of Zappos, the online shoe and apparel retailer, has been on my mind a lot recently. I saw his keynote speech at the SHRM national conference this past June (check out this behind the scenes video). I got a chance to sneak aboard the Delivering Happiness tour bus after the speech. I also finished reading his book, Delivering Happiness, just a few nights ago. 

Before reading the book I had several assumptions about the company and its culture. Two of them were:

  • that their current culture was already firmly established from the beginning (at least from the time when Tony took over the leadership reins), and
  • the company was more or less fiscally solid for during Tony’s time as CEO.

Reading the book made me realize that wasn’t the case. Regarding the culture, it evolved on its own, but it wasn’t until 2003 that they actually started to codify what that meant. For Zappos, this was summed up by their belief that they were all about delivering the best customer service. Once they determined this then the company was deliberately shaped to reflect that vision. Profitable portions of the business were sold off. They moved their entire headquarters to Las Vegas. To be specific, they were looking for locations to transplant their call center operations and chose Las Vegas. Before doing so they realized that if they wanted to be true to their customer service ideal then the call center shouldn’t be set apart from the rest of the operations. As Tony says in the book, “To build the Zappos brand into being about the very best customer service, we needed to make sure customer service was the entire company, not just a department.”

The future of the company was in doubt at various points. Several times Zappos was close to folding. Employees made a variety of sacrifices to keep the operations going. People lived in hotels or apartments for months at a time, took pay cuts, or worked for free. Tony sold many of his personal assets in order to keep the business afloat. Why? He was rich, having sold a previous company he started (LinkExchange) to Microsoft for $265 million. It’s because he, and those around him, valued the company’s potential. He believed it would be financially successful, for sure. More importantly, he believed that Zappos could be ideologically successful also. It fit with the decision he made in 1999 to “stop chasing the money and start chasing the passion.”

Now here’s where the cynical side of my nature rears its ugly head. Millionaires, especially young ones (Tony Hsieh was 24 years old at the time of the LinkExchange sale) chasing their passion generally has me rolling my eyes into the back of my head. Tony’s reality is not the same as most people. Many don’t have the resources and access that he does. This is the trap that I’ve allowed myself to fall into. Believing myself (and others like me) to be on equal footing with a multi-millionaire will just lead to resentment. The lessons inherent in his story is the point, and that’s what I enjoyed about the book.

So what are those lessons? For me, it’s a few things:

  • People will do almost anything to be a part of something great. Tony and the Zappos team struggled and made a lot of sacrifices in order to keep the business afloat. These shared experiences made them a stronger culture. There’s a passage in the book where Tony talks about how the move to Las Vegas, while difficult, was actually a good thing. Since they were in a new city where they had no friends, they had to rely on each other in and out of work. I’ve personally seen this happen at companies I’ve worked for. When I left Macy’s to join J. Crew I was part of the 1st team that was hired for their then flagship location. The long hours spent together getting the store ready for opening, and the ensuing holiday season madness, brought us together in ways that more normal circumstances wouldn’t have. Strong personal relationships were formed. It’s been over a decade and I’m still friends with many of those same people.
  • Culture won’t survive if you don’t handle the money. If Zappos hadn’t secured a line of credit in 2003 to stabilize its operations it would have went out of business. The well known culture it’s become would never have been. On a personal level, if you want to “start chasing the passion” then make sure you have a solid enough financial foundation to work from. Or else be prepared to struggle, much like Tony did. 
  • If you believe in what you do, be prepared to work for it. It seems logical but this is what separates dreamers from doers. It’s rarely easy to follow one’s dreams, which is why they often remain just that. Which leads to the next lesson, which is that
  • There are no guarantees. There’s no clause in the ‘follow your bliss’ contract that states you will achieve it. You may fail, or find out that your dream has morphed into something else. Enjoy the trip while keeping an eye on the destination.
So I enjoyed the book and the messages it contained. If you’ve read the book I’m curious to know what you thought of it!

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