When Zappos was founded it seemed an impossible mission: selling a product online that consumers traditionally have needed to see, touch, smell, and, most importantly, try on. Naysayers said it would never work. Today, it continues to be one of the great Internet success stories – although the exact financial details are unavailable since its acquisition by Amazon.

According to Erica Javellana, Zappos’ “speaker of the house,” the site is more than just an online shoe store – it is “a service company that happens to sell shoes, clothing and stuff.”

“The secret formula is not so secret – it is about happy, engaged employees,” she told attendees at the recent National Association of Federally-Insured Credit Unions annual conference in Seattle. “We make sure we hire the right people. There is an ROI to having a company culture, because when people are emotionally invested they feel ownership, which leads to increased productivity and increased profitability.

Erica Javellana, "speaker of the house" for online retailer Zappos, speaking during the National Association of Federally-Insured Credit Unions' 2018 conference in Seattle.
Erica Javellana, "speaker of the house" for online retailer Zappos, speaking during the National Association of Federally-Insured Credit Unions' 2018 conference in Seattle.

Javellana said for those in the audience who were wondering why someone from an online shoe retailer was talking to people from credit unions, it is because CUs and her company share a commitment. “For us it is customer service – you call it member service. Our company purpose is to live and deliver WOW. That made us a company of purpose over process.”

A big part of Zappos’ success, she said, comes from building a PEC – personal emotional connection – with its customers. According to Javellana, this stems from a significant investment in company culture that started in 2005, when the management team created a list of committable core values upon which it would hire or fire employees. Company leadership at first came up with 37 core values – “Which was too much to fit on a T-shirt,” quipped Javellana – before eventually whittling down the list to 10.

Core Value No. 1: Deliver WOW through service. WOW means going past expectations and giving people a pleasant surprise, Javellana explained. “As a society, we have gotten used to mediocre customer service. When we are interviewing people we ask them to tell us about a time they received excellent customer service. We want to see that they understand what ‘excellent’ looks like. It is all about the experience. Seventy-five percent of our customers are repeat customers, so we don’t spend huge money on marketing. Our repeat customers are our biggest advocates.”

Core Value No. 2: Embrace and drive change. Change is scary, but at a growing company, change needs to happen, she said. “Companies that fail tend to be those that did not adapt quickly enough to change. The average life span of companies today is 15 years. The way business is going, the way technology is going, we have to be willing to change.”

Core Value No. 3: Create fun and a little weirdness. “So many companies say a business is a place to work, not have fun, but people like to have fun. We want everyone to be their whole self at work.”

Core Value No. 4: Be adventurous, creative and open-minded. This means employees must be ready and willing to think outside the box.

Core Value No. 5: Pursue growth and learning. “Most people who leave a job say it was because there was no room for growth at the company. We do a very extensive hiring process to make sure the candidate is a culture fit.”

Core Value No. 6: Build open and honest relationships with communication.

Core Value No. 7: Build a positive team and family spirit. “Most of us spend more time at work than we do with our families. If we have to do this, why not make sure the people you work with are like family? It might be dysfunctional, but at the end of the day you know those people have your back.”

Core Value No. 8: Do more with less. “This is the only core value that is more business-oriented. The finance department likes this one,” she said with a laugh.

Core Value No. 9: Be passionate and determined. “Nothing great has ever been accomplished without passion. Passion is infectious.”

Core Value No. 10: Be humble. “We tell people, ‘Check your ego and arrogance at the door, we don’t have room for it.’ Our recruiters do a great job of not hiring jerks. We tell candidates whatever position they are applying for, they will have to go through a 4-week call center training program. We all answer phones. If they won’t, we won’t hire them.”

Who is responsible for the culture at an organization? “Everybody,” said Javellana.

“Know that changing the culture at your credit union is not going to happen overnight. It might feel weird when you first implement,” she said.