The Zappos Triangle of Accountability

Triangle of what now?!

For folks following the Zappos story, can you believe it has been over 5 years that we started our journey to self-organization? When we stopped talking about siloed departments and started talking about and organizing into circles? And while Zappos has gone through a lot of change since we initially rolled out Holacracy to a small pilot team in HR - and eventually to the whole company - our fundamental building blocks have stayed the same.

  • Our Core Values still drive who we are and how we do things.
  • Our Core Values still drive who we are and how we do things.
  • Our Core Values still drive who we are and how we do things.

So What is this Triangle of Accountability?

There she is! The Triangle of Accountability is a visual representation which highlights that even as things change, as we experiment and try new things, the core elements of Zappos do not. And it's a reminder that if we always keep any new initiatives balanced with our Core Values and focus on Delivering Wow Through Service, we will be able to accomplish great things while staying true to our brand.

As we continue on our journey to self-organization, we've figured out a clearer way to say WHY self-organization matters to Zappos and our employees. (And maybe someday, corporate America!) Ready? Here it is:

We want every person and team at Zappos to have *the minimal number of constraints that enable maximum freedom, but also maximum accountability*.

And thus... we have our Triangle of Accountability. We think it's kind of beautiful.

A Little Bit About Where It Came From

We learned from our initial step into self-organization that while the idea of giving employees complete autonomy was good, doing so with no guard rails was not so good. And in fact, it was counter-productive to what we wanted to accomplish in self-organization. We ultimately needed a system that not only helped our employees work on what they’re passionate about and what they’re good at, but also one that brings value to our internal customers (coworkers/business partners), our Zappos customers and the organization overall.

The Triangle helps us accomplish this! So let's do a quick dive into what each of those sides actually means.

It Starts With Our Purpose

Zappos' purpose statement is, “To Live and Deliver WOW”. It’s our north star; it’s why we exist. Our purpose aligns the entire organization around Zappos' Core Values and has always given us a much higher purpose than just selling shoes and clothing. To live and deliver WOW is to deliver happiness in everything we do and to everyone we come into contact with.

Side 1: Culture / Values, Zappos Culture & Our 10 Core Values

Core Values are the foundation of a sustainable and thriving culture. They act as a compass for how every Zapponian interacts with one another, with our customers, our partners, and the outside world. They root and define who we are and how we do things.

Every employee already agrees, via the Zappos Oath of Employment, to embrace and drive each Core Value. Having this as one of the sides of the Triangle of Accountability keeps us all true to the core principles, behaviors, and mindsets that define us as an organization.

Every Circle is accountable for staying true to the core principles, behaviors, and mindsets that define us as an organization.

If you'd like to learn more about Zappos' philosophy on Company Culture, click here: Zappos Insights Culture Camp

Side 2: Customer-Focused Mindset, Delivering The Very Best Customer Service and Experience

“We’re a service company that just happens to sell ________.”

The aim of the Zappos brand in the early days was to deliver the very best selection and service in the shoe business. But we quickly realized we wanted to be about more than that. We want to be THE brand that provides the very best customer service AND experience, no matter what products and services we provided.

We believe that if every single Zapponian is deeply obsessed with being customer-focused, no matter where the customer is, it will have profound and positive effects on Zappos' future. We also believe that in order to maximize our external customer-focused opportunities, we absolutely need to be internally* *customer-obsessed. Remember, we define customer as co-workers, vendors, customers, the community, investors - everyone.

We are relentlessly focused on solving problems for the customer, innovating and creating on behalf of the customer. Continuously finding new ways to deliver beyond their expectations.

Every Circle is accountable for continuously delivering beyond their internal and/or external customers’ expectations.

If you'd like to learn more about Zappos' approach to customer service, click here: Zappos Insights School of WOW

Side 3: Customer-Generated Budgeting, Balancing Your Circle’s Profit & Loss

Instead of having a top-down approach to budgeting (where budgets are passed down from the top Circle to and through each SubCircle), budget conversations and transactions will happen between Circles.

The goals for every Circle are simple:

  • Have at least one paying customer (internal and/or external customers that ultimately find value in your goods and services)
  • Break-even on your Circle’s Profit and Loss statement

Every Circle is accountable for breaking-even on its P&L (where a Circle’s costs and expenses don’t exceed its funding and/or income).

We'll talk more about Customer-Generated budgeting in the future but at the end of the day The Triangle is pretty simple...

What it comes down to: Any Employee / Circle can do whatever they want so long as they simultaneously deliver on each side of the triangle.

Rock on Triangle of Accountability!

If you'd like to learn more about Zappos' exploration in non-top down budgeting, click here: Zappos Insights Department Q&A

Culture is

Happiness

Great culture leads to employee happiness. The same way a toxic culture leads to unhappiness. Happy employees means higher engagement, profitability, and low turnover.

Culture is

People

Our culture would not be what is it today without the people, past and present. We are all protectors and cultivators of the Zappos Culture; it's what makes it unique and something that changes every day.

Culture is

Being Yourself

I love that I get to be me all day. The culture encourages you to be the same person you are at work as you are at home. I don't have to pretend to be something I'm not, which makes Zappos a comfortable place to be.

Culture is

Unique

Every company has a unique culture that's all their own. Just like every person has their own personality, every company has their own culture. Building a culture is a special process that can't be taken lightly. It's the responsibility of every employee to represent and foster culture.

Culture is

Fun

Work can be fun! We have 2 annual parties at Zappos. Our Vendor Party where we invite all of our brands to thank them and celebrate our partnership. And, our employee holiday party. Past epic party themes have ranged from Mardi Gras and old-school hip-hop to a Hawaiian luau at a waterpark. Each has had its own twists and tricks to surprise and delight partygoers. This year, we invited our vendors to run away with us to the “Untamed Circus."

Culture is

Perpetual

Your culture doesn't stay the same, it will continue to evolve. Having a defined set of values will serve as your guide to continue your culture's growth and evolution in a positive direction.

Culture is

Not Always Measured

A strong culture means lower employee burnout and therefore, lower turnover. It leads to higher employee engagement and higher profitability. But really, companies should focus on their culture because it matters. Because it's just the right thing to do. To quote Tony Hsieh, "Just because you can’t measure the ROI of something doesn’t mean you shouldn’t do it. What’s the ROI on hugging your mom?"

Culture is

Work-Life Integration

Companies and employees worry about work-life separation or work-life balance. But why? Wouldn't you rather be a company where your employees easily combine their full self into everything they do? Wouldn't you rather work for a company whose focus on culture allows your job to integrate with your life? It shouldn't be a struggle to find a balance between life and work where you are truly fulfilled and happy.

Culture is

Partnerships

Your vendors have the same objective as you: to sell their product, be successful in their work, and maybe have some fun while doing it. Something unique that Zappos does is allow brand representatives access to all the same sales and inventory information on their products that Zappos has. By working as a team, by partnering, you are setting the stage for success!

Culture is

Real

Your company has a culture. You may not have "planned" it. You may not like it. Or maybe you love it. But it's there. It is real. You can choose to be thoughtful about your company culture. You can set values and identify the behaviors that you want to be the core of your culture. That part is fairly easy. The hard part, is committing to the values once they are set. Living them.

Culture is

Core Values

Values are more than just words, they're a way of life. They are the foundation of your company culture. We know that companies with a strong culture and a higher purpose perform better in the long run. As we continue to grow, we strive to ensure that our culture remains alive and well.

Culture is

Your Brand

A company’s culture and a company’s brand are really just two sides of the same coin. The brand is just a lagging indicator of the culture.