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 business is still Powered by Service.
  • And we still strive to be a successful and thriving company.

So What is this Triangle of Accountability?

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