Tony Hsieh has successfully built and sold not one, but two companies. Link Exchange sold for $265 million to Microsoft and online shoe retailer Zappos.com sold for $1.2 billion to Amazon.
Here are the 10 lessons that every entrepreneur can learn from Tony Hsieh, the CEO of “Zappos”, which is consistently voted one of the best places to work for and has a reputation for outstanding customer service.
Entrepreneur Lesson’s From Zappos CEO, “Tony Hsieh”
Lesson #1: Being Passionate Increases Your Chance Of Success
If you want to be successful then you need to find something that you are passionate about. A lot of entrepreneurs are too caught up with the money that they can make. However this can actually hinder their chances of finding success. As Tony says “business that are run by people who are passionate about whatever the business is about tend to have a much higher” When you are passionate about something you are able to work harder and inspire others to do the same. When faced with adversity you will have the passion to keep going.
Lesson #2: Understand What Really Motivates People
In Daniel Pinks best-selling book “Drive: The Surprising Truth About What Motivates Us” He talks about how direct rewards such as bonuses or increased salaries can actually reduce productivity for many types of work. He also suggests that intrinsic factors such as being inspired by your work are actually much more important for motivation. Tony Hsieh illustrates this principle perfectly with his mission to create a company that you would want to work at even if you weren’t being paid to be there.
Zappos actually offers their new hires $4,000 to quit. Only about 3% have so far taken the money since the program was started. This concept was designed to weed out those who are only in it for the money and not in pursuit of a place where they can be part of a great working culture.
Lesson #3: Learn From Your Mistakes
Building and selling Link Exchange for $265 million might seem like the kind of mistake that any entrepreneur would be happy to make but Tony has stated he was not happy with his first company. The mistake he made was to try and build a company culture too late. With Zappos he didn’t want to make the same mistake and established the company culture at the very beginning.
Lesson #4: Focus on the Customer not the Product
Many entrepreneurs become so focused on the product or service that they are offering that they end up forgetting about their customer. Tony Hsieh wants to be known not as the best online shoe retailer but as the company with the best customer service. He has stated that he is actually not that passionate about shoes but providing the best customer service is something that inspires him.
Lesson #5: Talk To Your Employees
While we may understand that making our employees happy will increase their productivity how we achieve this can sometimes seem unclear. However Tony offers a simple prescription – “just talk to your employees. Ask them what would make them happy” Asking your employees what would make them happy and then giving it to them might sound simple but as Zappos has shown it can be incredibly effective. This includes ideas such as the laughing yoga classes, a full-time life coach and free lunches.
Lesson #6: Company Values Are Not Just Empty Slogans
Zappos has what are known as its 10 commitable core values. However these are much more than empty slogans. They guide the company in all decisions that are made on both a strategic and day-to-day level. An employees success in the company is directly related to how the live up to these core values. If they are failing to meet them then this is grounds for being fired.
Lesson #7: Support Your Staff
At Zappos, provided you are working according to the companies stated values then you will be fully supported. A lot of companies like to talk about integrity or customer service but fail to back their employees. A good example of this is a customer support call at Zappos that took over 7 hours. In many companies spending a whole work day over a relatively small order would be viewed as incredibly unproductive. However at Zappos this kind of customer service is celebrated.
Lesson #8: Understand What Makes You Happy
Tony Hsieh was running his own venture capital business when he initially invested in Zappos. At the time it was just one investment among many. However Tony realized within a year that what he really enjoyed in business was operating fledgling businesses not just being an investor in them.
Lesson #9: See Yourself As An Enabler
A desire to micro manage is something that many entrepreneurs find it difficult to avoid. However Tony Hsieh believes that the primary purpose of an entrepreneur is to enable people to do their best work. Tony also knows what it is like to be stifled by corporate culture. He quit his first job at Oracle after only five months. At Zappos he intended to create an environment which allows people to realize their full potential.
Lesson #10: Relationships Big or Small, Can Build Opportunity
Tony tells the story of a lesson that he learned from one of his business partners Fred Mossler. During a shoe show Mossler invited a rep for a very small brand out to dinner, rather than a rep from one of the larger brands they where introduced to. While the brand contributed almost nothing to Zappos bottom line, the relationship was something Fred Mossler truly valued. That rep would shortly there after go onto become the president of a company that Zappos had been trying to acquire. If Mossler had been concentrating on immediate gain rather than the relationship then the opportunity would have been lost.
To learn more about what Tony Hsieh is currently working on you can follow him on Twitter.
Article By: Jonathan Savage | Addicted2Success.com