Technology and Organizations

Friends have been asking for more information about my Zappos Tour. Here goes:

Anyone can sign-up for a free tour. (See post on Zappos and transparency.) They even run shuttles to help you get there.

My tour started at 9 a.m. this Wed. Checked in and started checking out the lobby:

Zappos Lobby

The lobby also holds the bookshelves where Zappos employees can come and pick-up books on management. No check-out, just use the material to learn. (When asked for a “tour-confession” later that morning, I declared that I would get copies of my book into that bookshelf.)

The lobby has a tiny museum. Here are a pair of shoes like the ones that caused Zappos to be born. Nick Swinmurn couldn’t find these and it gave him the idea to start Shoesite.com in 1999. The switch to Zappos.com came as it’s a better name (my view) and so they wouldn’t be constrained to shoes.

AirWalks

1999 Pitchbook

This is Jon our tour guide. He’s part of the Zappos Insights group and I think is also head of tours. He did an amazing job.

Jon telling us the Zappos history

Heading down the first hallway we saw framed commemorative t-shirts for each major sales goal. On the other side of hallway are caricatures of employees who have hit major goals/successes. A little further down and I spy the tablecloth quilt of brainstorm ideas from the April 2010 all hands’ meeting!

Part of Quilt of Ideas

As we get into the main floors we get our first greeting. Groups sit together, decorate their own area and have a special way of saying hello to people who come to visit. (Zappos now has three buildings in this office park, two occupied at the moment. They’re working on how to keep employees visiting both.)

In the Zappos Lab area we get to see a pair of size 20 shoes.

Very cool Zappos Labcoat

Zappos thought about having an open door policy for the execs. Then they decided it was just easier not to have doors. The execs sit in an area called “Monkey Row.”

Jungle theme for Monkey Row.

Keith Glynn wasn’t in. I would have liked to have said thank you in person for all the help with the fulfillment article.

Keith's seat on Monkey Row

We had a great time visiting with the different groups. In the customer loyalty area (people who take help & order calls), Jon tells us about how each new employee works in the loyalty area, no matter what their ultimate job. Video of him describing the importance of making connections with the customers:

Zappos Customer Loyalty Connections from Terri Griffith on Vimeo.

They keep a big white board down the hall showing call statistics. The goal is great customer service, not number of calls taken or shoes sold. They focus on how quickly calls are answered and how few calls are abandoned. (Zappos Insights offers for-fee courses on their whole process.)

Longest Call (7h 28m) Record Holder

Training is very important at Zappos — across your current job, job development, and personal growth. Three different groups: on-boarding, Pipeline, and Zappos Insights.

Tony the DJ (Desk Jockey for the day), Part of Customer Loyalty training group

In the downstairs hallway there is a bulletin board with pictures of teams that have taken immersion trips to Kentucky and the Fulfillment Center and teams from the Kentucky Fulfillment Center that have come to learn about the Las Vegas operations. The lobby also has a TV running video from the Fulfillment Center. You can tell they work hard to be a single family.

End of my tour included one-on-one time with Jon and then with Robert. I’d paid the extra bit for a “tour plus.” Even though Jon answered a ton of questions during the tour, it was nice to know I could ask all my management-nerd questions at the end. Overall, there was never a rushed moment, never anything we couldn’t ask — and yes, I even got to meet Tony Hsieh.

We’d seen Tony on his way to the Dunk Tank. Turns out they were raising money (and cooling off) back behind the building. Robert kindly took me back there where I could help some people get wet. I introduced myself to Tony, I’m sure gushing about the tour, and then asked for this picture:

Tony Post Dunk

Take the tour! Fly Southwest to get to Vegas and compare the two organizations. Tony’s book, Delivering Happiness, is great; Zappos Insight’s website is great; but there is huge value to seeing and hearing from so many Zappos people.

Today was my Zappos Tour.  The Zappos Family seems to be doing everything they can think of to share how they WOW! their customers and employees. They better share since we can’t all go work for them (tidbit from the tour: a lower percentage of applicants get jobs at Zappos than apply and get into Harvard). What’s the secret sauce?  The Zappos Family core values. My translation: Transparency and the drive to do better.

Their transparency takes a variety of forms. I’ve talked about how Zappos live streamed their last all hands’ meeting to the world [9/26/2010 update: Streaming from 1-5pm pacific, click here to sign up for access]. They have an entire piece of the organization, Zappos Insights, focused on sharing via tours, answering questions on-line, and management education. The Delivering Happiness 20 city bus tour is about to begin… and they’re accepting applications for one more person!

Why share your secret sauce?  From Zappos Insights:

It all started when Tony [Hsieh, the CEO] decided to be completely open and transparent about how the Zappos Family does business. So many businesses not only wanted to learn the “what,” they wanted to learn “how” we do what we do. Zappos Insights (ZI) was assembled as our crack commando force team to give you all the tools you need to develop the culture you desire.

Zappos has been being transparent since the beginning.  In Delivering Happiness (Tony Hsieh’s new book), Fred Mossler (part of the founding team) describes how they decided that they should let the vendors have the same information the Zappos buyers had:

I’ll never forget the afternoon I turned my chair around and asked Tony what he thought about giving vendors access to the same information as our buyers.  Traditionally in retail, information is hoarded, kept secret, and used as leverage against the vendors to get more out of them…. But if we created true transparency in our business, not only would they help us, they’d benefit as well.

Not too long after I proposed the idea to Tony, he spun back around and said “Were you thinking about something like this?” He created the beginning of what we now refer to as “the extranet”…. vendors have complete visibility into the business (p. 187).

The reasoning in the book is that the average buyer at Zappos is working with 50 brands, but by being transparent to those brands’ representatives, there are 50 other people helping to run the business.

Ok, that makes business sense.  But what about the value of being transparent with the rest of their secret sauce?  My thinking:

• It’s a good deed and completely in-line with their values.
• It gives Zappos employees the opportunity to share their commitment to the core values with the world — deepening their own commitment.
• Sharing is more than a one-way street.  By sharing Zappos is opening up the possibility that their partners will also share back — and they have extended the definition of partner to include us all.  Think of all the new ideas that can come their way.
• The more we trust each other, the easier it is for all of us to work together.  Trust is a relationship built on being vulnerable. The more often you trust someone and they come through, the more trust you have in that relationship. Zappos is taking the first step in building trusting relationships with all of us.

What can we do in return?

We can’t all go work for them (see note above, though I do hope one of my graduating students will get the chance).  We can do our best to deliver some of our own happiness and build transparency in a way that will make it better for our employees and business partners.  In November I said that transparency was the concept of the quarter.  I’ll go out on a limb and say that transparency is the concept of the decade.

Have you provided transparency to your employees or business partners?  Care to be transparent with the results?  Click on the respond link below and let’s start a conversation.

Many thanks to all the Zappos Family members I met today and have had the chance to talk with over the last few months.  Jon & Robert, special thanks to you for the tour, and Marie for setting it up.

Some of my prior Zappos posts:

• Wow! from the Zappos Fulfillment Center
• Helping Others Develop Systems Savvy: Learning from Zappos, Leadership, and Design
• Delivering Happiness: The Movement
• Tony Hsieh’s New Book: Delivering Happiness
• Zappos Has Insights and I’m in Awe

Last night I had the pleasure of introducing John Hagel at a TEDxBayArea event.  He came to talk with us about The Power of Pull, his new book with John Seely Brown and Lang Davison, and the broad-based shifts in our organizational and social environment.

Others have written great general reviews about the book (e.g., here & here) , so I don’t feel guilty about putting a systems savvy filter on my comments.  I see The Power of Pull as emphasizing the need for systems savvy management.  That is, the environmental shifts described in the book demand that you use a solid understanding of available technology tools, organizational practices, and human capabilities to weave together effective organizational and personal action. The Power of Pull also gives us examples of what this weaving might look like.

The Big Shift: Environmental Changes That Demand Systems Savvy Management

Before, the pattern of how technology tools, organizational practice, and people were woven together was generally pushed down from above, and not always effectively. Things have changed.  We have entered a period where important patterns (everything from organizational innovations to personal work strategies) can come from anywhere.  The Power of Pull describes three waves of this Big Shift:

• First wave of the Big Shift: New platforms built on the Internet.  This wave has already arrived.
• Second wave: Focus on flows versus stockpiles of knowledge.  Our feet are wet on this one.  Facebook, Twitter, corporate and employee blogs, customer-built technical support — these are at the forefront of this wave.
• Third wave: Organizational changes that result from the forces of the first two waves.  The emerging business relationships built on communication from throughout organizations are examples of this wave. SAP, for example, opened enough of its technical “secret sauce” to engage a number of partners who could then develop SAP innovations independent of SAP own engineers.  Turns out these efforts are beneficial to all.

The Power of Pull

With these shifts we have the opportunity (need) to “pull” rather than waiting for opportunities to be pushed down from above. We can pull by gaining access to people and resources in ways we never could before, attracting people and resources through our own participation and personal and project branding, and then using these resources to contribute by achieving new outcomes from our own potential.

How we do this is where I see the value of systems savvy management.  How do we decide what pieces of the technology infrastructure to use for our access?  How do we decide how to best build systems that help us attract the right people and resources?  How do we design organizational systems that will help us achieve our goals (working with the people we’ve attracted, the technology systems we have at our disposal, the organizational policies and procedures that distribute benefits to all involved, all with and understanding of our specific context). Systems savvy can help us weave these components together into something that can surf these waves of transformation.

John suggests five steps to start with (my weaving suggestions in italics):

1. Master the strength of weak ties. Use technology tools like LinkedIn or Facebook to access people outside of your usual circle.  Then find or create opportunities to meet face-to-face in ways that support your passion — just sharing coffee is not enough, you need to focus on work-related issues to understand each others’ relative strengths and who else you might want to bring into the network.
2. Grow your personal ecosystem. Use technology tools both inside and outside your organization to find activities that can support your tasks (perhaps a community of practice).  If you don’t find any, build one.  Use technology and organizational practice to strengthen the infrastructure in terms of its focus on learning, building a common language, being a repository of good ideas). Have a system in place for finding new members over time.
3. Choose wisely where you live and spend time to be in the right place at the right time. Use your technology tools to track the right times and places.  Start relationships before you get there and use your tools to maintain the relationships over time.
4. Find environments where people share your passions. For me the critical term is “share.”  Find the environment and then share.  This may be face to face, over the Internet, or a hybrid approach where you meet occasionally.  The conference behaviors John describes are great for keeping your (and others’) enthusiasm high.
5. Join a creation space. My favorite. Be it face to face or virtual, engage with people to create along the lines of your passion.  For me this is finding the opportunity to engage with others who use systems savvy on the job.  By working together we can tackle the bigger problems or use our diversity of background to solve the tricky small ones.

My summary: Use available (or acquirable) technology tools and organizational practices to build your ecosystem and then do something with it.  Play fair — be a producer as well as an acquirer from the social network.  Appreciate that small twists and turns made at the right time result in strong, beautiful, work.

Today’s guest author is Tracy Allison Altman, who writes the blog, Evidence Soup, about evidence-based management: What it is, what it isn’t, and how to make it happen. Tracy is the founder of Ugly Research, a technology company that has created a presentation format called Tiny Soapbox.  Tracy is the lead-off blogger for an ad hoc series of posts to run here focused on the emergence of true, functional transparency in organizations.  Please follow her blog for a focused view (and some crazy counter examples) of evidence-based management.

Many people inside organizations are now participating more actively: They’re exchanging ideas, making collaborative decisions, and adding transparency to functions that are crucial to innovation and high performance. They’ve got the right corporate culture, processes, and technologies to achieve what I call strong connectedness. Good stuff.

But participation and connectedness aren’t enough. To perform at the highest level, people need to know what works (and what doesn’t). And to do that, they need evidence: To help them make decisions, evaluate new ideas, or design management programs. (What is evidence? It’s information that demonstrates the truth of an assertion. Evidence is what helps people make up their minds – data, statistics, research findings, business intelligence, expert knowledge, observations, facts, and anecdotes.)

Participation without evidence is pseudo-transparency. By connecting people, you get lots of transparency into what they are saying, but you don’t necessarily get transparency into what the evidence says. However, there are some things you can do to get more evidence into people’s hands.

For example. To illustrate the crucial role of evidence in the modern organization, consider a hypothetical enterprise software company that’s releasing a new product (we’ll call them MaxSoft). During the planning stages, product managers gather evidence in the form of market research and customer feedback, and use it to determine which features will go into the new release.

• If MaxSoft is a participative organization that emphasizes the importance of hard evidence, then various stakeholders (marketing, R&D, sales, user groups) will be able to contribute evidence during this phase, and comment on the evidence contributed by others. Conversations and collaborations won’t simply offer opinions, and won’t contain opaque, undocumented references such as “the research proves…” or “we know that…” or “studies have shown….”
• And if the company has an especially sophisticated approach to evidence, participants will be expected to look at research findings, etc. from sources external to MaxSoft, rather than relying only on evidence created internally. For example, evidence about human capital and organizational development, such as how to hire, motivate, and compensate the best people. (This might come from trade publications, academic journals, and industry conferences.)
• Because this is new product development, the MaxSoft product managers must allow room for creativity, risk-taking, inference, and experimentation. The evidence is there to guide them, not to make decisions for them.

After the product launch, more hard evidence becomes available. Sales figures and other performance data provide tangible evidence to assess acceptance of the new product. Business intelligence and analytics are sophisticated ways to pinpoint the most promising customer segments, and will help MaxSoft improve its performance.

There’s qualitative evidence, too. Sales people will begin repeating customer feedback, whether positive or negative. This is where transparency and discipline are crucial. Rather than encouraging ad hoc or free-form participation, MaxSoft can instead gather evidence methodically, making it more representative and therefore more useful to decision-makers. For instance: Use an input form asking specific questions (this works with customers, too). So instead of a sales guy saying “our customers hate feature x-y-z,” MaxSoft will be able to know how many customers really said that. A meaningful enterprise feedback program, combined with social CRM, will generate valuable evidence. To assess customer satisfaction, the team can also use text analytics and sentiment analysis: This qualitative information will supplement sales figures, survey results, and other quantitative evidence.

Later on, when course corrections are needed, people can look for evidence to help them adjust the product positioning, software development, or sales strategy. Again, looking outside MaxSoft – not just inside – will be essential.

So how do you make this happen? Evidence without connectedness is only pseudo-evidence: It does no good if people aren’t aware of it. Here are some suggestions for connecting people to the evidence:

• Set expectations that people will look for, and follow, relevant evidence.
• Develop guidelines for participating with evidence. Identify what types are typically appropriate in various situations, so people look for the right evidence at the right time.
• Use presentation formats and technologies that help people find, interpret, and contribute evidence more easily, regardless of which ‘silo’ they work in. (This is the focus of my work at Ugly Research.)

People + Connectedness + Evidence = Transparent Participation. Without evidence, people can participate in conversations about what really is working, or is likely to work, for their organization. They can come up with theories, make forecasts, estimate risks, and generate new ideas. But eventually, they’ll need some evidence to prove all that up.

Comments or questions? I’m tracy AT evidencesoup DOT com and @EvidenceSoup on Twitter.

Wired’s Aug 2010 cover has Will Ferrell in a white skin suit with the title, “The Future That Never Happened.”  I’m going to where the future IS happening (hybrid planes, flying cars, personal electric aircraft, and all): AirVenture.  For the next week or so I will focus on electric aircraft and any other whiz bang innovation I can get a picture of.  I’ll be fighting over 550,000 other enthusiasts through the mud and aircraft noise to see what Boeing, GE, Airbus, NASA, cutting-edge vendors, and 1000s of homebuilders have to offer.

AirVenture is the Experimental Aircraft Association’s annual convention, airshow, and meetup.  From July 26 to Aug 1, 2010, Oshkosh, Wisconsin will be the heart of innovation — as well as the busiest airport (yes, busier than Atlanta given that the OSH control tower can handle over 3,000 flights in 10 hours).  I’m going to leave the Silicon Valley behind and focus on innovations you can get inside.

Electric aircraft had some exposure last year, but 2010 is a major milestone —  GE Aviation is sponsoring the World Symposium on Electric Aircraft as well as the Aviation Learning Center.  I’m looking forward to daily themed forums (search here with keyword: electric) and Friday’s full-day event:

Demo flights are on Sat, but I’ll be on a commercial flight home unless I can find a better ride… hint… hint.

Hope to see you there.  I’ll be wearing shirts with either Santa Clara University or N58PP logos — say, “Hi!”