by Chaise Perez
Zappos in the hot seat due to the lack of management skills going on within the company. Originally, they went with the tradition hierarchy way of running things. In June of 2013, an executive decision was made by Zappos CEO, Mr. Tony Hsieh. Tony Hsieh graduated from Harvard, created a company called LinkExchange that he eventually sold to Microsoft, for $265 million, then invested in Zappos. While working for Zappos he became a chief executor, which is when he sold Zappos to Amazon.com, for $1.2 billion. He continued his career at Zappos, as CEO. Zappos switched a management style of Holacracy.
“Holacracy is a complete, packaged system for self-management in organizations. Holacracy replaces the traditional management hierarchy with a new peer-to-peer ‘operating system’ that increases transparency, accountability, and organizational agility,” according to holacracy.org. Holacracy is an easier, more laid back type of management. Its main purpose is to create an easy-going, relaxing, and equal atmosphere. Everyone is responsible of everything they do and accomplish.
Holacracy differs from other styles because there are no managers, or bosses, or any higher power really that employees have to answer to. The employees create their own schedules, their own job titles, their own groups to work with, and anyone could call a meeting at any time about any given thing. Most other management styles have bosses and managers who supervise all the employees to make sure work get done, quickly and efficiently, whether they are hands-on or hands-off supervisors.
Zappos CEO, Tony Hsieh, pushed the decision to adopt this management style because he really wanted to change with the changing city of Las Vegas. Downtown Las Vegas was remotely dead. Tony read about the holacracy style and decided that it was what the company needed to shake things up and possibly become more efficient in the work that his employees were doing.
Some strengths to this style are the fact everyone has a voice, people get to pick who they are grouped with so there should be minimal issues, and the office has a relaxed atmosphere so it should be easy to work in. This seemed to work for the most part, the environment became more relaxed so it was easier to work during the day. Some weakness to this management type are the fact everyone gets to work at their own pace, everyone is responsible for logging the work they do, and it is a really casual environment. Obviously, not everyone agreed with this style. According to theatlantic.com, 18 percent of employees took buy-outs, meaning they left the company.
I believe that some employees have been resistant to this change because they do like change in the first place, but also because they need certain types of management in order to work. Personally, I am one who likes to be told or given a list of things to do. I also need a deadline in order to get things done. If I have to work on my own time and scheduling, I would either struggle horribly or just not get it done at all. I know of many others who are the same way.
I also believe a few other management styles could work for Zappos if they gave them a try. I believe authoritative and participative would be great management styles for them. Authoritative is the type of management style where the mangers or higher employees give direction but use motivation or incentives to get the other employees to work comfortably but efficiently. Also, participative is the type of management that everyone works together and everyone has a say but there is still a hierarchy in charge to make sure everything gets done.