Organizational Change and Managing Culture of Zappos Company

Table of Contents

1.0 Introduction        1

2.0 Company Background        2

3.0 SWOT analysis        4

Strength:        4

Weaknesses:        5

Opportunities:        5

Threats:        5

4.0 Organisational Chart        6

5.0 Company Culture        6

5.1 Why Company Culture Matters        6

5.2 Company Culture of Zappos        7

5.3 How Zappos Fosters A Culture of Creativity        7

1. Encouragement of Individuality and Team Spirit        7

2. Established Trust        8

3. Creative Freedom        9

4. Willingness to Fail        9

5.4 The customer service strategies behind Zappos’s success:        10

5.5 Understand the worth of your customers.        10

Zappos Vision        11

Zappos Mission        12

6.0 What is Target Market?        13

6.1 Who is Zappos Target Market?        13

6.2 How do Zappos attract their customers?        14

7.0 Marketing Mix of Zappos        15

Product        15

Pricing        15

Promotion/Communication        15

8.0 Conclusion        16

1.0 Introduction

This report will be discussing about the organizational change and managing culture of Zappos company. Organisational change occurs when a company makes a transition from its current state to some desired future state. Managing organisation change is the process of planning and implementing change in organizations in such a way as to minimize employee resistance and cost to the organization while simultaneously maximizing the effectiveness of the change effort. Today's business environment requires companies to undergo changes almost constantly if they are to remain competitive, there are few factors that cause organisational change such as; (a) Economic climate: The term ‘economic climate’ refers to the state of the overall economy condition’s. If there is a recession, a company may have to lay off workers and this requires restructuring. A merger or takeover also means total reorganization and changes in corporate culture. (b) New technologies: New hi-tech systems and devices have completely changed how commercial enterprises do business and interact with another individual in the marketplace. (c) Government Policy: When companies are faced with new legislation or rules imposed by the relevant regulatory authorities, they need to do two things which are comply with them and adapt so that they may continue to thrive in the business market.

It is vital to know the importance of culture in shaping organisational practice and performance in business market. Organisational culture is a widely used term but one that seems to give rise to a degree of ambiguity in terms of assessing its effectiveness on change variables in an organisation. For the past number of decades, researchers suggest the concept of culture is the climate and practices that organisations develop around their handling of people. Besides that, important trend in managerial thinking in recent decades has been one to encourage managers to try to create strong organisational cultures as culture and leadership are conceptually intertwined.

2.0 Company Background

Zappos is an online shopping hub for countless consumer brands from fashion to electronics. As a company that prides itself with incomparable customer service, it is necessary for Zappos to further enhance its customer service experience and streamline its supply chain in order to differentiate itself and compete within the increasingly saturated online shopping market.

Since the late 1990s, Zappos has grown exponentially through development and careful control of its supply chain. Zappos started as an idea for a shoe selection platform, in a market where only 5% of shoe sales happened online. At this time, the online shoe market lacked a platform that enabled customers to select from a wide range of products based on colour, size and other varying attributes. The company looked to fill that market gap, while differentiating itself by providing ground-breaking customer service through its call centre.

This call centre was an important piece of Zappos’ finetuned company culture, which faced massive morale fluctuation during the growth of the business. Today, Zappos executives have a concrete goal of maintaining a positive culture, and see it as an indispensable asset that drives performance and positive brand image.

In addition, Zappos has differentiated itself through its distribution practices. As the company-built capital, it was able to offer customers next day shipping. Natural variability of external shipping services forced Zappos to revoke these previously guaranteed shipping times, but continued focus on quick shipping without these promises allowed the company to continuously surprise customers with speedy delivery. During this development, Zappos was able to cut out intermediaries in its supply chain. It also consolidated the process down to 1 suppliers and Zappos’ inventory warehouse in Kentucky, known within the company as its fulfilment centre.