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Case Study 3: Stepping Forward in Stakeholder Satisfaction

Analyze how Zappos’ leadership has fostered a culture of ethicalness in the company.

Suggest two (2) actions that other companies can take to mimic this culture.

The leadership at Zappos was to create an atmosphere in which workers could innovate

and interact openly with management. The culture has been built to build partnerships that are

important to workers’ participation at all organizational levels. Leadership has effectively

developed this kind of link through creative and largely untested organizational culture scenario

approaches, and leading service firms dominate their respective sectors with innovative

customization experience strategies (Michelli, 2011). The tips that other companies should

follow out of this tradition include:

Understanding the desires and concerns of workers is a critical aspect of the company.

Zappos has experienced a straightforward approach to addressing business demands, including

social support and team bonding through continuous contact.

Excellent training with action makes staff appreciate the tradition’s work through

continuous dialog with managers and CEOs and increased trust and inspiration. Every behavior

has been clarified, including stealing personal documents and price difficulties—orders that have

been honored by the technical clinch.

Creation of collaboration designs; a well-developed approach has been shown in the case

study, where cuts and difficult choices have also been sufficiently clarified using consumers’ and

employees’ networks. Transparency is a central feature of the Zappos model. Transparency is an

ethical principle that involves the protection of open and truthful communication. Employees

receive detailed updates on the organization’s performance and are encouraged to share
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information on the enterprise. Zappos advises that employees create a clear and genuine

relationship-ship for all partners, hoping that this will help protect the business’s reputation.

Determine the significant impacts that Zappos’ leadership and ethical practices philosophy

have had on its stakeholders.

Zippos leadership feels that customers’ satisfaction and devotion are the significant

advantages of the corporation. They have managed it via substantial study and hard work, which

experienced guiding their customers to buy a product to understand their questions. They have

also satisfied numerous issues that were not under their website; this has been the meaning and

the devotion of the customers. The stakeholders were a bit skeptical concerning the strategy,

which experienced unambiguous communication, including all the actions that zippo required on

social networking and blogs; they desired a company that will focus more on the marketing of

goods active on social media networking. The deficits incurred due to the technical clinches and

earnings policy are some of the stakeholders’ major talking points ( Frei, Egi & Winig, 2000).

They wanted to observe earnings rather than employee engagement and customer satisfaction;

this action experienced tension between the CEO and the table. The customers, who were

significant stakeholders, were delighted with the service and had developed a sense of trust

towards the brand. They increased the spending on the various orders as the Zippos has had a

friendly annual returning policy. The other stakeholders are the employees who were one of the

significant strengths of the organization. The culture experienced foster development, free

communication and posting of issues, and explaining its guidelines. This experience increased

positive attitude and devotion towards the organization.

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Examine three (3) of the ethical challenges that Zappos faces. Recommend three (3) actions

that Zappos’ leadership should take to address these ethical challenges.

Even though Zippo was sensitive to ethics in its production, it still experienced some

ethical issues.

Layoffs: During 2008, Zippo experienced Zipoos experienced 8% of the employees and

had shown the reason for doing so on the websites and social media networks. The ethical issue

was how to handle such a sensitive case, as this can be seen as a breach of ethical values. The

challenge was addressed through effective communication and adequate explanation.

Merger issues/ Acquisition by Amazon: when Zippo merged with Amazon, there were

dissatisfaction issues, which caused tension with the board. The challenge was that Amazon had

a different culture, which Zippo could no adapt quickly. The challenge would have been

challenged by keeping zippo in an independent identity while maintaining its culture.

Loss of sensitive information: the Zippo database got hacked. It lost a lot of customers’

sensitive data alongside financial content, resulting in the outrage of one of the clients. Although

Zippo got informed the shoppers separately about the crack, this chose to detach the phone call

center as numerous clients inquired regarding the infringement. The problem might have been

managed simply by responding to the client’s particular queries worried about the crack.

Evaluate the effectiveness of the core values concerning developing a culture of

ethicalness. Determine how the core values support the stakeholder’s perspective.

Ethics is an integral part of the general culture of an enterprise. The Design Ethical

organization includes a comprehensive review of all facets of values and alignment in such a

manner as to promote ethical activity and discourage unethical conduct. Business ethics literature

tends to categorize corporate ethics systems as either an enforcement approach that focuses on
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the implementation of the rules, regulations, and policies intended to encourage conformity or a

Values or Integrity Strategy that applies more generic standards and aspirational statements

designed to guide decision-making as the basis for improved ethical results in organizations

(Segon & Booth, 2013). The approach to enforcement stresses consistent behavioral expectations

often related to legal criteria. The Code of Conduct and its prescriptive requirements are,

therefore, aligned with the compliance approach. Simultaneously, the Code of Ethics can be

viewed as an aspirational document more consistent with the integrity approach. According to

Segon & Booth (2013, there are specific vital requirements to value-based ethics culture: Based

training and development programs such as orientation, Leadership programs at all stages of

leadership decision-making of organization that sets the tone and both model the way as well as

build Opportunities for structured and casual collaboration and reviews Values and practices.

Moreover, the support systems that serve to improve and retain Ethical business and corporate

decision-making and action to be taken. Such support mechanisms allow standards to be created

and shared efficiently, control systems to be defined, and assessment and evaluation to be carried

out. Such effects of the core values concerning developing a culture of ethicalness.

The core values support the stakeholder’s perspective. Stakeholder theory as a

management theory presents us with various approaches to value development based on their

attitude towards stakeholders, emphasizing firm versus stakeholder orientation and value

creation (Tapaninahk & Kujala, 2017). The keys values to support stakeholders’ perspectives is

when Organizational managers pay a great deal of attention to stakeholder interactions and

cooperation and recognize the role of these stakeholders in generating economic, social, and

environmental meaning to the organization. Like values of zippo, which include Pursue growth
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and learning, Build a positive team and family spirit, and Be adventurous, creative, and open-

minded, among others, are values that support stakeholders’ perspectives.

Analyze the significant ethical challenges that Zappos has faced. Determine whether

or not you would have resolved these challenges differently than Zappos’ management.

Provide a rationale for your response.

Laying Off Employees: Zappos is known for its commitment to its employees, but the

company faced hard economic times requiring tough decisions. I would have resolved this by

ensuring Communications relating to layoffs are detailed and accurate, help modify work roles as

appropriate, and help make the necessary adjustments to the pay and benefits packages. Besides,

I would be instrumental in retraining the remaining workers and preserving their loyalty and

work satisfaction.

Acquisition by Amazon: Zappos was purchased by the e-commerce firm Amazon.com in

2009. Many of the Zappos customers were puzzled by the sudden change and shared concern

about the future of the company’s culture and customer support. I would have resolved this by

granting Zippo an independent entity but while maintaining its culture and values of such an

organization despite the acquisition.

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References

Michelli, J. (2011). Prescription for excellence. McGraw-Hill.

Segon, M., & Booth, C. (2013). Values-Based Approach to Ethical Culture: A Case

Study. Research In Ethical Issues In Organizations, 93-118.

https://doi.org/10.1108/s1529-2096(2013)0000009011

Tapaninahk, R., & Kujala, J. (2017). Perspectives on stakeholder value creation and

sustainability: A literature review. Academy Of Management Proceedings, 2017(1),

15278. https://doi.org/10.5465/ambpp.2017.15278abstract