Is Preserving Company Culture More Important than Profits?

by Aman Singh Das | November 18, 2010

  • My Vault

The Conference Board hosted a one-day event in New York last week aimed exclusively at senior marketing executives. My initial interest was limited to a couple of the listed speakers: namely Zappos CEO Tony Hsieh and Ogilvy & Mather Chairwoman Shelly Lazarus. What would a room of senior marketing chiefs take away from these speakers, known for their disposition toward corporate social responsibility? Further, in a time of limited budgets and struggling ROIs, would any of this make sense for them?

Thankfully, I was pleasantly surprised. In fact, I could have been at a conference meant for a CSR audience and it could have followed the same script. Consider, for example, the answers the audience gave to the following question:

Question: Identify your biggest challenge this year.

Answers:

--60 percent: Measuring ROI on marketing

--21 percent: Securing marketing budgets

--13 percent: Recruiting top talent for marketing

--6 percent: Other

      Sound like your topmost challenge as well?

      The conference not only provided food for thought on issues like the blurring of the distinction between marketing, advertising and CSR; but also on how an industry-wide push for corporate responsibility is changing the way marketing professionals approach their jobs.

      Tony Hsieh: Culture Trumps Profits

      Hsieh, who is in the middle of a book tour these days to promote Delivering Happiness, fit the prodigy part perfectly: Sporting a pair of jeans to address a room full of executives dressed in business formals is no mean task.

      If you've read Hsieh's book, you know already that the recruitment process, talent retention and employee engagement are handled unconventionally at Zappos. Hsieh touched on a few policies that serve as insightful pointers to some of the intangible but equally important factors that become the foundation of a successful company.

      Performance Reviews: "Fifty percent of our performance review at Zappos measures how you are furthering the company's culture."

      New hire training: Zappos provides five weeks of training to every new hire along with a copy of their Culture Book.

      Firing Policy: "We are completely committed to our core values, which we call the 3Cs—clothing, customer service, company culture—to the point where not following and contributing to them is reason enough for dismissal." This commitment gives our employees strict direction to follow these values even outside their work profile.

      Transparency: Hsieh's team live streams all of their all-hands meetings to any member of the public who wishes to listen in.

      Employee Engagement: "Employees think in terms of job, career and calling. If we can target fulfilling that last thing, we've got not just happy employees but also the most productive and innovative."

      What do you think? Do you agree with Hsieh's belief that a commitment to an inspiring culture and motivated employees yields higher profits than a mission statement that emphasizes profit margins? Weigh in by leaving a comment, emailing In Good Company or connecting with me on Twitter @VaultCSR.

      Next: Ogilvy's Chairwoman Shelly Lazarus discusses why "philanthropy is no longer the way to say we're good corporate citizens."

      Filed Under: CSR

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