Tony Hsieh, CEO of shoe retail giant Zappos.com, is a more current real-life example of authentic leadership. Hsieh joined Zappos after selling a company he co-founded to Microsoft at the age of 24, and was able to not only improve sales exponentially, but also to create a company culture that landed Zappos on the “Best Companies to Work For” list released by Fortune magazine each year (Delivering Happiness, 2013). Hsieh’s unconventional and passionate approach to organizational culture has set him apart as a leader in business, and he possesses several characteristics that exemplify authentic leadership.
Authentic leadership can be defined in multiple ways. The intrapersonal perspective of authentic leadership focuses on the leader and characteristics like self-concept, while the interpersonal perspective defines authentic leadership as a relational process created by leaders and followers (Northouse, 2012). Still another perspective, the developmental perspective, views authentic leadership as a process of nurturing between the leader and followers (Northouse, 2012).
Bill George developed an approach toward authentic leadership that examines the qualities and characteristics of authentic leaders rather than focusing on the actions of leaders in response to organizational problems (Northouse, 2012). The five basic characteristics identified by George, when examined in the context of Tony Hsieh’s leadership, paint a picture of effective authentic leadership in a company known as much for its cultures as for its product.
Authentic leaders understand their purpose (Northouse, 2012). Hsieh, from a young age, demonstrated an entrepreneurial spirit; he was only 24 years old when he became a millionaire after selling LinkExchange, which he had co-founded, to Microsoft in 1999 (Reiss, 2010). Zappos, as his new project, soared in sales from $1.6 million to over $1 billion in the first decade Hsieh was in the CEO spot (Reiss, 2010). More importantly, Hsieh has succeeded in his purpose of garnering the Zappos brand a reputation for superior customer service and culture (Reiss, 2010).
Authentic leaders have strong values about the right thing to do (Northouse, 2012). Hsieh’s customer-centric business approach has set Zappos apart from many other online retailers. Zappos offers free shipping and returns, as well as an accessible and effective customer service department (Reiss, 2010). The company culture he has developed also points to his concern for employees; Hsieh believes that happy employees make happy customers, and he strives to make both happen every day (Reiss, 2010).
Authentic leaders establish trusting relationships with others (Northouse, 2012). Hsieh’s business model for Zappos involves establishing positive customer relationships – customers know they can count on superior service from Zappos, which allows for a stress-free shopping experience. Within the company, Hsieh’s culture has centered on trust; Zappos employees are given many creative freedoms and enjoy a relaxed working environment because Hsieh feels that the bottom line is customer satisfaction. He trusts his employees to take care of his customers.
Authentic leaders demonstrate self-discipline and act on their values (Northouse, 2012). Hsieh, and by extension, Zappos, lives by the values he has established from the start. Everything he does comes from a place of wanting to do the best by Zappos customers and employees. Hsieh believes so strongly in Zappos that the company relies more on word of mouth than on more conventional advertising methods (Reiss, 2010). The hiring and selection processes used by Zappos remain true to the company’s values as well – candidates must demonstrate technical skill, cultural fit, and values that agree with Zappos’ 10 core values (Reiss, 2010). This model means that many good, technically-qualified candidates are passed over, even at the expense of profits, because cultural fit is so incredibly important (Reiss, 2010).
Authentic leaders are passionate about their mission (Northouse, 2012). Tony Hsieh has made customer satisfaction and company culture his missions, and he is passionate about both. He regularly states that money shouldn’t be a number-one goal, and that passion is what makes a business grow and succeed (Reiss, 2010). His book, Delivering Happiness: A Path to Profits, Passion, and Purpose, was written with the intention of spreading the message of using passion to find one’s purpose and turn a profit (Delivering Happiness, 2013).
Tony Hsieh’s brand of authentic leadership has made its mark on the business world, and those who would like to adopt a similar leadership approach will benefit from his example.
Delivering Happiness. (2013). About the Author. Retrieved from Delivering Happiness: http://www.deliveringhappiness.com/about-us/about-the-author/
Northouse, P. G. (2012). Leadership: Theory and Practice (6th ed.). Thousand Oaks: SAGE Publications, Inc.
Reiss, R. (2010, July 1). Tony Hsieh On His Secrets Of Success. Forbes. Retrieved from http://www.forbes.com/2010/07/01/tony-hsieh-zappos-leadership-managing-interview.html