Why Zappos Pays New Employees to Quit—And You Should Too

YOUR CHOICE: SEE THE MOVIE



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Ever heard of a “Quit-Now” bonus for new employees? We’ve all heard of severance packages where long-standing employees are essentially paid a bonus to quit now. But a “Quit-Now” bonus for new employees to voluntarily leave after a week on the job … that’s novel.

Bill Taylor, of Mavericks at Work fame, writes how Zappos , a fast-growing online shoe retailer, will offer one-week old employees a “Quit-Now” bonus of $1,000. Zappos will ask new employees this question … “If you quit today, we will pay you for the amount of time you’ve worked, plus we will offer you a $1,000 bonus.”

Why does Zappos do this? The reasoning, as Bill Taylor put it, is …

“Because if you’re willing to take the company up on the offer, you obviously don’t have the sense of commitment they are looking for. It’s hard to describe the level of energy in the Zappos culture—which means, by definition, it’s not for everybody. Zappos wants to learn if there’s a bad fit between what makes the organization tick and what makes individual employees tick—and it’s willing to pay to learn sooner rather than later. (About ten percent of new call-center employees take the money and run.)”

SEE THE POWERPOINT PRESENTATION FROM ZAPPOS PRESIDENT, Tony Hseih

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Tony Hsieh, CEO of Zappos, provides his 10 tips for building a customer service focused culture.

Whichever is your media of choice, the deal is that for a virtual company to have such a strong connection with its customers, they must be doing something right.

All employees that are hired into their corporate office, regardless of position, are required to undergo a 4-week Customer Loyalty Training course, which includes at least 2 weeks of talking on the phone with customers in the call center.^[7] at full salary. After training the new employees are offered $1000 to leave the job immediately.^[7] This is to ensure people are there for the love of the job and not the money. Over 90% turn down the buyout.

Great job Tony. And move over Southwest. I've just found a new case study for my toolbox.

I have emailed Tony who graciously offered me a free copy of his culture book. More to come.

Communicating the Experience can Increase Retention

Which Job Do You Want?

This interesting tidbit is from the Harvard Business Review.
Posted by Tammy Erickson on October 10, 2007 6:51 AM

Imagine that you’re in the job market, with offers in hand from three firms. All three are attractive -- the type of opportunities you’ve been looking for with competitive compensation packages. You decide to meet with each firm one more time, specifically to talk about what your entry experience might like -- what to expect in your first six months on the job. Here’s what representatives from the three companies say. Which job will you take?

COMPANY A “Actually, your first three months will be a probationary period in which you’ll get to know and work closely with your assigned teammates. They’ll see how well you work with the group and contribute to its success. At the end of that period, your teammates -- your peers -- will vote on whether or not you will get to stay in the organization.”
COMPANY B
“We can’t tell you what your exact role will be or who you’ll be working with. For the first three months, you’ll be in our “fishbowl,” performing a series of weekly challenges, perhaps designing new products or marketing campaigns, under the close scrutiny of our CEO and other senior executives. At the end of the time, depending on what we observe, we’ll help you find the right position for your skills.”
COMPANY C
“Your first three months will be spent learning our way of doing business. We have a specific way of operating, and we expect you to follow our processes closely. We’re convinced that the ways we’ve outlined are the most productive and successful. After an extensive training program, you’ll get a chance to apprentice with one of our strongest performers.”

If you’re like most people, these three ways of starting work at a new company are not equally appealing. In fact, depending on your personality and preferences -- depending on how you view work and the role you want it to play in your life -- you’ll probably have a distinct preference for one over the others.

In a Harvard Business Review article, "What It Means to Work Here”, getting it right -- finding a work experience that matches your personality and preferences -- is key to your ultimate enjoyment of your work. In the end, the realistic demands of the job need to be in line with the role you’re prepared for work to play in your life. By choosing the company that is best suited to your needs and priorities, the more likely you are to be highly engaged in your work.

Organizations differ widely along these important components of the work experience. Some companies have risk-based compensation (options, bonuses), while others have predictable cost-of-living salary structures. Some organizations set up highly flexible, self-scheduling work groups; others take a pretty intense “all hands on deck” approach most of the time. Some reflect an underlying philosophy of paternalism; others a virtually complete contractor-like hands-off attitude. As you think about what you want to do next, it’s as important to think about your preferences for these “experience” factors as it is to consider the actual objective of the work you’ll be performing. If you don’t get this right, no matter how much you intellectually like the idea of what you’re working on, you won’t really be engaged.

Here were the results as of last night when I picked my choice. (B)