(Ferenstein Wire) — Zappos was blindsided with a slew of recent stories reporting that a new radical management experiment was backfiring, given that an (ostensibly) alarming 18% of its employees left the company since Spring. Initially, Zappos declined to comment for the New York Times story, but the meme spread throughout the business press (upwards of 19 major outlets by Google News’s latest count), from Fortune to the Wall Street Journal.
For the past two years, quirky culture enthusiast and Zappos CEO Tony Hsieh has fascinated the business press with his radical experiment in self-governing management. Early on, I did a feature on their so-called “Holacracy” management method, which abolishes traditional hierarchy and replaces “bosses” with an overlapping network of self-managed teams.
To briefly summarize, employees split their time between teams dedicated to everything that one could do for the company, from managing the lunch menu to marketing strategy. Once the Holacracy constitution is enacted, not even the person who was formerly considered the CEO (Hsieh) can overrule a team in charge of a particular project (more on that here).
The Ferenstein Wire reached out to Hsieh and his team for a response to the recent string of press and given my previous reporting, he agreed to answer questions via email. For the sake of transparency, I decided to paste much of the interview in their own words, in a Q&A format. So, below is our interview (edited for clarity and brevity).
(The full responses to all of the questions can be read here.)
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