Tony Hsieh, CEO of, and author of "Delivering Happiness: A Path to Profit, Passion and Purpose," explained to an American Gem Society Conclave audience how he went from selling shoes, to concentrating on customer service, to making his company culture the No. 1 priority.

Although is a hugely successful online purveyor of shoes and clothing, Hsieh early on differentiated the company by focusing on customer service. Unscripted call-center employees were empowered to make customers happy any way that suited their personality, as long as the call ended with a happy customer who believed they had gotten the best customer service of their life. They could tell jokes or talk about their dogs. It worked.

"We've had customers ask us if we could please start an airline or run the IRS," Hsieh says. "Our whole philosophy is let's take most of the money we would have spent on advertising and invest it in customer service." The result is that the company has grown through repeat customers and word of mouth. has a 365-day return policy, free shipping both ways and advertises its (800) number on each page of its website. The company wants people to call! If they are out of stock on an item, they will refer callers to a competitor. Rather than trying to close an immediate sale, wants customers for life.

Company culture is based on a list of core values. So serious is Hsieh about company culture that employees are hired based on it and even fired if they don't fit in with it. Even talented, potential superstars who don't mesh with the core values are shown the door or not invited in to begin with.

Here's a list of's core values:

Deliver WOW service, embrace and drive change, create fun and a little weirdness, be adventurous, creative and open-minded, pursue growth and learning, build open and honest relationships with communication, build a positive team and family spirit, do more with less, be passionate and determined and be humble.

How do you test for humble? On a job interview, tests potential employees for the "humble" quality by asking the shuttle driver how the applicant treated him or her when they were picked up at the airport.

Creating a little weirdness may not be one of your core values. employees, for example, regularly hold themed parades in the office.

But Hsieh says the important thing is to know what your core values are, and to keep your company and employees focused on them. Why? Hsieh has learned that vision and culture inspire passion and purpose, and motivation takes care of itself. "Chase the vision, not the money," he advises. Do what you feel passionate about.

Ask yourself: What do customers expect? What do customers actually experience? What emotions do customers feel? What stories do they tell their friends? How can the company culture create more stories and memories?




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