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Zappos’ Case: Focus on Stakeholder Happiness
The principle focus of Zappos is the satisfaction of its stakeholders, employees and customers. All the decisions made by the company aim at improving employee and customer relations. This focus has affected the ethical culture of Zappos in a number of ways. The company has a return policy for all its customers. If a customer receives a commodity and they happen not to like it, they can return it to the store and receive a full refund (Ferrell et al., 2015). The company has an active team of employees who reply to customer complaints over the phone. The phones are active 24 hours a day.
To enhance their accessibility further, Zappos has put a phone number on every page of its website to encourage customer access. The company has also trained all its employees to handle the customer in a courteous manner. The policy of transparency is an integral part of Zappos’ ethical culture. When the company decided to lay some of its staff members in 2008, the CEO wrote an email to each of the affected, explaining to them the reasons behind the dismissal.
Competitive Advantage of the Good Relationships
The good relationship between Zappos has conferred on it a competitive advantage over its competitors. Unlike other online stores, Zappos has a unique corporate culture. The company insists on quality services to its customers while maintaining fun in the work place at the same time. When employees work in an environment full of fun, evidence shows that they become more productive Llopis (2013). This culture encourages teamwork and prepares the workforce for any unprecedented challenges in the future. Zappos also trains its employees to make them more productive. This practice gives it a competitive advantage over other online companies that think of human resource development as a waste of resources and working time.
The manner in which Zappos handles its clients is very different from its competitors. The customers feel important when they learn that they can return goods that do not meet their desires. Although the return rate at Zappos is 45%, the customer loyalty it attracts is appalling. A customer is likely to trust a retailer that is willing to take back his good than the one without a return policy. This simple gesture has given Zappos a competitive advantage over its competitors in the online fashion business.
Management of Ethical Risks and Future Ethical Risks
A common risk for online businesses is the pilferage of important information to unwarranted hands. The same applies to Zappos when hackers retrieved the personal information of its clients from the database. Zappos managed this threat by informing the people affected. It was an ethical move to make. Some companies would have kept the information a secret for the fear of soiling the company’s reputation. Zappos went ahead to repair its systems to prevent a repeat of the incident in the future.
Future potential risks include competitors poaching highly trained employees from Zappos. Although the company treats its employees well, it is usually hard to turn down the prospects of a better salary. The tough economic times have made people to yearn for better salaries (Pofeldt, 2014). Unethical competitors that do not want to train their employees may take advantage of the tough economic times.
References
Ferrell, O.C., Fraedrich, J., & Ferrell, L. (2014). Business Ethics: Ethical Decision Making & Cases. Stamford, CT: Cengage Learning
Llopis, G. (2013). 6 Ways to Make Your Leadership And Workplace Fun Again. Forbes. Retrieved from, <http://www.forbes.com/sites/glennllopis/2013/09/23/6-ways-to-make-your-leadership-and-workplace-fun-again> 11 November, 2015
Pofeldt,. E. (2014). How to Master the Art of Poaching Employees. Inc.com. [Online]. Retrieved from, <http://www.inc.com/magazine/201405/elaine-pofeldt/how-to-poach-employees.html> 11 November, 2015