Zappos CEO Tony Hsieh explains why 18% of staff quit

Zappos CEO Tony Hsieh explains why 18% of staff quit

Following Zappos’ ultimatum last March – adopt self-organisation or leave with severance pay – 18% of employees have left the company.

Workers were initially given until 30th April 2015 to decide where their futures lay, but those who were working on a task known as ‘Super Cloud’ were given until 4th January 2016 to avoid workflow disruption. 50 of those on this task accepted the offer, making the cumulative departure figure 260, or 18% of the workforce.

According to Transition Lead John Bunch, the firm has countered the exoduses with new hires, bringing the head count to approximately 1,500, Business Insider reports.

The severance package was three months’ salary, or a month’s salary multiplied by the number of years at the retail business.

Zappos CEO Tony Hsieh said to Business Insider: "It's more just in line with how we've always done things at Zappos.

"We could've just as easily not given any offer and then just said, 'This is what we're doing’, but we've always prioritised company culture and how we treat employees.

“Anecdotally I would guess that about half of them, the reason they took the offer ... actually had nothing to do with Holacracy or self-management, [it] was just because they really wanted to go out and start their own businesses. And now with a year's severance, for example, they have the funds to try it out. And they also knew that they could, 12 months later, come back to Zappos.”

Zappos COO Arun Rajan wrote on the company’s website: “There have been a lot of questions about the Super Cloud Teal offer - specifically around how many people took the offer and how we're going to handle the loss of employees in tech. Quick updates in this context...

“50 employees took the Super Cloud Teal offer - this is in line with expectations and represents 38% of those who were given the … offer, and 3.5% of the total number of employees we had in Q1 2015, which brings the total number of people taking the … [offers available] to 260, representing a total of 18% of the company taking the offer and leaving over the 12-month period since Tony's email in March 2015.

“While we have lost a number of folks, it is important to note that we have a significant group of highly talented individuals who will be staying to help move Zappos forward.”

The initial report can be read here, while an unrelated story on Hsieh and his “living experiment” can be found here.

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