May 30, 2014

Zappos Is Revolutionizing Hiring — but Is It a Good Idea?

By now, you’ve heard about perennial talent mavericks Zappos’s latest publicity stunt/hiring revolution (depending on how cynical you are): no more job postings!

Instead, Zappos is focusing its efforts on cultivating a community of “Zappos Insiders”. To quote senior HR manager Mike Bailen’s post on ERE, “Zappos Insiders will have unique access to content, Google Hangouts, and discussions with recruiters and hiring teams. Since the call-to-action is to become an Insider versus applying for a specific opening, we will capture more people with a variety of skill sets that we can pipeline for current or future openings.”

Essentially, Zappos is cultivating a sophisticated talent community — which hiring authority Lou Adler has hailed as the “future of sourcing”. The thinking goes that traditional methods of sourcing — i.e., putting out the call for resumés via job boards and other advertising platforms — are inefficient and unwieldy, resulting in missed opportunities for job seekers and employers alike. Bailen points out that Zappos received 31,000 applicants last year, but only hired 1.5 percent of them — which means recruiters spent the vast majority of their time slogging through ultimately unnecessary resumés. To quote Hironomy’s Tamer Rafla, who spoke with us earlier this week, “The biggest issue on the employer’s side is that all the jobs are accessible by everybody. They get bombarded with resumés, and they have to look through each one of them because they don’t know if the candidate is good or not.”

Talent communities, on the other hand, preclude the applicant flood. Instead, companies pre-build strong relationships with a ready-to-go talent pool. When a job opens up, there’s no resumé fusillade: recruiters dive into the talent pool, find the right fit(s), and fill the position.

With organizations like Deloitte Consulting predicting the transition to an open talent economy, Zappos seems poised to take on the future with its flexible, fluid, efficient new approach to hiring. But as radical and awe-inspiring as Zappos’s new method seems, there remains one obstacle that might derail the whole revolution: will the Zappos talent community thrive enough to furnish the company with the rich talent pool it’s looking for?

Heroes in the Hiring World — But to Everyone Else?

When it comes to the worlds of HR and recruiting, Zappos and its CEO Tony Hsieh are pretty much heroes. The company’s core values are held up as perfect pillars for building a great company culture. Glowing tales abound of the organization’s charmingly eccentric workplace. There even exists a training course, called Zappos Insights, which seeks to spread Zappos practices far and wide.

But while HR and recruiting professionals go crazy over Zappos, what about the talent itself? Do people whose lives don’t revolve around sourcing and hiring and retention care all that much about the company? And if they do care, do they care enough to put the effort in to become a Zappos Insider — to build a long-term relationship with a company that may never even hire them? Sure, the crush of resumés may be a pain for employers, but the tenuous nether space of the talent community can be just as agonizing for candidates — for the most part, they have no idea if the company is even considering bringing them aboard.

So the talent community becomes a strange form of unpaid emotional labor: members of the community have to work hard to demonstrate their passion and enthusiasm and cultural fit to Zappos, but there is no guarantee they’ll receive compensation in return. That can be off-putting for job seekers — think about how annoying and time consuming it is to fill out an application through a traditional ATS. Now consider removing the definite structure from that process and having to sell yourself to a company indefinitely. As a job seeker, you may feel sort of dirty and cheapened.

Not everyone is head-over-heels in love with Zappos the way HR and recruiting professionals tend to be. In the New Yorker’s excellent 2009 profile of the company, we’re (indirectly) made privy to a few complaints people have against the company culture. One Zappos employee mentions that some people see the company as a cult; another mentions that Zappos’s company culture played a role in her divorce (though, weirdly enough, she doesn’t have any problem with this — which, to me, is a bit chilling. But, hey, I guess I’m not the kind of person Zappos would want to hire, so fair enough).

But Zappos’s biggest gamble is that people will be drawn to work for the company without traditional recruitment advertising — that the company’s profile is big enough to bring talent in on the strength of its own magnetic pull. Is this really the case? Can culture alone draw people in, or is culture the complement that convinces a job seeker to apply to your opening? Because, here’s the thing: we can be totally idealistic about work, or we can admit that, by and large, people don’t enter the workforce because they love a company’s culture — they do it because they have bills to pay.

Hsieh told the New Yorker that he was interested in creating “such a great environment, where employees get so much out of it that they would do [the work] for free,” but perhaps he’s asking people to love their jobs a little too much.

Then Again — There Are Some Clear Benefits

For all of my misgivings about Zappos’s decision to drop job postings, I have to be fair and admit that this may have been a really good decision for the company. Consider just how strongly Zappos emphasizes company culture. It follows that the organization would be very interested in only hiring individuals who can help maintain their very specific culture. That means that Zappos’s hiring process has to be even more selective than most companies’ — after all, it’s harder to find personalities than it is to find skill sets. To paraphrase Rafla again: people can learn skills, but they can’t learn personalities.

When your hiring process is supremely selective, you don’t want the unwashed masses firing resumés at you like so many bullets — you’re just going to have to dodge 98.5 percent of them anyway. So why not find a way to keep the hoards from targeting you in the first place? That means less time sourcing talent and more time building relationships with people who matter.

For all the negative comments about Zappos that can and have been made, the fact remains that they’re a prominent organization with a significant customer base. While most job seekers aren’t spending their time reading about company cultures, a lot of them are buying clothes and shoes online — which means a lot of them are coming into contact with Zappos. I’m not certain that company culture will be enough to draw these people in, but I do believe that more than a few of them will like shopping with Zappos so much that they’ll poke around for employment opportunities.

I don’t have a definitive answer — right now, no one does. We won’t know if this was a good idea until we’ve seen how it plays out for Zappos. So I suggest tempering our enthusiasm with some realism: there are ways for this spectacular maneuver to blow up in the organization’s face. Let’s no go rushing after Zappos until we’ve seen where the path leads.

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Matthew Kosinski is the managing editor of