Zappos’s corporate structure is going to be getting a whole lot flatter.
The shoe-seller, which has almost 4,000 employees, is slated to do away with a traditional corporate hierarchy across its entire workforce by the end of next year, according to a report by Quartz.
Instead, the company is going to be reorganizing around “Holacratic” principles, which eliminate job titles and managers. In the place of a typical structure, employees will be placed into self-governing “circles.” Once the reorganization is finished, the company is slated to have more than 400 circles, and a more egalitarian structure.
According to the report, CEO Tony Hsieh wants to implement the system so that it’s possible to continue to scale the company without letting bureaucracy take hold.
The system seems like a good fit for the online retailer, which has always been known for its loose and wacky corporate culture. Zappos’s Q4 “all hands” meeting involved a female employee climbing into a case filled with tarantulas in a bid to win a $250 gift card.
These aren’t untested principles, either. Bellevue-based game development company Valve uses a similar corporate structure, which it credits for its ability to innovate and ship quality content efficiently. Still, the company’s system was not without its discontents: one former employee said that the company’s structure “felt a lot like high school,” and that it was difficult to communicate effectively.
It’s also far cry from parent company Amazon’s heavily regimented and closed corporate culture, which has caused its fair share of internal friction as well.
It’s always been interesting to us that Amazon has allowed the Zappos culture to thrive, kind of like a mini-ecosystem in the larger organization.