Zappos has launched a program that pays new employees $1,500 to quit the company during initial training sessions. The policy is designed to make sure new employees are committed to working at the online retailer beyond just a paycheck.
Known to Zappos' veterans as "the offer," the quitting bonus offer typically comes a week or two into Zappos four-week indoctrination period that immerses new employees in the company's strategy, culture, and obsession with customers. Typically, at some point in the training session, the training class leader leaves the room and designated employees enter to have a frank discussion with the new hire.
"They say: 'Off the record, really, how is everything going? Does it seem like the right fit for you? Is this really where you think you want to be?,'" Rachel Brown, training manager at Zappos, told Internet Retailer. "Then we say if this isn't the place for you we want to let you know about an early resignation offer that you can take advantage of."
The quit-now incentive, which started with offers of $100, was instituted by Zappos' CEO Tony Hsieh as an experiment two-and-half years ago. The quitting bounty was raised to $1,000 in January this year, and recently hiked to $1,500 because Mr. Hsieh didn't feel enough people were taking the company up on its offer at $1,000.
Only about three percent have so far taken the money since the program was initiated, Ms. Brown told Internet Retailer. She attributes the small number taking the cash to a careful screening process. Interviews are aimed at getting a feel for the applicant's personality, such as: 'On a scale of one to 10, how lucky do you think you are?' and 'When is the last time you went above and beyond for a customer?'
In an online interview with CEOshowonline.com, Mr. Hsieh said part of the secret of Zappos' success is around the "need to be truly passionate about whatever you're in the business of doing ... it should not just be about making money." Later, Mr. Hsieh explained how Zappos' success is directly connected with its unique "two-step" hiring process that in its second-step concentrates on Zappos' corporate culture and core values. Mr. Hsieh said, "We make sure the people we hire have similar values. We won't hire them if they are not a "culture-fit even if they are technically strong."
Discussion Questions: What do you think of Zappos pay-to-quit offer? Do you see value in such a practice become more widespread across retailing?