Culture and Commerce: Zappos, Francesca's Sow Spirit

Amazon is acquiring Zappos. On the face of it, the deal should work. Similarities abound. Both companies are online retailers -- one sells books CDs, and devices; the other, shoes. Both CEOs are visionary and respected. It should be a happy union save one striking difference: Zappos' legendary culture. In a recent Advertising Age magazine poll, 60 percent believed the merger put Zappos' innovative marketing culture at risk.

Jobs and opportunity are shifting away from giant corporations, often defined by their rigid cultures. Today, the action is at small and mid-sized companies, where there is a growing commitment to "culture" -- the spirit of the place. Zappos CEO Tony Hsieh believes that the way customers are treated has everything to do with employee commitment to a larger ideal. He equates working at Zappos with helping customers live happier lives. Sound superfluous? Consider that he sold the privately held company for nearly a billion dollars.

Developing a culture where everyone strives for excellence is like good chemistry -- magical if you've got it, deadly if you're faking it. How do you create a great culture? One example comes from Francesca's family of restaurants in Chicago. At Francesca's, all employees are encouraged to contribute ideas and suggestions. When the co-founder and namesake Francesca Pignataro decided she wanted all 18 locations to become more eco-friendly, it was a waiter who volunteered a list of suggestions he'd researched on how to conserve energy and reduce waste. Management implemented his ideas.

Company-wide, Francesca's maintains a commitment to grooming talent, moving people up and sharing the profits across the organization. Francesca Pignataro says, "Our quality is everything. We need a family spirit within the organization to keep our standards so high." In her mind, a great culture translates into a great experience for the customer. "We like to find and keep great people. Some career waiters now have their college-age kids working for us."

The results? Homegrown from a single location on Clark Street, Francesca's will open its 19th location next month. Ratings remain high. Business is steady, despite a weak economy. Executive chef and co-founder Scott Harris continues to explore new foods and dining concepts, continually tweaking his recipe for success.

Culture matters. Regardless of what type of business it is. These days, attracting great people to begin with, and motivating them to continually give their all is what lies at the heart of prosperity. Zappos does it by focusing on "happiness" and Francesca's emphasizes the spirit of family. Spreadsheets and number-crunching had their day. Culture is the new killer app.