Business Issues in Zappos & Forever 21: A Comprehensive Analysis

This report provides a comparative analysis of Zappos.com and Forever 21, focusing on their business issues, corporate culture, leadership styles, and organizational structures. Zappos.com, known for its customer service and flat organizational structure, contrasts sharply with Forever 21, which faces challenges related to employee satisfaction and a hierarchical structure. The analysis covers mission and vision, business processes, employee happiness, and change management barriers. It highlights the transformational leadership at Zappos versus the transactional approach at Forever 21, impacting employee engagement and organizational culture. The report concludes that differing leadership styles significantly influence the companies' ability to adapt to change and maintain a positive work environment. Desklib offers this solved assignment and many more for students.

Running head: ISSUES RELATED TO ZAPPOS
ISSUES RELATED TO ZAPPOS
Name of the Student
Name of the University
Author Note

1ISSUES RELATED TO ZAPPOS
Table of Contents
About the companies......................................................................................................2
Mission and vision of the companies.............................................................................2
Business and business processes in which the company engages..................................3
Current corporate culture of the companies...................................................................3
Leadership styles of leaders of the companies...............................................................4
Business facets of the companies that need to change...................................................4
Corporate structures of the organizations......................................................................4
Happiness factors of the employees in the companies...................................................5
Allowance based on autonomy of employees in the organizations...............................5
Flexibility based on work place and time in the organizations......................................5
Time required by employees and administrations in the social projects.......................5
Issues that can create barriers to change in organizations..............................................5
Conclusion......................................................................................................................6
References......................................................................................................................7

2ISSUES RELATED TO ZAPPOS
About the companies
Zappos.com is a clothing and shoe based online retail based organization which has
its origins in Las Vegas, Nevada. The organization was established in the year 1999 by Nick
Swinmurn. The organization was mainly launched under domain name of Shoesite.com. The
company further acquired by Amazon in the year 2009. The organization had shown
immense growth from the year 1999 to the year 2000. Zappos.com then became of the online
retail based giant Amazon (Zappos.com 2019).
Forever 21 is a fast fashion based organization that operates in the US and the
headquarter is located in Los Angeles, California. Forever 21 began its operations in the
industry with a 900 square feet based store in the year 1984. The organization is mainly
known in the industry for the fashionable products that are offered to the consumers
including, beauty products, accessories, clothing and home based goods. Forever 21 offers
different types of products and apparels to the consumers with the help of its effective online
platform (Forever21.com 2019).
Mission and vision of the companies
The vision statement of Zappos.com is based on the ways by which the organization
can deliver happiness to the employees, vendors and the customers. On the other hand, the
mission statement of the organization is based on the “WOW philosophy”. The most
important part of the mission statement is based on the best levels of services which are
offered to the customers (Cravens et al. 2015).
The mission statement of Zappos is based on the ways by which the company aims at
empowering the customers in so that they can be comfortable with their own bodies and the
fashion statement mainly needs to be an extension of their personal style statement. The

3ISSUES RELATED TO ZAPPOS
vision statement of Zappos is based on the sales of different pieces of clothing that are able to
develop a stylish outfit that is suitable for any occasion (Hussain, Rahman and Shah 2016).
Business and business processes in which the company engages
The most important part of the business process that has been developed by
Zappos.com is based on the best in class services that are offered to the consumers. The
organization is able to develop an alignment between the business processes and the
operating models. The annual revenues that have been gained by the organization in the year
2015 are more than 2 million Dollars (Kajalo and Lindblom 2015).
Forever 21 offers many different brands under the fast fashion label that include XXI
Forever, Forever 21 Girls, Love 21 Contemporary, Forever 21+, Gadzooks, 21Men, For
Love21, Heritage 1981, Forever 21 Lingerie, Forever 21 Red, Riley Rose. The offline stores
of the organization are located in different parts of the world and the online operations on the
other hand can reach out to a larger number of consumers. The variety of products that are
offered to consumers with the help of its website is also quite high (Karpen et al. 2015).
Current corporate culture of the companies
Zappos.com has become famous in the online retail industry for the culture and values
that have been followed in an effective manner. The organization has developed a consulting
based team which is helpful for the other companies who wish to improve the culture. The
culture in Zappos.com is able to inspire high levels of creativity in the operations and the
business model as well. The culture of Zappos.com is legendary in nature and the company
has implemented an open floor based plan. The representatives of the customer services have
same levels of authority like the CEO (Kumar, Anand and Song 2017).
The corporate culture of Forever 21 is not able to satisfy the employees and the
environment and compensation that is offered to them is highly satisfactory in nature. The

4ISSUES RELATED TO ZAPPOS
employees are able to receive satisfaction within the team. However, the overall
organizational culture and environment is not suitable for the employees (Nguyen et al.
2017).
Leadership styles of leaders of the companies
Employee engagement is considered to be the most important part of the leadership
style that has been implemented by Zappos.com. The leader or CEO of the organization has
followed the transformational style of leadership which is highly people centric in nature and
has been helpful in developing a positive environment in Zappos.com (Pedersen, Gwozdz and
Hvass 2018).
The transactional style of leadership is followed by the leaders of Forever 21. This is
the major reason behind the lack of proper levels of satisfaction in the organization. The
employees of the organization have provided low levels of ratings to the leaders (Holten and
Brenner 2015).
Business facets of the companies that need to change
The lack of proper differentiation of the products of Zappos.com is considered to be a
major facet of the business operations of the organizations that needs to be changed in order
to improve the revenues (Pedersen, Gwozdz and Hvass 2018).
The culture and environment of Forever 21 is a major issue that is being faced by
Forever 21 in the retail industry. The leadership style of the company needs to be changed in
order to gain the engagement levels (Cravens et al. 2015).

5ISSUES RELATED TO ZAPPOS
Corporate structures of the organizations
A flat organizational structure has been implemented in Zappos.com. The employees
and managers or leaders of the organization have similar levels of authority based on decision
making related to various operations (Kumar, Anand and Song 2017).
A hierarchical organizational structure is implemented by Forever 21. The authority
of leaders or CEO in the company is higher as compared to the employees who are a part of
different departments (Kajalo and Lindblom 2015).
Happiness factors of the employees in the companies
The levels of happiness of the employees in Zappos.com are high as the leaders are
highly cooperative in nature. On the other hand, the employees in Forever 21 are not quite
high happy with the environment that has been developed (Hussain, Rahman and Shah 2016).
Allowance based on autonomy of employees in the organizations
The autonomy of employees in Zappos.com is high and they are able to take part in
the decision making process in an active manner. The authority of employees in Forever 21 is
lower as compared to that of Zappos.com (Nguyen et al. 2017).
Flexibility based on work place and time in the organizations
The culture of Zappos.com is based on the high levels of flexibility that are depicted
in the workplace and time related to the completion of different tasks. The flexibility levels in
the workplace are low and arte able to let the employees become an active part in process of
decision making (Cravens et al. 2015).
Time required by employees and administrations in the social projects
The social responsibilities and projects are considered to be important for the
operations of Zappos.com in the online retail industry. Forever 21 takes part in corporate

6ISSUES RELATED TO ZAPPOS
social responsibility based activities in order to ensure compliance with the laws (Karpen et
al. 2015).
Issues that can create barriers to change in organizations
The change implementation process can face low levels of barriers in case of
Zappos.com as the leaders are highly cooperative in nature. On the other hand, the
management of Forever 21 will not be able to implement changes easily due to the lack of
proper collaboration between the employees and the management of the company (Hussain,
Rahman and Shah 2016).
Conclusion
The analysis in the report can be concluded by stating that the two organizations that
have been taken into consideration are based on two different types of leadership and
management style. The organizational environment and process based on change
management will be affected by the leadership based style of the CEOs.

7ISSUES RELATED TO ZAPPOS
References
Cravens, K.S., Oliver, E.G., Oishi, S. and Stewart, J.S., 2015. Workplace culture mediates
performance appraisal effectiveness and employee outcomes: A study in a retail
setting. Journal of Management Accounting Research, 27(2), pp.1-34.
Forever21.com 2019. Shop Forever 21 UK for the latest trends and the best deals | Forever
21. [online] Forever21.com. Available at: https://www.forever21.com/us/shop [Accessed 3
Mar. 2019].
Holten, A.L. and Brenner, S.O., 2015. Leadership style and the process of organizational
change. Leadership & Organization Development Journal, 36(1), pp.2-16.
Hussain, J., Rahman, W. and Shah, F.A., 2016. Market orientation and performance: The
interaction effect of entrepreneurial orientation. Pakistan Journal of Commerce and Social
Sciences (PJCSS), 10(2), pp.388-403.
Kajalo, S. and Lindblom, A., 2015. Market orientation, entrepreneurial orientation and
business performance among small retailers. International Journal of Retail & Distribution
Management, 43(7), pp.580-596.
Karpen, I.O., Bove, L.L., Lukas, B.A. and Zyphur, M.J., 2015. Service-dominant orientation:
measurement and impact on performance outcomes. Journal of Retailing, 91(1), pp.89-108.
Kumar, V., Anand, A. and Song, H., 2017. Future of retailer profitability: an organizing
framework. Journal of Retailing, 93(1), pp.96-119.
Nguyen, T.T., Mia, L., Winata, L. and Chong, V.K., 2017. Effect of transformational-
leadership style and management control system on managerial performance. Journal of
Business Research, 70, pp.202-213.

8ISSUES RELATED TO ZAPPOS
Pedersen, E.R.G., Gwozdz, W. and Hvass, K.K., 2018. Exploring the relationship between
business model innovation, corporate sustainability, and organisational values within the
fashion industry. Journal of Business Ethics, 149(2), pp.267-284.
Zappos.com 2019. Shoes, Sneakers, Boots, & Clothing + FREE SHIPPING | Zappos.com.
[online] Zappos.com. Available at: https://www.zappos.com/ [Accessed 3 Mar. 2019].