Mari

Tony: Don’t Outsource Your Core Competency.

In Be authentic, Business, Experience, Strategy, Tech on 06/21/2012 at 7:53 pm

I met Tony Hsieh at a 37signals event (seems like I meet a lot of people there). He was doing a national tour to promote Delivering Happiness, and my friend Jason invited me to join them. There were only 30 or so people there, so it was a pretty intimate setting, which was great.

Tony talked about his experiences with growing Zappos, and one of the biggest operational hangups he experienced was when they trusted an external company to handle their warehousing and fulfillment. After losing money, losing customers and losing time, Tony writes in his book:

“It was a valuable lesson. We learned that we should never outsource our core competency. As an e-commerce company, we should have considered warehousing to be our core competency from the beginning.”

People think our core competency is cupcakes. But it’s not. There are a million cupcakes in this city. What sets us apart (according to our clients) is the service level that each of them get with each order. Yes, the cupcakes need to be pristine. They need to be impeccable. But what we’re GOOD at, what sets us apart from our competitors, is our personal service.

So taking Tony’s advice, we will never outsource that. You have my word.

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