Alfred Lin began his keynote at the Strategy & Innovation Forum this morning by talking about how he met CEO Tony Hsieh. What began as a college alliance over pizza morphed into a partnership which now includes collaboration in running Zappos.com, one of the most inspiring online retailers in the world.

It’s no secret that Zappos is doing something right. The company, which grew an impressive 20% in 2008, boasts 900,000 unique UPCs but still manages to get most orders out the door in less than four hours. Their customer loyalty is superb and sales are strongly fueled by word-of-mouth. And, yes, they’re profitable, too. (Really. Someone asked.)

Lin believes that much of this success boils down to a crystal clear corporate culture that was created and is owned by employees. He gave some tips to attendees on how to duplicate that environment in their own companies.

For starters, he said, bring people on board who support your goals. “If you have someone who is good but they don’t believe in what you’re trying to build, don’t hire them,” he said. Continue to reinforce that philosophy. Once hired at Zappos, he noted that half of a person’s performance reviews are based on actual performance while the other half is reserved for how an employee embraces the company culture.

Then, he said, it’s important to get everyone on the same page. Each new hire at Zappos—from the people who pack orders to the accountants—begins his or her job with five weeks of training, much of which includes manning the call center. Not only do employees learn all about the customer very quickly, it’s also a great bonding experience. Believing that everyone is ultimately working for the customer, just in varying capacities, this policy helps weed out candidates who may think they are above the nitty-gritty interactions. Eliminating those people (and attitudes) up front is something that Lin values: “If you feel like you’re “above” that line of work,” he said, “this is not the right place for you.”

The company does still offer new hires $2,000 to quit, though Lin says that might not be enough. Only one percent of new hires take them up on the offer, he said, and hinted that the buyout might be raised in the future.

For managers and company executives, he said, the challenge is finding out what motivates and drives employees. He often likes to ask job candidates what they would do for the next ten years if money was no object. The current economic climate makes this question even more relevant because, he says, “if you are only in it for the money, you wouldn’t want to get out of bed right now to go to work.”

Transparency is also a crucial component. Although the idea of giving up control makes most executives squeamish, the Zappos philosophy involves relinquishing the brand, encouraging employees to Twitter from the office and establishing a Facebook page.

The company also believes in being brutally honest. Once a year, Zappos asks each employee to submit several paragraphs for a culture book, which is distributed company-wide. Lin said Zappos “only edits typos” and that everything is published…”the good, the bad, and the ugly.” Employees are also aware of how the company stands financially, receiving daily sales reports to monitor progress.

Having a strong corporate culture in place means that employees are able to make smart, quick decisions in the best interest of the business. Lin told a story about a person in the distribution center who found three $50 bills in a wallet that had been returned. He quickly jotted off a note to the woman and placed it, along with the $150, in the mail to her. The woman, who had been searching for the money (and, according to Lin, even accused her kids of taking it) told everyone she knew about the great experience. She even blogged about it. That’s an advocate money can’t buy.

An unwavering corporate culture meant the employee absolutely knew how to respond, Lin believes. “If you take care of your culture, things like this will happen,” he said. “People will do the right thing.”

But culture is only part of the puzzle. In this environment, Lin said, retailers need to focus on the “simple” things, like providing good customer service and a consistent shopping experience. “We sometimes do the complicated things very well, but we don’t always do simple things well,” he said. “This is a time to focus on what works.”

He’s even got a rosy outlook about the gloomy economy. When asked about competitors and staying afloat during challenging economic times (especially for a company that does not focus on price), Lin reflected that it all comes back to resilience. “What’s great about a downturn,” he said, “is that the people who are not committed and don’t want to be in it for the long haul will self-select themselves out of the game.”