by Sarah Van Wagnen
Netflix is known for its high quality streaming, but they should also be well known for something else. Their approach to how they manage and hire their employees is one of the main reasons they’ve continued to thrive. Looking at how Netflix keeps performing so well could be a guiding light for other companies going through a period of growth. Any company or organization that is struggling to adapt should look into how Netflix runs the show.
There are 7 very important principles Netflix is guided by. The first one is “Values are what we Value” they hire and keep people based on 9 values. These include judgement, communication, impact, curiosity, innovation, courage, passion, honesty, and selflessness (Hastings, 2009). Their second cultural aspect is high performance, this is valued much more over number of hours in the office. Instead of annual reviews, managers use the “keeper test”. They ask themselves what employees they would fight to keep if they had the option to leave for a different company. They want star players across the field.
Freedom and responsibility, along with context and not control are their next principles. By increasing freedom and responsibility talent within the company grows at the same rate as talented needed. Therefore even though Netflix is growing, there’s no need to lay down more procedures and limitations that will strangle the employees and end up hurting the company. Talent is able to thrive and Netflix will accept nothing less. Vacation time is also up to each employee to decide what best will fit their needs. Bosses are encouraged to lead by example and come back from vacation with fresh new ideas. Within how they manage their employees they use context instead of control. They do not micromanage or constantly have a say in what everyone is doing. Goals and objectives with clearly defined roles are set to create the highest quality work.
The remaining parts of Netflix culture are highly aligned, loosely coupled; pay top of market; and promotions and development. There are clear goals and expectations with trust between groups so that projects can move quickly and efficiently. Netflix also always pays at the top of the market for their workers. If their skills are valuable and growing they do not want to lose a star to another company. This motivates workers to align themselves with top of the market qualities 100 percent of the time. Promotions are given when there is a job big enough for a superstar employee; however some divisions in Netflix will grow while others may not, but employees will still be paid at the top of their individual market skill level.
These practices have been so successful because employees are constantly using their talent in the best way possible. While Netflix grew as a company, they made sure their employees did too. They only hired the best, and let go of those who didn’t fit their model. Netflix knew what type of company it wanted to be and did not settle on trying to control change. The company thrives on change because their employees can adapt, and when someone can no longer adapt they are offered a great severance package. The employees who fit Netflix’s needs are happy, and even the ones who no longer do are happy. “We continually told managers that building a great team was their most important task,” said a former employee (McCord,2016). Great co-workers are the key to employee happiness.
Compared to organizations I’ve been apart of, Netflix is very different. Most places I’ve worked have valued control over context. They’ve been very rigid jobs with pay based on the hour, not what I actually get done. In turn I had no desire to stay very long at these jobs and ended up moving on to something else pretty quickly. I did have one internship where what I did was a great deal of my own ideas, and it really helped me get more done in a smaller amount of time. Places I’ve worked could learn a lot from Netflix,”Giving employees greater freedom and holding them to higher standards, while not sweating tiny details, are common-sense approaches that seem likely to help many companies beyond Netflix” (Stenovec, 2015).
If I worked in a culture such as Netflix, I feel like I would be an effective worker. I enjoy being pushed and inspired while having a good amount of freedom. The only problem I might have is adapting to a lot of change quickly, but if I had the skills Netflix needed I would be motivated to allow my talent to thrive. Netflix treats employees like adults instead of children, and I’ve always valued mutual respect within any organization. Nothing makes me more upset than being treated as incompetent within a workplace. By building trust and respect between employees and the company both parties will benefit much more than when employees are restricted too much. Talent and passion is the driving force behind what motivates me, and behind what motivates so many other people as well. Workers are not inspired by clocking in and out; giving people the opportunity to do their best work free of the strict 9-5 shift creates the talent that has helped Netflix grow.
Hastings, R. (2009, August 1). Culture. Retrieved from http://www.slideshare.net/reed2001/culture-1798664/8-At_Netflix_we_particularly_value
McCord, P. (2016, January 27). How Netflix reinvented HR. Retrieved from https://hbr.org/2014/01/how-netflix-reinvented-hr
Stenovec, T. (2015, March 03). One reason for Netflix’s success — It treats employees like grownups. Retrieved from http://www.huffingtonpost.com/2015/02/27/netflix-culture-deck-success_n_6763716.html