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People Have Power; Don’t Take It Away
The fundamental lesson we learned at Netflix about success in business today is this: the elaborate, cumbersome system for managing people that was developed over the course of the twentieth century is just not up to the challenges companies face in the twenty-first.
We had come to understand that the most successful organizations in this world of increasingly rapid disruption will be the ones in which everyone, on every team, understands that all bets are off and everything is changing—and thinks that’s great.
Even more important, I saw that they were premised on false assumptions about human beings: that most people must be incentivized in order to really throw themselves into their work, and that they need to be told what to do. The “best practices” that have been developed on the basis of these premises are, ironically, disincentivizing and disempowering.
As for empowerment, I simply hate that word. The idea is well intentioned, but the truth is that there is so much concern about empowering people only because the prevailing way of managing them takes their power away.
We didn’t set out to take it away; we just overprocessed everything. We’ve hamstrung people.
A company’s job isn’t to empower people; it’s to remind people that they walk in the door with power and to create the conditions for them to exercise it. Do that, and you will be astonished by the great work they will do for you.
We approached developing the culture in the same way we approached innovating the business.
while I’ve removed the words “policy” and “procedure” from my vocabulary, I love discipline.
When engineers start to whine about a process you’re trying to implement, you want to really dig into what’s bothering them, because they hate senseless bureaucracy and stupid process. But they don’t mind discipline at all.
We wanted people to practice radical honesty:
We wanted people to have strong, fact-based opinions and to debate them avidly and test them rigorously.
We asked all managers, starting at the top with our executive team, to model these behaviors, and by doing so, they showed everyone on their teams how to embrace them as well.
The key is to proceed incrementally. You can start with small steps and then keep building. Pick a practice that you think fits your group and business issues particularly well and start there. For leadership teams, start with one department or group you think is best suited or most in need of change. Creating a culture is an evolutionary process. Think of it as an experimental journey of discovery.
Great teams are made when every single member knows where they’re going
When I’m hiring, I look for someone who gets really excited about the problems we have to solve. You want them to wake up in the morning thinking, God, this is hard. I want to do this! Being given a great problem to tackle and the right colleagues to tackle it with is the best incentive of all.
the best thing you can do for employees is hire only high performers to work alongside them. It’s a perk far better than foosball or free sushi or even a big signing bonus or the holy grail of stock options. Excellent colleagues, a clear purpose, and well-understood deliverables: that’s the powerful combination.
In product development, if something doesn’t work, you get rid of it. I realized we could apply that same principle to managing people.
the teams I saw that accomplished great stuff just knew what they most needed to accomplish; they didn’t need elaborate procedures, and certainly not incentives.
If you hire the talented people you need, and you provide them with the tools and information they need to get you where you need to go, they will want nothing more than to do stellar work
Ted Sarandos, head of content since the earliest days, told me that freeing high performers from constraints has been vital to building up the original-content business so rapidly.
Ted says that his core approach has been asking his team to focus on finding the best creative talent with the skills to execute, and then giving those creators the freedom to realize their vision.
I’m not at all saying that teams don’t need direction setting and coaching. They do. But the ways in which they’re given direction and feedback are often far from optimal.
Discover how lean you can go by steadily experimenting. If it turns out a policy or procedure was needed, reinstate it. Constantly seek to refine your culture just as you constantly work to improve your products and services.
Every Single Employee Should Understand the Business | Communicate Constantly About the Challenge
Reed and I had both been inspired by the argument for open-book management in Jack Stack and Bo Burlingham’s book The Great Game of Business.
as a business grows more complex, communicating about how it works, let alone about the course for the future, also becomes more complicated. Working out how to do this—and, for company leaders and HR executives, coaching all managers to do it, and do it consistently and continuously—takes time. The key is to establish what I call a strong heartbeat of communication, and that takes experimentation and practice.
Everyone Working for You, at All Levels, Can Understand Your Business
Humans Hate Being Lied To and Being Spun | Practice Radical Honesty |
being transparent and telling people what they need to hear is the only way to ensure they both trust you and understand you.
honesty helps people to grow, and it flushes out the differences of opinion and alternative ideas that people so often keep to themselves.
Openly sharing criticism was one of the hardest parts of the Netflix culture for new employees to get used to, but most quickly came to appreciate how valuable the openness was.
Many people feel hesitant to speak so openly, but the truth is that most people really appreciate the opportunity to get a better understanding of their behavior and how it’s being perceived, as long as the tone of delivery isn’t hostile or condescending.
Model Honesty and People Will Pick the Habit Up You want everyone on your team—and, for upper management, all around the company—to learn to be more open and honest with one another. For this to happen, the standard must be set and practiced from the top down.
The more rigorously you communicate and model the transparency standard, the more pervasive a part of your culture it will become.
At Netflix we learned that preparing people for changes to come led to a sense of trust around the company: trust that we would proactively take the company where it needed to go and that we wouldn’t mislead anyone about the changes that would require.
When leaders not only are open to being wrong but also readily admit it—as Reed did that day, and regularly did—and when they do so publicly, they send a powerful message to their teams: Please speak up!
a study by the Corporate Executive Board found that companies that actively fostered honest feedback and had more open communication produced a return over a ten-year period that was an astonishing 270 percent higher than that of companies that didn’t.
Anonymous Surveys Send a Mixed Message
The conventional thinking is that if you allow people to be anonymous, they will be more truthful. In my experience that’s not the case. Truthful people are truthful in everything they do. And if you don’t know who is giving you feedback, how can you put their comments into the context of the work they’re doing,
Perhaps the worst problem with anonymous surveys, though, is that they send the message that it’s best to be most honest when people don’t know who you are.
If you want to know what people are thinking, there is no good replacement for simply asking them, best of all face to face.
If people ask in a true spirit of interest about the problems others are wrestling with, remarkable bridges of understanding can be built.
Over time, this sort of questioning helped cultivate curiosity and respect and led to invaluable learning both within and among teams and functions.
Netflix turned out to be too much of a culture change for him, and he moved on before long.
the way to keep employees committed is to hire people who are really interested in a problem like the one you’re hiring for and who have a track record of or proclivity for working on things for a very long time.
Another big mistake made with metrics is thinking that they’re fixed. They must be fluid; they must be continuously revisited and questioned. This is where vigorous debate comes in.
Debate Only for the Sake of the Business and Customers
