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May 21 - June 25, 2023
My goal was to make employees feel like owners and, in turn, to increase the amount of responsibility they took for the company’s success.
The more employees at all levels understand the strategy, financial situation, and the day-to-day context of what’s going on, the better they become at making educated decisions without involving those above them in the hierarchy.
When it comes to personal struggles, an individual’s right to privacy trumps an organization’s desire for transparency.
Humility is important in a leader and role model. When you succeed, speak about it softly or let others mention it for you. But when you make a mistake say it clearly and loudly, so that everyone can learn and profit from your errors.
“Whisper wins and shout mistakes.”
The pratfall effect is the tendency for someone’s appeal to increase or decrease after making a mistake, depending on his or her perceived ability to perform well in general.
When transparency is in tension with an individual’s privacy, follow this guideline: If the information is about something that happened at work, choose transparency and speak candidly about the incident. If the information is about an employee’s personal life, tell people it’s not your place to share and they can ask the person concerned directly if they choose.
As long as you’ve already shown yourself to be competent, talking openly and extensively about your own mistakes—and encouraging all your leaders to do the same—will increase trust, goodwill, and innovation throughout the organization.
It’s to do what’s right for the business.
DON’T SEEK TO PLEASE YOUR BOSS. SEEK TO DO WHAT IS BEST FOR THE COMPANY.
Dispersed decision-making can only work with high talent density and unusual amounts of organizational transparency.
The more people are given control over their own projects, the more ownership they feel, and the more motivated they are to do their best work.
If your employees are excellent and you give them freedom to implement the bright ideas they believe in, innovation will happen.
When some of those bets don’t pay off, we just fix the problems that arise as quickly as possible and discuss what we’ve learned.
good decisions require a solid grasp of the context, feedback from people with different perspectives, and awareness of all the options.”
“Farm for dissent,” or “socialize” the idea. For a big idea, test it out. As the informed captain, make your bet. If it succeeds, celebrate. If it fails, sunshine it.
We now say that it is disloyal to Netflix when you disagree with an idea and do not express that disagreement. By withholding your opinion, you are implicitly choosing to not help the company.
I and everyone else at Netflix now actively seek out different perspectives before making any major decision. We call it farming for dissent.
In some cases, an employee proposing an idea will distribute a shared spreadsheet asking people to rate the idea on a scale from –10 to +10, with their explanation and comments. This a great way to get clarity on how intense the dissent is and to begin the debate.
The more you actively farm for dissent, and the more you encourage a culture of expressing disagreement openly, the better the decisions that will be made in your company.
FOR A BIG IDEA, TEST IT OUT
Farm for dissent. Socialize the idea. Test it out.
individual decision-making with input.
What matters is moving quickly and learning from what we’re doing.
The one thing you must do is show, ideally in public, that you are pleased she went ahead despite your doubts and offer a clear “You were right! I was wrong!” to show all employees it’s okay to buck the opinion of the boss.
Ask what learning came from the project. Don’t make a big deal about it. Ask her to “sunshine” the failure.
If you make a big deal about a bet that didn’t work out, you’ll shut down all future risk-taking.
We talk about sunshining our failed bets at Netflix, which means talking openly and publicly about things that go wrong.
When a bet fails, the manager must be careful to express interest in the takeaways but no condemnation.
If you make a bet and it fails, it’s important to speak openly and frequently about what happened. If you’re the boss, make it clear you expect all failed bets to be detailed out in the open.
We encourage employees to write open memos explaining candidly what happened, followed by a description of the lessons learned.
We shouldn’t be afraid of our failures. We should embrace them. And sunshine mistakes even more!
In a fast and innovative company, ownership of critical, big-ticket decisions should be dispersed across the workforce at all different levels, not allocated according to hierarchical status.
A worker’s performance will be judged on the collective outcome of his bets, not on the results from one single instance.
To help your workforce make good bets, encourage them to farm for dissent, socialize the idea, and for big bets, test it out.
Teach your employees that when a bet fails, they should s...
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firing a good employee when you think you can get a great one.
But a high-talent-density work environment is not a family.
A professional sports team is a good metaphor for high talent density because athletes on professional teams: Demand excellence, counting on the manager to make sure every position is filled by the best person at any given time. Train to win, expecting to receive candid and continuous feedback about how to up their game from the coach and from one another. Know effort isn’t enough, recognizing that, if they put in a B performance despite an A for effort, they will be thanked and respectfully swapped out for another player.
On a high-performing team, collaboration and trust work well because all the members are exceptionally skilled both at what they do and at working well with others.
Would the company be better off if you let go of Samuel and looked for someone more effective?
IF A PERSON ON YOUR TEAM WERE TO QUIT TOMORROW, WOULD YOU TRY TO CHANGE THEIR MIND? OR WOULD YOU ACCEPT THEIR RESIGNATION, PERHAPS WITH A LITTLE RELIEF? IF THE LATTER, YOU SHOULD GIVE THEM A SEVERANCE PACKAGE NOW,
AND LOOK FOR A STAR, SOMEONE YOU WOULD FIGHT TO KEEP.
Avoid stack-ranking systems, as they create internal competition and discourage collaboration.
“Only say about someone what you will say to their face.”
Positive actionable feedback (continue to . . .) is fine, but keep it in check. A good mix is 25 percent positive and 75 percent developmental (start doing . . . and stop doing . . .).
“Lead with context, not control.”
You provide all of the information you can so that your team members make great decisions and accomplish their work without oversight or process controlling their actions. The benefit is that the person builds the decision-making muscle to make better independent decisions in the future.
Therefore, the first question you need to answer when choosing whether to lead with context or control is, “What is the level of talent density of my staff?”
When considering whether to lead with context or control, the second key question to ask is whether your goal is error prevention or innovation.
