… derives from ‘net’ as in internet and ‘flix’ as in flicks (another name for movies)
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The other day during the beginning of a course presentation, the presenter quoted Reed Hastings, the CEO of Netflix as saying to his employees something along the lines of ‘never, ever try to please your boss’. Unfortunately for this course presenter, once I heard this, I switched off what he was saying and started finding out more about the culture of Netflix.
Netflix has over 193,000,000 subscribers worldwide. What type of organisation is Netflix to make it this huge global success?
Perhaps it is down to the unconventional management style of Reed Hastings, the CEO of Netflix. He calls his style ‘a unique cultural experiment’. In his book No Rules Rules, he talks about how Netflix gradually adopted this radical style from having to adapt and thrive in a rapidly changing industry. One of the keys to the success of this highly regarded platform is that he hires and keeps on the best workers and pays them top salaries!
This is one of the key markers of his success: Reed Hastings realised that job performance (good or bad) is contagious. If you have an under-performer on your team, this can have adverse effects. Through the ups and downs of the early years of Netflix he had to make a number of staffing layoffs. Hastings soon realised that if he got rid of unproductive workers, he would have an increase of talented employees to promote teamwork, which would in turn increase the level of performance all around – hence creating a strong group of collaborative high performers.
These high performers want to work at Netflix because they know they will improve their skills by learning from other top performers and will therefore push themselves and each other to produce high-quality work, which for the employee increases their own motivation and job fulfilment.
In order to combat other companies poaching his high performers, Hastings pays more than any other comparative company and gives raises based on the market demand for the employees’ skillset – an interesting concept.
Something I find questionable about the talent retention aspect of the business is that Netflix uses a procedure they call the “Keeper Test”. This involves team managers asking themselves whether they would fight to keep a particular team member if the employee resigned. If the answer is no, then a conversation would need to be had with that team member as to how they might improve or … they would be quickly out of a job ( but love the sound of this) … with an offer of anywhere from a 4-9 month salary severance package (based on the position).
Another unique aspect of working for Netflix includes allowing employees to have unlimited holidays! They encourage people to take holidays to refresh and recharge – formally it is unlimited holidays but they also encourage people to set a good example and have a balanced life.
There are so many other things that Netflix does differently than the historical factory model of companies… I may need to add to this …
Living an Inspired Life 