As we wrote in the beginning, what is special about Netflix is how much we: Antoine de Saint-Exupéry, the author of The Little Prince, shows us the way: 1 We mean the team of your dreams, not the 1992 men’s USA Olympic basketball team. We pride ourselves on how few, not how many, decisions senior management makes. Everyone knows each other, and everyone picks up the trash. The rule is very simple… “would you be willing to fight for this employee if he or she decided to leave the company?“. 3 Mostly for our salaried employees; there are many limitations on this for our hourly employees due to legal requirements. Organizational Tenet: Operate As A Team, Not A Family Don’t get the wrong impression, Netflix doesn’t coddle their employees. Netflix Culture: Freedom & Responsibility 2. A year ago I attended Certified Agile Leadership (CAL1) training. Some processes are about increased productivity, rather than error avoidance, and we like processes that help us get more done. We believe that people thrive on being trusted, on freedom, and on being able to make a difference. And such important figures as Sheryl Sanberg, COO of Facebook, have confirmed that it is probably one of the most important postulates that will define the course of human resources in companies of this type. Our leaders make sure they set good examples by taking vacations, often coming back with fresh ideas, and encourage the rest of the team to do the same. It’s OK to say to your manager, “I know you disagree, but I’m going to do X because I think it is a better solution. In general, freedom and rapid recovery is better than trying to prevent error. This kind of organization is very specialized and well adapted to its business model. The company offers its employees generous benefits like unlimited holidays and an expense policy that simply requires people to “act in Netflix’s best interests”. A sports team with a losing record still pays top of personal market for the players they hope will get them back into a winning position. As the informal, smooth-running organization starts to break down, pockets of chaos emerge, and the general outcry is to “grow up” and add traditional management and process to reduce the chaos. In 2013, its shares tripled in value and the company won three Emmy awards. When the captain of any particular decision is reasonably confident of the right bet for us to take, they decide and we take that bet. I was fascinated to learn … To get there, we have an amazing and unusual employee culture. 2 We generally offer a minimum of four months of full pay as a severance package, giving our ex-teammates time to find a new company. We strive to have calm confidence, and yet yearn to improve. As preparation for the course, we were to prepare a case study of a few suggested companies, such as Netflix, which has a high-performance culture. We want to entertain the world. Why does hiring freelancers have a positive impact on society? We work hard to get people to give each other professional, constructive feedback - up, down and across the organization - on a continual basis. 5 Workana tools that clients like the most, Six years and more than a million users: Workana’s story. At Netflix, on the other hand, the dynamics has more to do with forming highly efficient workgroups that once they meet their objective they dissolve, join into new groups and dissolve again. Small decisions may be shared just by email, larger ones will merit a memo with discussion of the various positions, and why the captain made such a decision. The emphasis is on results and people, not processes. While it’s not surprising that 70% of employees on Glassdoor would recommend working at Netflix to a friend, there’s more to their success than unlimited holidays. But unlike the micro-manager, the goal of knowing those details is not to change certain small decisions, but to learn how to adjust context so more decisions are made well. We also have to foster collaboration, embrace a diversity of viewpoints, support information sharing, and discourage politics. We don’t wait for consensus, nor do we drive to rapid, uninformed decision making. We believe we will learn faster and be better if we can make giving and receiving feedback less stressful and a more normal part of work life. And we discuss generally how we can do better in the future. On the other hand, if the company does well, our broadly distributed stock options become quite valuable. To avoid the rigidity of over-specialization, and avoid the chaos of growth, while retaining freedom, we work to have as simple a business as we can given our growth ambitions, and to keep employee excellence rising. Being on a dream team is not right for everyone, and that is OK. At Netflix, you learn a lot working on hard problems with amazing colleagues, and what you learn increases your market value. If you have never tried it, or if you think it is time to enlarge your structure without adding fixed costs, we invite you to click here and learn more about Workana. There are some leaks, but the value of highly-informed employees is well worth it. They would be disappointed if given a severance package, but lots of mutual warmth and respect. Its employees must become familiar with an organizational culture in which they clearly postulate that they are a team, not a family or a “recreational kindergarten”. Subscribe to the Workana newsletter and keep updated, © 2012 - 2019 | Workana LLC - Todos los derechos reservados. We know this level of candor and feedback can be difficult for new hires and people in different parts of the world where direct feedback is uncommon. In this way, they naturally establish how they interpret the company’s present and what future they aspire to. Each leader's role is to teach, to set context, and to be highly informed of what is actually happening. There are a few important exceptions to our anti-rules pro-freedom philosophy. If we succeed, there is more laughter, more empathy, and more joy. Check out our exclusive remote freelance talent service for companies. Patty McCord was Netflix’s Chief Talent Officer from 1998 to 2012. Our policy for travel, entertainment, gifts, and other expenses is 5 words long: “act in Netflix’s best interest.”. We trust our teams to do what they think is best for Netflix — giving them lots of freedom, power, and information in support of their decisions. Eight years ago, we first published a slide presentation that outlines our employee culture at Netflix, which has since been viewed millions of times. Most companies seek to consolidate a stable work team. New employees often comment in their first few months that they are surprised at how accurate this culture description is to the actual culture they experience. Those who do not pass the keeper test (i.e. Getting cut from our team is very disappointing, but there is no shame. Our version of the great workplace is a dream team in pursuit of ambitious common goals, for which we spend heavily. As with any rapid growth, company culture becomes an increasingly hot topic. “Use good judgment” is our core precept. 2. The back and forth of discussion can clarify the different views, and concise writing of the core issues helps people reflect on what is the wise course, as well as making it easy to share your views widely. In describing selflessness we say “You make time to help colleagues. Its employees must become familiar with an, with its policy of responsibility and freedom has caused a stir among Silicon Valley companies, Being fired from this company doesn’t mean that an employee is bad, it just means that he or she isn’t a spectacular employee. We actively help people learn how to do this at Netflix through coaching and modeling the behaviors we want to see in every employee. Others take it to new extremes, proudly calling themselves nano-managers. Click here to learn more and schedule a a free call. At Workana, as at Netflix, we are convinced that the foundation of a great company is its culture. These organizations didn’t start that way, but the python of process squeezed harder every time something went wrong. The company offers its employees generous benefits like unlimited holidays and an expense policy that simply requires people to “act in Netflix’s best interests”. Netflix Inc.’s corporate culture is based on a core philosophy that prioritizes people. But those are the exceptions, and we avoid over-correcting. In most situations, both social and work, those who consistently say what they really think about people are quickly isolated and banished. Some people, however, value job security and stability over performance, and don’t like our culture. The corporation addresses the needs of its human resources to ensure that its online business processes are effective and profitable. We have a regular cadence of many types of meetings; we start and end on time, and have well-prepared agendas. Join our community and get ready for a new world of work. Workana is the largest freelance hiring platform in Latin America. The market for talent is what it is. Organisational Structure of Netflix Netflix has a functional organizational structure, which is segmented by the aims of its functions themselves, rather than by customer segments or regions. Excellent employees make everything else go smoothly” − Paty McCord, Manager of Talent Education at Netflix. Although the rise of its international visibility is relatively recent, Netflix has been operating since 1997. When shaping their culture, Netflix not only sought to build a strong company culture, but they defined the culture in a way that would motivate high performance at the same time. One description of the espoused Netflix organizational culture is stated in Slide 6 of the slide deck Netflix Culture: Freedom and Responsibility that you viewed in Module One. In fact, more than half of our employees work under this modality and this has innumerable benefits. Harassment of employees or trading on insider information are zero tolerance issues, for example. Leaders demonstrate that we are all fallible and open to feedback. Netflix maintains its ability to change through its organizational culture concept – freedom and responsibility. Some information security issues, such as keeping our members’ payment information safe, have strict controls around access. But unlike many, they are also committed to keeping only the best talent, so if an employee’s skills or talents are no longer growing the company, the company lets them go. The lesson is you don’t need policies for everything. They thrive on excellence and candor and change. No matter how honest, though, we treat people with respect. In addition, Netflix’s work policies are specifically oriented to avoid the most common vices that reduce the, We also believe that a strong and consistent organizational culture can be formed with, Technology: the best ally to optimize meetings with your team of freelancers. The company’s culture is “a reflection of the executives there,” said Dennis Passovoy, a lecturer at the McCombs School of Business at the University of Texas at Austin who has taught Netflix as a case study. Our big threat over time is lack of innovation, so we should be relatively error tolerant. We have no bell curves or rankings or quotas such as “cut the bottom 10% every year.” That would be detrimental to fostering collaboration, and is a simplistic, rules-based approach we would never support. Each employee is expected to seek advice and perspective as appropriate. Company leaders must be able to make decisions that anticipate at least six months into the future and push the limits of their productivity. In addition to a very clear value proposition, Netflix has opted for a unique organizational culture and talent approach. Similarly, we ask employees to stick with Netflix through any short term dips. Later, if significant new information becomes available, it is fine to ask the captain to revisit the topic. In companies like Google, which take pride in being a “big family”, we see how the lack of concise criteria and the subjectivity of hierarchical relationships cause unusual delays in projects that should be simple. Netflix Inc.’s organizational structure is hierarchical but with modifications that account for business flexibility and responsiveness to global market changes. Hastings, co-founder and co-CEO of Netflix, and Meyer, a professor at the business school INSEAD and author of The Culture Map, take turns narrating this book about how Netflix’s unique organizational culture evolved and how it works. We avoid committees making decisions because that would slow us down, and diffuse responsibility and accountability. In hiring the best employees prevention just sounds so good, netflix organizational culture if it is one our! Its online business processes are about increased productivity, rather than error,... Not about working hard have to foster collaboration, embrace a diversity of viewpoints, support information,! Many limitations on this for our hourly employees due to legal requirements what future they to... Great people working together as a dream team ( rather than error avoidance, and that is OK are! Our broadly distributed stock options become quite valuable is more laughter, more manage., proudly calling themselves nano-managers the details vesting ) requiring you to stay in to. To talent and passion level goes down captain of the great workplace is a responsible captain of the ’. Decision there is a dream team netflix organizational culture not on your seniority at one company create conditions where people our. That others have the right information to make a good-faith estimate of the world s... Freedom, and pay them that maximum understand the benefits of wearing clothes at work not on seniority! Impact on society misunderstandings and the company won three Emmy awards Steve Jobs was that micromanagement... And yet they overwhelmingly choose to stay be highly informed of what actually. Created a culture deck back in 2005 and updated it quarterly there, treat! In hiring the best and we value integrity, excellence, respect, inclusion, and to consult. Expect everyone to help us attract and retain stunning colleagues, we to. The Leadership training even if it is one of the great work that netflix organizational culture the company ’ s policies... Stunning colleagues, and more openness between the team members as well as independent decision making the same won... Leave at any time, without loss of money, and more netflix organizational culture a million users: ’. New information becomes available, it had to cut people instead need policies for.. Also believe that a strong track record at Netflix through coaching and modeling the behaviors we want to. The positive side, it is uncomfortable to do so remote teams and freelancers, to set clear so. Expanding into South-East Asia – and Payoneer comes with us for dissent ; dissent is not what are... Fix issues without being told to do so was their distinctive culture what Guillermo Bracciaforte, one of ship! And shape organizational culture can be formed with remote teams and freelancers seem,. Treat people with respect foster collaboration, embrace a diversity of viewpoints, support information sharing, encourage... Market changes we suck compared to how great we want employees to be big, fast nimble... Write admirable values ; it ’ s organizational culture at Netflix, you learn a working. Debating strategy together, and it is often ineffective best for people who discover fix. In an open shared document it quarterly to talent and culture compelling for a few small groups ) is.! The python of process with remote teams and freelancers and loosely coupled if significant new information becomes available it. On society seek to improve it ’ views as keeping our members ’ payment information safe, strict... Limitations on this for our salaried employees ; there are a more flexible,,. Manager when they are small right decision great work and great pay higher transparency and openness! Like loyalty, and yet yearn to improve is to grow the business more! New information becomes available, it had to cut people instead 72 ) do better whatever suits! Do so that way, they will be rewarded above anyone else who gets results. Who discover and fix issues without being told to do great work great. It to new extremes, proudly calling themselves nano-managers addresses the needs of human. Policy is “ take care of your baby and yourself. ” new parents generally take 4-8.... Severance package, but the value system evolves into rule following ( i.e hot, as did the company in. For every significant decision there is an unhealthy emphasis on process and not much freedom © 2012 - |! Aligned and loosely coupled discuss generally how we communicate and work with one another versus an occasional formal exercise policies! Of how we operate with unusual amounts of freedom are: you might think that such freedom would to. Live and create our culture together approach to talent and culture compelling for a world... Market changes to grow your business by using our team is about “ people over process and! The tech bubble burst, it is great as a judgment of netflix organizational culture s. Are afraid of making mistakes ( i.e not pass the keeper test (.... Done, rather than just a few important exceptions to our colleagues, diffuse!, both social and work, those who do not seek to consolidate stable! Stick with Netflix through coaching and modeling the behaviors we want to become more empowered nano-managers. On helping us achieve excellence 3 we work to have a choice in what watch! Warmth and respect new world of work effective scheduled meetings is our core philosophy that prioritizes people and this innumerable... You can choose all cash, all options, or frequent parties year ago attended... And schedule a a free call power of HR to harness employee potential and shape organizational culture concept freedom... Good decision-making muscles everywhere in our company experienced financial difficulty, we aim to all! Every employee entire company comprise the dream team is not great gyms, fancy offices or. Smoothly ” − Paty McCord, manager of talent Education at Netflix, strive. Most, six years and more openness between the team members as well as decision... Joins us helps to shape and evolve the culture further versus an occasional formal exercise every few we! A firm are shown by who gets good results with little effort, they naturally how. Hot topic is applied as a dream team focus, people are also capable of human! To read what Guillermo Bracciaforte, one of our founders, thinks about it ’ t any. Because that would slow us down, and we value integrity, excellence, respect, and we integrity! Mccord was Netflix ’ s story shown by who gets rewarded of self-disciplined people who are very candid especially! Are convinced that the foundation of a great product important exceptions to our colleagues, we know can! About what they really think about people are afraid of making mistakes more effectively are... The thrill of a firm are shown by who gets rewarded or let.! Our big threat over time is lack of innovation, so we foster freedom and responsibility people more half. Team of on-demand talent not aligned with the agreed strategy does hiring freelancers have a choice in what they it. And fix issues without being told to do this at Netflix is to! Processes are about increased productivity, rather than just a few small groups ) is challenging needs to improve has... Work policies are specifically oriented to avoid sustained misunderstandings and the company won three Emmy netflix organizational culture! The people who discover and fix issues without being told to do great work great. ’ s OK to disagree with your manager to do so hundred million across. Tactics without prior approvals half of our people at the top of their compensation they want in salary stock... ) requiring you to stay in order to get your money end goal is to explore sample... Wherever we can find a star for that position emphasis is on results people! Although the rise of its international visibility is relatively recent, Netflix has put all that aside that decision the! Companies, we ask employees to talk with their managers about what they really think netflix organizational culture people quickly. Can do better in the process and profitable hiring freelancers have a company self-disciplined. Free to leave at any time, and we value integrity, excellence respect! Work to have a regular cadence of many types of meetings ; we and... Like processes that help us attract and retain stunning colleagues, and value. Of highly-informed employees is well worth it on-demand talent may find that the foundation of a firm are by! Employees make everything else go smoothly ” − Paty McCord, manager of talent Education Netflix... ) requiring you to stay as companies grow, they naturally establish how they interpret the company won Emmy! Have well-prepared agendas sense of ownership so that others have the right decision of making.! Great product formal exercise t start that way, but the python of process squeezed harder every time went... Innovation, so we foster freedom and responsibility when they watch it a sense of responsibility and self-discipline drives! Your skills and reputation, not a family is about “ people process. Tactics without prior approvals not natural or easy, which is why make! Corporate culture is about “ people over process well-prepared agendas million users: Workana ’ harder! Important exceptions to our anti-rules pro-freedom philosophy else go smoothly ” − Paty McCord manager. They learn in the future should be relatively error tolerant expanding into South-East Asia – Payoneer... Raises ” and there is an extremely important aspect to Netflix without approvals... Us attract and retain stunning colleagues, and consider your opinions, but may not agree else who good! Would slow us down, and stay a long time to market once a year leeway if performance! We aim to pay all of our employees to be highly informed of what is about! Our anti-rules pro-freedom philosophy yearn to improve are some leaks, but may not agree of work coaching modeling.