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Create excellent corporate culture: Get Real with Netflix

October 15, 2018 / by Talya Zwiers posted in Employee Engagement

How important is corporate culture? Does it make or break an organisation and ultimately impact on its success? The simple answer is… YES! Companies are investing so much into trying to emulate the ‘perfect’ culture, but times are changing so quickly especially with the influx of the younger generation entering the workplace, who have a totally different demand. A more flexible and creative approach with how businesses handle policies, procedures, the working environment and how teams engage with each other needs to be considered in order to create a passionate culture where employees want to work and more importantly, be a part of whole heartedly.

Patty McCord, Netflix’s Chief Talent Officer, together with CEO Reed Hastings created an infamous document and HR philosophy known as Netflix Culture Deck: Freedom and Responsibility. Facebook’s Sheryl Sandberg has even called it “the most important document to come out of the Valley.” In short, it’s a living set of behaviours and skills which instills people with both a sense of freedom and responsibility. It is built of expectations of high-performance, radical honesty and a controversial motto – we’re not family. There’s a lot companies, both big and small, can learn from this, somethings more sweeping and harder to implement than others, yet a fresh approach to identifying and building a sustainable corporate culture.

Values
To start off with, a lot of companies have nice-sounding values and mission statements plastered throughout their business, but they are hollow and just words in an induction document. Netflix believes that “real company values are behaviours and skills that we particularly value in fellow employees.” Their values include judgement, communication, impact, curiosity, innovation, courage, passion, honesty and selflessness. In order to create an effective culture that will propel your business forward, employees should truly believe and breathe the values. How can you exert all your efforts into something you disagree with? When employees totally embrace the values of an organisation, then it is acceptable to question actions which are inconsistent with values.

High Performance
Netflix believes that quality is worth paying for. Only hire top players as “one outstanding employee gets more done and costs less than two adequate employees.” If you want quality, then reward your team with their true value both financially and with trust. Don’t undermine the people you hire. Be confident in their abilities to perform and drive your business forward. It is said “if you pay peanuts, you get monkeys”.

Despite effectiveness being harder to assess and measure than effort, for Netflix it is all about effectiveness. Employees shouldn’t be measured by how many evenings and weekends they work, and how many hours they spend in their cubical, but rather measurement should be based on how much, how quickly and how well work is completed within a certain deadline.

Honesty
There is a lot of emphasis placed on employee loyalty. Netflix isn’t afraid to cut under-performing staff, however they do see the value of handing a pass to anyone in their team who are going through a rough patch, as long as its employees give the same kind of loyalty to the company when it is going through a rough time.

Trusting your employees to make the best decisions for both themselves and the company is a huge part of building a successful team. Companies need to trust and give the ropes to the team in order for them to be creative and work on their own terms. If there is no trust for this – then have you hired the right caliber of people? Ensuring there is 100% buy-in and a built-in commitment and passion to your company is a must in order to create an unbreakable and admirable corporate culture.

Freedom and Responsibility
Is it possible to have an employee who is self-motivating, self-aware, self-disciplined, self-improving, acts like a leader and never feels ‘that’s not my job’? Do these rare people exist? For Netflix, these are responsible people who thrive on freedom and ultimately it is because these people are actually worthy of freedom. This is one area companies should focus on. If you hire people, you need to have enough trust to let them get on with their expertise and experience. Give them the freedom they deserve to get the job done as it is they who will carry the long term success of your business.

Treat people like adults
Most companies have an unhealthy emphasis on policies, handbooks and sticking to strict guidelines about absolutely everything, where is no leeway or lenience anywhere. Allow some freedom and watch your team flourish. For example, for most companies it would never be a consideration to have unlimited holidays. Would this create a happy working culture, or will the novelty fizzle? What would it do for team morale and engagement?

It seems astounding that Netflix does not have a Vacation and Tracking Policy. Employees are able to take what they need when they need within reason. If an employee wants to take six month vacation, it means they do not want to be at work, hence are working for the wrong company. For an effective culture, policies are not needed for everything! McCord states that “there is no clothing policy at Netflix, but no one has come to work naked lately.” Most companies also have complex expense policies and departments about what they can expense. Employees should have the company’s best interests in mind when expensing, and that should suffice in what is expensed – its about treating people as adults!

As a company grows, processes change. What works for a start up when everyone can fit around the boardroom table, probably wont fly when your company has moved into office space over 3 floors. Change can be met with a lot of hostility and resistance. In order to have a successful culture, don’t accept chaos. There’s a lot which can be learnt from Netflix and their culture, however creating an engaging culture cannot follow a copy and paste template straight into your organisation.

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Posted in Employee Engagement