‘No Rules Rules’: A Look into Netflix's Company Culture

Sally Hetherington   27 August, 2020
Employee Engagement Featured

Imagine working for a company that not only has an entire website dedicated to job opportunities, but an entire page dedicated to their company culture, where the final note on their culture summary is: “No rules”. This is the company culture of Netflix, revealed in a tell-all behind the scenes book, No Rules Rules: Netflix and the Culture of Reinvention, co-written by founder Reed Hastings and The Culture Map author Erin Meyer. The book has been nominated by The Financial Times as one of the best business books of 2020 and launches on September 8th. 

Hastings has never been one for convention. When founding Netflix he took a visible stance to go against the corporate grain and reinvent how things are done. He didn’t reward hard work. He instead paid you to leave for simply being adequate. He didn’t want his staff to say what they thought he wanted to hear. He instead wanted absolute truth and honesty. Instead of incentivising staff with fancy holidays or performance bonuses, he chose to rather pay them top dollar according to individual worth, all round. Through these principles he has put Netflix at the top of the world’s entertainment streaming service.

netflix company culture

Co-author Erin Meyer has also earned her corporate stripes in the field of company culture. She is professor of leading international business school INSEAD and is known for her insight into company culture and how different countries have differing cultural views and norms and how to effectively understand these differences and work through them to be a successful leader in the workplace. 

An integral aspect of the Netflix culture that both Hastings and Meyer agree on is the importance of communication, particularly in a global word where cultural norms in communication may differ. This is key to employee satisfaction and employee retention. Being able to offer timely, candid feedback as well as being able to listen and understand before reacting is more important to the Netflix culture than working towards a monetary reward. In fact as a company Netflix has taken the unusual stance to pay each employee at the max of their salary bracket when compared to what they could earn at a competitor, rather than paying according to performance. There is no such thing as second rate at Netflix - this will get you a ticket out the door with a four-month severance. They aim to pay all of their people “at the top of their personal market.”

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The company culture of Netflix also pushes their no rules policy, believing that freedom builds empowerment, which in turn builds a level of self-discipline that allows employees to find and fix mistakes without being asked to do so. This level of freedom allows employees to take vacation time whenever they need, take up to eight months maternity leave, choose stock over salary and to use good judgement when spending company money. Surely having no limits would cause people to push their boundaries? The simple answer is yes, however the Netflix company culture is such that they don’t believe in constantly overseeing everything, which in turn breeds a culture of trust. 

Netflix is also a firm believer in the concept of “highly aligned, loosely coupled”. This means that they avoid management making decisions at every level and having copious amounts of cross-departmental meetings on every project to keep everyone happy. Again this boils down to ultimate trust - while their employees love and encourage a good tactical debate, it is up to the individual to make the final decision: “Ultimately, the end goal is to grow the business for bigger impact while increasing flexibility and agility.”

Netflix also offers a great list of employee benefits, going above and beyond normal expectations. This list of employee benefits includes long maternity leave, a flexible vacation policy and days off, relocation benefits and ride-shares, as well as an “act in Netflix’s best interest” expense policy where employees use their own discretion as to when to claim.  

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For an organisation to offer this kind of company culture is indeed revolutionary, fostering a new culture of independence, openness, honesty and flexibility, creating a work environment filled with highly effective people who avoid rules, but in the best sense of the word. Could this be the future of HR and employee engagement strategies? As one of the most successful and well-known companies on the planet, Netflix certainly seems to think so.

Like Netflix, we at Staff Treats believe that employee wellbeing is integral to creating an environment where every staff member can contribute effectively. Book a demo with one of our customer engagement specialists to find out how we can help you.

Sally Hetherington

Full time teen wrangler, part time writer, passionate traveller and wannabe chef.

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