netflix HR╱corporate culture guide

Click to edit Master title style,Click to edit Master text styles,Second level,Third level,Fourth level,Fifth level,7/4/2009,#,Reference Guide on our,Freedom & Responsibility Culture,These slides are meant for reading,rather than presenting,1,Freedom & Responsibility Applies to our,Salaried,Employees,Our hourly employees are important, but have more structured job roles,2,Culture: what gives Netflix the best chance of continuous success for many generations of technology and people?,3,Seven Aspects of our Culture,Values are what we Value,High Performance,Freedom & Responsibility,Context, not Control,Highly Aligned, Loosely Coupled,Pay Top of Market,Promotions & Development,4,Lots of companies have nice sounding value statements,5,Enron Had A Nice-Sounding Value Statement with 4 Values,Integrity,Communication,Respect,Excellence,Enron,headquarters,6,Their 4 values were chiseled in marble in the main lobby, but had little to do with the real values of the organization,The,real,company values, as opposed to the nice-sounding values, are shown by who gets rewarded, promoted, or let go,7,Real company values are the,behaviors,and,skills,that we particularly,value,in fellow employees,8,We Particularly Value in our Colleagues these Nine Behaviors and Skills,9,You,make wise decisions (people, technical, business, and creative) despite ambiguity,You identify root causes, and get beyond treating symptoms,You think strategically, and can articulate what you are,and are not, trying to do,You smartly separate what must be done well now, and what can be improved later,10,Judgment,11,Communication,You listen well, instead of reacting fast, so you can better understand,You are concise and articulate in speech and writing,You treat people with respect independent of their status or disagreement with you,You maintain calm poise in stressful situations,12,Impact,You accomplish amazing amounts of important work,You demonstrate consistently strong performance so colleagues can rely upon you,You focus on great results rather than on process,You exhibit bias-to-action, and avoid analysis-paralysis,13,Curiosity,You learn rapidly and eagerly,You seek to understand our strategy, market, subscribers, and suppliers,You are broadly knowledgeable about business, technology and entertainment,You contribute effectively outside of your specialty,14,Innovation,You re-conceptualize issues to discover practical solutions to hard problems,You challenge prevailing assumptions when warranted, and suggest better approaches,You create new ideas that prove useful,You keep us nimble by minimizing complexity and finding time to simplify,15,Courage,You say what you think even if it is controversial,You make tough decisions without excessive agonizing,You take smart risks,You question actions inconsistent with our values,16,Passion,You inspire others with your thirst for excellence,You care intensely about Netflix success,You celebrate wins,You are tenacious,17,Honesty,You are known for candor and directness,You are non-political when you disagree with others,You only say things about fellow employees you will say to their face,You are quick to admit mistakes,18,Selflessness,You seek what is best for Netflix, rather than best for yourself or your group,You are ego-less when searching for the best ideas,You make time to help colleagues,You share information openly and proactively,Judgment,You make wise,decisions (people,technical,business, and creative) despite ambiguity,You identify root causes, and get beyond treating symptoms,You think strategically, and can articulate what you are,and are not, trying to do,You smartly separate what must be done well now, and what can be improved later,Innovation,You re-conceptualize issues to discover practical solutions to hard problems,You challenge prevailing assumptions when warranted, and suggest better approaches,You create new ideas that prove useful,You keep us nimble by minimizing complexity and finding time to simplify,Impact,You accomplish amazing amounts of important work,You demonstrate consistently strong performance so colleagues can rely upon you,You focus on great results rather than on process,You exhibit bias-to-action, and avoid analysis-paralysis,Curiosity,You learn rapidly and eagerly,You seek to understand our strategy,market, subscribers, and suppliers,You are broadly knowledgeable about business, technology and entertainment,You contribute effectively outside of your specialty,Communication,You listen well, instead of reacting fast, so you can better understand,You are concise and articulate in speech and writing,You treat people with respect independent of their status or disagreement with you,You maintain calm poise in stressful situations,Courage,You say what you think even if it is controversial,You make tough decisions without excessive agonizing,You take smart risks,You question actions inconsistent with our values,Honesty,You are known for candor and directness,You are non-political when you disagree with others,You only say things about fellow employees you will say to their face,You are quick to admit mistakes,Selflessness,You seek what is best for Netflix, rather than best for yourself or your group,You are ego-less when searching for the best ideas,You make time to help colleagues,You share information openly and proactively,Passion,You inspire others with your thirst for excellence,You care intensely about Netflix success,You celebrate wins,You are tenacious,We Want to Work with People Who Embody These Nine Values,19,“You question actions inconsistent with our values”,Part of the Courage value,Akin to the honor code pledge: “I will not lie, nor cheat, nor steal,nor tolerate those who do,”,All of us are responsible for value consistency,20,Values reinforced in hiring, in 360 reviews, at comp review, in exits, and in promotions,21,Seven Aspects of our Culture,Values are what we Value,High Performance,Freedom & Responsibility,Context, not Control,Highly Aligned, Loosely Coupled,Pay Top of Market,Promotions & Development,22,Imagine if,every,person at Netflix is someone you respect and learn from,23,Great Workplace is,Stunning Colleagues,Great workplace is,not,day-care, espresso, health benefits, sushi lunches, nice offices, or big compensation, and we only do those that are efficient at attracting stunning colleagues,24,Like every company, we try to hire well,25,But, unlike many companies, we practice “adequate performance gets a generous severance package.”,26,Were a,team, not a familyWere like a,pro sports team, not a kids recreational teamCoaches job at every level of Netflixto hire, develop and cut,smartly, so we have stars in every position,27,The,Keeper Test,Managers Use:,“,Which of my people, if they told me they were leaving in two months for a similar job at a peer company,would I fight hard to keep at Netflix?,28,The,Keeper Test,Managers Use:,“,Which of my people, if they told me they were leaving in two months for a similar job at a peer company,would I fight hard to keep at Netflix?,29,The other people should get a generous severance now, so we can open a slot to try to find a star for that role,Honesty Always,To avoid surprises, you should periodically ask your manager: “If I told you I were leaving, how hard would you work to change my mind to stay at Netflix?”,30,Isnt Loyalty Good? What About Hard Workers?What about Brilliant Jerks?,31,Loyalty is Good,Loyalty is good as a stabilizer,People who have been stars for us, and hit a bad patch, get a near term pass because we think they are likely to become stars for us again,We want the same: if Netflix hits a,temporary,bad patch, we want people to stick with us,But unlimited loyalty to a shrinking firm, or to an ineffective employee, is not what we are about,32,Hard Work Not Directly Relevant,Its about effectiveness not effort even though effectiveness is harder to assess than effort,We dont measure people by how many evenings or weekends they are in their cube,We do try to measure people by how much, how quickly and how well they get work done especially under deadline,33,Brilliant Jerks,Some companies tolerate them,For us, the cost to teamwork is too high,Diverse styles are fine as long as person embodies the 9 values,34,Why are we so manic on high performance?,In procedural work, the best are,2x,better than the average.,In creative work, the best are,10x,better than the average, so huge premium on creating effective teams of the best,35,Why are we so manic on high performance?,Great Workplace is,Stunning Colleagues,36,Seven Aspects of our Culture,Values are what we Value,High Performance,Freedom & Responsibility,Context, not Control,Highly Aligned, Loosely Coupled,Pay Top of Market,Promotions & Development,37,The Rare Responsible Person,Self motivating,Self aware,Self disciplined,Self improving,Acts like a leader,Doesnt wait to be told what to do,Never feels “thats not my job”,Picks up the trash lying on the floor,Behaves like an owner,38,Responsible People,Thrive,on Freedom, and are,Worthy,of Freedom,39,Our model is to,increase,employee freedom as we grow,rather than limit it, to continue to attract and nourish innovative people,so we have better chance of long-term continued success,40,Most Companies,Curtail,Freedom as they get Bigger,Bigger,Employee Freedom,41,Most Companies Curtail FreedomAs They Grow to Avoid Errors(sounds pretty good to avoid errors),42,Desire for Bigger Positive Impact Creates Growth,Growth,43,Growth Increases Complexity,Complexity,44,Growth Shrinks Talent Density in Most Firms,% High Performance Employees,Complexity,45,Chaos Emerges,% High Performance Employees,Chaos,and errors spikes here businesshas become too complex to runinformally with this talent level,Complexity,46,Process Emerges to Stop the Chaos,Procedures,No one loves process, butfeels good compared,to,the,pain of,chaos,47,Process-focus Drives More Talent Out,% High Performance Employees,48,Strong Near-Term Outcome,A highly-successful process-driven company,With leading share in its market,Minimal thinking required,Few mistakes made very efficient,Few curious innovator-mavericks remain,Very optimized processes for its existing market,49,Then the Market Shifts,Market shifts due to new technology or new competitors or new business models,Company is unable to adapt quickly, because the employees are extremely good at following the existing processes, and process adherence is the value system,Company generally grinds painfully into irrelevance, due to inability to respond to the market shift,50,Seems Like Three Bad Options,Stay creative by staying small,Try to avoid rules as you grow, suffer chaos,Use process as you grow to drive efficient execution of current model, but cripple creativity, innovation, flexibility, and ability to thrive when market inevitably shifts,51,A Fourth Option,Avoid Chaos as you grow with Ever More High Performance People not with Rules,Then you can continue to run informally with self-discipline and avoid chaos,The run informally part is what enables and attracts creativity,52,The Key: Increase Talent Density faster than Complexity Grows,% High Performance Employees,Business Complexity,53,Increase Talent Density,Top of market compensation,Attract hi-value people through freedom to make impact,Be demanding about high performance culture,% High Performance Employees,54,Minimize Complexity Growth,Business Complexity,Few big products vs many small ones,Eliminate distracting complexity (barnacles),Value simplicity,55,With the Right People, Instead of a Culture of Process Adherence, Culture of Freedom and Responsibility, Innovation and Self-Discipline,56,Is Freedom Absolute?,Are all rules & processes bad?,57,Freedom is not absolute.Like “free speech” there are somelimited exceptions to “freedom at work”,58,Two Types of Necessary Rules,Prevent irrevocable disaster,E.g. Financials produced are wrong,E.g. Hackers steal our customers credit card info,Moral, ethical, legal issues,E.g. Dishonesty, harassment are intolerable,59,Mostly, Though,Rapid Recovery,is the Right Model,Just fix problems quickly,High performers make very few errors,Were in a creative-inventive market, not a safety-critical market like medicine or nuclear power,You may have heard preventing error is cheaper than fixing it,Yes, in manufacturing or medicine, but,Not so in creative environments,60,“Good” vs “Bad” Processes,“Good” processes help talented people get more done,Web site push every two weeks rather than random,Spend within budget each quarter so dont have to coordinate every spending decision across departments,Regularly scheduled strategy and context meetings,“Bad” processes try to prevent recoverable mistakes,Get pre-approvals for $5k spending,3 people to sign off on banner ad creative,Permission needed to hang a poster on a wall,Multi-level approval process for projects,Get 10 people to interview each candidate,61,Rule Creep,“Bad” processes tend to creep in,Preventing errors just sounds so good,We try to get rid of rules when we can, to reinforce the point,62,Example: Netflix Vacation Policy and Tracking,Until 2004 we had the standard model of N days per year,63,Meanwhile,Were all working online some nights and weekends, responding to emails at odd hours, and taking an afternoon now and then for personal time.,64,An employee pointed out,We dont track hours worked per day or per week, so why are we tracking days of vacation per year?,65,We realized,We should focus on what people get done, not how many hours or days worked. Just as we dont have an 9-5 day policy, we dont need a vacation policy.,66,Netflix Vacation Policy and Tracking,“there is no policy or tracking”,67,Netflix Vacation Policy and Tracking,“there is no policy or tracking”,“There is also no clothing policy at Netflix, but no one has come to work naked lately.” Patty McCord, 2004,Lesson: you dont need detailed policies for everything.,68,Another Example of Freedom and Responsibility,69,Most companies have complex policies around what you can expense, how you travel, what gifts you can accept, etc. Plus they have whole departments to verify compliance with these policies.,70,Netflix Policies for Expensing, Entertainment, Gifts & Travel:,“Act in Netflixs Best Interests”,(5 words long),71,“Act in Netflixs Best Interests”,Generally,Means,Expense only what you would otherwise not spend, and is worthwhile for work.,Travel as you would if it were your own money.,Disclose non-trivial vendor gifts.,Take from Netflix only when it is inefficient to not take, and inconsequential.,“taking” means, for example, printing personal documents at work or making personal calls on work phone: inconsequential and inefficient to avoid,72,Freedom and Responsibility,Many people say one cant do it at scale,But since going public in 2002, which is traditionally the beginning of the end for freedom, weve,increased,talent density and employee freedom substantially.,73,Summary of Freedom & Responsibility:As We Grow, Minimize Rules. Inhibit Chaos with Ever More High Performance People.Flexibility is More Important than Efficiency in the Long Term,74,Seven Aspects of our Culture,Values are what we Value,High Performance,Freedom & Responsibility,Context, not Control,Highly Aligned, Loosely Coupled,Pay Top of Market,Promotions & Development,75,If you want to build a ship, dont drum up the people to gather wood, divide the work, and give orders. Instead, teach them to yearn for the vast and endless sea.,-Antoine De Saint-Exupery, Author of,The Little Prince,76,*translation uses people instead of men to modernize,The best managers figure out how to get great outcomes by setting the appropriate context, rather than by trying to control their people,77,Context, not Control,Context,Strategy,Metrics,Assumptions,Objectives,Clearly-defined roles,Knowledge of the stakes,Transparency around decision-making,Control,Top-down decision-making,Management approval,Committees,Planning and process valued more than results,Provide the insight and understanding to enable sound decisions,78,Exceptions,Control can be important in emergency,No time to take long-term capacity-building view,Control can be important when someone is still learning their area,Takes time to pick up the necessary context,Control can be important when you have the wrong person in a role,Temporarily, no doubt,79,Managers: When one of your talented peopledoes something dumb,dont blame them.Instead, ask yourself what contextyou failed to set.,80,Managers: When you are tempted to “control” your people, ask yourself what context you could set instead,Are,you,articulate and inspiring enough about goals and strategies?,81,Good Context,Link to company/functional goals,Relative priority (how important/how time sensitive),Critical (needs to happen now), or,Nice to have (when you can get to it),Level of precision & refinement,No errors (credit cards handling, etc), or,Pretty good / can correct errors (website), or,Rough (experimental),Key stakeholders,Key metrics / definition of success,82,Why Managing Through Context?,High performance people will do better work if they understand the context,83,Investing in Context,This is why we do new employee college, and why we are so open internally about strategies and results,84,Seven Aspects of our Culture,Values are what we Value,High Performance,Freedom & Responsibility,Context, not Control,Highly Aligned, Loosely Coupled,Pay Top of Market,Promotions & Development,85,Three Models of Corporate Teamwork,Tightly-Coupled Monolith,Independent Silos,Highly Aligned, Loosely Coupled,86,Tightly-Coupled Monolith,Senior management reviews and approves nearly all tactics,Lots of x-departmental buy-in meetings,Keeping other groups in agreement has equal precedence with pleasing customers,Mavericks get exhausted trying to innovate,Highly coordinated through centralization, but very slow, and slowness increases with size,87,Independent Silos,Each group executes on their objectives with little coordination,Work that requires coordination suffers,Alienation and suspicion between departments,Only works well when areas are independent,e.g. GE: aircraft engines and Universal Studios,88,The Netflix Choice,Tightly-Coupled Monolith,Independent Silos,Highly Aligned, Loosely Coupled,89,Highly Aligned, Loosely Coupled,Highly Aligned,Strategy and goals are clear, specific, broadly understood,Team interactions are on strategy and goals rather than tactics,Requires large investment in management time to be transparent and articulate and perceptive and open,Loosely Coupled,Minimal cross-functional meetings except to get aligned on goals and strategy,Trust between groups on tactics without previewing/approving each one groups can move fast,Leaders reaching out proactively for ad-hoc coordination and perspective as appropriate,Occasional post-mortems on tactics necessary to increase alignment,90,Highly-Aligned Loosely-Coupled teamwork effectiveness is dependent on,high performance,people and,good context,Goal is to be,Big and Fast and Flexible,91,Seven Aspects of our Culture,Values are what we Value,High Performance,Freedom & Responsibility,Context, not Control,Highly Aligned, Loosely Coupled,Pay Top of Market,Promotions & Development,92,Pay Top of Market is Core toHigh Performance Culture,One outstanding employee gets more done and costs less than two adequate employees,We endeavor to have only outstanding employees,93,Three Tests for Top of Market for a Person,What could person get elsewhere?,What would we pay for replacement?,What would we pay to keep person?,If they had a bigger offer elsewhere,94,Confidential,Takes Great Judgment,Goal is to keep each employee at top of market,f