Netflix is not just renowned for its movies, it also tops the box office as a great place to work. The company is leading the way in HR with policies based on communication, collaboration and trust – discover how these are the foundations of its huge success.
CEOs have always been the rockstars of the business world; hogging the limelight, taking centre stage and, in one recent example, even being well known enough to be the subject of an April fools which saw one silicon valley star allegedly launch his own clothing collection.
But, occasionally HR can steal the CEO’s thunder. This is exactly what happened when one internal policy document from a video web service attracted the attention of Facebook’s Sheryl Sandberg, who described the document as one of the most important to ever come out of Silicon Valley.
The company that this thunder stealing document belonged to? Netflix.
The reason why it was so important? Well, it showed that…
Success is about more than simply perks.
While some companies have HR policies which are considered enlightened and allow employees to, take as much holiday as they want, work on projects of their own interest, oversee their own expenses or enjoy free recreation facilities. Not all companies with such enlightened policies succeed.
However, Netflix is one company that certainly has succeeded. If there is any doubt in this consider; the company’s share price increased by 121% compared to the previous year, announced over $1.8 billion in revenue (Jan 2016) and has plans to expand to an additional 130 countries.
So, just what is it that makes Netflix such a success? In short it enables the conversation between employer and employee.
Success starts with enabling conversations between employer and employee.
All the perks and privileges offered by Netflix they all have one thing in common – they involve the employee in the decision and are based upon the ideas of great communication leading to great collaboration and resulting in great trust.
This idea of communication, collaboration and trust can be seen in the unifying principle of Netflix’s HR policy.
“Act in the company’s BEST INTERESTS”.
It is not about endless paperwork, signed and countersigned requests, but rather the employees themselves act as part of the Netflix feedback culture.
Success is based on trust.
Rather than policing its employees’ every move Netflix believes in trust. It trusts its people to put the company first and it believes in their innate good nature, making employer and employee partners not competitors. This attitude engages employees, opens up channels of communication and means that people work towards solving problems, not just seeing them.
In the words of Netflix…
“If you’re careful to hire people who will put the company’s interests first, who understand and support the desire for a high-performance workplace, 97% of your employees will do the right thing.”
Success is about turning costs into communication.
Netflix turned areas that would traditionally be seen as costs into areas of communication. For example unlimited maternity leave is normally a cost but by focusing on work achieved not time in office, Netflix has has kept its staff loyal and engaged.
Success is about simplicity and openness.
By keeping the rules simple, communications open and trusting [there it is, that word trust again] its employees to put the company first Netflix has developed a culture of agreement over box-ticking, employees seek to get together and find a resolution for their issues rather than going through the motions until they leave.
Success is simply about…results.
This might seem to be the most “hard business” example in this post, however at Netflix results are prized over hours. It is about what your people achieve, not about how long they work. There is no 9-5 but rather, by enabling truly flexible working Netflix shows that it understands that for today’s employees the “desk” can be anywhere and, provided it fits within the overall business structure, results can be achieved at anytime.
Success is about firing (only when you’re ready).
By enabling your employees to feel they can communicate openly you can ensure that the first recourse need not be to fire the employee who doesn’t measure up but is instead, talking the issue over in an honest and open fashion.
In its ‘culture deck’ Netflix states,
“We’re a team not a family. We’re like a pro-sports team, not a kids recreational team. Netflix leaders hire, develop and cut smartly, so we have stars in every position”.
The same deck then goes on to pose the question
“Which of my people, if they told me they were leaving for a similar job at a peer company would I fight hard to keep at Netflix?”.
At Netflix the channels of communication are always open. By ensuring that everyone working there is constantly communicating and collaborating there is a high level of trust resulting in, less paperwork, better staff relations and above all better outputs for and from everybody. In short, if you treat your staff as adults, they may surprise you.
- Communication and collaboration build trust.
- Treat your employees like adults and they will behave like adults.
- Trust goes further to getting results than policing people.