Hiring and Leadership Lessons Learned from Netflix
Netflix has redefined the way companies attract and retain employees. No matter what industry you are in, Netflix offers unique hiring and leadership lessons that have influenced talent management reform.
Hire Talented People Who Model Adult Thinking and Behavior
The cornerstone of Netflix’s hiring process is that they go out of their way to hire talent who have the maturity and drive to put the company’s interest first and to collaborate positively with the other team members. Most companies spend time and money instituting HR polices to deal with problems that only effect a small percentage of employees, when it is more efficient to prevent the problems from arising in the first place. Essentially, they look for talent that demonstrates adult like attitudes and behaviors. These behaviors might include a willingness to openly talk about problems with colleagues and managers and time management skills.
For instance, their paid time off is not tied to a rigid formula. They instituted a policy to “take what is appropriate” after discussed with their team leader or boss. While Netflix does provide guidelines of what they consider responsible behavior, they leave it up to the employees to self-enforce those expectations. While not every employee complied with the expectations, the vast majority did.
Be Honest About Performance
Initially, Netflix participated in the ritual of formal yearly reviews, but eventually they stopped. They realized that the review sessions did not happen often enough to be useful. Instead, they asked leaders and managers to openly discuss work performance with their employees on a regular basis. Many companies stick with annual reviews because they are concerned about litigation. If the company decides to fire someone, they want documentation that they can point to in the case of a lawsuit to show that the employee was underperforming. Netflix found that as long as you gave the employee a good severance package and were honest with them about why they were let go, lawsuits were a nonissue.
Netflix recognizes that great leaders take ownership of their role. By doing so, company culture is defined and improved. Leaders need to make sure that there is consistency between the company’s values and objectives and the practices and policies of the company. For example, you can’t tolerate employees whose performance is contrary to the company’s mission statement. Leaders also need to be aware of subcultures. A strong leader needs to keep in mind that each division might require different styles of management. The concerns of employees at a call center, for example, are likely very different than the concerns of employees at company headquarters.
Netflix has been innovative in promoting “people over process.” It isn’t about being a laissez faire leader, but instead a leader that can teach others how to make decisions for the purpose of the greater whole. The culture is ever-changing because it is improving as employees collaboratively work for the common goal of the company’s overall success. Netflix’s model is innovative for not only promoting company culture but company culture that encourages, enhances, and motivates high performance.
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