Powerful: Building a Culture of Freedom and Responsibility
How to get the best out of your staff?
I am always a bit wary of books that use the template of one company as the success formula for every company. Books like "Blitzscaling". As Freek Vermeulen and many others have explained, companies are too complex for a one size fits all approach.
Powerful, building a culture of freedom and responsibility
However, it is Netflix and some of the suggestions in “Powerful, building a culture of freedom and responsibility” make a lot of sense. The book is best described as a hard-nosed version of ROWE (Results Only Work Environment).
We all know Netflix. It has continuously reinvented itself and is in my view a lot more sympathetic than “The four” and is likely to be more successful in the long run. It will be interesting what they will do when TV, AR, VR and gaming merge into one.
Check your own HRM
Here are a few questions for you:
If you stop any employee, at any level of the company, in the break room or the elevator and ask what are the five most important things the company is working on for the next six months, that person should be able to tell you, rapid-fire, one, two, three, four, five, ideally using the same words you’ve used in your communications to the staff and, if they’re really good, in the same order. If not, the heartbeat isn’t strong enough yet.
How well do you think people throughout the company could describe its business model?
Do you share with employees the same information presented in your company’s earnings calls?
Is everyone aware of the difficult challenges your company faces? Have you asked them their thoughts about how to tackle these?
What areas of your business do you think your people know little to nothing about?
How well do you think your people understand who the customer is and what their needs and desires are?
Do you regularly share customer research?
If you were going to hold an off-site, what is the most pressing issue you would want your people to learn about and debate?
Are people free to disagree with a point made by someone in authority during a team meeting?
How open have you been with your team about the current prospects of your business and the most difficult problems the company and your team are dealing with?
Netflix kept it very simple. Every Single Employee Should Understand the Business. Read that again. Every Single Employee Should Understand the Business
They began with inculcating a core set of behaviours in people, demand these behaviours, but then giving them the latitude to practice those behaviours well. It makes teams astonishingly energised and proactive. The key word is latitude. Freedom to act. Treating people like adults and let them get on with it. That includes transparency and giving people the information they need. It means encouraging and stimulating questions and honest debate.
Embrace the thrill
You want people to embrace the need for change and be thrilled to drive it. Netflix had come to understand that the most successful organisations in this world of increasingly rapid disruption will be the ones in which everyone, on every team, understands that all bets are off and everything is changing—and thinks that’s great. They wanted people to feel excited to come to work each day, not despite the challenges but because of them.
Strip away the policies and procedures
Which means they kept stripping away policies and procedures. What Netflix found that after they d had to let many middle managers go in our big layoff, they noticed that everyone moved much faster without all those layers of opinions and approvals. What takes the place of rules, processes, approvals, bureaucracy, and permissions? The answer: Clear, continuous communication about the context of the work to be done.
People are adults
Which means they don’t tell people what to do. Don’t do incentives. There is no better reward than making a significant contribution to meeting a challenge. Ask any very successful person what their fondest memories of their career are, and they will inevitably tell you about an early period of struggle or some remarkably difficult challenge they had to overcome.In Netflix’s view, a company’s job isn’t to empower people; it’s to remind people that they walk in the door with power and to create the conditions for them to exercise it. Do that, and you will be astonished by the great work they will do for you.
A business leader’s job is to create great teams that do amazing work on time. Excellent colleagues, a clear purpose, and well-understood deliverables: that’s the powerful combination. The most important job of management is to focus intently on the building of great teams.
The tips (not that dissimilar to “Principles”)
The best thing you can do for employees is to hire only high performers to work alongside them.
You go to war with the army you have, not the army you might want or wish to have at a later time.
People need to see the view from the C suite to feel truly connected to the problem solving that must be done at all levels and on all teams so that the company is spotting issues and opportunities in every corner of the business and effectively acting on them.
Fully and consistently communicated to everyone the behaviours you expect your staff to be disciplined about, starting with the executive team and every manager.
Make sure that every single employee understand your philosophy and the behaviours you want them to execute
Create a culture deck.
Create open, clear, and constant communication about the work to be done and the challenges being faced.
Practice radical honesty.
Truthful people are truthful in everything they do.
It is not cruel to tell people the truth respectfully and honestly. To the contrary, being transparent and telling people what they need to hear is the only way to ensure they both trust you and understand you. Your people can handle the truth, straight and in person, and so can you.
Encourage people to have strong, fact-based opinions and to debate them avidly and test them rigorously.
Get people to base their actions on what was best for the customer and the company.
Get hiring managers to take the lead in preparing their teams for the future by making sure they had high performers with the right skills in every position.
Find the best creative talent with the skills to execute, and then give those creators the freedom to realise their vision.
Make sure that every single member of a team knows where they’re going and will do anything to get there.
Hire talented people who are adults and want nothing more than to tackle a challenge, and then communicating to them, clearly and continuously, about what the challenge is.
Hire people who absolutely love problem-solving.
Do not fixate on metrics that don’t matter.
Do not assume that current employees will be able to grow into the responsibilities of the future.
Have the right person in every single position.
Your HR people must be businesspeople.
Pay top dollar for your best people.
Be a great place to be from.
Do not make false promises of job security.
If you look at the most successful companies of the last decade or so, many of them are Internet firms with teams that work very collaboratively and organically. Harnessing the power of small, unencumbered teams. Unencumbered being the operative word.
Trust and transparancy
Netflix learned that preparing people for changes to come led to a sense of trust around the company: trust that we would proactively take the company where it needed to go and that we wouldn’t mislead anyone about the changes. Transparency about the difficulty of the decisions didn’t make coming to them any easier, but the honest dialogue did mean that people all over the company were prepared. Too often upper management thinks that sharing about problems confronting the business will heighten anxiety among staff, but what’s much more anxiety provoking is not knowing. Transparency also helps ensure that people take ownership of the positions they’ve advocated and don’t get hopelessly caught up in finger-pointing after the fact.
Business and sports
The metaphor that Netflix uses is that the company is like a sports team, not a family. Read "Legacy". Netflix as the All Blacks of the business world. One reason the sports team analogy is so helpful in managing people is that everyone readily understands that coaches are letting the rest of the team and the fans down if they don’t replace players who aren’t producing top performance.
Power to the people
The conclusion from Netflix, and it should not come as a surprise, is that when people feel that they have more power, more control over their careers, they feel more confidence, confidence to speak up more, to take more risks, to pick themselves up again when they make mistakes, and to take on more and more responsibility. It’s not your job to give it to them. Appreciate their power, unleash it from hidebound policies, approvals, and procedures, and trust me, they will be powerful.
Get out of the way
If all your employees have a shared vision, shared purpose, shared passion, shared guiding principles, an understanding and belief in the brand, you are 80% there. Combine that with team sports principles, transparency and radical honesty and you are 90% there. Also, read “Reinventing organisation”. Everything is culture. Heck, you might even become lovable.