WWCode London BookClub: key takeaways from Netflix: No Rules Rules

WWCode London started the year with an insightful Book Club session discussing "Netflix: No Rules Rules" by Reeds Hasting and Erin Mayer. Some of the topics and ideas resonated with the group, so we’re here to share with you key takeaways you can apply to your career!

What’s the book ‘No Rules Rules: Netflix and the Culture of Reinvention’ about?

At Netflix, the rules for success are more than just conventional wisdom. Rather, it's about trusting your team and being radically honest with them to make an impactful transformation – something that has allowed this streaming giant to accumulate 190 million loyal subscribers and reach a market capitalisation akin to Disney! 'No Rules Rules' dives into how they managed such success against all odds.

Reed Hastings, Netflix Chairman and CEO uncovers the secret philosophies powering Netflix's culture and provides creative solutions to productivity challenges. With his insight into leadership theory and practice coming from INSEAD business school Professor Erin Meyer, readers discover why existing beliefs may not be enough for success in today's ever-changing world. By rejecting traditional corporate protocol – from unlimited holidays to abolishing approvals, they can access a holy grail of creativity while inspiring innovation throughout their organisation.

Let’s dive into our key takeaways from the book:

Believe in transparency and give candour feedback

Taking a step towards trust and respect: foster an open dialogue through honest communication. Encourage transparency to build relationships founded on honesty and understanding.

What is candour feedback exactly?

Candour feedback is an effective approach to facilitating dialogue and promoting a higher level of communication. 

Candour feedback is an honest exchange between two or more people that involves open, unconditional disclosure and acceptance. It focuses on facts, feelings, and how behaviour can be improved. 

By openly discussing the strengths and weaknesses of everyone involved in the conversation, it enables all participants to grow more quickly than they could by relying solely on their judgement. 

Candour feedback encourages directness, transparency, and genuine sharing so those receiving feedback can properly process the information being conveyed and learn from the presented experiences. 

Remembering it is not about criticism; rather it seeks to provide valuable insight in a productive manner that will help individuals become better overall communicators.

Practice giving candour feedback everywhere and at any time.

How Netflix do it: Netflix's 4A feedback framework

When giving feedback…

1. Aim to assist 

Your feedback should be formed on how it can help the individual or the company and given with only positive intent. Providing feedback to hurt the person intentionally is not tolerated.

2. Actionable

Feedback should give 'a call for an action', i.e. must focus on what the recipient can do differently.

When receiving feedback…

3. Appreciate

Humans naturally become defensive upon hearing criticism.

Rather than immediately reacting, the receiver must listen carefully and be open-minded without being defensive or angry.

4. Accept or Discard

Listen and consider all feedback, but the receiver is not required to follow it.

The decision to react to the feedback is entirely up to the recipient.

Freedom of responsibility

Netflix made the surprising (and inspiring) decision to annul its vacation policy. 

This move can be interpreted in different ways. On the one hand, it could signal that Netflix is trying to keep up with the fierce competition for talent in Silicon Valley, where taking extended sabbaticals is becoming increasingly popular. 

On the other hand, it could be motivated by a need to drive higher employee productivity due to increased competition in the streaming market. 

It gave us two immediate thoughts: will people stop taking holidays? Will people ill take too much holiday?

But Netflix proved that it could work.

Ability to take vacations 'as much as you want and when you want' increased both the creativity and the responsibility of Netflix’ employees. Employees go on vacation when they prepare back up for it. This policy (or lack of) also allows shifted flexible work weeks, which works great for those that need more freedom in their work hours.

In Netflix, they removed the reimbursement policy.

For organisations that are structured in a way that allows employees to have autonomy, it's no surprise that Netflix's decision to remove their reimbursement policy encourages people to take ownership of the company a step further. 

Without needing approval from their immediate supervisors, individuals can now make decisions based on what they consider to be the best interests of the company as a whole. 

Thus, creating an environment where everyone feels trusted to do the right things for each other and ultimately ensures that everyone is on the same page when it comes to achieving organisational goals.

 

The ability to make decisions without approvals but acting in the company's best interests allows people to have more ownership.

In Netflix, they removed approvals for making decisions.

It's very common when reporters would like to make a decision that their boss will approve. That leads to the fact that the boss should be able to make efficient decisions for everything. In practice, that's not true: bosses don't know how to make efficient decisions for the task that Junior engineers are working on. In Netflix, they expect that everyone can make an efficient decision that's not necessarily the same as their boss would make. They encourage their employees to make their own decisions. This is a very good strategy to apply in the workspace!

Rajani Rao:

"I'm getting the whole team together and trying to involve every member, including Junior engineers, in the decision-making process."

The culture of Rock Stars

Netflix is renowned for its innovative approach and commitment to employee engagement. 

One of the most interesting aspects of working there is that managers are open to their reports interviewing with other companies. Rather than perceiving it as a threat, they view it as empowering employees to take responsibility for their market worth. And by allowing them to do this, managers can also demonstrate their acknowledgement and appreciation for each individual's unique skill set. 

This powerful message allows everyone in the organisation to feel valued – something that no doubt compensates for any fear or insecurity that those leaving may have had. It’s inspiring to see a company actively helping build their employee's confidence rather than undermining it.

Your value on the market is your responsibility.

Open books for transparency

To make informed decisions, Netflix employees must know the ins and outs of the business. 

An essential aspect is being aware of the P&L and strategies used by the company and its overall profitability. There is no need to be intimidated or hesitant when requesting your boss for more detailed information about your company's revenue numbers and how it generates them. 

Access to this data type can provide valuable insights into the effects of decisions and how they impact an organisation’s financial health. 

Don’t let phrases like ‘keeping out of information overload’ prevent you from asking questions and gaining a deeper understanding of your company's operations.

Other techniques to reinforce the culture of freedom and responsibility

• The keeper test. If a person said they were leaving for another job, you ask yourself if you would fight to keep them.

• The circle of feedback. Regularly receiving feedback from team members without anonymity.

• Leading with a context. Leaders do not make all the big decisions and control every high-stakes situation for their direct reports. They lay out the context so employees feel empowered and informed to make the judgement call themselves,  even if it is risky.

They also encourage the shift of the mind to learn the product or the feature, what customers want. This allows them to make more efficient decisions from design to delivery in production rather than just implementing a business requirement.

Conclusion: Netflix and the Culture of Reinvention

If you’re looking for an excellent book that will give you insight into how to succeed in your career, we highly recommend No Rules Rules: Netflix and the Culture of Reinvention. 

It was inspiring to discuss as a group, and we took away some key points that we thought would be valuable for our members. We hope you find these takeaways useful and that they help you in your career journey!