Founder of Netflix: why can I achieve a market value of more than 10 billion without requiring 996?


Welcome to the wechat subscription number of “chuangshiji”: sinachungshiji
Interviewee | Irene Meyer, Professor of European School of business administration, co-author of Netflix founder Hastings’ book “not stick to one pattern: Netflix’s free and responsible work law”
Interviewer: Feng Hao, Zeng shaomei (Intern), business research team of chaos University
Source: hundun University
As a business manager,
Will you turn down 10 ordinary programmers and recruit only one excellent programmer who costs ten times as much when you build a team?
Will you pay every employee the highest level in the market?
Will you raise TA’s salary by a large margin before the excellent employees ask for it?
Will employees’ salary structure completely ignore performance factors?
Will there be no standard, no upper limit, no process and no supervision for employees’ travel reimbursement?
Can an employee decide a large order worth several million yuan without the signature of you or the leader of TA department?
Can employees take more than two-and-a-half months off each year without asking for leave from you or the leader of TA department?
The daily work of employees is to complete the tasks you assigned. Will you turn off TA?
Do you synchronize all the company’s information with employees at every level, including sensitive strategic and financial information, organizational restructuring, personnel changes, and even key mistakes made by management?
Chances are, you won’t do that.
In fact, the vast majority of business managers will not agree with the above practices, and even criticize that they are totally contrary to the known psychological mechanism, common business knowledge and even common human behavior.
However, Netflix, the famous streaming media giant, has chosen “yes” to all the above questions.
The company, with a market value of more than 200 billion US dollars, a series popular in more than 190 countries and regions around the world, 193 million paid subscribers and the highest growth miracle of US stocks, has no vacation system, no travel system, no funding and decision-making approval system, no follow-up examination, no performance improvement plan, no KPI, no OKR, or even no salary level, no profit margin Pay grade, no performance bonus
It is also because of such abnormal management principles that Netflix is highly sought after by its employees, and has become a popular website in the science and technology talent market Netflix was rated as the company employees most want to work in, beating Google, Tesla and apple.
In terms of internal management mechanism, Netflix advocates freedom and responsibility; in terms of external performance, Netflix is ambitious and constantly attacking.
Over the past 20 years, Netflix has not only successfully completed the transformation from DVD mail business to Internet streaming media, but also ranked in the upper reaches, making its own TV series, original films and variety shows with large global media companies.
From the recent hit TV series “rear wing abandons soldiers” on the home page of the micro blog and the circle of friends to the phenomenal masterpiece “Jack of the horse”, both the political plot theme “house of cards” and the ancient zombie Korean drama “Lee corpse Korea” have achieved new ratings and topics.
If we say that the key to small companies is to seize an opportunity; the key to medium-sized companies is to have a group of strong executives; the key to large companies is to have a unique corporate culture. The key to Netflix’s amazing success is its innovative and flexible organizational philosophy and corporate culture.
So in Netflix, the way every employee thinks and does things is like a boss.
Recently, Mr. chaos interviewed Eileen Meyer, a professor at the European School of business administration. She and Mr. Hastings, the founder of Netflix, jointly studied Netflix’s management principles and co authored the book “not stick to one pattern: Netflix’s freedom and responsibility working method”. In the book, they completely restored Netflix’s management principles from the perspective of internal and external intersection. Today, I’d like to share with you the management principles of a company with a market value of 200 billion US dollars.
This article is the original article of chaos university business research team
Decentralization – employees decide their own vacation, as well as the company’s money
When we talk about Netflix, we should talk about the culture of Netflix and the famous “freedom and responsibility”. Irene Meyer, a management professor who entered Netflix as an enterprise recorder and closely observed, found that these are two words that Netflix employees often talk about.
However, in the various expressions of Netflix, the outside world tends to overemphasize the “freedom” in the first half of the sentence, which means giving more freedom to employees and maximizing their talents, which means delegating power in management. However, the founder of Netflix Hastings emphasizes that we should not get lost in the beauty of freedom and ignore the “responsibility” in the second half of the sentence, which means letting employees bear the corresponding corporate responsibility.
Both of them constitute the core of Netflix management mechanism. With an atmosphere full of freedom and responsibility, we can try to abolish control.
Decentralization 1: abolishing the system of limited leave
Sala, a senior software engineer of Netflix, works 70-80 hours a week and takes 10 weeks off every year. She recently visited the Yanomami tribe in the Amazon jungle in Brazil. She believes that after a few weeks of intense work, she needs a week to do something different to relax: “the important thing is not the length of the holiday, but the ability to arrange life exactly the way you like.”
In 2003, Netflix drastically cancelled the deadline vacation. Employees decide their own commuting time. They don’t need to come to the company as long as they are willing. They don’t need to ask for instructions and approval, and they don’t need to worry that the boss will allow a few days off. The only thing employees need to think about is how long they need: a few hours, a day, a week, or a month.
When fashion in Yahoo’s Lu Qi still remember clearly, Netflix vacation policy, the whole industry was shocked. In theory, of course, this can motivate employees and bring innovation benefits, but there will be a lot of risks and challenges in the specific implementation. Many Silicon Valley enterprises are discussing this possibility, but most of them stay on paper. Only Netflix can give employees free vacation time and days.
The logical basis of this strategy is that the value of creative work should not be measured by working hours.

Hastings believes that a lot of outstanding ideas are the sudden emergence of employees in a relaxed state. Vacation can make employees relax physically and mentally, thus promoting creative thinking and facing work with a new attitude. If you work all the time, you often just turn around and can’t have a new perspective.
Taking this opportunity, Netflix hopes to express to its employees that the company trusts its employees, and at the same time, employees should enhance their sense of responsibility.
At the beginning of abolishing the fixed leave system, some people felt completely free and chose to take leave at an inappropriate time, which brought a lot of trouble to other colleagues and the whole team. Therefore, Netflix has gradually formed three vacation criteria
Always act in the best interests of the company;
Never do anything that prevents others from achieving their goals;
Try to achieve your goals.
Freedom is a path to responsibility. Hastings said that when employees get more freedom, they will naturally have a sense of belonging and responsibility.
Decentralization 2: cancel the examination and approval of travel and expenses
Jennifer Neva, director of product innovation, worked at HP:
In 2005, I took over a big project at HP. According to the company’s process, input the expenditure approval application into the system. Before I have the right to carry out the work, I need to obtain the signature and approval of 20 leaders! My boss, my boss’s boss, my boss’s boss’s boss, and a bunch of names I haven’t heard of, even my purchasing colleagues in Guadalajara, Mexico. In order to get the purchasing department to sign, I kept calling, first every day, then every hour. The approval of this application has been delayed for six weeks
In 2009, I joined Netflix and planned a direct mail campaign to send 3 million copies of brochures to those paying users who were active before but didn’t use our service recently. The whole campaign cost about $1 million. Without any approval process, I just need to sign and fax to the supplier.
With the development and maturity of a fast and flexible start-up enterprise, a complete set of financial supervision system is often established, which requires employees to provide various applications, while the enterprise relies on layer upon layer approval to control expenditure. In Netflix’s view, this will not only undermine the enthusiasm of employees, but also lose the speed and flexibility of a low rule environment.
Hastings described his imagination as follows: hundreds of employees are like birds yearning for the blue sky, but the company entangles their wings with a large bundle of tape, and has no choice but to bow to the company’s policies. Even if it’s completely right, it’s always procrastinating, even eventually leading to failure, resulting in employees’ frustration.
“I don’t want anyone in the company to waste time on meaningless discussions, and I don’t want talented employees to be bothered by stupid rules and regulations, destroying their whimsy and creativity,” Hastings said. “What Netflix needs is to spend other people’s money to buy the most beneficial things for you and your work at the fastest speed in the way you think is the most appropriate.”.
In Netflix, employees can purchase directly, then take photos of the receipts and upload them to the system to wait for reimbursement. There is no need to fill in and submit the application and wait for the approval of the superior.
However, if employees are allowed to spend the company’s money the way they want, and no approval process is required, the company is likely to go bankrupt. Netflix has found out the working method of setting scenarios in advance and verifying reimbursement afterwards.
In the induction training for new employees, CFO wells will preset the first round scenario:
Before you spend a sum of money, imagine how you stand in front of me and your boss and explain why you chose this flight, reserved this hotel or purchased this phone. If at this time, you can give an explanation that fully meets the interests of the company, then don’t hesitate to do it directly; but if the reasons for supporting you to make this decision are not enough, don’t spend the money first, communicate with your leaders or try a cheaper option.
This is called “Presupposition”.
In addition, in order to avoid unreasonable consumption, at the end of each month, the finance department will summarize the reimbursement invoices submitted by each employee of the Department and send them to the manager. The manager can choose to audit each expense and consider the specific situation of each employee. He can also submit all the information to the internal audit department to check whether there is any abuse of public funds 。
This is the so-called “post verification reimbursement”.
Usually, when employees find that the leader will supervise the expenditure afterwards, they are unlikely to test the company’s bottom line and be as careful as possible. The financial audit department will spot check 10% of them every year. If there is fraud, they will be dismissed immediately.
Hastings said that the core of the concept of “freedom and responsibility” is that if someone abuses freedom, he must be severely punished. In this way, other employees will take warning, otherwise, freedom will be meaningless. You tell your employees that you believe them, and they show you that they deserve your trust.
Decentralization 3: no decision-making approval
In 2015, Netflix did not provide download service, that is to say, it would not be able to watch Netflix’s programs without the network, but at this time, Amazon Prime and Youtube have opened related functions.
Neil hunt, the high-ranking chief product officer, strongly opposes the development of download service. He thinks that the Internet will develop more rapidly and become more popular, and the practicality of download function will only continue to decline. He also wastes a lot of time and energy, which will affect the company’s improvement of streaming media quality. According to hunt, “you have to remember to download first; it takes time to download; you have to choose the right storage mode and manage it.”
President Hastings also believes that for 1% of the download utilization rate, there is no need to make the user experience so complicated. Those competitors who support downloading may spend several years here, and Netflix’s service is more quality.
But Todd Yelin, then the company’s vice president of products (a subordinate of Hunter), was skeptical. He conducted an investigation to verify whether the two leaders were right.

The result of the survey is: in the United States, 15-20% of Amazon Prime users will use the download service, which is far higher than 1% predicted by Hastings. In addition, in India, more than 70% of YouTube users use the download function. Even in Germany, the Internet is not as popular and stable as in the United States.
According to sufficient market research, rather than the result of pyramid decision-making, Netflix finally launched the download function, which was well used.
There is no doubt that people like the work of full freedom and self-determination. The micro management mode of guiding employees’ words and deeds has long been out of date. “Nano manager” is often considered as “dictatorial” and “dictatorial”. But in most enterprises, no matter how much autonomy employees are given to set their own goals and realize their own ideas, almost all employees still think that the boss has the responsibility to prevent employees from making stupid decisions and reduce the waste of funds and resources.
Netflix executives rarely participate in the decision-making of specific affairs. On the contrary, they have been working hard to cultivate employees’ independent decision-making ability. “We don’t want employees to give up a good idea because of the denial of their boss,” Hastings said. The purpose of the job is not to please the boss, but to benefit the company. ”
He believes that the secret of Netflix’s success lies in the fact that employees have great autonomy and can make decisions on their own without the approval of their superiors (but they need to let their superiors know).
He suggested that the boss who dare not let go ask himself four questions:
Is he a good employee?
Do you believe he has good judgment?
Do you think he can bring benefits to the company?
Is he competent for the work of your team?
If the answer is no, then he should be dismissed; if the answer is yes, then don’t interfere and leave the decision-making power to him. When the boss gives up the status of “decision-making Examiner”, the company’s business will develop more rapidly, and the employees’ innovation ability will also be enhanced.
Employees with autonomy can refer to the following steps of Netflix:
1. Collect objections or exchange ideas
If you want to implement a good idea that appeals to you, you can create a shared memo, first explain your plan, and then share it with dozens of colleagues. Colleagues can leave their pros and cons in the blank of the document, which can be seen by all. Sometimes, the employee who proposes a proposal will attach a spreadsheet inviting you to rate the proposal from – 10 to + 10, along with the reasons.
Of course, it’s not a vote or democratic election, and you don’t have to add up all the numbers to get the average, but to collect honest feedback means to stress test your ideas and collect a lot of data points.
The more actively we collect objections and advocate public expression of objections, the better decisions the company will make. This applies to all companies, no matter what industry they are and how large they are.
For a plan that is not particularly important, there is no need to go around to collect objections, but it is best to let other colleagues know what you are doing and weigh the feasibility. Communication is also a way to collect objections, but this way focuses on collection rather than objection itself.
2. Thoroughly examine major decisions
Most successful companies conduct a lot of market research to understand customer preferences and the reasons behind them, and determine the company’s strategy accordingly. The difference of Netflix is that even if the person in charge totally opposes, the investigation and demonstration will continue. Netflix’s download service is an example.
3. Make bold bets if you know what to do
The consensus is ultimately implemented in decision-making. Every important decision will have an “informed commander”, who has complete freedom of decision-making. Of course, he also needs to take full responsibility for the final result. As an informed commander, signing a contract independently is an expression of bearing responsibility.
An employee said, “I will make decisions for my boss, my boss’s boss, my boss’s boss’s boss, and Netflix as a whole without approval from others. In my heart, responsibility and worry are intertwined, which also makes me work harder to ensure that every contract I sign can bring benefits to the company. ”
4. Celebrate success and face failure
If a subordinate’s plan is successful, one of the things you have to do as a boss is to publicly congratulate him, because after you deny his plan, he can still stick to his idea. In addition, you should clearly admit: “you are right, I am wrong.” To tell other employees that they can refute the boss.
If the scheme fails, it is even more important to give the right response. For example, ask employees what lessons they have learned, don’t hold on to their mistakes all the time, and tell them to learn to face failure.
Honesty — 360 degree transparency
Every Friday, Netflix holds a plenary meeting in the parking lot – the only place where the company can accommodate all its employees. Send the financial statements to you, and then browse the changes of weekly indicators together. For example: how much is the average revenue after several batches of goods are delivered; how to meet the needs of customers and make Netflix film the first choice. And the strategy document, which is full of information you don’t want competitors to know, is posted on the bulletin board next to the coffee machine.
“I don’t want my employees to feel like they’re working for Netflix, I want them to feel like they’re part of Netflix,” Hastings said. This is actually the first half of the irrelevant sentence. Almost every manager will say it, but he goes on to say, “even if it means risks to Netflix and its employees.”.
The workplace is always full of secrets, especially behind the door of the high-rise office in the deepest part of the office area, there always seem to be a lot of “can’t say”. From the perspective of the employees, they just feel chilly, “although I work conscientiously, the managers don’t trust me. They have some big secrets that they keep secret from me.”.
The dilemma of managers is that sharing this information may damage relationships, cause confusion, or even bring crisis. For example, if you are considering restructuring, some employees may lose their jobs. For another example, you have “business secrets” that you don’t want to reveal to your competitors.
But Netflix insists on sharing all the information. Netflix believes that its teams are “adults”, those who can handle complex information independently, and those who understand that freedom means greater responsibility.

At the same time, the synchronization of financial and strategic information can also maximize the talent and ability of employees.
If a manager doesn’t know how many customers the company has signed and what strategic discussions have taken place in the past few weeks or months, how can he know how many people he should hire? He has to ask his boss. If his boss doesn’t know the details of the company’s development and can’t make decisions, he has to go to his boss again.
Therefore, the more employees understand the company’s strategic financial situation and daily operation, the more they can make correct decisions on their own, and they don’t have to involve so many hierarchical relationships.
This all-round honesty and transparency is also reflected in the performance evaluation.
Most companies use the annual performance appraisal – the boss lists the advantages and disadvantages of the employees, according to the overall performance rating of the employees, and then carries out one-to-one appraisal and confirmation on the employees. Such feedback is one-way, that is, the evaluation from the superior to the subordinate conflicts with Netflix’s idea of “don’t try to please the boss”. In addition, Netflix does not have quantitative annual goals or key performance indicators.
After many experiments, Netflix has developed a feedback method consistent with the open and transparent corporate culture.
Frank one: 360 degree written feedback
Everyone will try to give feedback to colleagues in different positions, not limited to direct reports, line managers or colleagues who ask for feedback.
No rating, the result has nothing to do with promotion.
A series of valuable discussions after feedback.
No anonymity.
The top level systematically shares the feedback with their direct subordinates, the middle level shares the feedback with their team, and so on. It can not only enhance the internal transparency of the company, but also form a “reverse responsibility system”.
Frank 2: 360 degree face to face feedback
Dinner together is an effective way to understand the interpersonal dynamics, which can improve the work efficiency of the group. Each team member understands the internal differences in a new way and enhances team cooperation.
“360 degree face-to-face” activities often take several hours, and it is more appropriate to carry out them at dinner time (including at least one dinner); in addition, the number of participants should not be too large each time (8 people are suitable).
All feedback should be considered a gift and must be practical; follow 4A feedback guidelines. Positive encouragement and support (i.e. “continue…” Class feedback), accounting for 25%; improved feedback (“start…” Class and “stop…” Class feedback) should account for 75%; try to avoid non operational generalizations (such as “I think you’re really a good colleague”).
At the dinner table, in front of everyone, what is it like to point out “what you need to improve” bit by bit? It may still be fear and worry, but this way can significantly improve performance.
Elite: the bottom principle
Netflix regards “talent density” as the core of enterprise innovation ability.
In Netflix, most jobs rely on the innovation and creativity of employees. For creative work, the work efficiency of the best employees can easily be more than 10 times higher than that of ordinary employees, and the best people can continue to motivate other talents.
As a leader, the primary goal is to create a working environment composed of excellent employees. These people have different backgrounds and perspectives, but they have one common feature: extraordinary innovation ability, ability to complete heavy tasks, and ability to cooperate with each other.
Hastings said that we must first ensure that the talent density is in place, otherwise other principles will not make sense.
Bill Gates often said: “an excellent lathe worker’s salary is several times that of an ordinary lathe worker; and the code written by an excellent programmer is 10000 times more expensive than that written by an ordinary programmer.” These figures are not groundless. As early as 1968, the software industry put forward the “elite principle” to assign nine programmers the same task, requiring them to complete a series of coding and debugging tasks within two hours. The best one is 20 times faster than the worst one, 25 times faster than the debugging speed, and 10 times faster than the program execution speed.
This principle is not limited to programming, but can be extended to all creative work.
Elite principle 1: no performance bonus
Netflix’s approach is: compared with 10-25 ordinary employees, it is better to employ an elite to pay the highest salary in the industry, and there is no need to set performance bonus.
First, the premise of the bonus system is to make a reliable Forecast of the future. However, in Netflix and other start-ups, they must be able to quickly adjust their direction to cope with rapid changes.
For example, if this year’s goal is to increase operating profit by 5%, then employees must focus on improving profit; but if we consider the competitiveness of the next five years, we may need to change the direction, which means increasing investment and risk, the profit margin of that year may be reduced, and the stock price may also fall.
This means that only when employees achieve their goals set in December in January of the same year can they get rich year-end bonus, which will only encourage employees to behave in a disguised way, which is one of the reasons for the lack of innovation in large companies.
Second, putting more money in front of excellent employees does not mean that they will work harder.
No matter whether there is bonus or not, people with high performance will consciously pursue success and do their best to do a good job. “I don’t know why I want to sign a contract with a bonus,” said John Klein, a former chief executive of Deutsche Bank. “I won’t work harder just because someone gives me more bonus, and I won’t relax just because someone gives me less bonus.”
Not only Klein, MIT has conducted an interesting study, requiring undergraduates to complete a cognitive skill task (sum up the numbers) and a mechanical skill task (hit the keyboard as quickly as possible), and to offer high (600 dollars) or low (60 dollars) prizes according to their performance. As a result, the higher the bonus, the higher the performance of the mechanical skill task, but the cognitive task is unexpected: the higher the bonus, the worse the performance.

Researchers believe that creative work requires emancipation of the brain. If you always think about how to do it to get a high bonus, you will lack open cognitive space, and the possibility of producing the best ideas and creativity is also very small. On the contrary, you will do worse.
Hastings believes that it is a high enough salary, not a performance bonus, that stimulates creativity.
Elite principle 2: keep the market at the top
The experience of ruo’ang, director of public relations of Netflix, is as follows:
Netflix offered me three times the salary of my last job. In the first year of my job, I didn’t think about raising my salary. But nine months later, the leader suddenly said to me that the salary should be increased by 23% to keep the highest market. Can you imagine my surprise?
Netflix not only pays its employees high salaries at the beginning, but also keeps rising with the market supply and demand to ensure that they always get the highest salary in the industry.
Most companies use “salary pool” and “salary grade” to decide the salary increase, which is difficult to reflect the real market value of employees, so they can only increase their salary by job hopping. Market research shows that if employees stay in the original company, the average annual wage increase will be about 3%; if they give up their original jobs and change jobs, the average annual wage increase will reach 10-20%. In this way, it seems that there is no “money way” to stay in the same company all the time.
Keeping the highest wage in the market is a staggering expense, which may even drag on until the company goes bankrupt. But only in this way can we attract and retain the best talents in the market year after year in a high performance environment. Before employees ask for a raise, and before employees start looking for other jobs, take the initiative to raise their wages.
If there is no way to maintain the highest salary, it needs to reduce costs through layoffs, rather than cutting the salaries of elite employees.
In addition, Netflix is probably the only company that openly encourages employees to talk to competitors or even interview.
“The market demand for talents continues to heat up, and you will continue to receive calls from headhunters, probably Amazon, apple and Facebook. If you’re not sure if you’re earning the most in your industry, you can find out how much money you can get in those companies through headhunting. If you find that they are paid more, please let us know. ”
Netflix has even set up a database for this purpose, in which all people can input their own data obtained by phone and interview. Netflix’s rule is, when the headhunter calls you, before saying “no, thank you”, ask: “how much is it?
Elite principle 3: business is not family
In Netflix, the decision-making power of major issues is scattered at different levels, which means that the highest talent density is needed, and everyone must go all out to meet all challenges.
At this stage, Netflix’s suggestion is to quit the current employee decisively if you are sure to recruit a better employee. It’s very difficult, because the employees are excellent, but no matter how difficult the decision of personnel adjustment is, we should ensure that every position is the best employee.
Netflix wants everyone to feel that they are part of the company, but at the same time, it doesn’t want employees to stop learning, because it’s like giving way to others: as long as someone does better than you, you have to leave.
Netflix encourages managers to regularly assess employees with the help of “employee retention test”:
If someone is going to quit tomorrow, will you persuade him to change his mind?
Or will you accept his resignation, or even feel relieved?
If it’s the latter case, you can pay severance immediately, and then find an elite you want.
Considering supporting the basic family expenses, Netflix will pay generous severance expenses. The average employee’s salary is four months, and the vice president’s salary is nine months.
There is no doubt that the employee retention test has increased the talent density, but at the same time, it has also led to the anxiety of employees and the fear of being kicked out of the team. In order to minimize the fear in the office, Netflix adopts two methods
1. Employee retention tips
Encourage employees with fear to have a one-on-one conversation with their boss as soon as possible, and directly ask, “if I want to quit, how much effort will you make to persuade me to change my mind?”
There are three possible answers:
Your boss said he would try his best to keep you, so it’s unnecessary to worry;
If your boss hesitates, he will give detailed feedback on how to improve your working ability. The next thing to do is to improve your performance according to the suggestions;
Your boss thinks that he may not stay, and your performance level is far from his psychological expectation. So you need to take this opportunity to reflect on whether your skills are really suitable for the job.
2. Turn on the light after dismissal
If someone’s name is crossed out from the company’s list, what other employees want to know most is how the company made the decision and how many warnings the dismissed employee received in advance. At this time, the best way is to turn on the light to illuminate all the unknown things and sweep away all the uneasiness with clear thinking and frank attitude.
The core of Netflix culture is “talent is more important than process, innovation is higher than efficiency, freedom is more than control”, and its foundation is that creativity needs freedom, but freedom cannot be abused. Therefore, to improve the density of talents, to introduce the culture of honesty, to cancel all kinds of control, the three are closely linked, promote each other, and spiral through three stages.
“Once we increase the talent density, we can confidently raise candid questions; then, we can gradually abolish all kinds of rules for controlling employees,” said Hastings, founder of Netflix. Only by putting it in a complete and self consistent system of triple helix can we understand Netflix’s seemingly abnormal practice at the beginning of this article.
“Rules and processes” has been the management model adopted by most organizations for centuries, and it may still be the best model for specific organizations in the next few years. However, in today’s information age, with the continuous growth of intellectual property rights and creative services, the proportion of economy relying on invention and innovation will only be higher and higher. It is dangerous to still follow the management mode of wealth creation dominated by the industrial revolution era.
Because the goal of the industrial age is to minimize the difference, but today’s creative enterprises are pursuing the maximization of the difference. At this time, the biggest risk is not to make mistakes or lose consistency, but to fail to attract top talents, invent new products or change the direction in time when the environment changes.

Consistency and repeatability at this point may suppress new thinking rather than bring profits to the company. Many small mistakes can be painful, but they can help an organization to learn and grow quickly. At the same time, small mistakes are also a key link in the innovation cycle.
Netflix has chosen the corporate culture of “freedom and responsibility”. Maybe your company can pursue creativity, speed and agility in a way closer to the edge of chaos.
Mr. chaos asked Professor Irene Meyer a few questions
1. Mr. chaos: what do you think of the applicability of Netflix’s management principles in China?
Meyer: in November this year, I gave a lecture at Ali business school. The audience I was facing was Chinese entrepreneurs. In fact, I have many doubts about whether the ideas in the book can adapt to the special business environment in China. But in that sharing, many entrepreneurs expressed interest and even began to practice in their own companies. Of course, there are others who feel that these ideas are too radical and totally impractical in China.
On the whole, entrepreneurs who have lived and studied in the United States, smaller enterprises whose business scope is in the field of high technology and innovation, are more eager to try this set; on the contrary, more traditional Chinese enterprises will say, “I will never do that.”.
In my opinion, these cultures are quite strange to China, but they are not totally without reference.
2. Chaos King: “996” is very common in China’s Internet companies, which belong to the same highly competitive industry. Netflix has completely different working hours principles. How does Hastings evaluate these Chinese enterprises?
Meyer: talking about “996”, I would like to give the example of Japan Netflix. In Japan, people told me that when they used to work, they needed to take the first train in the morning and the last train in the morning. One of the employees said that she took only one vacation in six years, which was her sister’s wedding. But in Japan, employees can choose their own holidays, and Netflix even encourages people to work at home and where they like. Joining Netflix means that there is an opportunity to balance work and life.
What can’t be ignored is that in some cultural environments, people sometimes work overtime too much, which requires innovation of management methods. Hastings takes about six weeks’ vacation every year, and he often talks about it. Before almost every leadership meeting, he starts with the photos of his last vacation to let employees know, “this company, we encourage employees to take vacation.”.
In order to make employees creative, they must have their own time. It is difficult to see the creative aura when they have been working without gap. The development of Netflix in Japan proves that even in a completely different cultural environment, more freedom given by Netflix still has its place.
3. Mr. chaos: Based on your observation in Netflix for such a long time, what’s your general view on the company and employees?
Meyer: I have to say that although they are given a lot of freedom, Netflix employees are very engaged in their work and work for a long time, which may even lead to spontaneous and voluntary “996”. If you’re given a lot of freedom, you know that your reputation will be based on how to deal with it, and many times, you’ll be working longer, as in Netflix. Given the power to do things, people invest a lot in their work.
4. Mr. chaos: what is the most controversial part of Netflix’s practice? How do you respond to these queries?
Meyer: it’s very controversial! Especially the part about job security. Because we live in the industrial age, good employers provide job security. They will say that we take care of you, take care of your family, and protect you for the next 30 years. As long as you give faithfully, we will also give faithfully.
However, Netflix provides a completely different new employment mode. This mode is – you come here to work, we give you more freedom, but even if you do well, the company still needs to continue to judge: are you suitable for here? Sometimes, the company will make a decision, you are not suitable!
Every reporter who interviewed me would ask: isn’t that cruel? Won’t it create a culture of internal competition? No, I don’t think so. I think it’s just a different way of working. Moreover, I think we will see more such companies in the future, based on more frequent turnover of personnel, which will make the organization more flexible and innovative.
5. Chaos: will freedom and corresponding responsibilities bring too much pressure to employees?
Meyer: freedom does mean pressure, but I think it’s a choice that any adult should make for himself. The three years of writing this book is also the most stressful period in my life. Part of the reason is that Hastings gave me a lot of freedom. He said that I can finish this book in any way I think is right. I can’t help thinking that it might be a failure, a disaster, waking up at three in the middle of the night and starting to write It’s not because Hastings told me that I have to work, but because I have an opportunity to do something big and I don’t want to waste that precious opportunity.
We should not look down on any employee, who could have greater dreams and great opportunities and potential.
6. Chaos Jun: that sounds like a slogan. Won’t there be too much emotional and managerial internal friction without job security?
Meyer: of course, if the corporate culture is constantly preaching, “you’re going to lose your job at any time!” Daily work will also receive a lot of negative feedback, people will inevitably fall into indifference, selfishness and indifference.
But I want to be honest with you, Netflix is not like this. On the contrary, I’ve never seen the middle and high levels spend so much time helping the grassroots employees succeed. Netflix’s management model is that the boss is the tree trunk, and the job is to create soil to nourish the trees, rather than the top of the pyramid structure in the traditional model. I think it’s crucial to emphasize that.
How to create this kind of working atmosphere, the boss needs to know what high-performance employees need – they need to be appreciated when they succeed, they need to be cooperated, they need to feel surrounded by their best colleagues, and they need to work together to achieve great things. The responsibility of the middle and senior management is to create such an environment, rather than constantly monitor the performance of employees and put too much pressure on them.

A lot of people only see the surface, but don’t pay attention to the kernel. If there is only the pressure part, no one will want to work in Netflix. What a terrible and over competitive environment it will be!
7. Mr. chaos: are there any specific examples to illustrate how managers create a work environment that helps them grow?
Meyer: in Netflix, the manager’s job is not to make decisions, but to make a series of preparations for the employees who really make decisions.
First of all, managers will provide some decision-making chips when employees enter the company, just like casinos, and do not expect these decision-making chips to bring profits to the company. On the contrary, if they are all profits, it only means that you are not risk-taking enough. The important thing is to learn from failures. You don’t lose your job because of a decision failure.
Second, in every step of employee decision-making, managers will provide a lot of timely feedback. Many people in the workplace have realized that managers often don’t give feedback for various reasons, but Netflix’s managers will appear at every moment when they need to tell you the appropriate resources, manpower and my suggestions, and let go of the final decision.
I think the most important message of this book is that if you want to innovate, you have to endure failure, which is just part of innovation.
8. Chaos Jun: because of the new crown epidemic, many enterprises are forced to choose to work at home. What changes does this bring to Netflix’s corporate culture? What do you think of the future development of flexible working style?
Meyer: I think it’s ironic. In September this year, the reporter had an interesting interview with Hastings. The reporter asked him, during the epidemic period, what is the benefit of working at home and letting employees work freely at the time and place they want to work?
Hastings’ answer is, it’s no good! Since then, it has become a variety of front page headlines. The founder of Netflix said that flexible office has no advantage!
This is actually a misreading. In Netflix, employees can work when they want to and wherever they want to. So what Hastings meant was that flexible working during the epidemic reduced the chance of meeting and discussing. The newspapers misunderstood him.
I believe that in the future, many companies will learn something from the new crown. They will be flexible and free. They will not let employees slack off, but will only improve their work enthusiasm and creativity.
9. Mr. chaos: what’s the most charming part of Hastings after spending so much time with him? Can you share with us the story behind the book?
Meyer: Hastings is a very modest person. Even modesty is not the right word. He is a very self mocking man. Of course, he has a lot of power. Most of the powerful people show off inadvertently, but Hastings, on the contrary, tries his best to make himself feel and look like an ordinary person. He initially contacted me and wrote such an email: “Hi, Irene, like you, I used to be a volunteer in Africa. Now, I work in Netflix, a technology company. My name is reed.” he works very hard to be an ordinary person.
There is an interesting story. The second or third time I met him for this book was in Belgium. We walked in the forest together and spent 6-8 hours together. Later, he went to Holland by train. That night, he sent me a text message, which said: “Irene, it’s so embarrassing. I didn’t find it. All day, my shirt was on backwards!” To tell you the truth, I didn’t notice the shirt he was wearing on the back, but he made fun of himself casually, which made you feel very kind.
At the same time, he is also very strong, especially in the face of important decisions.
Of course, you can say that he was always right when he was strong. As early as 1996, he foresaw the coming of streaming media era. However, since he advocates decentralized decision-making in Netflix, he should avoid stubbornness. In Netflix, everyone dares to contradict him, but he will be very stubborn and strong in defending his major decisions.
(statement: This article only represents the author’s point of view, not Sina’s position.)