Attract the Right Candidates by Building and Defining a Strong Company Culture: a Netflix Case Study

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Treating customers with dignity and respect starts with treating employees the same way. Employees need to feel it, experience it, and receive it themselves. The beloved companies care for their employees, because they know this internal culture builds trust and inspires great work.

Furthermore, in the wake of the “Great Resignation,” companies in every industry are feeling upheaval. Hiring is frenzied with nearly 11.3 million job openings in January, according to the US Department of Labor.

Practicing Leadership Bravery by Trusting Employees

In 2009, Netflix made cultural history when then chief talent officer Patty McCord and CEO Reed Hastings created a 124-page PowerPoint document entitled “Netflix Culture: Freedom & Responsibility.” This document, which has been shared over 13 million times, states that Netflix intends to thrive—by only hiring courageous employees.  The document provides clarity on what “courage” means in the case of Netflix.

McCord has been quoted to say that the foundation of the Netflix culture is to attract only “fully formed adults.”  For Netflix that means only hiring people who are grounded and self-sufficient, and who thrive with the responsibility that comes with freedom. For example, the expense policy is: “Act in Netflix’s best interest.”  Instead of HR policies, Netflix focuses on hiring people who do not require the oversight that most rules are created for.

Relying on people to use logic and common sense, Netflix does not have a formal vacation policy or annual reviews. While this may seem ‘touchy-feely’ to some, they are rooted in motivating productive human behavior in self-driven people, logic, and financial reward. Reduced policing of travel expenses lifts accountability and reduces cost. Hiring people who prefer regular communication and self-driven management to formal reviews reduces all the paperwork and time of the review system.  The goal is to run a courageous company full of only people who thrive and perform in this type of environment. Netflix’ clarity about how they would and would not grow is what makes their credo so admired.

Netflix Gives New Parents 12-Months of Freedom to Bond

Netflix decided to give all new parents freedom to decide what’s right for their family within the first twelve months of their children’s lives.  To enable this, Netflix gives its salaried employees up to 12 months of paid parental leave to take as they choose. According to Vox, “Netflix by far offers the longest paid family leave out of all the tech companies we asked. Salaried employees, including birth and adoptive parents of any gender, can take up to a year off at full pay following the birth or adoption of their child.” Furthermore, they note that the median paid time off for birth mothers (not all new parents) at these tech companies was 18 weeks.

At Netflix, the benefit applies to both mothers and fathers and includes adoptions. On Netflix’s blog, senior software engineer Ludovic Galibert wrote, “I truly wish more companies would offer their employees generous parental leave and employees would take advantage of it, especially dads. Yes, we too can and should take parental leave to take care of our family and support our spouse, even if it’s not for a first child.”

Attract the Right Talent Through a Culture of Trust

Netflix CEO Reed Hastings was quoted explaining this decision: “Our model is to increase employee freedom as we grow, rather than limit it, to continue to attract and nourish innovative people, so we have a better chance of success.”

This means that employees can decide when and for how long they work during that first year, getting paid their regular salary.  The goal and challenge for Netflix must also be to create the comfort to take that time as desired. Reed Hastings and Netflix’ actions are grounded in understanding the Millenials who are now of child-rearing age. The balancing act is creating an environment of courageous people, while also not making it career limiting to take the benefits offered. Stewart Friedman, a professor at the University of Pennsylvania’s Wharton School who has been researching work-life balance policies since 1991 says they’ve nailed it. Friedman states his research validating Netflix’ move: “Millennials saw their parents forsake aspects of life like family life in their pursuit of career success and didn’t always like what they saw.”

For employees cut out of the cloth that lets them thrive in the Netflix environment, they stay and thrive because they are in a place that lets them work with “stunning colleagues.” They greatly value a culture that entrusts them to act as adults and manage their time, as evidenced by how they leave it up to the employee to determine the right parental leave for them.  They are consistently attracting people who seek to thrive in their environment. In today’s competitive environment, their culture is one of their strongest assets.

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