January book recommendations
This month I’m just going to share one book. I ordered this shortly after it was released but it got lost in the post from London to Israel. When it finally arrived, I couldn’t put it down. This is a business book focussing on the culture at a company that has disrupted the entertainment industry, put BlockBuster out of business (after being laughed out of an acquisition meeting in their early days) and become a household name.
No rules rules
This is a brand new book that just came out a few months ago, co-authored by Netflix CEO Reed Hastings and Professor Erin Myers, about the incredible culture Netflix has built within their organisation and how it has enabled them to grow from strength to strength.
Some of the principles are unorthodox - some are downright controversial. But the more controversial they were, the more I was punching the air and shouting “YES!” in agreement.
Okay, I was more nodding along and smiling, but in my head I was punching the air.
At Netflix, they hire the best people and “pay top of the personal market”. They shop around to see what the employee could earn at a competitor and pay the top of that bracket. Each year, raises aren’t based on percentages or budgets - they’re based on how the market as changed. If an employee has worked at Netflix for 2 years and could now earn 20% more by moving to Facebook, HBO or another competitor, they get the 20% pay jump straight away.
But Netflix also fire quickly, based on performance, as part of their goal of maintaining what Hastings calls a “high talent density”. Hastings and Netflix recognise that average performers pull down star players and by surrounding star players exclusively with other star players, their output is magnified. According to them, 1 star player operating at their full potential is worth 10 average performers, so it’s better to hire the 1 star player and use the salaries of the average performers to pay them the very best salaries.
Hastings and Myers make it very clear none of these individual concepts, nor any of the other principles that guide Netflix, such decentralised decision making (there’s no need to get the boss’s signature on big expenditures) and no travel policy (just do what’s best for the company), could exist in isolation. They only work because they all come together.
I’m not going to give away too much more of the book’s content, but instead encourage you to go straight out and read it - this one’s a game changer.
