Thursday, November 26, 2009

9 Things I Learned from Reed Hastings @ Netflix

At a private CEO event a few weeks back, I had the pleasure of seeing Reed give a powerpoint-less presentation.   His way of looking at business is quite inspirational, and there’s now doubt it’s a major reason why Netflix succeeded where many others have not.  I’ve been thinking about which of these ideas fit for BzzAgent…regardless, every company could add a little bit of his wisdom.  Here’s what I jotted down (note much of this is paraphrased):

  1. When outlining a strategy, instead of just articulating what you’re going to do, always add what you’re NOT going to do.   To know what your strategy will force you to not do will make things much clearer.
  2. If you can grow within your market by 10x, then stay in that market.  If you can’t grow by 10 times, then expand into other markets where you can.
  3. Companies aren’t like families.  Families provide unconditional love and are highly dysfunctional.  Companies, rather, are high performance teams.  Sports teams make their players try out for their job every year.  If you need a great left tackle, you shouldn’t just keep someone because they were there last year.
  4. A great company is not sushi at lunch; it’s working with incredible people.
  5. Don’t optimize for people who follow process, optimize for people who think and are mavericks.  Flexibility is more important than efficiency.
  6. Coordinate team on strategy but avoid buy0in on tactics.  Think: Highly aligned, loosely coupled.   Occasionally stuff goes wrong, but this allows for much better speed to execution.
  7. Managers need to ween selves from crutch of an employee’s time in seat vs how they’re succeeding.
  8. If a smart person does something dumb, figure out the problem in the context that you set, not the tactic that they failed at.
  9. Value is what you hire and fire on.  Forget the bs flowery stuff.  Your values are based on what makes you decide to hire someone.

When I caught up with Reed after his speaking gig, we talked a little bit about some of his other ideas on compensation.  I’m not sure I buy into those yet, but he’s got me thinking…

Reed Hastings, CEO of Netflix

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