I’m reading far fewer business books recently. You can blame Stephen King, Cixin Liu, and Lee Child. However, when I went to the Gartner Symposium in London last year, Erin Meyer gave a keynote, and during her talk I bought her book about Netflix, “No Rules Rules”.
Erin is an amazing speaker, one of the very best I’ve had the privilege to listen to live. She started by asking the audience which company has the values “Integrity, Communication, Respect and Excellence”. She showed a photo of the Enron lobby with those values and then advanced to her next slide: the exact same core values at Netflix.
Erin and the CEO of Netflix, Reed Hastings, co-wrote No Rules Rules about how Netflix operates with very few rules. The most famous one is unlimited holiday time. Only a small number of Netflix employees have strict rules, such as staff in compliance or mission-critical and sensitive roles.
Some “no rules” even require guidelines to ensure they stay that way. Unlimited holiday time requires managers to actually take holidays so everyone else doesn’t get terrified to take time off.
That doesn’t mean it’s completely open season. There are harsh consequences for [mildly] underperforming staff. They get fired quickly. But focusing on the negative misses the point. Other policies include paying salaries well above top-of-market rates, and allowing employees to spend any amount of Netflix money, whether on investments, projects, or expenses, as long as it’s in Netflix’s best interests.
The book is super easy to read. I can’t think of many CEOs who would read it and adopt more than one or two of these concepts. Unlimited holiday time has been adopted by other companies. For example, my employer Endava offers this in some countries. It would take a small company in a highly profitable area to adopt all the no rules.
What I really liked about the book is how Reed started a previous company and found standard rules, the ones almost every company has by default, drove the wrong behaviour. They slowed work down and removed innovation. So when Reed started Netflix, he rethought every behaviour from the ground up, including expenses, holidays, and investments.
