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Powerful: Building a Culture of Freedom and Responsibility
Download PDF Powerful: Building a Culture of Freedom and Responsibility
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Audible Audiobook
Listening Length: 4 hours and 21 minutes
Program Type: Audiobook
Version: Unabridged
Publisher: Silicon Guild
Audible.com Release Date: January 9, 2018
Whispersync for Voice: Ready
Language: English, English
ASIN: B0787F5CRM
Amazon Best Sellers Rank:
This is one of a gazillion books about creating the team you need to be the next Netflix. Is it worth it? That depends.If you’re looking for a passionate, pleasantly irreverent, contrarian perspective on building a high performance team, then the answer is probably yes, and you should consider this book a 5+.If, on the other hand, you’re looking for definitive answers on how to measure performance and talent, this book is another 1 or 2.If you agree with McCord that the annual performance review is a colossal waste of time and money, and I could not agree more, great. And if you agree that no company has an obligation to guarantee career development to its employees, you’ll want to display the book prominently on your desk. In this regard, I do agree with her on the obligation part of the perspective, but not the return on investment of pursuing such a strategy, unless, of course, you are another Netflix, and you probably aren’t.Everything in life and business must be viewed in context. Building a high performance team is no exception. This model assumes that high-performance employees value nothing quite so highly as they value hard-core honesty and the chance to be part of a big, ugly shared challenge. And that fits some of the people some of the time in some companies at some point in their development. For Netflix it was a winner. For you? I don’t know.What you are guaranteed to get is churn, unless of course you are Netflix at exactly that point in the company’s development. McCord, to her credit, admits that she applied the same standards to herself as she did the rest of Netflix. And she left and the company apparently didn’t stop her, at least not successfully.I have no doubt she will be a huge success in consulting. Bigger than big, is my guess, particularly in the Silicon Valley biosphere. She definitely has something to offer.I liked the book. I really did. It’s a quick read and wonderfully written. Without the Netflix brand it’s probably over-priced but that’s okay. I happen to think Netflix is the greatest invention since the electric garage door opener, although I’m showing my age and the fact that I’ve always lived in cold, snowy climates.But after four decades in the corporate world, none of it in Silicon Valley, but with a decade of experience in China, where I managed a company that was successful despite my inability to speak the language, my unanswered question is how to specifically and objectively identify top talent. I fully understand the Justice Potter Stewart standard of “I know it when I see it,†and my record has been pretty good as both a CEO and a broad member evaluating CEOs.But I’d still like to better understand the why behind the what. I got whiffs of it in this book, for sure, but it ultimately fell short of being the Holy Grail – at least in that one regard.
Netflix is one of the world’s greatest companies. They didn’t become a great company because they have a great strategy. Let’s be clear about this: strategy never made any company great. They are a great company because the have a sound strategy AND a superb people management system. This book is a description of that system by the Human Resource executive, Patty McCord, who to helped create it.McCord writes: “…we found that inculcating a core set of behaviours in people, then giving them the latitude to practice those behaviours—well, actually, demanding that they practice them—makes teams astonishingly energized and proactive.†To transform a culture in a team or the whole company, isn’t achieved by formulating a set of values and principles. It is only achieved when the behaviours you desire become consistent practice.This book describes the eight practices below:1. The greatest motivation is contributing to success2. Every single employee should understand the business3. Practice radical honesty4. Debate vigorously5. Build the company now that you want to be in the future6. Have the right person in every single position7. Pay people what they are worth to you8. Perfect parting well with non-performing staff or staff who are no longer required, and be a great reference company to have worked at.I will touch on only three.The first principle is that motivation flows from being a contributor to success, not from incentives and perks. Talented people who are adult in their behaviour, want nothing more than to be challenged. This requires that you employ talented people and then explain to them, clearly and continuously, what exactly you expect from them.The common alternative is to create policies and procedures as a substitute for explaining clearly and continuously. The weakness of this approach is that the manual cannot anticipate the ongoing changes that are inevitably required.Netflix was changing too fast to be able to follow a policies and procedures manual. The company had to have a flat management which allows for speed in execution. This became clear when they had to retrench, and many middle managers were included. The result of removing a layer of management was a quickening of response times Netflix had not anticipated.As the fortunes of the company improved and it grew, the challenge became how to sustain the creative spirit and extraordinary level of performance the teams had been demonstrating. This stimulated McCord to ask: “What if people in marketing and finance and my own group, human resources, were allowed to unleash their full powers?â€Netflix began by trusting people to be responsible with their time, got rid of their expense and travel policy, and in place simply demanded that employees use good judgment about how they spend the company’s money. The company lawyers warned it would be a disaster, but what emerged was that people didn’t abuse the freedom. “We saw that we could treat people like adults,†and that the staff wanted this. Netflix then experimented with every possible way to liberate teams from unnecessary rules and approvals.This approach required management to appreciate that their most important job is to focus on building superb teams. The best achieving teams were those where all members understood the ultimate goal of their work and were freed to creatively solve the problem of how to get there.Netflix was able to prove to itself that operating with the leanest possible set of policies, procedures, rules, and approvals, releases speed and agility.This led to the second principle that every single employee should understand the business.What is required in the absence of rules, processes, approvals, bureaucracy, and permissions, is clear, continuous communication about the context of the work to be done. It is an ongoing discussion about where we are, and what we’re trying to accomplish.In Netflix’s case they were changing from a system where you paid per rental of a movie which was mailed to you, to a subscription model where you paid in advance for future benefits. This change had profound operational implications. Too many companies when faced with new and difficult challenges “invested so much in training programs of all sorts and spent so much time and effort to incentivize and measure performance, but they’ve failed to actually explain to all of their employees how their business runs,†McCord observes.Ask yourself these questions: Do your staff appreciate the most pressing issues facing the business? How much do you think they know about how their work contributes to the bottom line?If your instinctive response is that if you tried to explain, they would not understand, McCord advises: “The rule I would give them was this: explain it as though you’re explaining to your mother.†After all, if your staff aren’t informed by you, there is a good chance they’ll be misinformed by others.Communication between management and employees should flow in both directions. The more you actively encourage questions and suggestions, the more your people, at all levels, will offer ideas and insights that will amaze you.And the job of communicating is never done.To achieve all of the issues above, you have to have a focus on principle 6 - the right person in every single position.Netflix relied on the talent-management philosophy that “the responsibility for hiring great people, and for determining whether someone should move on, rested primarily with managers,†not on HR. HR is only an assistant in this process.They also required the deceptively difficult task of hiring a person who would be a great fit for the position (at whatever level,) and not just adequate. Building a great team is the managers’ most important job.“True and abiding happiness in work comes from being deeply engaged in solving a problem with talented people you know are also deeply engaged in solving it, and from knowing that the customer loves the product or service you all have worked so hard to make,†McCord explains. Money alone doesn’t buy love.This book is an accessible, very practical guide to managing staff at every level, based on insights from only one, very unique company – Netflix. However, it provides a valuable source of thought provoking ideas that you can easily adapt to your own circumstances.Readability Light -+--- SeriousInsights High --+-- LowPractical High +---- Low*Ian Mann of Gateways consults internationally on leadership and strategy, and is the author of the recently released ‘Executive Update.
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