How did Netflix become successful

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3 Things That Netflix Did Right To Become A Billion-Dollar Company

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Don’t Hesitate To Do Things Differently

Netflix started off by shipping DVDs through mail.

Then, they removed late fees for their customers.

Later, they started streaming TV shows and movies for people to watch online.

Now they produce original content of their own watched by millions worldwide.

Bridgerton, Squid Game, The Witcher, and many others are household names now.

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Hire High Performance People

Netflix finds that a ‘responsible’ person embodies the qualities that make a person right for their company.

These people are self-motivated, self-aware, and self-disciplined who do not need to rely on rigid rules.

Hiring should not only be about finding someone who fits in a job description template.

Make sure you are a right fit for them as well.

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Balance the Trade-Off Between Efficiency and Flexibility

In the beginning, companies follow predefined workflows and processes with little to no creative thinking or brainstorming.

“Efficiency trumps flexibility”, but a lack thereof means chaos.

The answer lies in the people you should hire: self-disciplined, growth-oriented, and high performance.

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At Gaper, we try and emulate this by providing exclusively remote engineering teams to our clients. These teams are vetted for technical and soft skills to ensure they are able to manage their own time and productivity without any micromanagement.

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Demonizing High-Performance Culture

Overworked, under-paid employees don’t make a high-performance work culture.

The recent skill shortage crisis is a testament to the notion that employee turnover in inflexible and toxic work cultures is inevitable.

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Are you doing enough to incorporate an appropriate amount of flexibility in our work? Are our teams equipped to learn, grow and adapt in line with the markets and other economic variables? Letting go of old systems is hard, but they are starting to become counter-productive now.

Netflix is a classic success story of our time; one that business school students will study case studies on decades down the road. While the pandemic-ridden years saw business activity dwindling, Netflix continued to operate stably. How does one build a company system that allows them to cushion their fall in uncertain, hard times? Netflix has a few lessons on offer for other companies. While these may seem a bit obvious and oft-mentioned at first, are we really implementing them in our own businesses?

Don’t Hesitate To Do Things Differently

Business owners and managers are so eager to get back to the ‘old normal’. There is always a perpetual state of some kind of expectation to ‘return to the office next month’, to have ‘in-person meetings starting next week’, or some other version of reverting back to work systems as we knew it. Why? Because our competitors are doing it. Because that’s what FAANG are planning. Or, because that’s what we’re used to.

Netflix started off by shipping DVDs through the mail, and then followed that by removing any late fees for their customers. They then moved to streaming TV shows and movies for people to watch online. Now they produce original content of their own watched by millions worldwide. Bridgerton, Squid Game, The Witcher, and many others are household names now.

At no point did they hesitate to take the next, ‘different’ step. This eventually led to the rise of an innovative, market-disrupting product.

Point is, do what feels right for your team and company without worrying about what the ‘normal’ elsewhere is.

These days, this applies particularly well to the labor shortage crisis and companies’ approaches to dealing with it. It is not uncommon to see business leaders criticizing the work ethics of new entrants in the labor market. Truth be told, it’s not just the new lot. An overwhelming majority of the workforce is now demanding flexible work systems. Companies like Gaper have gained traction in the tech labor market by providing remote engineers to businesses struggling with recruitment. Still, many managers and leaders find it weird to have a part of their team working remotely in the future.

Flexible tech teams at this juncture, are poised to become a crucial part of a company’s success and goal achievement in the future. It may end up costing businesses later if they continue to undermine their significance right now.

Hire The Very Best

A neat segue from our previous point is the importance of hiring exemplary individuals and teams for your company – whether they are remote or in-person. It is not difficult to find individuals with decent technical skills and business acumen. It is however, hard to get soft skills right.

Netflix finds that a ‘responsible’ person embodies the qualities that makes a person right for their company. This is something that a lot of recruiters and hiring managers miss. Hiring should not only be about finding someone who fits in a preprepared job description template. Make sure you are a right fit for them as well.

Netflix describes a responsible employee as someone who is self-motivated, self-aware, and self-disciplined, in addition to having a proactive approach to doing small things without necessarily being instructed to do so. It is better to rely on people who can be trusted to employ logic and common sense for their work rather than having to subject them to rigid formal policies. Such people are worthy of freedom.

Several years back, Netflix actually got rid of the formal review system because it was considered too “ritualistic”. If your teams and managers have a healthy workflow and interaction system (remote or in-person), productive conversations about performance and goal setting will naturally be a regular part of their day-to-day work. In fast-paced business environments, and uncertain economic climates, a (probably outdated) review checklist won’t contribute to the growth and improvement of any team.

Balance Flexibility and Efficiency Smartly

Successful companies of this decade have been met with success primarily because of flexibility.

Once you hire responsible employees who are a ‘best fit’ for your company, you have the freedom to be as flexible as feasible for the sort of work they do. Make sure you extend that flexibility to your teams as well. Netflix has broadened employee freedom and flexibility in tandem with its own growth. This allows them to nourish a more innovative and creative culture amongst its teams that positions them for a more sustainable route to growth.

When companies are growing, they tend to follow predefined workflows and processes. While such systems tend to produce very consistent output on a regular basis, they pose a tradeoff between efficiency and flexibility-led innovation. There is little to no creative thinking or brainstorming involved. There are certainly fewer mistakes made because these processes are optimized for the existing market, but there is no cushion for exogenous shocks. “Efficiency trumps flexibility”. Companies fail to quickly adapt when a competitor enters, or an unforeseen economic shock jostles the business environment.

So how does one draw this balance? Efficient processes suffocate flexibility. But a lack thereof equals chaos. The answer is related to the people that you hire. Self-disciplined, growth-oriented, and high performance. These attributes allow for people to work with discipline in the absence of strict rules.

At Gaper, we try and emulate this by providing exclusively remote engineering teams to our clients. These teams are vetted for technical and soft skills to ensure they are able to manage their own time and productivity without any micromanagement.

Demonizing High-Performance Culture

It is not uncommon to see high-performance cultures and growth-focused companies be criticized for being toxic. This is certainly true for companies that only label themselves as such without actually creating a healthy environment for both employee and business growth. It is not long before the over-worked, under-paid employees end up leaving them for their competitors.

The recent skill shortage crisis is a testament to the notion that employee turnover in inflexible work cultures is now on the rise. There is always a competitor who is building a better employee-centric work system that befits the environment they operate in.

Conclusion

Netflix’s approach of empowering their employees with creative but disciplined freedom is actually a win-win situation for all stakeholders. The pandemic-ridden years have also offered businesses a chance to revamp their hiring and work processes. Question is: have we done enough to incorporate an appropriate amount of flexibility in our work? Are our teams equipped to learn, grow and adapt in line with the markets and other economic variables? Letting go of old systems is hard, but they are starting to become counter-productive now.