I was an engineer at Netflix from 2010-2012. There were a lot of things that I really liked about the Netflix culture. They really do live the "Freedom and Responsibility" culture. It was very empowering. There is a dark side to that culture though. At Netflix it was too easy to fire people.
This had two side affects.
1) People were afraid of being fired. You could come in one day and be sent home that afternoon without ever having any idea that you were under-performing. You'll hear Netflix employees talk about the "Culture of Fear".
2) In a meeting with my team Patty said "We are your co-workers, not your friends." `The idea being, you don't make friends at work because you might have to fire that person one day. It was really strange, people were very guarded and almost never talked about their lives outside of work.
PIPs protect employees from the constant fear of being fired. They require managers to give an employee negative feedback. Without them, managers can take the easy route and never have the uncomfortable conversations.
#2 made life really hard at Netflix. The majority of my friends come from my co-workers. You spend more time with them than most other people in your life. Some teams ignored the company culture and became close friends anyway. I think the correct thing to do here is to expect your managers to be adults and do the hard thing. Fire your friend.
It's interesting that your experience is so different from mine (I work at Netflix now).
for #1, I've never heard of someone being let go without having any idea. When a manager goes to HR and says "I'd like to let this person go", they ask, "will it be a surprise?" and if the answer is yes, they send you back to have the hard conversation first.
for #2, I have lots of friends from Netflix. And some of them have even been let go and we're still friends. I was even friends with my boss, but like any company, when it is a relationship with a manager it must always be reserved.
This is an example of survivorship bias. I think you need to consider the fact that Netflix has massive employee churn compared to its peers.
One of the reasons no doubt they're constantly pestering me on LinkedIn to interview with them even though they have just 2100 employees or so. They're running out of people who will actually listen to them.
Facebook, on the other hand, has 5700 employees and I've never heard from them even though my resume is definitely suited to their needs. Why? They don't have to. People want to work at Facebook. They don't have to recruit.
I'd say the best sports teams share a close bond of friendship. Look at the Red Sox this year. They came back after two dismal seasons to win the World Series and the team culture was largely responsible for that. Little was expected from most of these players but the right group of people can make the seemingly impossible happen.
Article say that big money make things a lot smoother anyway. Do you disagree ?
Working at Netflix seems to be a very demanding experience. Will you say that Netflix balance this demand ? In which way ?
Reading this article, I have the feeling that Netflix wants the perfect employees, with no bonuses, no awesome perks, an Uncle Scrooge culture (Wow, I can display my $40 SV paid-by-myself poster in the corridor without asking ! Awesome !), and worst of it an "Han shot first" management.
The saddest thing in this article is the unconditional autocongratulation (sorry for the frenchism) when it doesn't seems so marvelous.
Working there, IMHO, is no more demanding than any other company.
There are no bonus', the salary is just raised - the average pay for engineers at Netflix is something like $200k which is fairly competitive to the "total compensation" from other employers.
I might be wrong here, but being treated like an adult, a very liberal vacation policy, and 100% support for anything and everything I need to do my job; are more valuable than what most people consider perks...
And they're certainly not a "uncle scrooge" culture - I've never once had to justify a purchase and as far as I can tell unless you're asking for something odd or fairly expensive (>5k or so) manager approval isn't even needed.
Anyone's experience at Netflix is going to be heavily influenced by their manager, and sadly, Netflix doesn't seem to be much better than any other company at finding or growing good managers.
> Working at Netflix seems to be a very demanding experience. Will you say that Netflix balance this demand ? In which way ?
It is demanding, but management sets a good example of taking time off and allowing for a work/life balance. If you're there at 6pm on a weekday, the building is 1/2 empty and by 7pm almost no one is around. People do not work crazy hours.
Also, for the most part, no one is around for the next two weeks, other than being on call for critical issues.
As for the no bonuses and perks, that is deceiving. Yes it is true, but instead they pay us what they would spend on those perks. Then we can chose to spend it on that or anything else.
Also, there are no official perks, but management is really good about celebrating wins and making sure we feel appreciated.
And thank you mackwic. I appreciate seeing "thank you" comments, especially when they specify what they liked/disliked about the parent post. HN could use some more of the civility and appreciation that you exemplify. =)
> The idea being, you don't make friends at work because you might have to fire that person one day.
This sounds sort of like a culture built around having lots of temporary contractors around; or perhaps employees who are treated as temporary contractors.
You can filter for just engineers, if that's who you want to pay attention to. Netflix rates very low compared to Facebook, Google, etc. Those companies demand hard work from their employees, but are great places to work. They do a good job with hiring.
Netflix does not, they just grind through people very rapidly .. like they're cheap batteries. Thus the poor glassdoor reviews.
Fact is, Netflix culture is terrible for employees but effective for the Company.
I advise anyone before they apply for a job anywhere to study glassdoor carefully. Ignore ratings, read comments carefully. Reviews which balance positive with negatives are the ones to take as credible.
The big accounting firms in the US are an interesting case to look at. Accountants will join the firm and spend 8-10 years there. Eventually, they either become partners or they wash out (most don't make partner). The culture has developed in such a way that "washing out" is not really seen as a negative thing. They've established a concept of alumni and maintain good relationships. The "washed out" alumni go on to become CFOs and CPAs and there is a steady stream of referrals to and from the big firms.
Maintaining relationships after letting an employee go is hard. If employees are only let go for incompetence, it may not even be worth the effort. But if an employee is let go because there's a resource mismatch I think there is a lot of value in maintaining that relationship.
Netflix seems to say "We just don't need your exact skill set right now" instead of "You aren't good enough for us". That seems like a prime situation to try and keep a good relationship.
I've often wondered whether the structure you describe, which is also used by law, consulting, and investment firms, could be adapted to startups. It seems like it might be a way out of the employee/founder dichotomy.
The key concept here is that of partner. I like that word, but would like to know exactly what it means in such a structure. How, besides having high status, do partners differ from non-partners? How are they compensated? What sort of equity do they get?
In a (US) Limited Liability Partnership, partners get a share of the firm's profits--while still having their individual liability protected in a similar way to a corporation. In a large firm, you probably have multiple levels of partners. While I'm hardly an expert, I imagine that this structure would probably limit the options for raising capital.
Presumably you could set the details up however was necessary to satisfy investors. What I'm really interested in is the conceptual structure. Joining as an associate, proving yourself, and working your way to a possible partnership seems intuitively like a more rational way to attract and reward talent than the employee model is. I don't like the idea of being someone's employee. I'm fine with the idea of being their partner. In fact, if it's someone I respect, that's a goal worth working for. My thesis is that lots of creative people feel this way and more will.
LLCs vary by state in the USA. Some states allow almost complete freedom regarding the structure of the business entity. I lived in Virginia for several years. My friends and I launched a business in 2003. We decided to go for a custom LLC structure. We spent about $5,000 on lawyer fees, but we got a structure that allowed us to sell shares in our LLC. It was a hybrid structure, partly a C form, partly a normal LLC.
My wife worked for Netflix customer service (CS) back about 9 years ago - in their formative years. She likens her time there as similar to any other large company. The individuals were great, but the management was your typical bureaucracy. Rankings were heavily based on seniority, not actual individual value.
As CS reps were considered to be fully interchangeable (and the first to be let go to maintain profit margins), it was a terrible department to try and gain seniority in.
Never seemed all that different, HR wise, from any other company. Perhaps they've changed; I can't say.
Note the part of the article about "split personality" cultures. A lot of the policies that this article was about were for the engineering team, and do not apply at all to what the author calls "hourly employees", which may well include customer service.
I think that's true for any Valley company. Customer support is frequently an after-thought for which you bring someone with a title Director of Customer Relations, give them limited budget, and let them figure out how to take care of things.
Article mentions the shift to "unlimited vacations". Sounds like it worked at Neflix, larger companies are starting to move toward unlimited vacation model, but it appears that it's driven by not having carry accrued paid time off on the books and studies that show that people actually take less vacation under unlimited plans. How is it done at your company?
While the generous severance package and transparency about the process ease my concerns over whether it's ethical or not to cut employees so frequently, all I really got out of this is that I will probably never apply to Netflix.
I am counting my blessings that my contact with a Netflix recruiter did not go past the initial phone screen. At that time I had no idea what kind of company it was.
Unsurprisingly, even though this happened less than three years ago, all the people I had been in contact don't work in Netflix any more.
There are no regular firings at Netflix. If a manager is really happy with all of their team, there is no pressure to rank everyone and can the lower n%. This alone suggests that it's most certainly not like stack ranking.
I mean, an employee is satisfactory, but only satisfactory, so they give him a generous severance package and go hiring somebody else. Really?
Netflix wants a high-performance team. That means that "merely satisfactory" in a sleepy, less demanding company would make someone an outlier.
You have to cut the "merely adequate" 4s and 5s if there's no way to turn them into 7+; what you should do is do it humanely. Personally, I think that a 3-5 month severance is (a) not that expensive, in the grand scheme of things, and (b) by far superior to the morale toxicity of the traditional PIP-- especially when you're talking about a good-faith employee who did nothing wrong.
The tricky bit is successfully hiring high performance people. You have to have a pretty high success rate, and low turnover, or else you'll just be constantly churning through the "satisfactory" people and getting an occasional gem in there.
I don't think it's that hard, if you have high-level people involved in the hiring process and you're not stingy with pay and benefits.
You need enough of a draw to get a competitive applicant pool, and enough people who have sufficient talent to judge it.
Most companies err by hiring based on specialty, e.g. "we need exactly 3 data scientists and that's it". If you're looking for generally good people and willing to accept the variability that comes with that, and you have a managerial environment that provides multiple avenues to success (which is the definition of a good management environment) rather than multiple ways to fail, I think it's not that hard.
So what problems are your typical Netflix Engineers solving? I really don't mean to be insulting but given my interaction with Netflix as a consumer it's hard to see the stellar part. Lots of bandwidth play and even some Web app challenges but what part about it requires only A players with 200K+ salaries? Genuinely curious.
After getting to this line - "after I left Netflix and began consulting..." - I couldn't help wondering whether or not the author was fired and whether this means there are significant portions of her advice that the current management of Netflix would disagree with.
She was not fired -- she left on great terms and most everything she put in place is still there. She had just been there a long time and wanted to help other companies.
I am not sure its all positive though. I only heard bad things about Netflix and the atmosphere. I stay away from it and their recruiters proactively because of that. Just like the "there is no limit on vacation" scam that they pull over their employees got implemented in many startups, I am sure a lot of that "culture" spilled into the startup world as well.
Just like the "there is no limit on vacation" scam that they pull over their employees...
Why do you call it a scam? It certainly can be, but it doesn't have to be. We used to have a fixed-PTO policy (3 weeks per year) at my company, and moved to an unlimited policy sometime in 2012. In the 2013 calendar year I've taken about 4 weeks off. I'm actually not sure of the exact number of days I've taken off, as we don't really track it so closely. I'm perfectly happy with this arrangement.
Do you have any evidence that it's a "scam" at a large number or majority of companies?
From what I hear (from the few people I know at Netflix) since there is a lot of fear that you can be fired at will, no one takes a vacation at all. It actually makes sense too, if one member of the team does not take a vacation but you do then you will come across as the one "slacking off". On the other hand if you are a set number of time off days you can take them without feeling guilty about it. Of course it depends on the culture in the group as well but I am very skeptical about it working in a company the size of netflix.
Result of a shit culture, then. Taking a reasonable amount of vacation means you're taking care of yourself, not that you're slacking off. Burned-out employees are certainly not a plus to a company's bottom line.
I see some tension between values like "go for the root cause rather than the symptoms" vs "bias towards action rather than analysis-paralysis", as well as "speak up when we we aren't practicing our values" vs "value action rather than process".
At the end of the day it'll come down to the personality of your manager and the dynamics on your day-to-day team.
I appreciate the philosophy of getting rid of HR rules in favor of treating people like adults with good judgement. However, good judgement is probably one of those things whose definition is open to disagreement. E.G. one person's good judgement might mean taking risks and another's might mean playing it safe. Is Netflix just forming a monoculture of people with the same definition of good judgement.
Also, it's interesting that the writer validates Netflix's efforts by saying the company's stock went up, 3 Emmys were won, and the firm acquired a bunch of new customers. Are employees expected to optimizing these metrics, first and foremost, which seem very short sighted to me? What about fundamentals like profitability and customer retention?
So once someone is not needed, the person is just sent off? I understand a generous severance is given. But, you couldN'T use that money to try to retrain the worker with another technology/task/job?
What about mentoring? Someone has to start somewhere. So if Netflix ONLY hires someone who's A grade, where do B and C grade people get their chance to learn and improve? Sounds like a very selfish way of hiring (granted every company is selfish).
I do agree with one thing in the article. The whole year-end or half-year end performance review is just a sham. No one in management cares until management decides to lay off someone. They start putting down C or D grade all of sudden when earlier it was mostly As and Bs. And next thing you know, you are let go.
Engineers are expected to take responsibility for themselves. They are, after all, "fully formed adults" (in Patty's parlance). And honestly it's not that hard to figure out which skills are useful to the work around you.
Netflix has traditionally only hired very senior engineers. Mentoring, at least technical, isn't seen as necessary for these people. Further, if an engineer thinks mentoring would help them, the onus is on them to seek it out.
Netflix sounds like an extremely well-managed company. Can anyone comment on the accuracy of what's in the slide deck? I'd be curious to know how it all works out.
This had two side affects.
1) People were afraid of being fired. You could come in one day and be sent home that afternoon without ever having any idea that you were under-performing. You'll hear Netflix employees talk about the "Culture of Fear".
2) In a meeting with my team Patty said "We are your co-workers, not your friends." `The idea being, you don't make friends at work because you might have to fire that person one day. It was really strange, people were very guarded and almost never talked about their lives outside of work.
PIPs protect employees from the constant fear of being fired. They require managers to give an employee negative feedback. Without them, managers can take the easy route and never have the uncomfortable conversations.
#2 made life really hard at Netflix. The majority of my friends come from my co-workers. You spend more time with them than most other people in your life. Some teams ignored the company culture and became close friends anyway. I think the correct thing to do here is to expect your managers to be adults and do the hard thing. Fire your friend.