What Is Company Culture? The Values That Define Who You Hire, Promote and Fire

“The most important document ever to come out of the Valley” is a quote from Facebook COO Sheryl Sandberg.

She is referring to a presentation simply called “Culture” that was published in 2011 by Netflix CEO Reed Hastings.

What does this have to do with marketing or content? It turns out, content and effective marketing is all about culture.

I needed to cover it here for a few reasons:

• Netflix is an amazing company with a culture that many companies envy
• Netflix knows how to create great content (“House of Cards” anyone?)
• Netflix gets that the employees (and their content) are the best marketing assets in any business

And coming from a guy who loves Slideshare, this is the “creme de la creme.” The “piece de resistance.”  Or as Jerry McGuire said in his memo, it is “The Things We Think But Do Not Say.”

Aside from their content production, this is possibly the best marketing Netflix will ever do .

It has been viewed more than 8 million times, shared more than 20,000 times and has more than 400 comments. And yet it contains almost no color or graphics or animations in 127 slides. It simply defines the culture of excellence they were trying to support by defining the values that would determine whether someone “gets rewarded, promoted or let go.”

The Things We Think But Do Not Say

While it has become a viral hit, most of the advice in the Netflix culture code is just common sense. For example, they have no vacation policy. Employees are allowed to take whatever time they want, as long as they are responsible about it.

We don’t track hours worked, so why are we tracking days of vacation per year?

Netflix’s travel and expense policy: “act in Netflix’s best interest.”

Some of my favorites from the many pages in the docuement:

• Adequate performance gets a generous severance package.
• We don’t measure people by how many hours they work or how much they are in the office.
• No “brilliant jerks.”
• To increase employee freedom as they grow vs. become more bureaucratic
• “The best managers figure out how to get great outcomes by setting the appropriate context, rather than by trying to control their people.”
• Pay “top of market” because one outstanding employee is worth more and costs less than 2 adequate ones.
• Big salary is the most efficient form of comp.
• “We want people to manage their own career”

Patty McCord helped Reed Hastings develop the policy during her 14 years as Chief Talent Officer at Netflix. According to Patty, some of the biggest lessons in trying to transform and build the culture at Netflix:

1. Hire only “A players”
2. Logic and common sense work better than formal policies
3. Get rid of formal reviews
4. Get rid of under-performing employees immediately (no performance improvement plans)
5. Hire people who already have great jobs
6. Make sure every employee knows what “high performance” means

Patty also advised Inbound Marketing company Hubspot to to define their culture and values in a published document. Check out their attempt at creating a “culture they love.”

But for the original inspiration here is Culture by Reed Hastings

What’s your company doing to create an amazing culture?