​How Netflix

Reinvented HR
​Based on the article by Patty McCord, Harvard Business Review,
January–February 2014

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Stellar talent has led
to stellar success.

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It All Began with
One Employee

​“I’d rather work by

myself than with
subpar performers.”

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The Talent Philosophy at Netflix

​Hire only “A” players.

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But There’s a Catch…

​You have to be willing to

let some people go.

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Be generous
with severance.

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Tenets of
HR at Netflix

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Hire Only Grown-Ups
Employees should rely on logic and
common sense, not formal policies.

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The Old Policy for Paid Time Off

• 10 vacation days
• 10 holidays
• Sick days

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The New Guidelines for Paid Time Off

• Take whatever time

is appropriate.
• Work it out with your
boss and colleagues.

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One Simple Rule for T&E

​Act in Netflix’s
best interests.

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Tell the Truth About
Performance
Improvement plans are dishonest.

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Maria Wouldn’t Benefit from a
Performance Improvement Plan…

​… and neither would Netflix.

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​Frequent, honest conversations

​Ratings on a five-point scale

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A New Tool: Informal 360s

Stop Start Continue

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Charge Managers with
Creating Great Teams
Make recruitment their top priority.

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What skills will
your team need six
months from now?

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How can you
fill the gaps?

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 Market rates

Netflix’s
Compensation Choice on equity
Philosophy

Immediate vesting

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Charge Leaders with
Creating the Right Culture
They have to model the behavior
they want to see.

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A Classic Tension at Start-Ups

​Efficiency and
high performance

VS Casualness
and fun

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Make sure employees
understand what
behavior drives success.

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Subcultures may require
different approaches.

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Think Like
Businesspeople First
Cheerleading doesn’t improve
morale—but good results do.

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 What’s good for
the company?

The Critical
Questions How do we
communicate that?
for HR

What defines
high performance?

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HR people can be
innovators, too.

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 Trust employees

Netflix’s Be honest
Recipe
for High
Performance
= Recruit stars

Walk the talk

Focus on results

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 • Are our HR practices too
bureaucratic?
• What do they focus on most?
• Could they support our
business goals better?
• Do they help employees
understand how to drive
For Discussion results?
• Would replacing rules with
common sense work here?
• How would things change if
we made recruiting stars the
top priority for our managers?

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 ​Harvard Business Review Magazine
and Web Articles
​How Netflix Reinvented HR
​Patty McCord

​Reinventing Performance Management

​Marcus Buckingham and Ashley Goodall

​Talent Management for the Twenty-First Century

​Peter Cappelli

​Building a Game-Changing Talent Strategy

​Douglas A. Ready, Linda Hill, and Robert J. Thomas

Learn More
​Harvard Business Review Press Books
​The Alliance: Managing Talent in the Networked Age
​Reid Hoffman, Ben Casnocha, and Chris Yeh

​It’s Not the How or the What but the Who:

Succeed by Surrounding Yourself with the Best
​Claudio Fernández-Aráoz

​HBR’s 10 Must Reads on Managing People

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