Reed Hastings 7 Super Tips

We want to thank you for joining us for this special edition, the superhero edition, brought to you by the great folks at Marvel Studios and all the events... Hey, it's number one best-selling author and motivational speaker Eric Qualman. Most of you know me as Equalman. Thank you for joining us for today's 7 Super Tips. This show is going to have Reed Hastings, that's right, the CEO and founder of Netflix, where he's going to give us his top 7 super tips. You have to be authentic. I mean, you've got no hope if you try to pretend to be Reed Hastings or Mark Zuckerberg or Bill Gates or whoever you want to think your CEOs are that you've met, you know, that is crazy. And you got to really get comfortable with yourself, your strengths and weaknesses. People are inspired by authenticity and I'm just surprised how many people feel like they're acting and or try to act. And you may be a really quiet person and that's fine. But if you have that fierce will, that desire for the institution, the company to be great, and your own role in that is secondary, and you authentically express that in whatever ways you do, then you'll be greatly accepted. Okay, and so that's all it takes is to be authentic and not try to be something else and to fundamentally care at your core about what's good for the company. And if everybody knows and you act in the notion of what's good, as best as your judgment can tell, what's good for the company, they will see that and people will follow you and they won't be cynical. It's when you hide things, it's when you pretend that you lose trust very quickly. I think the key thing, it's a great point, is there are many different cultures. And as long as you're really clear about your culture, you can get the employees who love that culture and not everyone will be the same fit. There are some things like integrity that are pretty universal, but there are other things of how to deal with dissent where there's perfectly reasonable different ways and effective different ways of dealing with things. And so the literature on culture is pretty clear that strong cultures work and weak cultures are diffuse. In a weak culture, it's really a diverse culture. You get many people acting very differently and then they don't understand each other and they feel undercut and political. Even in a, let's take a Hollywood studio that many of you would not like to work in, they have a very clear system of how to operate in terms of how they manage the politics and it's internally consistent. And everybody knows it and the people who get good at it love it and a lot of people don't. And that's just a different, it's not inherently awful or ineffective. It just wasn't right, say, for us. And so that's why I think culture is an expression of what you and your senior team want to be. It's a bit aspirational in that way. We've got to have some failures and so we don't really want to have all hits. I'm gladly glad the first ones are hits. But the sign that you're right at the edge of chaos, the edge of creativity is that some stuff doesn't work. Life's short. I mean, why are we doing this? We're like, we want to have a difference. And so it's innate, it's wanting to push the edge, to create something that the people are proud of and that they enjoy. Yeah, our basic philosophy is to have the right people and to pay them really well. And through that, we've got tremendous loyalty and low turnover and high commitment to the customer. Yeah, and the reason that we publish our culture deck is so people can figure out before they come to Netflix, is this the right fit for them? You know, it's probably a little like Starbucks, doesn't seem that hard to make coffee, and yet one coffee chain is amazing around the world. So there's a lot of heart and passion that goes in it that doesn't come across in the words. It's the execution. It's the people at Netflix. You can't be afraid to change. You know, you can't let friendship get in the way of professional judgment. So you've always got to be thinking, do I have the right team? And I owe it to the whole team, to the marketplace, to my investors, to myself, to do what I think is the right thing for the company. And when I was first a CEO, I'd never managed anyone. So I'd never written a review for anyone or anything because I was an individual engineer. And I found a lot of those communication things difficult. And in particular, I couldn't possibly fire someone. It felt so cruel. It felt inhuman. And I just, you know, it's like breaking up with a girlfriend or boyfriend or something, but worse, you know? And so it felt awful because it was selfish. And, you know, so it took me probably three years before I came to a view that I had and the rest of the company was depending on me to do the right thing. And that it wasn't about me being selfish and pushing the person out. It was about me protecting the company. And once I could neutralize the value scales that way, I could comfortably say to someone, I'm sorry for this, but I think it's best for the company if we end your employment. And, you know, once it was, and I think it's best for the company, I could get there. Now, many of you are probably more sophisticated, more mature, you've broken up with more partners. So it's easier for you. But, you know, because it just takes practice, right? And we don't get enough practice in that. Yeah, I think everyone tries to build culture and values at first. You know, you have to stage it with a company to the degree that you're 20 people and you've got no revenue. It's sort of a very implicit culture. You know, you spend time on, you know, things that could kill you like, you know, product market fit and that's appropriate. And then, you know, later, if you're going to last, then you say, okay, how do we, you know, make sure that as new people come in, the culture gets better. And one of the big things is probably this idea that you get better as you get bigger. So everyone implicitly has the idea that, you know, you start sucking as you get bigger, more political, harder to get stuff done. And you have to actively fight acceptance of that and come up with very concrete examples where like Netflix is significantly better in culture than three and five years ago, and then 10 years ago and 15. And why is because we got more brains thinking about the problem. This is where Malthus really went wrong. So of course, Malthus in the late 1700s said everyone's going to starve because you look at all the people growth and you look at the fixed agriculture. And he didn't realize that, you know, basically as the people grew, the ideas to improve agriculture would also improve. And so we've had a massive explosion in agricultural productivity and the ability to feed 7 billion people, which he would be shocked by. And it's the same thing in company culture, which is if you have more, you know, if you have a thousand really thoughtful people thinking about how to improve, you make more progress than if you've got a hundred. And so we are actually getting better as we get bigger, but it's constantly changing the frame of reference. That's really what the leader does, you know, that this is possible and that in fact, we should aspire to it and make it happen. You know, put a lot of statistics and analysis and we've never believed in that. We say about data, you know, use a lot of data when you're picking stocks, but probably don't use a lot of data in picking a spouse. That the more that you're in an emotional element and a gut feel element, the less useful data is. And the more you want to really listen to your intuition and judgment. And so we spend a lot of time with candidates trying to get them to talk and feel, but then we don't do like how long did it take analysis or I don't know, something like that. And then we do a lot on references. I'm always stunned how many companies don't do good references, how many employees that I don't get called about. And I'm like, really? You didn't even call, you know? And so we're manic on getting, and always blind. I mean, we never even ask the person for references. That's it for today's seven super tips. I'm on campus at University of Texas, Hook Em Horns. This is my alma mater for graduate school. If you get a chance, come on down to Austin. But most importantly, in the meantime, make sure you hit that subscribe button to ensure you get the next seven super tips from the next amazing person we have on the show. And until then, remember, it's not what we take from the world. It is what we leave behind. That'd only be $100,000 if I get 13. Am I doing the math right there? At Equal Man Studios, we have the utmost respect for Marvel Studios. You see Mr. Driscoll's face every time we have to talk about Avengers in the office. We're trying to accelerate that unwrapping of your specific gifts.