Netflix loves touting its culture of avoiding rules and minimizing corporate bureaucracy. But of course the company has operating guidelines, famously detailed in the Netflix Culture document posted on its website. Co-founder Reed Hastings even wrote a 2020 book explaining the principles, titled “No Rules, Rules: Netflix and the Culture of Reinvention.”
Now Netflix is releasing an update to its corporate culture memo for the first time in nearly five years, a copy of which Variety obtained exclusively ahead of its release on Thursday. The last major update was in 2017, when it distilled Hastings’ original 125-slide presentation from 2009 (which has been viewed more than 21 million times).
The core tenets of the Netflix Culture memo, including empowering employees to make decisions, requiring honest feedback, and firing employees who don’t measure up to the “dream team,” remain intact. But there are some key changes. For starters, the document has a new title: “Netflix Culture – Striving for Excellence” (previously it was simply called “Netflix Culture”).
More significantly, the document adds a new directive for employees to act fiscally responsible, a change that comes as Netflix in the first quarter saw its first decline in subscribers in more than a decade. The updated Netflix Culture memo also includes a new section called “Artistic Expression,” which explains that the streamer will not “censor specific voices or artists,” even if employees deem the content “harmful,” and bluntly says: “If you find it difficult to support our breadth of content, Netflix may not be the best place for you.”
The Artistic Expression portion of Netflix’s Culture document appears largely in response to the controversy over Dave Chappelle’s “The Closer” that engulfed Netflix last fall over what critics said were his transphobic and homophobic comments on the show. stand-up special. Co-CEO Ted Sarandos defended the company’s decision to keep Chappelle’s special service in service, prompting a large employee walkout in protest.
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“Entertaining the world is an incredible opportunity and also a challenge because viewers have very different tastes and points of view. That’s why we offer a wide variety of TV shows and movies, some of which can be provocative,” reads the new section. “To help members make informed decisions about what to watch, we offer easy-to-use ratings, content warnings and parental controls.
“Not everyone will like or agree with everything on our service,” the Artistic Expression section continues. “While each title is different, we approach them based on the same set of principles: We support the artistic expression of the creators we choose to work with; we program for a diversity of audiences and tastes; and we let viewers decide what’s appropriate for them, rather than Netflix censoring specific artists or voices.”
The section concludes: “As employees, we support the principle that Netflix offers a diversity of stories, even if we find some titles contrary to our own personal values. Depending on your role, you may need to work on titles that you perceive to be harmful. If you find it difficult to support our breadth of content, Netflix may not be the best place for you.”
To tighten your belt, in the “Valuable Behaviors” section (previously called “Actual Values”), there is a new entry under the heading “Judgment”: “You spend our members’ money wisely.”
While that’s new to Netflix’s Culture memo, company executives have used similar verbiage in the past, including in the April 2018 quarterly letter to shareholders, which said of its revenue earnings: “Our job is to spend this money wisely to increase membership. delight. “
That said, there are other changes to the culture document that indicate Netflix wants to make it clear that employees don’t have carte blanche when it comes to spending company money. For example, this passage was removed from the document: “There are virtually no spending controls and few contract signing controls. Each employee is expected to seek advice and perspective as appropriate. “Use good judgment” is our fundamental precept.”
The update also removes the following section: “Please note that if our company experienced financial difficulties, we would not ask our employees to accept a lower payment. A sports team with a losing record still pays top of the personal market for players they hope will lead it back to a winning position. On the other hand, if the company does well, our widely distributed stock options become quite valuable.”
In addition to the Artistic Expression verbiage, the memo adds three other new sections: “Ethical Expectations” (which reads, in part, “we act with honor, even when no one is looking” and “We expect all employees to protect confidential information from company, whether it is marked ‘confidential’ or not”); “Representation Matters” (“Our members want to see a variety of stories and people on screen, and our company and leadership should reflect that diversity”); and “Employees Direct Our Philanthropy” (documenting that when an employee donates to a charity, Netflix donates twice that amount to the same group).
The addition of the Ethical Expectations section comes after Netflix said in October that it had fired an employee who admitted to downloading internal data and sharing it outside the company. The information, which was leaked to Bloomberg, included Netflix financial data for Chappelle’s “Squid Game” and “The Closer,” apparently an effort by an irate staffer to highlight that the streamer paid more for Chappelle’s controversial content than it did. the best performance of South Korea. suspense.
Even with the addition of the four new sections, the updated Netflix Culture memo is shorter than the previous version: it now clocks in at around 4,070 words, down 6% compared to the previous 4,340.
According to Netflix, everyone in the company was able to view and comment on the proposed updates to the cultural memo in a shared document. Thousands of employees participated in the process, which took place over six months.
The wording of Netflix’s notorious “hold test” is largely the same: “To strengthen our dream team, our managers use a ‘hold test’ for each of their employees: if a team member were to perform a similar role at another company, does the manager try to keep them?” The document still notes that employees who fail the gatekeeper test “receive a generous severance package so we can find someone even better for that position”; however , the updated version removed this footnote: “We generally offer a minimum of four months of full pay as a severance package, giving our former teammates time to find a new company.”
Some of the edited material from the Netflix Culture memo is something that was awkwardly phrased. For example, these two sentences have been removed from the goalkeeper test discussion: “Getting cut from our team is very disappointing, but nothing to be ashamed of” and “We suck compared to how great we want to be.”
Also deleted was this embarrassing remark, which was intended to underscore the point that a business doesn’t need all-encompassing rules: “[W]We also don’t have a dress code policy, but no one has ever come to work naked…Most people understand the benefits of wearing clothes at work.”
Additionally, Netflix revised a portion of the “Freedom and Responsibility” section that previously read: “Freedom is rarely abused. We had a senior employee organizing kickbacks in IT contracts, for example.” In the new version, it now reads: “Over the years, some employees have taken advantage of this freedom in various unfortunate ways.”
And this paragraph, named after Apple co-founder Steve Jobs, was deleted:
We don’t buy into the tradition of senior leaders, who are so involved in the details that their product or service becomes amazing. The legend of Steve Jobs was that his micromanagement made the iPhone a great product. Others take it to new extremes, proudly calling themselves nano-managers. The heads of major networks and studios sometimes make a lot of decisions in the creative process of their content. We do not emulate these top-down models because we believe we are most effective and innovative when employees across the company make their own decisions.
Meanwhile, Netflix’s stock section has removed the “Impact” heading. Netflix said it was removed because it’s not technically a behavior. The section had these points:
- You do amazing amounts of important work.
- Demonstrate consistently strong performance so your colleagues can trust you
- You make your teammates better
- You focus on results over process
Two of those principles are repeated elsewhere in the document, where it says, “You make time to help Netflix colleagues succeed” and “Our core philosophy is people over process.”
Finally, here are some other edits worth mentioning in the Valuable Behaviors section:
- New entry in “Integrity”: “Act with good intentions and trust your colleagues to do the same”
- New entry in “Selflessness”: “You debate ideas openly and help implement any decisions that are made, even when you disagree”
- New entry in “Passion”: “You are proud to entertain the world”
- Modified in “Innovation”: “You thrive on change” is now “You are flexible and thrive in an ever-evolving organization”
- Court of “Curiosity”: “You contribute effectively outside your specialty”
You can read the full note at https://jobs.netflix.com/culture.