Former Netflix Chief Talent Officer Patty McCord on how to fix your company

Corporate America is known for specific kinds of standards, practices, and initiatives, but one person has thrown how organizations commonly operate today under the microscope.

Along with CEO Reed Hastings, former Chief Talent Officer Patty McCord helped develop the Netflix Culture Deck — a manifesto which helped define the culture and values of the company — which made waves through Silicon Valley. “It may well be the most important document ever to come out of the Valley,” Facebook COO Sheryl Sandberg reportedly told GQ in an interview.

The original presentation racked up more than 17 million views since it was first published in 2009, and was updated in June 2017.

On the heels of the release of her new book, POWERFUL: Building a Culture of Freedom and Responsibility, McCord spoke with Ladders News about what she learned during her 14 years at Netflix.

In the first of two parts, McCord discusses corporations and what they can do to evolve.

On typical corporate standards and conventions:

“It’s not just that we call them ‘standards,’ … we refer to them as ‘best practices’ in our organizations and what I’m challenging is, ‘Really? Says who?’ Looks a lot like we’re just copying each other to me.”

“Let’s say I want a process that gives people feedback because I think it’ll make them perform better. So we come up with the annual performance review and that’s the best we could do? Really? It’s not so much as I turn things on their head or recommend radically different stuff, mostly just that we just throw it away because it doesn’t work anymore.”

On workplace feedback and annual performance reviews:

“I learned a lot, I’ve been taking a lot of cues from professional sports coaches that I’ve been speaking with recently and if you talk to them about how they get performance from their teams … there’s a rhythm of giving feedback that is absolutely geared at optimal performance for every member of the team.

“So I don’t really care what system you use, but I do know that you can’t get very good at anything that you only do once a year. I’m not wed to any particular rhythm but it needs to be more than once a year. It probably needs to be in the moment.”

“The most effective feedback is positive and in the moment. I mean catching people doing things right, encouraging them when you’ve asked them to do something hard that they’ve actually tried and helped/succeeded at. It’s that constant working together to make us a better team.”

On expectations of employees:

“If you expect excellence, you might get it even from mediocre performers. But if you expect mediocrity that’s the best you’re gonna get.

“On one hand, we’re supposed to be the group that makes everybody happy, you know, the happiness police … we want everyone to be engaged. And engaged, happy employees make better products, or so we say, we don’t prove that, but we say that.

“And on the other hand, we’ve gotta protect the company from the evil employees that might sue us — so which one are they? And it’s not true that companies with lots of perks and happiness don’t result in bad behavior, as we’ve certainly seen lately.”

On ‘engagement,’ ’empowerment’ and ‘millennials’: 

“I’ve seen plenty of engaged employees at work, but they’re not engaged because they’re rewarded with perks and parties. They’re engaged because they’re working on stuff that’s interesting to them, with other smart people, that makes a difference. That’s what engagement really is.”

“Empowerment is not something you give people, you empower people by giving them a lot of context and holding them responsible for the decisions they make and the impact that they have. That would be way more helpful than any class on empowering people.”

“I’ve just never been a fan of putting people in those big buckets, anyway, because they’re too simple. And not broad enough. I mean, the idea that millennials don’t want to work hard is ridiculous.”

On how employees should be treated “like adults” at work:

“One of the biggest things that slow companies down is … people having to ask for permission or get approval to do something when they know it’s the right thing to do — when they’re making a good judgment call and they understand.”

“When we ask people to ask for permission for things they can logically figure out … then we say, ‘We can’t trust you.’ In doing those things, we’re like, ‘You can’t make the best decisions,’ and that’s pretty childish if you think about it.”

… yet, how being an adult is not just about reaching a certain age:

“[In America] you have to be 18 to work. You should be pretty far along on that maturity curve. What I mean by ‘maturity’ and what I mean by ‘adult’ is not [age]. I know really mature 25-year-olds, and I know really immature 45-year-olds. So, by ‘adult,’ I mean, taking responsibility, following through on your commitments, informing other people — you know, the things that grown-ups do.”

On how technology keeps changing, just as companies should too:

“I think it’s important to understand how we’re different [than millenials], you know? We hold in our hands the same computational power as I used to have [on my desk]. The idea that we call it a phone and we take pictures, send email, do text — basically, it’s what used to be a laptop computer that I now hold in my hand. … It changes the way we all live and work, and I don’t think technology tethers us to our jobs, I think it frees us.”

“That’s kind of the point of why I wrote the whole book: I thought, ‘You know, really, we’re all doing things the same way we did in 1980?’ Every couple of decades, we [really should] rethink this stuff.”

On how older companies can begin to peel away at the status quo:

“I think that one of the think one of the things that larger, more established companies, do is a matter of habit. Everything has to be a huge corporate initiative. They strive for consistency in these big rollouts. And I think what they can at least try is: Take a little corner of the company, or a particular organization, and strip away some of the stuff from them, and see if it yields better performance. I think we’ve learned now, that not everything has to be done the same way across the world with 100,000 employees.”

On the biggest fallacy regarding company management:

“[The misconception] that managers have all the power. That they’re psychic, and they’re gonna make the right decisions for you, and they own your future. They don’t. We gotta stop telling ourselves that lie because it hasn’t been true for a really long time and it’s not true now, and it’s definitely not gonna be true in the future. This is a journey, you gotta embrace it, enjoy it.”