Yesterday’s post featured Patty McCord, the architect of that culture and the creator of the Netflix Culture Deck—a popular resource that has over 20 million views—who recently sat down with the HR Works podcast to discuss company culture and leadership.
Patty has since moved on from Netflix, but she continues to leave a strong and thought-provoking mark as she coaches and advises companies around the world on culture and leadership. Patty is also the opening keynote speaker at BLR’s upcoming HR Comply and Workforce L&D Conferences, taking place November 14–16 in Las Vegas.
Here is the remainder of that interview:
HR Works: So, when I was looking at the Culture Deck, I was taken by a list of values that were in there, and a few of them especially caught my interest. A particular one said “freedom and responsibility,” and that seems to be pretty basic to the culture that you’re espousing. Can you describe how that works, freedom and responsibility?
Patty: Yeah, it’s kind of two sides of the same coin. If you expect a lot from each other, and you know that your job as a team member is to be really good at anticipating what needs to be done, articulate what you’re going to do and what your time frame is for doing it, and everybody’s coordinated and aligned across the team, you can have a lot of freedom as to how you go about doing that.
And the thing about freedom and responsibility as combined thoughts or combined actions is it creates this thing that HR people always want to do with a magic wand, which is it creates a lot of trust.
I know that if I tell you that I’m going to deliver something in a month, and you are counting on me to do it, and if we both come in in a month in the right place with both of us delivering great work, you’re going to want me on your team next time. Right? So it’s that ability to take seriously the commitments that we make to each other around deliverables, and that’s the responsibility side.
HR Works: I see. So then, you also said context, not control.
HR Works: What’s the concept there?
Patty: That’s the glue that makes freedom and responsibility work. Right? It’s the ability to understand, in the whole of the organization, what we’re, together, trying to do. When I talk to companies about issues they have, like in customer service, they always want to talk about how we motivate customer service people because they have to talk to cranky people all day long, and it’s really exhausting, and it’s not a very motivating job.
I say the best thing you can do for them is teach them how to read a profit and loss statement, and they’ll realize that every time a customer hangs up from talking to them and tells a friend to use their service for free, they’re throwing whatever the marketing cost is, say $20 bucks a customer, right to the bottom line.
So they’re actually contributing, via word-of-mouth marketing, to the business as a whole. They’re not just dealing with cranky customers. And that’s an example of context. Right? That puts their job, their part of the whole, into perspective with the objective of what the company exists to do, which is to make happy, satisfied customers who keep coming back.
HR Works: Right. Good. And then, how about highly aligned, loose-coupled (one of the values of the Culture Deck)? How does that work?
Patty: That’s a goofy synonym, isn’t it?
HR Works: Yeah.
Patty: It’s related to context, not control. It’s where I spend enough time … I’ll give you an example. I’m a technical engineer at Netflix, and I’m working on getting your streaming service to be as beautiful as possible. Right? Well, you also want to know what’s coming down the pike in terms of content from the folks in L.A. who are signing on action films. Right? Because you want to think about how that particular piece of content might be viewed and when it might be viewed.
So there’s a reaching out across the aisles to other parts of the organization and understanding what’s motivating them, understanding what their time frames are, understanding what matters to them, understanding what their role is so that then you don’t have to comment on, using my example, I don’t have to call you up and opine about whether or not that was a good action movie because it’s not my business to do those, but we are working together to serve the same customer in the end who’s going to be watching that great content with a great deliverable experience. Right?
That’s an example of the two teams being highly aligned in terms of the customer experience, but they don’t have to opine about each other’s every single decision they make, every single thing that they’re going to do. So the team, even a very large team, can move in the same direction because we have a lot of alignment.
HR Works: That’s very helpful. Thank you. Now, I said we’d get back to engagement, and I note that you’ve talked disparagingly about some of these current HR buzzwords, like “engagement” and “empowerment” and “culture fit.” So, what’s wrong with these concepts, and where should we be focusing instead?
Patty: There’s nothing wrong with the concepts themselves. I mean, like I told you earlier in the podcast, I love when people are engaged in their work. I just don’t think that engagement is a product that HR people deliver. I don’t think HR people have a magic wand to empower people.
I named my book Powerful because I don’t believe in empowering. I think that the reason why we have to go around empowering people now is because we took all their power away from them. There’s so many rules and so many processes and so many things that we have to do that people reach out to be empowered instead of just walking in the door with the power that they have every day.
So I don’t necessarily disagree conceptually; I just don’t think we need to have our own language to talk about it. And I think when we talk about these things in language that only HR people understand, I think that creates cynicism, and employees kind of roll their eyes. “Really? You’re going to empower me? Let’s see you do it.”
You know, I just want to get underneath what that stuff means, and I want to treat it like everything else we do in the business. I mean, HR is the only department that can speak its own language and not have any metrics.
I did a talk at a conference a couple months ago that was 1,000 HR people. I started off the talk, and I said, “Please raise your hand if you’re in the same job that you had when you graduated from college. And if you’re an intern, abstain.” Not a single person raised his or her hand, and I said, “Wow, that’s pretty statistically significant, actually, that I just happened to stumble into a room full of 1,000 employees whose first employer couldn’t retain them. Every one of you started out your career in a really sucky company, huh?”
And I’m like, “Okay, so raise your hand if you measure retention. Raise your hand if that’s a critical metric for your HR organization.” I’m like, “It’s not. It didn’t work for 1,000 people in this room.”
Let’s measure the things that are important. Let’s measure whether the business is successful, whether things are getting done on time, whether customers are happy with our product, whether we have a great reputation in our community as a company, and whether the people who we work with operate with integrity and are smart and deliver things.
Those are things that are important to measure, and those are things that are the result of things like empowerment and engagement. That end game is what you’re reaching for, not the action of empowering.
HR Works: Oh, that’s really helpful. I appreciate that. I want to change gears here just for a second. You’ve talked a lot about harassment and the #MeToo movement and how negative stereotypes or inequitable practices can damage a company’s reputation and people. What are your recommendations for what actions HR should be taking?
Patty: Well, I think we need to take a really hard look at ourselves and ask why we do the things that we do and ask whether or not they work. Okay? Let’s take sexual harassment. I’ve had HR people tell me, “You know, it’s our job to investigate sexual harassment.” I’m like, “Really? So it’s our job to investigate sexual harassment after it happens? That’s our job?” It’s not working. It’s our job to have companies where people don’t harass each other. That’s our job. Right?
By investigating it afterward, let’s just take a look at that practice. It failed. It’s not working. We’re still doing it. What we need to do is make sure that people operate in a high-integrity way and that when they don’t, they go work somewhere else. Right? We are the hire and fire people.
While I’m on my rant, at that very same HR conference I talked to the other day, I said, “Let me tell you a couple of things that I’d like you to do right now. One, fix equal pay. Write some checks. Make it okay. You own pay. We’re HR. Whose permission are you waiting for to make that so? And it’s probably not that bad, but you know what? People are going to feel a lot more empowered when they feel like they’re being paid what they’re worth. There’s a way to empower people. Right?
Okay, and then the second one is let’s take a good hard look at the compensation systems that we created that keep us down. Are we really looking hard at how we make offers to people? Are we really looking hard at what those job families are and are those really created in the right way so that people have opportunity?
Are we really taking apart and examining the way that we promote people? It’s not just the rules that we make, but how it really happens. What really happens in those conversations where people think about who’s going to get the next promotion, because we have an opportunity as HR people right now to really make a difference.”
I tell them you want a seat at the table? Pull up a chair. There’s a plate. There’s napkins. It’s all there. Just sit on down and start reexamining some of the practices that we do and ask ourselves, “Could we do better?” And then do what everybody else in the company would do, which is say, “Of course we could do better.”
Let’s reinvent this. Or, here’s another concept, a crazy concept. You know what other people in the company do when something doesn’t work? They stop doing it. So could we. You asked me.
HR Works: Pull up a chair. I like that one.
Patty: Yeah. Sit at the table. Instead of whining about it, do something.
HR Works: This was all great. To sum this all up, any final recommendations for companies concerned about their cultures?
Patty: I think just take a look at everything that you do, all of the stuff that’s “best practices.” When you say things like best practices, ask yourself as measured by what? Because I find a lot of times, best practices just means what everybody else does. So I tell people, “I don’t care if you choose to do what you’ve always done. I don’t care if you want to run your company in a very traditional way. I really don’t. I just want you to choose to.”
HR Works: I like that very much. Patty, thanks so much for joining us today. Very helpful insights.
Patty: Thanks. It was great being here.
HR Works: I’m just going to mention again that Patty is the opening keynoter at BLR’s HR Comply and Workforce L&D Conferences, taking place November 14–16 in Las Vegas. And again, Patty’s new book is Powerful: Building a Culture of Freedom and Responsibility.