I’ll be honest with you – when I first picked up Reed Hastings’ book “No Rules Rules,” I thought it was going to be another boring corporate playbook. Boy, was I wrong.
This book didn’t just teach me about Netflix’s culture. It completely flipped my understanding of what makes a company truly successful. And trust me, some of these ideas will make you uncomfortable at first. They did for me too.
The Big Idea That Blew My Mind
Here’s what Netflix figured out that most of us miss: High performance and freedom go hand in hand.
Think about it. We’re so obsessed with creating rules and policies to prevent the worst 2% of employees from screwing up. But what if instead, we hired amazing people and gave them incredible freedom?
That’s exactly what Netflix did. And it’s scary as hell if you’re used to traditional management.
The Keeper Test: Brutal but Brilliant
This one hit me hard. Netflix managers ask themselves: “If this person came to me tomorrow and said they were leaving, would I fight to keep them?”
If the answer is no, that person shouldn’t be on the team.
I know, I know. It sounds harsh. But here’s the thing – keeping mediocre performers doesn’t just hurt your business. It’s actually unfair to everyone, including that person. They deserve to find a place where they can truly shine.
When I started applying this mindset (gently, of course), I realized I was doing everyone a disservice by accepting “good enough.”
Radical Honesty: The Scariest Superpower
Netflix has this thing called “radical candor.” Basically, everyone – and I mean everyone – gives direct feedback to each other. Even to the CEO.
My first thought? “That would never work in my company.”
But then I realized something. All those times I bit my tongue when I saw a problem? All those “everything’s fine” moments when it clearly wasn’t? That’s not protecting people – that’s letting small issues become big disasters.
The Netflix way isn’t about being mean. It’s about caring enough to have difficult conversations before they become impossible ones.
No Vacation Policy (And Why It Actually Works)
Here’s where Netflix gets really wild. They don’t track vacation days. At all.
Your brain probably just went: “But people will abuse it!”
Except they don’t. When you hire top performers and treat them like adults, they act like adults. Who knew?
This taught me something profound: Most rules exist because we don’t trust our people. And if you don’t trust your people, you’ve got the wrong people.
The Freedom and Responsibility Dance
Netflix gives employees incredible freedom, but with one catch – you’re completely responsible for the results.
No micromanaging. No checking in every hour. But also no excuses when things don’t work out.
This balance is everything. Freedom without responsibility becomes chaos. Responsibility without freedom becomes prison.
Context, Not Control
Traditional companies love control. Netflix chose context instead.
Instead of telling people exactly how to do their job, they make sure everyone understands:
- What we’re trying to achieve
- Why it matters
- What success looks like
Then they step back and let talented people figure it out.
I started doing this with my own team, and the results surprised me. People didn’t need me hovering over them. They needed me to paint the picture and get out of their way.
The Uncomfortable Truth About Culture
Here’s what Reed Hastings taught me that I wish someone had told me years ago: Culture isn’t what you say. It’s what you actually reward and punish.
You can put “teamwork” on your wall all you want. But if you promote the guy who throws everyone under the bus to hit his numbers, your real culture is “winning at any cost.”
Netflix figured this out. Their culture document isn’t fluffy corporate speak. It’s brutally honest about what they actually value and how they actually behave.
Why This Matters for Your Business
Look, you don’t have to become Netflix overnight. But there are some lessons here that every entrepreneur needs to hear:
Start with talent. If you’re spending more time managing people than growing your business, you might have the wrong people.
Trust creates performance. The more you treat people like responsible adults, the more they act like responsible adults.
Clear expectations beat rigid rules. People need to know what winning looks like, not every step of how to get there.
Feedback is a gift. The kindest thing you can do is tell someone the truth about their performance while they can still do something about it.
The Bottom Line
“No Rules Rules” isn’t just about Netflix. It’s about what becomes possible when you stop trying to control everything and start focusing on creating an environment where excellent people can do their best work.
Will it work for every company? Probably not. Is it scary to try? Absolutely.
But if you’re tired of feeling like a babysitter instead of a business leader, maybe it’s time to consider a different approach.
After all, the biggest risk isn’t trying something new. It’s staying stuck with something that isn’t working.
What’s one rule in your business that might actually be holding you back? I’d love to hear your thoughts.
