Netflix CEO's leadership transformation: a shift from autocratic to participative style.

September 15, 2021

Netflix CEO Reed Hastings "...changed his use of communications in sending and receiving messages from Pure Software to Netflix because at Pure Software he was considered an autocratic leader and very hard headed. He only cared about doing what he wanted by fiercely pushing his ideas and killing any of his employees ideas. His employees had to follow the leader or get left behind. At Netflix he changed his style to participative. Instead of telling others what to do he seeks out ideas and advice from his employees. At Netflix he listens to his employees and tries to understand their ides. Instead of criticizing he asks the employees to explain why they think an idea will work. He is now more honest and direct with employees but not confrontational. His communication skills have increased greatly."
(Acc 101 2017 paper - course heroes, case study 6).

Do you think a person's leadership style is able to change so dramatically and if so how?

Let’s take a step back.

Hastings revolutionised how the world watches movies. He cofounded Netflix in 1995, the same year he sold his first company, Pure Software.

He famously said:

“as an entrepreneur you have to feel like you can jump out of an airplane because you’re confident that you’ll catch a bird flying by. It’s an act of stupidity, and most entrepreneurs go splat because the bird doesn’t come by, but a few times it does.”

In 2011, he went further with Netflix, introducing an online streaming service, at a higher subscription fee. The stock price stumbled, and the Huff Post called him “monumentally stupid.”

Today, Netflix has a market value almost identical to Disney, a model for engaging consumers through the power of big data and AI, and creates content that is personal and compelling to them (CNN Business).

While the company is admired across the world for its innovative business model, Hastings realised that it needed to innovate how it works inside too – in other words, how people engage in work and lead others – in order to deliver the external promise and sustain its market momentum.

Netflix’s “Culture Desk”, subtitled “Freedom and Responsibility” has been described by Sheryl Sandberg as what could “ well be the most important document ever to come out of Silicon Valley.” It was developed by former chief talent officer Patty McCord as she and Hastings were unimpressed by most organisations, and didn’t want Netflix to become one of the many.

You can easily check out the bullet-point-happy PowerPoint, which has become a cultural manifesto for the Internet’s economic epicentre, amassing over 3.2 million views on Slideshare.net according to techcrunch.com

(here: https://igormroz.com/documents/netflix_culture.pdf )

But what really happened and how did Hastings' transformation come about?

image: moonshots.io

The autocratic leader from Pure Software hadn’t really changed from one day to the other, thinking about inclusion and the power of co-creating or sharing. No.

He faced problems in his personal life as the drive, and passion for business made him “a systematic liar” about what is and isn’t a priority to him (according to his own reflections). There were blind spots that he wasn’t aware of (as is the case for most of us). In an interview he shared with the public how he recognised he was saying the right things which were socially acceptable such as “family is most important”, or "people matter greatly" but the reality was different. He wanted to be followed without questions.

The process of coaching and counselling helped him face those aspects of himself which were uncomfortable and detrimental to his relationships (personal and work related). Going thought them and the layers that got him to be who he was at that stage of his life, reinvented the way he looked at things - business wise and otherwise.

“That marriage counsellor turned out to be the best CEO coach I ever had” – Hasting said.

A vice president at Netflix has also pointed out to him that he's "unempathetic" and he doesn't "encourage criticism." Hasting is now able to admit that even with his success, getting negative feedback is still painful, but the process of coaching and counselling helped him learn how to explore these moments as an opportunity for change instead of fighting them - which is his natural inclination.

In other words, this incredibly savvy businessman is just one of the many examples of the great depth of revelations, improvements and self-awarness that comes with  dedication to the process of counseling and coaching.

Perhaps it's our turn to explore the value of digging deeper into our personalities and feelings. The positive outcomes could be much greater than simply success in monetary terms.

P.S. We encourage you to speak to different professionals and experience trial sessionsu until you find "your person". You can book a free consutations with one of our coaches as a starting point.

Respect,
Val and the ILC Team

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