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There are numerous strategies for building and maintaining a high-performing team, but unfortunately, they are not plug-and-play. What works for some companies will not necessarily work for others. Erin Meyer, co-author of No Rules Rules: Netflix and the Culture of Reinvention, shares one alternative employed by one of the largest tech and media services companies in the world.
Instead of the ‘Rank and Yank’ method once used by GE, Meyer explains how Netflix managers use the ‘keeper test’ to determine if employees are crucial pieces of the larger team and are worth fighting to keep.
“An individual performance problem is a systemic problem that impacts the entire team,” she says. This is a valuable lesson that could determine whether the team fails or whether an organization advances to the next level.
Erin Meyer is the author of The Culture Map: Breaking Through the Invisible Boundaries of Global Business, and co-author of No Rules Rules: Netflix and the Culture of Reinvention. She is also a professor at INSEAD, one of the world’s leading international business schools. Her work has appeared in Harvard Business Review, The New York Times, and Forbes.com. In 2019, Meyer was selected by the Thinkers50 as one of the fifty most influential business thinkers in the world. She received an MBA from INSEAD in 2004, and she currently lives in Paris, France. In 1994 and 1995 Meyer also served in the Peace Corps as a volunteer teacher in southern Africa. Visit erinmeyer.com for more information.
His latest book No Rules Rules: Netflix and the Culture of Reinvention https://amzn.to/3mt3QQG
ERIN MEYER: When Reed started Netflix, he had this question, this experiment in his mind, which was: Would it be possible, if he created an organization that was made up entirely of top performers? Would it be possible to give them an incredible level of freedom without having to worry about the organization descending into chaos? Because, of course, in most companies, most of the rules and process are put in place in order to deal with employees who are underperforming, or who are maybe not the best employees of the batch, right? So that led him to this idea, this idea of talent density, of creating a high performing team that had very little rules and process tying it down. And the idea is specifically not just that we’re any other team, but we’re a high performing Olympic team. And I think that’s actually an interesting image, because we can all think about top athletic performers, that they recognize that if they want a spot on that top Olympic team, that they’re going to have to fight hard to get that spot. Meaning they’re going to have to really be performing at their highest level. And when they get there, they know every year they kind of have to try out again. It’s not like they’re going to be in that spot for life. So, I think that that’s an atmosphere that is very attractive to some of the younger generations today that aren’t thinking about employment for life, but instead are thinking about opportunities that can allow each of us to shine to our full potential. And then, when that opportunity is done, we can move on to another opportunity. Of course, that also means that Netflix, I would say, is a rather high adrenaline place to work. Just like being on an Olympic team may be high adrenaline. And what I found is that people are both excited and delighted and a little bit exhausted. So, you have to be a person who really is looking for that level of freedom and opportunity, knowing that it may be a position that is also going to use every inch of your neurons while you’re working there.
So of course, saying that you want to have a team of all high performers is easy enough, but figuring out how to do that is not so easy. Historically, companies like GE and Microsoft have dealt with this idea of trying to get all top performers by using these processes, which are sometimes called things like “”Rank and Yank,”” where you rank your employees from top to bottom. And for example, with GE, for a period of time, managers were then asked to fire the bottom 10 percent. But since been shown to not be a great management tool, because it creates a lot of internal competition and even backstabbing. Plus, because Netflix is so anti-process, that wouldn’t work there anyhow. But instead, what they do at Netflix, which I think is actually a very interesting…
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