As the CEO of Netflix, Reed Hastings once said that he prides himself on making as few decisions in a quarter for the company as possible. Seems non sequitur. What does a CEO do if they don’t make decisions? Thinking about it, maybe that such a question comes to mind marks a problem with the way many of us think about our approach to our companies.
So much emphasis is placed on people in a business. And for good reasons. However, we may not be empowering the people within our businesses to express their thoughts freely to effect change. Instead of giving them the context, illustrating the problems we’re facing as a company, we focus on control and mire our best minds in process.
In a well-known slide deck freely available on the web, Netflix outlines the problem it sees other companies face with unleashing employee decision-making. It says as companies get bigger and more complex, they tend to curtail employee freedom to minimize the chance of errors. They do that by installing processes. But those processes drive out high-performing employees who find them stifling. It also spells doom for companies when the market shifts because the company is too rigid to adapt — employees just become good at following processes.
Netflix admits this doesn’t work for every business; pharmaceutical companies are compelled to adhere to certain processes. But clearly there’s a benefit to giving people the freedom and the space to express their opinions. Doing so enables them to bring fresh perspectives straight to company principals, and that can create meaningful change. Companies that won’t listen may be caught off-guard by a changing world, unable to innovate because the focus has been on idea-suppressing processes rather than encouraging open expression.
Not every idea will be a good idea, but consider opening your door to more of them rather than creating policies that keep them out. Seems to have worked for Netflix.
Fred Koury is President and CEO of Smart Business Network Inc.
