As the founder and co-chief executive of Netflix Inc.
NFLX <span>-1.84%</span> Reed Hastings has re-shaped both the way people watch television and how the entertainment industry operates.</p><div><p>Launching Netflix as a DVD-by-mail movie-rental service with Mark Randolph in 1997, Mr. Hastings quickly realized that Internet distribution was the future. Previously old movies and TV shows that Hollywood studios and networks were more than happy to sell, then with original programming such as "House of Cards" and "Stranger Things", the streaming giant has built a global customer base that is 200 million Reaching homes. Wide. Along the way, Mr. Hastings has created a distinctive - and, some, jackfruit - for corporate culture. The Netflix way encourages employees to take big risks, usually without requiring approval from a range of owners, and to communicate with blunt candor. Leaders often practice what is called a "keeper test", in which they ask themselves: If an employee was offered a job elsewhere, would you fight to keep that employee? If the answer is no, then the person is let go. In his new book "No Rules Rules: Netflix and the Culture of Renewal", Mr. Hastings likes to be employed in the streaming giant to be part of a sports team: Cutting is disappointing, but to no shame. "Unlike many companies, we practice: adequate performance gets a generous severance package," reads one of Netflix's motto. Mr. Hastings spoke with The Wall Street Journal by video from his son's bedroom in the family home in Santa Cruz, California. <strong>WSJ:</strong> Which elements of Netflix culture are harder to maintain now that so many employees are working from home? <strong>Mr. Hastings:</strong> It is now difficult to debate ideas. <strong>WSJ:</strong> Have you seen benefits from people working at home? <strong>Mr. Hastings:</strong> No, I do not see any positive. In person, especially not being together internationally, is a net negative. I have been super impressed by people's sacrifices. <strong>WSJ:</strong> It is anticipated that many companies will relocate to work from home for many employees even after the Kovid-19 crisis. What do you think <strong>Mr hastings</strong>: If I had to guess, a five-day workplace at the office would be four days, while one day is virtual from home. I bet that's where a lot of companies end up. <strong>WSJ:</strong> Do you have a date in your mind when your workforce returns to the office? <strong>Mr. Hastings:</strong> Twelve hours after a vaccine is approved. <strong>WSJ:</strong> I like it. <strong>Mr. Hastings:</strong> This is probably six months after a vaccine. Once we can get most people vaccinated, it will probably return to the office. <strong>WSJ:</strong> In the book you say, "It is impossible to know where our business will be in five years." What kind of pregnancy do you do? <strong>Mr. Hastings:</strong> We keep experimenting. The business model will be quite similar in five years. Can we detect animation? Can we catch Disney in family animation? <strong>WSJ:</strong> You've said that you want Netflix to pounce on unexpected opportunities. An example you haven't seen? <strong>Mr. Hastings:</strong> Nonfiction programming is a very good one. We started as Superpremium TV, and the expansion into non-proliferation has been a huge success. The worldwide distribution of content has been a major success. Earlier, people thought that Americans would not see content produced outside the US <strong>WSJ:</strong> Netflix is about radical candor. How clear can people be with each other from a personnel-management standpoint? <strong>Mr. Hastings:</strong> We want people to be very creative. We do not want people to turn around like drunk fools, to say terrible things to people. We want people to live with positive intentions, creating an environment where people avoid getting feedback. <div data-layout="header " data-layout-mobile="" class=" media-object type-InsetMediaVideo header scope-web|mobileapps article__inset article__inset--type-InsetMediaVideo article__inset--header "> <figure class="media-object-video article__inset__video media-object-video--standard"> <figcaption class="wsj-article-caption article__inset__video__caption"> When Netflix went public in 2002, its chief talent officer, Patty McCord, at the time, helped formulate formal-time company, travel and spending policies. WSJ caught up with McCord to learn how this unorthodox move helped shape Netflix culture. </figcaption></figure></div> Like when you do push-ups or when you run - it hurts, but you know you're getting stronger. You have to think about it in terms of reacting: it is causing enough discomfort to learn, but not so much discomfort that you are attacking the person or it seems. <strong>WSJ:</strong> You write, "Only a CEO who is not busy is actually doing his job." I am sure a lot of CEOs and their families differ. Can you explain in detail? <strong>Mr. Hastings:</strong> You do not want to consume strategy wise as the CEO. For me, casting decisions or product feature decisions - there are too many to make. You get very busy, even if you are good at it, you are not thinking about the long term health and development of the business. You really want to know what is happening in all kinds of places, but are not making decisions. <strong>WSJ:</strong> You recently elected to share the title of CEO with Chief Content Officer Ted Sarandos. The corporate world is awash with examples of co-CEO structures that have not worked well. <strong>Mr. Hastings:</strong> It is replete with examples of single CEOs not working. Co-CEO is an unusual thing, certainly. It only works well when two people actually work together. Ted and I have been working together for over 20 years. He has been a virtual co-CEO for a few years, and we have decided to make it official. <strong>WSJ:</strong> Netflix is known for offering top-of-the-market salaries. Are you worried that the cost has gone up for you and others in Hollywood? <strong>Mr. Hastings:</strong> When you are looking at great sports teams, they are often teams that can pay high for the best players. We want the absolute best players and compensation is a part of that. We are three excellent people compared to four fine people. <strong>WSJ:</strong> You have written that value or constructive value should not be measured by time and you have never paid attention to the people who are working. Yet many people on Netflix describe it as a 24/7 lifestyle. Is your lack of work-life or your ability for burnout anxiety? <strong>Mr. Hastings:</strong> Coming back to athletics, think about the idea of a coach: it's not how many hours you spend in the gym, but rather how well you play. But if you are going to play at elite level, then you are probably very less in the gym. It is not just the target state. The goal is position effectiveness. <strong>WSJ:</strong> Who is the audience for your book? <strong>Mr. Hastings:</strong> The book is for small organizations and new organizations that are trying to be very creative. For big companies like WarnerMedia or Disney, they will read it and roll their eyes, and that's fine. Hopefully this will help small companies that are still trying to find out what they are trying to do. <strong>WSJ:</strong> How will Netflix's culture work in politics? <strong>Mr. Hastings:</strong> Politics is difficult because in many ways people elect people who lie a lot. In business, we really try to avoid him. The skills to succeed in politics are actually quite different than in business. ) <strong>WSJ:</strong> How has production been returning since the epidemic stopped? <strong>Mr. Hastings:</strong> We are going to most of Europe and Asia, and we are already getting some things [Los Angeles]. The hope is that, through September and October, we can actually get - with proper testing - a lot more going on. <strong>WSJ:</strong> You're not getting out of original programming anytime soon? <strong>Mr. Hastings:</strong> We hope to get more original titles next year than this year. This is so incredible. <strong>WSJ:</strong> If Netflix gives your book a choice, who should you play? <strong>Mr. Hastings:</strong> There is always Brad Pitt. <strong>Write </strong>Joe Flint at [email protected] </div><p style="position: absolute;z-index:-1;top:0;left:-15000px;">Copyright © 2020 Dow Jones & Company, Inc. All rights reserved. 87990cbe856818d5eddac44c7b1cdeb8</p> .