No Rules Rules by Reed Hastings and Erin Meyer

No Rules Rules by Reed Hastings and Erin Meyer is an interesting book co-written by the founder and CEO of Netflix along with the author of The Culture Map. No Rules Rules is about how Netflix looks to have top performance with a culture of what the authors describe as "freedom and responsibility." It's detailed in the book that this is to come from three concepts that enable and build on one another.

1. Build up talent density The idea put forth in the book is to not have adequate performers in the company, but only exceptional ones, or "stunning colleagues." Part of the principle behind this is less than stunning employees will bring down the performance and morale of the rest of the team, and result in most of the management time required. Trying to have this talent density comes from both how hiring is done and how employees are managed. If someone not performing exceptionally, they may be let go and the authors describe Netflix as like a professional sports team, always seeking to have the very best in any role. The "keeper test" is that a manager should consider if they would fight to keep an employee if that person said they got an offer to leave. If they wouldn't fight hard to keep them, that person should probably be replaced. Tying into this, it's written that employees on a regular basis should ask their managers how hard they would fight to keep them. Around compensation, it's noted that Netflix for any creative role seeks to pay top of personal market, if the market for someone increases dramatically, the objective is to increase their salary dramatically. People are encouraged to take calls from recruiters, find out what they're being offered, and report that information back to Netflix so that people don't leave because of money they're worth, but not getting at Netflix. Additionally, Netflix doesn't pay bonuses, rather pays higher salaries, in part because as the business changes, what should be the bonus criteria can change as well. 

2. Increase candor It's detailed how to help improve performance within this talent-dense workforce, there's a focus on having employees having a high level of candor with one another. The idea is for people to say what they really think (with positive intent) and give candid and actionable feedback to people, feedback that can help the recipient and help the company. This should be done not just during performance review cycles, but frequently and in-person. Also, feedback provided to someone should take into account any regional differences in how feedback best delivered. Additionally, it's covered that feedback should go upwards in the management hierarchy as well as down and laterally. People are described as hired for their opinions, and part of their job is to provide them. The concept of "open the books" is put forth, being transparent and letting people know all the details of what's going on, including potential job losses due to restructuring and profit and loss information about the company that can only be released externally at certain times. 

3. Remove controls The third large concept from the book, one that certainly requires a high level of talent density to work, is to remove controls on things including vacations, expenses, and approvals. It's covered that the goal is to instill in managers the notion of leading with context, not control. Set the context of what good behavior is and if done effectively, people will model that behavior. Around expenses, the guideline described is "act in Netflix's best interest." Make sure there's decision-making freedom, just as how people were hired for their opinions, they were hired for their decision-making ability. It's noted that Netflix runs on the "informed captain" concept, people who spend the time on something are the ones who make the decisions on it, with the company designed to be loosely rather than tightly coupled and not have everything run top-down.

These three principles of increase talent density, increase candor, and remove controls are of course easier said that done, and it's interesting reading in the book of how Netflix is said to go about the effort.

Excellent business writing - by Riley, Vance & Thurston

Three interesting and well-done pieces of recent business writing included two stories from Businessweek and a post done to the site TechCrunch.

The larger of the two Businessweek pieces was by Michael Riley with "How Russian Hackers Stole the Nasdaq." It's a fascinating in-depth look at what appears to be a government-sponsored break-in to Nasdaq, done for reasons unknown. It was a really compelling and somewhat chilling story that brought to mind for me the Michael Lewis book Flash Boys that I wrote on a few months ago.

From a more recent BW issue was "Netflix's Ken Florance: The Man Who Keeps the Video Streaming" by Ashlee Vance. It's a short and interesting piece that covers how Netflix paying Internet Service Providers (ISPs) for better connectivity... something that wouldn't be required were there net neutrality.

The last solid piece of writing to note here was "Christensen Vs. Lepore: A Matter Of Fact," posted by Thomas Thurston to TechCrunch. Thurston is a guy who I worked with back when he was in college and his essay done in response to criticism of Harvard professor and author Clayton Christensen by a fellow Harvard professor. I've a few times posted on work from Christensen (best known for his writing around "Disruption Theory" in business) and Thurston provides some solid logic in support of  the theory as a way to predict the success or failure of a business.

Businessweek writing - on Netflix, Google X, GoPro & Southern New Hampshire U

There's been a few pieces from Businessweek over the past few weeks that stood out as particularly interesting with two cover features and two smaller stories.

From the May 13-19 issue was the feature "Netflix, Reed Hastings Survive Missteps to Join Silicon Valley's Elite". Written by Ashlee Vance, it's a terribly interesting piece that starts off with the sentence from Vance that "on a normal weeknight, Netflix accounts for almost a third of all Internet traffic entering North American homes." Also, from this issue was "A Little College That's a Giant Online" on Southern New Hampshire University. As opposed to a company like Coursera, Southern New Hampshire is a traditional college that also has a significant online education offering.

From the May 27-Jun 2 issue was "Inside Google's Secret Lab" by Brad Stone and it's fascinating stuff on the Google X division within the company that's devoted to "moonshot" ideas or problems that Lab Director Astro Teller says about which "over some long but not unreasonable period of time we can make that problem go away." Additionally of interest from this Businessweek edition was the extremely short piece "Ask a Billionaire: GoPro CEO Nick Woodman".

Fast Company Magazine 100 Most Creative People Issue

Some interesting content from the Fast Company annual 100 Most Creative People in Business issue.



Keeping in mind the Fast Company guideline of not featuring anything on a prior 100 most creative list (nope, no Steve Jobs in this issue), here's the vignettes that stood out...

Wadah Khanfar / Al Jazeera at #1 - Not to discount what Khanfar and Al Jazeera have done, but what struck me was mention of the Qatari government ownership... and willingness to lose what Khanfar says was "much more than $80M last year." Not a promising statement for the field of Journalism when this appears to be what it takes for a major player in News like Al Jazeera to emerge.

Sal Khan / Khan Academy at #7 - I a few weeks ago posted on and linked to this Businessweek profile of Khan and view the guy and his efforts as just plain remarkable.

Ted Sarandos / Netflix at #22 - Remarkable how the company has completely remade themselves for a digitized streaming content world.

Sitaram Asur / HP Labs at #26 - Profile includes mention of HP Labs fellow Bernardo Huberman... whose efforts around Prediction Markets were featured in Businessweek back in 2005.

Laura Ching / Tiny Prints at #60 - Impressive products from the online stationery company recently acquired by Shutterfly.

Kevin Systrom / Instagram at #66 - One of those companies that I just keep hearing about.

Natsumi Iwasaki / Author at #90 - Wrote the Japanese bestseller What If a Female Manager of a High School Baseball Team Read Drucker's 'Management'? Sounds interesting... now, if only there were an English translation...

May 9 Businessweek Pieces: Why Bin Laden Lost / Supply Chain Efficiencies

Some solid content from the May 9 issue of Businessweek.



The lead essay was "Why Bin Laden Lost" by Brendan Greeley and featured insightful writing about Bin Laden in the same vein as the commentary by David Von Drehle for Time which I posted on and linked to.

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Less profound, but also interesting from this issue was the feature piece "Taco Bell and the Golden Age of Drive-Thru" written by Karl Taro Greenfeld.

This was one of those cases where I first took note of a piece based on the author... as I recall reading and posting on Greefeld's "Growing Old with Autism" book excerpt two years ago in Time Magazine). This first Greenfeld piece fit into the category of excellent and important writing and while I don't imagine he saw Taco Bell and Supply Chain efficiencies on the same level of import as autism in his family, the recent story it's an interesting one about the mechanics of a huge business segment.

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Also from this issue were two one page pieces of interest because of the companies and offerings being written about...

- Charlie Rose interview with Netflix CEO Reed Hastings.

- "Otávio Good's Instant Translator" about the Word Lens iPhone app. Program does visual language translation via augmented reality, or layering of new data on top of an image from the phone's camera.

Japan Disaster & New Ideas Feature - from Time Magazine

Some pretty compelling writing and interesting content from the latest issue of Time Magazine.

The Special Report on the Japan Earthquake and Tsunami featured pieces that captured well both the scope of the devastation and resilience of the people impacted.

To this end, the cover story essay was "The Day the Earth Moved" by Nancy Gibbs and Hanna Beech provided "Aftermath: How Japan Will Recover from the Quake" highlighting actions taken by individual citizens after the disaster. Really solid writing in both stories.

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In the much less important, but still interesting from this issue category was some of the things mentioned in Time's "10 Ideas That Will Change the World" section. Two I found of note were about the concepts of airport communities as well as that of sharing rather than owning:

- "Think of Your Airport As a City — but Nicer" makes reference to the ideas put forth in a book I've heard about several different times lately... "Aerotropolis" by John Kasarda.

- "Today's Smart Choice: Don't Own. Share" is about the idea of item rental as championed by well known companies like Netflix. Also mentioned are less well known businesses such as SnapGoods (borrowing and renting of stuff), Zipcar (car rentals) and Airbnb (vacation rentals).

Recommendation Pieces from Time Magazine

A couple of interesting pieces from the last two issues of Time around the concept of recommendation... with the first being from the May 31 cover story on Facebook.

The story by Dan Fletcher is titled "How Facebook Is Redefining Privacy" and looks at the concept of sharing information online via Facebook and how the company enables (or as some privacy advocates assert, forces) that sharing.  One very interesting area that Facebook is getting into is that of recommendation with the company making a concerted effort to enable users to easily click a button on other websites saying they "like" a product or service.  With this information then broadcasting to the friends of that user, you've got a powerful influence mechanism. 

In this same category of recommendation, the June 7 issue of Time contained the Lev Grossman piece "How Computers Know What We Want — Before We Do" about Internet music company Pandora.  The concept is the company breaks a song down to the presence or absence of some 20-30 specific attributes and then uses the results to recommend/play songs for users. Basically you have users who say they like a song (or group), then a database of now 740,000 songs which Pandora algorithms use to match up other music with the same characteristics.

It's pretty ingenious stuff (with additional details about Pandora and concept on the below video)...



The examples from Facebook and Pandora are different in that one handles recommendation based on individual feeling and one on technology and defined characteristics, but both cases are about influencing perception and then purchase decisions.  Coupling these examples with recommendation efforts from other companies like Amazon and Netflix (with Netflix and their recommendation engine being fairly heavily featured in the Grossman piece)... you've got a whole new world around purchase decisions.

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On a completely different note, but something that also struck me from Time lately was the Nancy Gibbs essay "TAPS: Help for the Families of Fallen Soldiers."  Powerful stuff that's also profiled in this ABC News story...

Employer / Employee Relationship BusinessWeek Pieces

Two brief interesting pieces around employees and the companies they work for from the November 16 issue of BusinessWeek.

The longer of the two is titled "The Return of the House Call" and details the Microsoft program that let's employees request an in-home doctor visit. From a financial perspective, it can actually reduce Microsoft expense in helping to bring down company costs for any unneeded emergency room visits by covered employees (should probably be noted that the Microsoft health care plan is apparently noted for being low-cost to it's employees).

The secondary, but still important impact of the program is in showing employees how valued they are by the company.

Very much tied to this latter concept, I thought the point raised in the extremely short "Are Your Employees Just Biding Their Time?" was a solid one. The concept is that there's a number of companies out there taking the current recession as an opportunity to squeeze employees and that could turn out to be counterproductive when the economy turns around. If an employee doesn't feel valued or treated fairly, it could well be a mass exodus of talent once other opportunities present themselves.

I find this whole idea of the employee / employer relationship to be a fascinating one and (keeping in mind things are always as they appear) it's interesting to read about and reflect upon the approaches taken by some large corporations.

I did a blog post in Oct 2008 titled Corporate Workplace Culture: the Good (Not the Bad or Ugly) which featured some positive employee treatment stories from companies such as Costco, Netflix, Google and yep... Microsoft and then another post in March of this year on People Management at IBM.

Just interesting... I think the point is that companies can squeeze employees under certain conditions, but I really question how sustainable the practice is over the long haul.

Corporate Workplace Culture: the Good (Not the Bad or Ugly)

While Corporate America often gets a bad rap (justifiably so) for the environment (not CFC-type environment, but employee mattering-type environment) it's people work in, there are some stories out there of companies that do it right...

In a September 2007 article, BusinessWeek ran "Netflix: Flex to the Max" about the efforts at Netflix to both attract and retain the best employees... through extreme "flexibility and responsibility" provided from CEO Reed Hastings on down.

Also, from September 2007, BusinessWeek published "How to Make a Microserf Smile" about the efforts at employee responsiveness done at the tech behemoth. Led by HR chief Lisa Brummel, Microsoft has fought gamely over the last few years to keep both it's star employees and overall moral up.

It's probably not necessary to point to Google as a company that treats it's employees well (given the legendary free cafeteria, child care, laundry, etc), but in it's March 2008 "50 Most Innovative Companies" issue, Fast Company has a piece about the perks enjoyed at Google, including an author and Presidential Candidate speaker series (pretty good stuff).

Finally (and more recently), Fred Kiel in his October 6, 2008 BusinessWeek opinion piece, tears apart the notion that employees are motivated only by self-interest. Kiel argues that rather than this, employees greatly value a workplace culture that trusts it's people (REI as an example) and gives them opportunities to advance (i.e. Costco Wholesale).