Netflix co-CEO Reed Hastings told CNBC the company models itself on professional sports teams, an approach that has been critical to its ascent into a global streaming giant.
“If you’re going to win the championship, you got to have incredible talent in every position. And that’s how we think about it,” Hastings said in an interview with CNBC’s Andrew Ross Sorkin that aired Wednesday on “Squawk Box.”
Hastings, who co-founded Netflix in 1997, just published a book, “No Rules Rules: Netflix and the Culture of Reinvention,” that details the company’s cutthroat view on employee retention.
Hastings’ co-author, business professor Erin Meyer, likened the approach to “The Hunger Games.”
“We encourage people to focus on who of your employees would you fight hard to keep if they were going to another company? And those are the ones we want to hold onto,” said Hastings.
As Netflix transformed from a start-up that mailed DVDs to a digital streaming behemoth, the company’s emphasis on granting freedom to employees has been a key component to the transition, Hastings said.
“We are fundamentally dedicated to employee freedom because that makes us more flexible, and we’ve had to adapt so much back from DVD by mail to leading streaming today,” Hastings said. “If you give employees freedom you’ve got a better chance at that success. And the book is all about the subtlety of how do you give freedom and not have chaos.”
Hastings added he believes Netflix’s corporate culture has improved over the company’s more than two-decade existence. As of Dec. 31, 2019, it had grown to about 8,600 full-time employees.
“Our culture is much better than it was 20 years ago,” he said. “We’ve continued to get more honest, more thoughtful, more creative. We have better tools internally. We’re focused on inclusion, all kinds of dimensions, so our culture gets better as we get bigger.”