No Rules Rules by Reed Hastings
Reed Hastings, Co-Founder of Netflix, shares how Netflix creates its unique work environment—how they hire, pay, and even let employees take vacations without needing approval. No Rules Rules shows how a relaxed, trust-based culture can lead to big ideas.
If you’re a business owner or planning to start one, this book is a must-read. It will teach you how to build a strong team, find the right people, and run a successful business without relying on a lot of strict rules.
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Book in Five Sentences
- Trust Your Team: Netflix hires the best people and gives them freedom instead of micromanaging. They trust their employees to take ownership of their work and make the right decisions.
- No Vacation Rules: Employees don’t need to ask for permission to take vacations. They’re treated like business owners and know how to balance their responsibilities.
- Feedback Goes Both Ways: At Netflix, feedback isn’t just top-down. Employees can give feedback to their managers, coworkers, and even the CEO. It’s all about improving together.
- Freedom to Innovate: Employees are encouraged to come up with ideas and take charge of their projects. This creates a culture of creativity and smart work.
- Hire Passion, Not Just Skills: Netflix believes in hiring people who care about their work, not just those who want a paycheck. A passionate team can take a business to the next level
No Rules Rules Summary
I’ve read quite a few management books—whether it’s about time, teams, or workforce—but after reading No Rules Rules, one thing stood out to me:
If you’re not starting a business and are working for someone else, treat that business as your own. Give it your 100%. Not only will you get paid well, but you’ll also work without fear and gain a deeper understanding of how the business runs.
Talking about my own setup:
I don’t run a big company, but I do manage five websites and a YouTube channel. I have two team members.
Here’s how we work: I don’t tell them what to write, how to write, when to write, or even how to find topics. They take full ownership of their work. If it’s a big project, they know to come to me for approval, but even deciding if it’s a big project is their call.
I pay them well too—it’s not like they’re working 5 hours a day and getting Rs 20,000 a month. As of now, this approach is working great. No issues from my side, and no complaints from theirs.
This system is something I picked up from No Rules Rules. Earlier, I used to approve everything they wrote, which slowed us down. Now, things feel much smoother.
That’s my experience, and now, let me share some key lessons from the book.
Free Vacations
When starting a new business, this approach might not be ideal right away, but you can still give it a try and see how it works for you.
Netflix has an interesting policy: employees don’t need permission to take vacations, and their vacation expenses are reimbursed by the company.
Of course, expenses are monitored by managers, so it’s not like you can spend ₹10 lakhs in a day and keep your job at Netflix.
At Netflix, employees are treated like business owners, so they’re trusted to know how much to spend and when to take time off.
However, as Reed Hastings mentioned, there was a case in Taiwan where an employee claimed over $100,000 in expenses over three years without being caught by their manager. Eventually, Netflix’s finance team caught this during an audit, and the employee lost their job.
The takeaway? No matter how carefully you hire your team, there might always be one or two who don’t live up to the trust placed in them.
Feedback
At Netflix, feedback is a two-way street—it’s not just the boss giving feedback to employees, but employees can also give feedback to their managers.
The feedback process is designed to be meaningful and constructive. For example, employees can’t just comment on someone’s appearance or dressing style. Feedback needs to be relevant and helpful.
Netflix even has an online portal where employees can share feedback with their peers, managers, and even the CEO. But this system isn’t taken lightly—every piece of feedback is monitored by managers.
If someone behaves poorly or uses inappropriate language on the portal, they can lose their job.
On top of giving feedback, employees are also expected to know how to take feedback in the right spirit. It’s all about creating an environment where everyone can grow.
The Ideas
If you’ve worked in any company, you know how managers usually assign tasks, and employees are expected to complete them within a deadline.
At Netflix, things are flipped. Employees are the ones who come up with ideas, and whoever proposes an idea is responsible for working on it. If it’s a big project, the final call goes to the CEO.
This approach creates more opportunities for innovation, encouraging employees to work smart instead of just hard.
Of course, this setup won’t work for every business, but giving your team the freedom to be creative can make a huge difference.
In short, build a team that’s passionate about the business. Hire people who care about what they do, not just the paycheck.
No Rules Rules Review
Some rules in this book might not work for every business, but they’ll give you good ideas on how to treat your employees better. The book is also easy to read and understand.
I highly recommend No Rules Rules. If you use the ideas in the right way, they can truly improve your business.
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No Rules Rules Quotes
“Lead with context, not control,” and coach your employees using such guidelines as, “Don’t seek to please your boss.”
“My goal was to make employees feel like owners and, in turn, to increase the amount of responsibility they took for the company’s success. However, opening company secrets to employees had another outcome: it made our workforce smarter.”
“Above all you have to be humble, you have to be curious, and you have to remember to listen before you speak and to learn before you teach. With this approach, you can’t help but become more effective every day in this ever-fascinating multicultural world.”
“The Fearless Organization, she explains that if you want to encourage innovation, you should develop an environment where people feel safe to dream, speak up, and take risks. The safer the atmosphere, the more innovation you will have.”
“Netflix treats employees like adults who can handle difficult information and I love that. This creates enormous feelings of commitment and buy-in from employees.”
“I recommend instead focusing first on something much more difficult: getting employees to give candid feedback to the boss. This can be accompanied by boss-to-employee feedback. But it’s when employees begin providing truthful feedback to their leaders that the big benefits of candor really take off.”
“My goal was to make employees feel like owners and, in turn, to increase the amount of responsibility they took for the company’s success. However, opening company secrets to employees had another outcome: it made our workforce smarter.”
“If you’re hiring someone for an operational position, say window washer, ice-cream scooper, or driver, the best employee might deliver double the value of the average.”
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