Strategic Discipline Blog

Last time I told you I’d reveal Netflix CEO, Reed Hastings ideas about vacations. My title has already provided that answer. At Netflix, Reed Hastings believes that tracking vacations is an artifact of the industrial age. He believes his business should be all about inspiration rather than control. So rather than caring about whether someone is at work or not, he’d prefer to focus on results and performance. What he really cares about is what the individual gets done.   

Wow, can you imagine that. How many of us can say we trust our employees so much that we would be willing to give them unlimited vacations?  It should make a lot of businesses jealous that Netflix system is so powerful that he can trust his staff to take vacations with out any regard to how much time they take off. If they are conscientious and responsible about their work he feels they can have complete freedom in the amount of time and when they take off. 

His belief system offers that your business doesn’t need more rules, what you need are more high performance people. It would seem Reed is a big believer in Topgrading [See the free white paper on Was Michael Gerber Wrong]. In fact he reviews their policies and procedures and tries to find rules they can eliminate each year. The big rule is to always act in Netflix best interest. As he sees it if everyone follows that rule the company prospers and he can eliminate most other rules altogether. 

Topgrading, if you’re unfamiliar with it, is a driving force in many of the best companies. GE, Allied Signal, Costco, the Container Store, and Goldman Sachs are just a few of the companies that embrace this practice. In fact Goldman Sachs chairman and CEOLloyd Blankfein just spoke to the NFL Owners at their annual meeting speaking about how to get good people, motivate them and keep them when they've accomplished great things. He talked about money, but he talked about people more. He told the owners, "Our best assets at Goldman Sachs take the elevator and leave the building every day.''

Unlimited vacations for your people may sound like a pipe dream. [Can you imagine offering that to a new employee?] Yet it comes down to a core belief about how you operate your business. Our belief is that in the coming future, finding employees may be more difficult than finding customers. If you believe that is possibly true, and if you believe that you can get greater performance from one great person than you can from three good people, isn’t it time you considered changing your HR practices and hiring procedures accordingly? Providing unlimited vacations to your employees might not seem like such a profound and unrealistic notion then, and might just signal that you’ve arrived at a place where responsibility and accountability are the prime requisite that has been firmly established in your business. It will allow you the opportunity to enjoy an unprecedented level of personal and financial freedom as a result.