“I want to build a world-class organization,” thought a young Reed Hastings in 1991 when he founded the company Pure Software. As a Silicon Valley hotshot at the forefront of the tech boom, he seemed like someone who could do it, but he needed a strategy to manage the rapidly growing company. He began to feverishly build business systems, write handbooks and fill vacancies with the most technically qualified people he could find. Processes and policies were designed to minimize mistakes and provide guidance to every situation. It was exhausting work and Reed was approaching burnout after just a few years. He also began to notice that he was surrounding himself with a bloated bureaucracy and process-driven people that would have a very difficult time adapting within a fast-moving and tumultuous world.
“I want to build a world-class organization,” thought an older and more experienced Reed Hastings in 1997 when he founded the company Netflix. After the eventual failure of Pure Software, he decided on a different approach. Rather than spending his days “dummy-proofing” his business (his words), he would focus instead on building a culture that promoted freedom and responsibility. A library of policy manuals and handbooks would be largely replaced by a simple slide deck that clearly laid out the “first principles” (business-speak for values) to which every employee was expected to align and adhere. Instead of rule followers, he would build a team of creative people who fully bought into the company’s values and were motivated to work toward its best interests. What started as a humble DVD rental business weathered tremendous industry storms, made dramatic pivots and rose to become the world’s largest and most successful online streaming service, largely with the same core workforce. Reed Hastings attributes the success of Netflix to a deeply committed and culturally aligned staff and he now prides himself on the small number of decisions he has to make as CEO.
While not every organization can follow the same path as Netflix, there is nevertheless a powerful lesson to be learned. Many leaders think of organizational development as an architectural enterprise in which ever more elaborate systems, processes, and policies are established in order to provide a highly structured environment where workers can be changed in and out with relative ease. They spend their days constructing crystal palaces which can be marvelous to behold, but no one actually wants to live there. While every organization requires a certain level of structure, the best leaders understand that scaling their organizations primarily means helping their staff to increase their responsibility and performance, a process which is generally best served by reducing bureaucracy and increasing freedoms within the bounds of a set of shared core values. Christian organizations in particular tend to prefer adding bad policies rather than subtracting bad employees, yet this is precisely the opposite of what we see in scripture. Consider the drastic bureaucratic reductions and return to first principles implicit in this observation from Christian author and apologist, Ravi Zacharias: “Moses gave his people 613 laws, David reduced them to 11, Isaiah reduced them to six and Micah reduced them to three. When Jesus was asked what is the greatest commandment, he gave them two; to love the Lord your God with all your heart and all your mind and all your soul and to love your neighbor as yourself. On these two commandments hang all of the Law and the Prophets.”
Reflection Questions
What does organizational development mean to you?
How much of your efforts are currently dedicated to “dummy-proofing”? What message does this send to your staff?
What first principles would lead your team to better alignment and performance?
