Successful Change in Organisational Culture at Netflix
Introduction
The Internet has been a big help for small startups turning into huge companies fast, like
Netflix. Started in 1997 as a small business in California, Netflix became a top online
streaming service with 247 million subscribers worldwide. It offers original shows and
movies you can watch on any device. Netflix's success comes from being online, having
unique content, and using cool tech.
In 2010, Netflix decided to change how it worked, especially how it treated its employees.
They wanted motivated people to handle the growing demand for streaming services. The
goal was to build a great online platform, stand out, and succeed. This change aimed to create
values and beliefs that encourage innovation and make it easier for employees to share ideas.
Reason for Transformation
Netflix wanted to be the best at streaming original content online, and with more companies
joining in, they needed to get creative. So, they changed how they worked, focusing on
letting people work independently, good communication, positive attitudes, being effective,
and not being too strict about rules.
The main reason for this change at Netflix was to keep up with the fast business world. A
company's success is now connected to how well employees perform, and the culture plays a
big role. Studies show that a company's culture affects employee performance and how it's
seen in the market. Being innovative and focusing on employees can lead to a good image
and success.
Especially in tech, companies need a culture that boosts productivity and teamwork. Netflix
realized they needed to change how they worked to reach their goals. Changing the culture
made things more transparent and let employees make decisions on their own.
Achievement of the Transformation
Netflix's big change in how it works has really helped it grow fast and become a top player
globally. Recent research found that this change in the company's culture is the main reason
it's so successful, even beating big names like Google's YouTube, Facebook, Disney,
Walmart, Apple, and HBO in the list of the 50 best online content providers. Back in 2010,
Netflix was losing ground to competitors like Google and Disney in the US. It was clear they
needed a new way of doing things to stay competitive.
In 2011, Netflix started changing its corporate culture, focusing on encouraging new ideas
and giving employees more freedom to make decisions. They formed groups called 'dream
teams' to come up with and test innovative ideas. By 2015, the company saw the benefits of
this culture change and jumped from the 6th to the 2nd position in the list of the most
innovative online content providers. This success was directly linked to the change in
corporate culture.
Around 2015, companies offering online content were facing challenges like high demand for
original and engaging content. Customers wanted more interesting and interactive online
services. Netflix's new culture was designed to tackle these challenges. The company
overcame many difficulties by focusing on innovation and understanding what customers
wanted. Recent studies show that this new culture is a smart way for Netflix to stay
competitive and keep growing.
Thanks to this new culture, Netflix gained lots of new customers and increased sales. By
2018, they had over 150 million subscribers, and by 2020, it went up to over 170 million
subscribers. The COVID-19 pandemic, which led to more people staying home, also boosted
subscriptions. These achievements are mostly because of the new corporate culture
encouraging innovation and letting employees and their teams make decisions independently.
Factors Responsible for Successful Change
1. Autonomy in Decision-Making:

Netflix gave its employees the freedom to make decisions on their own.

This "people over process" approach motivated employees to come up with
their own solutions to problems in the content streaming business.

Independent decision-making helped Netflix develop new capabilities and
gain a competitive advantage.
2. Effective Communication:

The company focused on open and deliberate sharing of information.

In an online-based business-like Netflix, communication is crucial for staying
innovative and understanding consumer and market trends.

The flat organizational culture supported efficient communication throughout
the company, reducing barriers to growth and expansion.
3. Positive Attitudes and Candidness:

Netflix encouraged a culture of extraordinary candidness to promote sincerity
and objectivity among employees.

The new culture facilitated teamwork, supporting global content-streaming
operations.

It aimed to shape employees' attitudes and behaviours in a way that benefits
the organization.
4. High Effectiveness and Productivity:

The culture change emphasized high effectiveness to boost productivity and
job performance.

Netflix introduced programs to show that increased productivity is essential
for success in the content-sharing industry.

The focus was on motivating the workforce to achieve high productivity levels
for long-term success.
5. Rule Avoidance:

Netflix adopted a unique approach by avoiding strict rules.

The idea was that rigid rules could make the online business inflexible,
reducing responsiveness to market changes and customer needs.

Rule avoidance helped Netflix maintain a flexible business, adjusting to
customer demands and ensuring high customer satisfaction.
Conclusion
We can learn important lessons about entrepreneurship and leadership from this case study.
One of the most important lessons is organizational culture is crucial for employee
performance and overall company success. When building a culture, it's essential to focus on
human resources since employees are a company's fundamental assets.
For effective cultural change that boosts employee performance, Netflix teaches us to
prioritize communication and decision-making freedom. Ineffective communication and a
lack of independence can block innovation. Employees need the freedom to express ideas and
solve problems creatively.
Rigid structures have no place in the modern business world that relies on accessible
communication. In online businesses, information is key, and it must be shared effectively.
Without this, a company can't thrive in modern business models, hindering its potential for
growth and expansion.