The importance of Netflix’s organisational culture
Netflix is noteworthy not only for its leadership position in the entertainment industry, but also because the company’s organisational culture has brought a whole new approach to human resource management (HR) and corporate culture, one that emphasises freedom and responsibility, and along the way creates an environment where employees can develop their full potential. Netflix’s model differs from traditional corporate structures in many ways: while most companies strictly regulate the work and authority of employees, Netflix deliberately dispenses with direct control, encouraging employee autonomy and engagement.
Netflix’s culture of “Freedom and Responsibility” is unique in that it gives employees a high degree of freedom, while expecting them to work responsibly and perform to high standards. This type of culture is a great enabler of the company’s agility and ability to innovate quickly, which is essential in a competitive sector such as entertainment. Netflix’s free work culture is reinforced by transparent communication, a high level of diversity and inclusivity, and the opportunity for continuous learning and development.
Netflix’s track record of success and cultural innovation is not only vital for the streaming market, but also an inspiration for many industry players. The company’s unique approach can also guide companies looking to create a more dynamic, creative and autonomous working environment.
My aim is to provide a comprehensive picture of Netflix’s unique organisational structure, management methods and workplace culture, and its impact on corporate success. I will use the example of Netflix to illustrate how organisational development theories and modern HR practices can be combined, with a particular focus on how this is put into practice.
I will also include my personal views on how a similar working environment and culture can affect the individual and their own work ethic. The comparison of theory and practice will help us to understand the benefits and challenges of such a corporate culture for both the employer and the employee.
The example of Netflix is an excellent case study to show the basic guidelines of modern organisational development. In the article, I cover the structure of the company, the division of responsibilities and tasks, management styles, workplace culture and company values. The aim is not only to understand why Netflix’s organisational model has been successful, but also to see what lessons and applicable ideas it can provide for other companies, including our own.
Netflix organisational structure and structure
Netflix’s organisational structure takes a unique approach, combining traditional hierarchical elements with a flat organisational model to create a unique, dynamic operation. The hierarchical structure clearly delineates roles and levels of responsibility, but Netflix also consciously avoids rigid, centralised management, thus fostering autonomy and innovation across departments. The decentralised model allows the different units of the company to operate according to their own goals and strategies, enabling them to react quickly to market changes and to take advantage of different opportunities. This type of organisational structure is particularly advantageous in a dynamic, competitive industry such as entertainment, where consumer needs change rapidly and competitors are constantly coming up with new solutions to gain an advantage.
The main advantage of a streaming service provider’s decentralised structure is that it keeps decision-making processes local and gives employees greater autonomy. This autonomy is particularly evident in the areas of content development and technological innovation, where a fast and creative response to market needs is particularly important. For example, the content development departments work on projects that are tailored to local markets, so they can reflect the cultural specificities of different countries, thus increasing the effectiveness of the company’s global presence. For the company, being present in global markets also means being able to offer unique and specific content tailored to local preferences, which strengthens brand loyalty.
But decentralisation is not without its challenges. As the company grants a high degree of autonomy to the different departments, information flows and coordination become more complex. Close cooperation between different areas and maintaining cultural unity can be difficult, especially when different regions or departments have different priorities. However, the structure adopted by Netflix provides the flexibility to allow each unit to adapt quickly and work effectively in the face of potential challenges.
Within the content giant’s organisation, the various departments play a central role in achieving the company’s long-term goals. The content development department is responsible for creating and managing in-house produced shows and films, which gives Netflix a clear competitive advantage as this content is often exclusive and only available on the platform. The technology and product development department is constantly working to improve the user experience on the platform, the user interface and the personalised recommendation system, which is particularly important as one of Netflix’s core values is to make it easy for viewers to find content that interests them. The marketing and communications department is responsible for branding and running promotional campaigns to attract new users to the platform and increase the loyalty of existing subscribers. The HR and Organisational Development department ensures the recruitment, training and development of employees and plays an important role in fostering the company culture, with a strong focus on diversity and inclusivity, ensuring that all employees feel at home. The customer service department aims to resolve all user queries and issues quickly and efficiently, which also contributes to a positive user experience and helps maintain Netflix’s global reputation.
The organisational structure of the broadcaster allows all departments of the company to work closely together, while at the same time being able to do their work autonomously and creatively. This flexibility and a mutually supportive organisational structure allows the company to constantly adapt to market trends and maintain its competitive advantage in the entertainment industry.
The division of tasks and responsibilities
The duality of freedom and responsibility, one of the most important principles of Netflix, is a key part of the way the company operates. With this approach, Netflix gives employees the opportunity to work with a high degree of autonomy, fostering creative thinking and innovation. The company’s philosophy is that employees do not need to be micromanaged; rather, they need to be clear about the goals they are working towards and the context in which they are performing their tasks. In this way, Netflix not only encourages employees to solve tasks independently, but also to take responsibility for their decisions and their consequences.
One of the central elements of the “Freedom and Responsibility” principle is that workers have broad decision-making powers. As a result, the role of managers is transformed from giving direct instructions to providing guidance and context in which employees can make their own decisions effectively and confidently. This context-based leadership creates an environment where employees not only feel empowered but also take responsibility for the company. Meanwhile, managers ensure that the goals to be achieved are clear and that all employees are well informed about the background to the projects, so that they can make decisions with confidence. This system also significantly enhances trust between managers and subordinates.
This form of division of tasks and responsibilities encourages responsibility among employees, as the company expects employees to make responsible decisions and even take risks if necessary to succeed. The result of this attitude is that employees are not only executors of tasks, but also actively involved in finding and implementing solutions. This autonomy also means that the company focuses on the outcome rather than the process of work, i.e. the important thing is to achieve the objectives set, but they can also achieve them according to their own approach.
This approach offers a number of advantages for the video-on-demand provider. Autonomy allows staff to react quickly and efficiently to market changes, as not all decisions need to be approved centrally. This kind of flexibility is particularly useful in the entertainment industry, where new trends and changing consumer demands require quick reactions. Employees can decide for themselves how to carry out tasks and set priorities, which helps them to do their best and come up with new and innovative solutions.
However, a high degree of freedom and responsibility is not ideal for all employees. For those who prefer precise guidance or are more comfortable working within a strict framework, the Netflix approach can be challenging. For Netflix employees, the ability to effectively manage stressful situations and make quick, responsible decisions is essential. Such demands require employees to be sufficiently motivated and confident to face the challenges that arise and to act on their own professional judgement.
The company’s system of division of tasks and responsibilities, based on the principles of freedom and responsibility, successfully supports the company’s agility and innovation. Employee autonomy and context-based management allow for fast and creative problem solving, while fostering trust between managers and subordinates, a cornerstone of corporate culture.
Management methods and styles
Netflix’s leadership philosophy is based on the principles of transformational leadership, where leaders are not just managers, but inspirational, supportive and mentoring actors. The company strives to ensure that its leaders do not simply assign tasks, but create an environment in which employees can grow and develop their talents independently. This leadership style promotes open and honest communication, which is paramount to Netflix’s culture. Managers regularly give and solicit feedback, which not only improves employee performance, but also fosters a sense of commitment to shared goals and employee comfort. This openness is felt throughout the company, as the feedback system and performance appraisal are transparent and purposeful.
In building relationships between managers and with subordinates, the company places a strong emphasis on transparency and direct, respectful communication. The company believes that employees need to be aware of current goals and corporate strategy in order to be able to contribute fully to the company’s success. This transparency allows all employees to understand the bigger picture and feel that they are an integral part of the company’s success. For managers, transparency and openness also serve as a tool to build trust, as employees can see and understand the background to decisions and feel less distanced from the strategic goals of the company.
Another important aspect of leadership in the company is its commitment to fostering the possibility of error, as risky decisions are inevitable as part of innovation and experimentation. Embracing mistakes and fostering a culture of learning at Netflix creates an environment where employees can experiment and explore new ways of doing things. Managers do not punish failure, but encourage employees to see mistakes as valuable learning opportunities. This attitude is important in a company where content development and technological innovation constantly present employees with new challenges and where fast, creative decision-making is essential.
Netflix’s management style clearly differentiates the company from companies with a traditional hierarchical structure. Leaders are not at the centre of decision-making, but rather provide guidance and support. The company’s goal is to empower employees to take responsibility and make their own decisions in their own areas, thus increasing motivation and engagement. Thanks to Netflix’s leadership culture, employees feel that their performance and opinions matter, as feedback is regular, communication is two-way and decision-making at all levels is free and accountable.
This transformational leadership approach contributes to the success of the company by ensuring that each employee feels empowered and knows that his or her contribution is important to the company’s goals. Autonomy and the responsibility that comes with it increase employees’ creativity and effectiveness, as trust between managers and subordinates is built on strong foundations and teams can adapt quickly to changing circumstances.
Organisational culture and values
The digital media giant’s organisational culture is built on principles that foster creativity, innovation and teamwork. The company’s core values include the philosophy of “Freedom and Responsibility”, which is closely intertwined with all aspects of the company culture. This principle sets out the expectation that employees should be able to work autonomously, independently yet responsibly, and that they should be able to perform at a high level without managerial control. Freedom and responsibility go hand in hand in everyday work, so that each individual can make his or her own decisions but must also bear the consequences of those decisions.
Diversity and inclusivity are an important part of Netflix’s culture, which supports people from different backgrounds, experiences and perspectives. The company believes that a diverse team can best understand the needs of different cultures and audiences, which is essential to the company’s global success. Diversity and inclusivity is not just an ideal, but an integral part of the company’s strategies, as the goal is for all employees to feel valued and appreciated for their contributions, regardless of their background.
One of the defining elements of an organisational culture is open and honest communication, which allows everyone to freely express their thoughts, ideas and criticisms. The company promotes transparency at all levels, so that there is a direct dialogue between management and employees. For employees, this kind of openness means that they have an insight not only into their own work but also into the management of the company as a whole, and a better understanding of the company’s goals and decisions. Open communication gives employees the feeling that not only are they being listened to, but that their opinions really matter. As a result, employee engagement, morale and loyalty are strengthened.
The acceptance of mistakes and the promotion of a learning culture are further strengths of the VoD provider. The company consciously creates an environment where employees are not afraid to try new methods and take risks, as they know that making mistakes does not lead to punishment, but rather is seen as a learning opportunity. It is an essential part of innovation that people are able to step out of their comfort zone, seek new solutions and take the risks that are inevitable in the creative work process. The culture of the online broadcaster therefore encourages employees to continuously develop their skills, as the company aims to enable all employees to be the best they can be.
In addition to the principle of “Freedom and Responsibility”, the company’s values include a focus on results. At Netflix, results are measured not just by effort in the work process, but by tangible performance. Employees define the results they want to achieve and can approach their goals in their own way, giving them a high degree of flexibility while strengthening their commitment to the projects. This results-driven approach is one of the key drivers at Netflix, encouraging employees to devote all their resources and energy to producing the highest quality work.
An outside perspective: the impact of Netflix’s organisational culture
As I don’t work for Netflix, I can only appreciate their organisational culture from the outside, but I am still impressed by the company’s commitment to the principle of “Freedom and Responsibility”. This principle reflects a particular approach to employees: Netflix combines independence of work with responsibility to an extent that is unusual for most companies, especially in Hungary. This principle gives employees the opportunity to decide independently how they want to carry out their tasks, relying on their own skills and intuition. Such a culture teaches workers to make decisions with confidence and to take responsibility for the consequences. As an outsider, I see this principle as a way of building not only employees’ confidence, but also their ability to find the best possible solutions without being under constant scrutiny, and therefore ultimately their ability to grow!
Netflix’s practice of transparency and open communication is also noteworthy to me and I see it as an example to follow. Making strategic goals, the background to decisions and all relevant information available at all levels of the company is a very valuable way for employees to get a full picture of the company’s direction. Transparent communication not only helps to engage employees, but also contributes to their autonomy to make decisions in the company’s best interests. In my view, this culture can be a valuable lesson for all industries, as it can also increase employee engagement and satisfaction when they can truly understand and see the impact of their own work in the bigger picture.
The company’s feedback culture is particularly exemplary. Feedback is actively given and received not only by managers but also by colleagues, and it works as a two-way communication, a real dialogue. Through this system, all employees can contribute to the collective work by providing honest assessments and suggestions. Netflix’s open feedback practice not only develops employee competencies, but also strengthens team spirit, as everyone feels they have a role and a voice within the company. For me, this culture highlights the importance of self-reflection and peer support within an organisation, where employees not only recognise but also encourage each other’s development.
The culture of handling mistakes and learning from them is another aspect that represents a unique approach at Netflix. Allowing for the possibility to make mistakes not only supports the creativity of employees, but also contributes to the willingness to innovate and to corporate flexibility in the long term. The company’s approach, where mistakes and failures are a natural part of moving forward, can give employees the opportunity to take risks and learn from experience. From an external perspective, I believe that such a culture can not only boost employee motivation, but can also make the whole organisation more resilient, as employees need not be afraid to make mistakes in the search for innovative solutions.
The content giant’s management model, based on the principles of transformational leadership, is also very sympathetic to me. Transformational leaders do not simply give instructions, but are mentors who inspire and support employees, fostering development and engagement. As an outsider, I see such a leadership style as encouraging autonomy and commitment, as employees feel that their performance really matters and is important to the organisation. The lesson from Netflix’s leadership practices is that transformational leadership can be particularly useful in environments where creativity, development and the development of individual capabilities of employees all contribute to the achievement of organisational goals.
Netflix’s organisational culture is therefore, from an outside perspective, a very inspiring and successful model. Autonomy and responsibility, open communication, learning-based error management and transformational leadership are all values that can serve as a guide for other companies. These principles not only contribute to Netflix’s competitive advantage, but also create a work environment in which employees can become true value creators and, perhaps most importantly, understand themselves as valuable within the company. I believe that the greatest value in a company is not the product, but the people!
The impact of organisational culture and communication
Netflix’s organisational culture and communication model has a direct and profound impact on the company’s employees and its performance. Transparency, honest feedback and a high level of information flow foster employee engagement, as all employees feel that they are an important part of the organisation. This type of culture fosters a sense of belonging because employees not only perform simple tasks, but also contribute directly to the success of the company, knowing that the impact of their work is reflected in the results Netflix achieves.
Open communication in the organisation ensures that all employees have easy access to the information they need and know exactly where the company is heading, what its goals are, what its business is – and what it can already relate to. This transparency allows employees to better understand the importance of their own tasks and to see their own work in the context of the bigger strategic picture. This transparency also increases employee satisfaction and helps them to work better, as they can respond more quickly and effectively to changing market demands and new directions.
The quality of feedback and communication is essential to the functioning of an organisation. An honest and constructive feedback culture promotes continuous learning and improvement. It is accepted practice in the company that feedback flows horizontally, not only from the top down, but also in all directions, so that all employees have the opportunity to assess and help their colleagues. This approach allows trust between colleagues to be strengthened and real teamwork to develop. In an environment where everyone’s views are open and accepted, employees adapt more easily to change and are more willing to embrace new ideas and approaches.
Participation in decision-making is also an important element of Netflix’s organisational culture. The decentralised model and the autonomy granted to employees allows everyone to contribute directly to decision-making in their own area of work. This system not only supports faster and more efficient decision-making, but also increases employee satisfaction, as everyone feels that the company trusts them and takes their opinions seriously. This kind of participation also has a positive impact on employees’ personal development, as they receive clear feedback on the impact of their own decisions, which allows them to analyse their experiences and determine the next steps.
Netflix’s organisational culture and communication system therefore creates an environment that supports employee autonomy, motivation and creativity. Transparent decision-making, open communication and trust among employees are fundamental to the success and sustainability of the company, especially in a competitive and fast-changing industry like entertainment.
The Netflix example shows an organisational and management model that can combine autonomy, accountability and transparent communication. A corporate culture based on the principle of “Freedom and Responsibility” is a unique way to support innovation and employee satisfaction. Decentralised decision making, a transformational leadership style and learning from mistakes are principles that contribute to Netflix’s continuous development and market leadership.
The company model encourages organisations to think about renewing traditional management practices. Values such as autonomy, open communication and transparency can serve as a model for other companies, especially in industries where agility and rapid decision-making are essential.
From a personal point of view, I am also inspired by the positive impact that the key elements of Netflix’s culture – empowerment, learning culture and transformational leadership – have on employees. In such an organisational model, employees are seen not just as task performers, but as active shapers of the company’s success, contributing autonomously to the achievement of shared goals.
Netflix’s organisational culture is therefore not only important for corporate success, but also conveys values that are sustainable in the long term and can serve as an example for any organisation that is open to change and innovation.
For the average Hungarian company, Netflix’s organisational culture may seem out of reach, but by following a few basic steps, they could develop a similar principles-based operation. Firstly, a culture change would be crucial for a Hungarian company, aiming to create an organisational environment that supports autonomy, accountability and transparency. This change can be achieved gradually, with the support of managers and a change of mindset, as it requires a fundamentally different approach from that of domestic companies. By introducing transparent communication, a company could make it easier for employees to understand its strategic objectives and to feel that their work contributes to the success of the organisation. This would be supported by a feedback system where employees can share their thoughts with confidence and openness, while management provides regular feedback on progress and expectations.
To be effective, it would also be important to accept mistakes and develop a learning culture. A useful lesson for a Hungarian company could be to treat failure not necessarily as a failure, but as an opportunity for improvement. In this process, managers need to build trust and emphasise that risk-taking is valuable if it promotes growth and learning. This would allow employees to be more courageous in trying new solutions, to dare to be creative and not to fear sanctions for making mistakes. At the same time, it would be worthwhile to increase employee autonomy, i.e. to give them more autonomy in their work. This autonomy is the basis for employee satisfaction, as it gives everyone the opportunity to contribute to the company’s goals to the extent of their abilities. At the same time, ensuring autonomy requires that managers set clear expectations and objectives, but that employees are free to choose the means to achieve them.
The introduction of transformational leadership can also be useful for the average Hungarian company to develop a similar corporate culture. This leadership style focuses not only on managing employees and defining their tasks, but also on inspiring, supporting and mentoring them. Transformational leaders do not just manage, they empower employees to achieve success through their own development. This approach supports employees’ development, while increasing their commitment and motivation to work.
I believe that a Hungarian company can achieve a Netflix-like organisational culture if it is open to innovate its communication and management methods, and if it promotes the principles of autonomy, learning and open feedback in its daily operations.
In the average Hungarian company, a Netflix-like organisational culture is not widespread because many cultural, economic and structural factors require a different approach.
Firstly, in Hungary many companies still operate in a traditional hierarchical structure, with managers exercising tight control and allowing little autonomy to employees. This organisational model has been the way of working for a long time, and often the familiar, controlled processes provide firms with a sense of security. Most managers may sometimes believe that they can guarantee results by closely supervising employees and giving precise instructions. In contrast, the Netflix model relies much more on trust and autonomous management of responsibility, an approach often lacking in the Hungarian workplace culture.
Another important factor is risk aversion: in Hungary, companies and their managers are generally cautious about introducing new methods, especially if they deviate from well-established, traditional workflows. There may also be a stricter attitude towards mistakes: in many workplaces, mistakes are not seen as a learning opportunity, but rather as a punishable event. As a result, employees often do not feel they have the scope to take risks or try creative solutions, which limits the creation of innovative environments like Netflix.
In addition, the lack of a feedback culture is an important factor. In many Hungarian workplaces there is still a lack of transparent, two-way feedback. Many employees do not receive regular, constructive feedback on their performance, and senior management rarely shares detailed strategic directions or plans with the whole company. The lack of open communication and transparency makes it harder for employees to understand the background and purpose of company decisions, and thus to feel less part of the organisation.
Moreover, creating an innovative, autonomy-based culture like Netflix often requires more resources and commitment. The average Hungarian company does not always have the tools to help it adopt transformational leadership or create a culture of learning and development. A lack of resources and a lack of skilled managers who are familiar with modern management methods can also contribute to companies being less willing to build a Netflix-like organisation.
For domestic companies, traditional structures and secure operations may therefore be a priority, but global competition and the need to retain talent may in the long term encourage companies to gradually open up to more modern organisational cultures that support greater autonomy. For the average Hungarian business leader who wants to improve his company’s organisational culture and increase its competitiveness, one of the first steps could be to engage an experienced organisational developer. An organisational developer can help to shape the culture and processes that best fit the business objectives, so that the manager can make improvements that support the long-term success of the company. In addition, the involvement of an organisational development professional can help management to review current structures and communication methods and adapt them to modern needs. Another important step could be the development of a feedback system that allows for regular two-way communication between management and employees. In this way, the manager can create a transparent atmosphere and ensure that employees better understand the company’s goals and their role in them – in most cases, in my experience, the managers themselves have not even articulated their vision and their cause, they are just doing their job. It is also recommended to organise training that focuses on developing leadership styles, especially in the area of transformational leadership, as a supportive, mentoring leadership increases employee engagement. Finally, in order to progressively develop the company culture, it is worth creating internal programmes that foster autonomy and a learning approach. It can be particularly useful to promote a positive attitude to failure, which encourages employees to take risks and innovate. In the long term, these small steps – organisational development, transparent communication and a management style that supports development – can help a company to develop a modern, competitive and attractive organisational culture.
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