1. Analyse the following questions based on the case scenario. You need to present and EVALUATE the facts and explore the hidden leadership principles behind these facts.
o How did Hastings change his use of communications in sending and receiving messages from Pure Software to Netflix?
o How did Hastings change his use of feedback from Pure Software to Netflix?
o How did Hastings change his use of coaching guidelines from Pure Software to Netflix?
o Which conflict management style did Hastings tend to use at Pure and Netflix?
o In making a deal with Epix, which conflict management style was most likely used by
Netflix?
2. How would you improve Netflix’s product offerings (i.e., what things can’t you watch that you would like to watch) or processes (i.e., how can it improve its delivery or service)?
3. Which level or levels of analysis and leadership paradigm are presented in this case, and did Hastings use the management or leadership paradigm?
4. How did Hastings Big Five model of personality leadership traits change from Pure Software to Netflix?
5. Which University of Iowa leadership styles did Hastings use at Pure Software and Netflix?
6. Explain how power, orgorganizational politics, networking, and negotiation are, or are not,discussed in the case.
Wilmot Reed Hasting, an education philanthropist and entrepreneur, is known for serving over the boards of Facebook, CEO of Netflix and a number of not- for- profit companies. In the year 1997, Marc Randolph and Hastings contributed in co-founding Netflix that offers film rental- by- mail at a flat rate or price to the customers in the entire United States of America. With the headquarters in California, the company of Netflix has been amassing a collection of more than 44 million subscribers for almost 100,000 titles. Hastings is known for being ahead in the curve of technology. He also possesses the quality of anticipating the preferences of the customers. In consideration with this quality, it had been anticipated by him that in an eventual manner the customers will show preferences towards getting movies instantly being delivered through the sources of the internet (Musek 2007). Even though the organization is now being criticized by a number of individuals in the market, the organization had been able to achieve success in the initial period and in recent times due to the leadership style of Reed Hastings.
Hence, the leadership style of Reed Hastings is extremely important for the purpose of this report and will be the key focus of the research as well. In the beginning of the year 2005, the analysts of Wedbush Securities Stock had place a price targeting at 3 dollars, the trading of which was being done at the price of approximately 11 dollars (Loftus 2011). In this particular report, analysis will be done on the case study that questions and doubts the position of Reed Hasting as a number one businessman or entrepreneur. With respect to certain aspects, this report will be analysing the scenario in terms of human resource management and leadership perspectives at Netflix.
In the beginning of the year 2005, the analysts of Wedbush Securities Stock had place a price targeting at 3 dollars, the trading of which was being done at the price of approximately 11 dollars. However, there had been a change in the scenario after Reed Hasting had introduced certain changes within the system of the business. Majority of the success at Netflix is on the basis of the fact as to how the company had been built on culture that was eager to take risks and hard- driving as well. Netflix had managed to initiate change in the model of its business by the cannibalization of its own customers (Loftus 2011). This change had been made in a quick manner without much consideration of certain facts and was initiated in the plans of subscription that resulted in causing a widespread outrage amongst the base of customers.
The company had been catching vicious backlash events from the customers who subscribed the organization after the announcement had been made to separate its services of live streaming and providing DVDs through e-mails. The CEO of the company realized that the mistake lied in the way in which communication of the message had been done with the customers (Loftus 2011). The CEO realized this as there had been cancellation of subscriptions by a number of customers and involvement of a number of negative comments along with the plummeted stocks by 50 per cent. In order to rectify the mistake, the CEO had sent an email to 24 million customers of the organization for apologizing stating “I messed up and I owe you an explanation”.
Further announcement had been made that the service of providing DVDs through e-mails will now be known as Qwikster and the organization will be only available for the activity of streaming. This instance can be considered as an evidence for the change that took place in Hasting, in comparison with what had been in the case of Pure Software. This change of communication, as stated by Reed Hastings had not been a tactic of marketing but an expression for the sincere and genuine regret regarding the way in which communication had been handled with the customers (Musek 2007). However, there had still been certain flaws in the way in which communication was being done. Hence, with the changes in its way of communication, the CEO had been introducing transparency in their relationship with the customers. As showing preferences towards communication, Netflix had utilized its services with a consent to receive electronic communications from the web site of Netflix in relation with this accountability.
Netflix had managed to initiate change in the model of its business by the cannibalization of its own customers. This change had been made in a quick manner without much consideration of certain facts and was initiated in the plans of subscription that resulted in causing a widespread outrage amongst the base of customers (Loftus 2011). The company had been catching vicious backlash events from the customers who subscribed the organization after the announcement had been made to separate its services of live streaming and providing DVDs through e-mails. These feedbacks had been used by the CEO, Hasting as a source for understanding the perception and expectations of the customers. The CEO then considered making moves for responding to the feedback obtained in a different yet significant manner. This instance can be considered as an evidence for the change that took place in Hasting, in comparison with what had been in the case of Pure Software.
The sources of feedback now seem to be involving emails being sent to the email addresses that have been provided in the duration of registration or to post communication over the service of Netflix or on the page of “Your Account”. This page will be including notices regarding the account such as authorizations on payment, changes in the method of payment or password, confirming e-mails and a number of other information related to transactions. This has resulted in creating a relationship with the organization of Netflix as an important stakeholder of the company (Loftus 2011). In the beginning of the year 2005, the analysts of Wedbush Securities Stock had place a price targeting at 3 dollars, the trading of which was being done at the price of approximately 11 dollars. In this particular report, analysis will be done on the case study that questions and doubts the position of Reed Hasting as a number one businessman or entrepreneur.
Majority of the success at Netflix is on the basis of the fact as to how the company had been built on culture that was eager to take risks and hard- driving as well. Netflix had managed to initiate change in the model of its business by the cannibalization of its own customers. This change had been made in a quick manner without much consideration of certain facts and was initiated in the plans of subscription that resulted in causing a widespread outrage amongst the base of customers (Musek 2007). The coaching guidelines are available on the web page of the company and is one of the most viewed document.
By the introduction of these coaching guidelines, the CEO of Netflix had made an attempt of shaping the culture and motivating the performance of the workforce at Netflix. Ideas were being introduced for the management of talent that was highly successful for the organization. This particular change in the coaching guidelines had been considered compelling for the culture and talent of the organization for a number of reasons (Loftus 2011). As stated by the CEO, the derivation of this approach had been done on the basis of common sense. These coaching guidelines have helped in attracting, retaining and managing talent.
Considering the leadership of the CEO, it can be stated that he believed in hiring, rewarding and tolerating only those adults who were fully formed. Over the passage of time, it has been observed that if one asks an individual for relying upon common sense and logic rather than the formal policies, majority of the times, one ends up getting improved results and at a lower amount of cost. If a leader becomes careful for hiring an individual who will be putting the interests of the company at first place, who will be understanding and supporting the desire for a workplace with high performance, 97 per cent of the employees at the workforce will be doing the right thing. When it comes to behaving like an adult, Hasting believes in expressing the issues with the colleagues, subordinates and the boss openly.
After the failed experiences of Hasting at the Pure Software, the CEO of Netflix had been showing concern towards the issue related to growth. His public goal was to build a company of entertainment and his personal goal was focused on building a company that grew at a rapid pace without the loss in the spirit of entrepreneurship within this particular process. Netflix had been a bed for being tested in consideration with these theories of the CEO. The model of conflict management, being followed by Hasting at Netflix has resulted in affecting the expectations of the viewers.
By the introduction of these conflict management styles, the CEO of Netflix had made an attempt of shaping the culture and motivating the performance of the workforce at Netflix. Ideas were being introduced for the management of talent that was highly successful for the organization (Loftus 2011). This particular change in the style for the management of conflicts had been considered compelling for the culture and talent of the organization for a number of reasons. As stated by the CEO, the derivation of this approach had been done on the basis of common sense. This style for the management of conflict have helped in attracting, retaining and managing talent. This instance can be considered as an evidence for the change that took place in Hasting, in comparison with what had been in the case of Pure Software (Musek 2007). This change of communication, as stated by Reed Hastings had not been a tactic of marketing but an expression for the sincere and genuine regret regarding the way in which communication had been handled with the customers.
However, there had still been certain flaws in the way in which communication was being done. Hence, with the changes in its way of communication, the CEO had been introducing transparency in their relationship with the customers. As showing preferences towards communication, Netflix had utilized its services with a consent to receive electronic communications from the web site of Netflix in relation with this accountability.
The CEO of the company realized that the mistake lied in the way in which communication of the message had been done with the customers. The CEO realized this as there had been cancellation of subscriptions by a number of customers and involvement of a number of negative comments along with the plummeted stocks by 50 per cent (Bakker 2010). In order to rectify the mistake, the CEO had sent an email to 24 million customers of the organization for apologizing stating “I messed up and I owe you an explanation”.
Further announcement had been made that the service of providing DVDs through e-mails will now be known as Qwikster and the organization will be only available for the activity of streaming. This instance can be considered as an evidence for the change that took place in Hasting, in comparison with what had been in the case of Pure Software (Block 2010). The organization of Netflix had been too slow in offering the services of placing orders through mails that resulted in reducing the number of customers of Netflix. However, the factor of surprise was the subscriptions for mail DVD had been increasing continuously by the year of 2011. So it can be stated that both of these services, in combination, had helped in making Netflix highly successful.
Ideas were being introduced for the management of talent that was highly successful for the organization. This particular change in the strategies had been considered compelling for the culture and talent of the organization for a number of reasons (Fleeson 2011). As stated by the CEO, the derivation of this approach had been done on the basis of common sense. These strategies have helped in attracting, retaining and managing talent.
The philosophy of leadership that the organization of Netflix involves three strategies for the management of people. These strategies will be discussed further ahead.
This might seem to be harsh but in accordance with Hastings, employees who had been producing work of B- level, even if they had been putting forth an effort of A- level, should end up letting go, with a severance of generosity in package. The workers at A- level, in a converse manner, should be given rewards, even if there have been production of great work with the comparative minimum level of efforts (Hans 2012). A worker who is talented does not need to be putting in a specific duration of hours, while working at a desk. Netflix had been espousing a flexible schedule at work, and does not seem to be restricting the number of days on vacation that can be taken up by the employees every year. This is considered as long as there is production in the work of quality.
As there is growth in the businesses, they often have been taking an increased number of employees, lowering their standards for the talent, and implementation of policies that are more strict for compensation of this absence of autonomy amongst the employees (Ian 2012). It does not seemed to be having the way that is insisted by Hasting. Instead, the organization ought to be raising their standards related to the autonomy for the employees and the standards of talent as the organization has been growing in size.
In this way, instead of the development of a highly complicated series of policies towards the work of police, the growth in the business can end up remaining highly flexible and highly competitive within the place of market (Keinonen 2003). The conventional form of wisdom that have prevention in error that is cheaper that can be fixed. This does not seem to be holding up the businesses that are fast, big, and highly flexible that is an ideal form of the trifecta.
In terms of psychology, the big five model of traits related to personality leadership are five key wide dimensions or domains related to personality that are utilized for description of human personality. The theory on the basis of the big five factors is referred to as the five factor model. The five factors are neuroticism, agreeableness, extraversion, conscientiousness, and openness. The model of big five has the ability of being accountable to a number of varying traits within personality that overlaps (Loftus 2011). On the basis of empirical research that has been conducted, the case of Netflix seems to be showing consistency in being self- described and observed.
The openness or exposure towards experience appreciates the category of experience, curiosity, unusual ideas, adventure, emotion and art. This factor of openness reflecting the degree related to intellectual creativity, curiosity and a preference related to variety and novelty a person has. There is also a description as the limit towards which an individual is independent or imaginative, and depictions can be seen in an individual preference for a category of activities over a routine that is strict (Lussier N.D.). A tendency for being dependable and organized, act dutifully, showing self- discipline, aiming on achievements, and prefer the process of planning instead of spontaneous behaviour.
With respect to the leadership style of Hasting, democratic leadership, also referred to as participative leadership is being followed. This is a category of leadership style within which participants of the group taking a more role of participation within the process of making the decisions (McAdams 2005). It has been found by a number of researchers that style of learning is mostly the one that is more effective and results in higher level of productivity, improved contributions from the members of group, and increased morality of group.
If a leader becomes careful for hiring an individual who will be putting the interests of the company at first place, who will be understanding and supporting the desire for a workplace with high performance, 97 per cent of the employees at the workforce will be doing the right thing. When it comes to behaving like an adult, Hasting believes in expressing the issues with the colleagues, subordinates and the boss openly. This instance can be considered as an evidence for the change that took place in Hasting, in comparison with what had been in the case of Pure Software (McRae 2012). The sources of feedback now seem to be involving emails being sent to the email addresses that have been provided in the duration of registration or to post communication over the service of Netflix or on the page of “Your Account”. This page will be including notices regarding the account such as authorizations on payment, changes in the method of payment or password, confirming e-mails and a number of other information related to transactions.
Conclusion
Considering the leadership of the CEO, it can be stated that he believed in hiring, rewarding and tolerating only those adults who were fully formed. Over the passage of time, it has been observed that if one asks an individual for relying upon common sense and logic rather than the formal policies, majority of the times, one ends up getting improved results and at a lower amount of cost (Musek 2007). If a leader becomes careful for hiring an individual who will be putting the interests of the company at first place, who will be understanding and supporting the desire for a workplace with high performance, 97 per cent of the employees at the workforce will be doing the right thing. When it comes to behaving like an adult, Hasting believes in expressing the issues with the colleagues, subordinates and the boss openly for effective results.
References
Bakker, A.B., 2010. The General Factor of Personality: A meta-analysis of Big Five intercorrelations and a criterion-related validity study. Journal of Research in Personality, 44, pp. 315–327.
Block, J., 2010. The five-factor framing of personality and beyond: Some ruminations. Psychological Inquiry, 21 (1), pp. 2–25.
Fleeson, W., 2011. Towards a structure- and process-integrated view of personality: Traits as density distributions of states. Journal of Personality and Social Psychology, 80, pp. 1011–1027.
Hans, J.E. 2012. Four ways five factors are not basic. Personality and Individual Differences, 13(8), pp. 667–673.
Ian, J., 2012. Correlates of personality trait levels and their changes in very old age: The Lothian Birth Cohort 1921. Journal of Research in Personality, 46 (3), pp. 271–8.
Keinonen, M., 2003. Broad versus Narrow Personality Measures and the Prediction of Behaviour Across Cultures. European Journal of Personality, 17, pp. 413–433.
Loftus, T., 2011. Netflix Customers: Sorry Doesn’t Cut It, Pal. The Wall Street Journal.
Lussier, A., N.D. Leadership: theory, application & skill development (5th Ed.), South-Western Cengage Learning, pp. 222-223.
McAdams, D. P. 2005. What do we know when we know a person? Journal of Personality, 63(3), pp. 365–396.
McRae, K., 2012. Reply to Eysenck. Personality and Individual Differences, 13 (8), pp. 861–865.
Musek, J., 2007. A general factor of personality: Evidence for the Big One in the five-factor model. Journal of Research in Personality, 41, pp. 1213–1233.
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