Analyzing Leadership Principles In The Context Of Netflix: A Case Study

Netflix’s Product and Service Offerings

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?

• How did Hastings change his use of communications in sending and receiving messages from Pure Software to Netflix?
• How did Hastings change his use of feedback from Pure Software to Netflix?
• How did Hastings change his use of coaching guidelines from Pure Software to Netflix?
• Which conflict management style did Hastings tend to use at Pure and Netflix?
• 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?

1. Netflix is considered to be one of the leading services of online subscription that streams television shows as well as movies. In the year 1999, it was Hastings and Randolph who had presented their idea about permitting clients to rent three DVD television shows as well as movies at a time through its DVD mail service (Taylor, 2006). An online waiting system helped the users in listing their most preferred movie rental choices in order they needed those to be delivered. The business idea proved revolutionary as the users could keep those with them without paying any extra cost. Their rental system, subscription rates, and that of shipping costs are quite different from that of other traditional models that charged higher prices. In the year 2000, it had launched a personalized recommendation system where the clients could rate the movies as per their choices.

Above all with respect to the legal implications, Netflix had to evaluate its entire consumer base in video streaming as well as DVD mail. With passing years, the company had been successful in gaining increased number of subscribers and the figure has been on a constant rise. It has been reported that Hastings did not apologize for increasing prices as well as complicating things for clients with separation of DVD streaming and rental services (Gladson Nwokah and Ahiauzu, 2010). Rather, he apologized for the manner the firm mishandled the way it broke the news. as per Hastings, it was clear from the past feedback that several members felt that it lacked humility as well as respect in manner it had announced the separation of streaming and DVD, including that of the price changes  (Mahajan, 2011). He further announced lot more changes, dividing the services within two firms having different pay structures. From his acts and ordeals of Hastings, some of the things that are reflected are:

• Being authentic – The apology of Hasting was quite unclear which makes it ineffective. A direct feedback to client concerns is the best way to be clear in commenting and avoid any sort of further apologies.
• Responding quickly – It is essentially important to act as immediately as possible. Only then effective outcome can be expected (Giltinane, 2013).
• Being personal – Hasting could have been more contrite during the press conference if he had been little more personal and would have invited questions from the audiences. Instead, he gave an email with carefully framed language with no direct questions and answers.
• Being humble – Hasting had named his post as an explanation and reflections. This sounded quite defensive. Rather he could a little more humble so that it had attracted more viewers with his humble attitude.

The leadership style that is practiced by Netflix is participative one, also named as democratic leadership style. This style values the team members and their efforts, but the main responsibility of decision-making rests with the participative leader. He is responsible for boosting the morale of his team members as the members are allowed to participate in the decision-making process. It gives them a feeling of importance and that their opinions matter significantly (Leban and Zulauf, 2004). When the firm needs to make relevant changes in the organizational environment, the democratic leadership style supports employees to accept the challenges of changes in a positive manner (Rogers, 2012). This style increasingly enables the organization to meet challenges of the firm to make effective business decisions.

Netflix’s Legal Implications and Hastings’ Response

With reference to the given case scenario, the firm Netflix believes that behind leadership the main role is played by the concept of governance. The current environment is prevailed with leadership. Here it has been mentioned in the case that the organizational management includes all members within the process of decision-making, and this is usually followed by effective policies regarding leadership for motivating the members (de Vries, 2012). Effective governance means the concept of value adding that is quite nebulous in nature. The firm is quite specific about its leadership concepts; it refers the concept as it involves all issues, practices, procedures, and theories to lead to the positive change within the organizational to result in positive changes in the environment (Giltinane, 2013). It is significant for the firm to practice effective leadership for having better results in the corporate governance. The manner the leaders at Netflix practice leadership styles as well as encourage the members to strive and achieve organizational objectives with increased effectiveness dictate the level of growth as well as development of the firm. The leaders having dynamic style bring positive impacts upon the organizational culture. To inspire and also drive transformational changes, the role of such styles need to be shown by every organizational individual (Nicholson and Kiel, 2007). The responsibilities in the sustainable leadership need to be an integral part of its culture, thereby expanding beyond any statement.

Certain important factors in leadership are the organizational leaders, his team members, situations, and communication styles that lead to the effective utilization of leadership styles. The leaders of the firm are well aware of their positions. They are the right ones to decide upon the level of success. They understand that to be successful they need to gain the trust as well as confidence of the members (Lin, 2005). They understand the need to motivate the members to get the work done at the right moment and in favorable manner so as to ensure harmony in the organizational environment. The employees deliver their best outcome when they are motivated thoroughly by several means. For adopting sustainability initiatives, the higher authority needs to practice crucial policies for incorporating the right thing. The leaders at the Netflix possess greatest foresight and courage to forecast the results of all such organizational policies. The management of the firm is quite strong to motivate its employees to practice the policies. When the firm needs to make relevant changes in the organizational environment, the democratic leadership style supports employees to accept the challenges of changes in a positive manner. This style increasingly enables the organization to meet challenges of the firm to make effective business decisions.

2. With reference to the given case scenario, the firm Netflix believes that behind leadership the main role is played by the concept of governance. The current environment is prevailed with leadership. Here it has been mentioned in the case that the organizational management includes all members within the process of decision-making, and this is usually followed by effective policies regarding leadership for motivating the members. The leaders at the Netflix possess greatest foresight and courage to forecast the results of all such organizational policies. The management of the firm is quite strong to motivate its employees to practice the policies. When the firm needs to make relevant changes in the organizational environment, the democratic leadership style supports employees to accept the challenges of changes in a positive manner.

Netflix’s Leadership Style: Participative or Democratic?

As per the given case scenario, the mentioned organization Netflix has been practicing some of the most effective strategies that are enumerated below:

• Rewarding performance and not just effort – As per Hastings, the members who generate B-grade work even if they put A-grade effort must be let go. A-grade employees must be rewarded even if they generate increased productivity with less effort. He emphasized that a talented employee need not invest extended hours at the office desk so long they are providing quality work. The single exception as per Hastings is those ‘brilliant jerks.’ By giving one bad outcome, even a talented member is not worth the damage which is caustic personality may cause to the entire team (Johnson and Klee, 2007). Hasting has addressed the hiring philosophy of Netflix along with a metaphor regarding professional sports teams. But it was not justified as unlike that of a sports team, a successful business never has a restricted number of vacancy; effective as well as talented employees often create new positions and that of a positive atmosphere of internal competition. Also, cutthroat attitude should never be encouraged.
• Safeguarding employee independence – With increase in the size of a business, more and more employees are hired, that lower the overall standards of talent, and this makes to implement harder policies for compensating the lack of autonomy amidst its employees. It need not be that way as per Hastings. To its contrary, firms must raise their standards of autonomy as well as talent for members as the firm grows in size. In that way, instead of creating complicated series of policies to monitor work, developing businesses may maintain flexible as well as competitive position at the marketplace (Leban and Zulauf, 2004). With gradual increase in the standard of the performance along with that of the increasing growth and complications in the organization, a business firm gets the ideal condition.
• Paying employees what they deserve – As per Hastings, for maintain and retaining top talents, employer needs to pay their employees as per their performance. He emphasizes a single employee costs less and more productive than that of two other employees (Charlety, n.d.). So, the firm Netflix always ensures that it pays its employees adequately as per the market environment o salaries. He also states that Netflix provides market-convenient salaries to his employees by means of three evaluations: how employees are paid elsewhere, what firms pay to replace employees, and what a firm would be paying to retain any specific employee to a job. Also Hastings says that a firm must think outside the shell with respect to raises. With alignment of the pays of employees against the rate in the market for respective position, salaries rise up with varying rates. Hastings believe that the one and important thing to do is to pay the employees as per their individual worth at top of market value.

3. With thorough analysis of the given case scenario, it can be perceived that earlier the type of leadership style practiced within Netflix was quite different than that practiced now after its come-back. It is generally the culture as well as organizational objectives that determine the type of leadership style to be practiced at the organization (Lin, 2005). From the case scenario it is estimated that earlier the organization Netflix used to practice kind of laissez faire leadership style earlier. Here, the leaders lack direct supervision of members. They fail to give regular feedback to their team members. Highly trained as well as experienced employees needing little supervision come under this type of leadership style. The typical style of leadership obstructs production of members requiring effective supervision. However, when the company had made suitable come-back, it tried altering its leadership style to a more desirable one. In the later period of business conducts, the leadership style that is practiced by Netflix is participative one, also named as democratic leadership style. This style values the team members and their efforts, but the main responsibility of decision-making rests with the participative leader (Carver, 2003). He is responsible for boosting the morale of his team members as the members are allowed to participate in the decision-making process. It gives them a feeling of importance and that their opinions matter significantly (Charlety, n.d.). When the firm needs to make relevant changes in the organizational environment, the democratic leadership style supports employees to accept the challenges of changes in a positive manner. This style increasingly enables the organization to meet challenges of the firm to make effective business decisions.

Within the given case scenario about Netflix, not much is explained about organizational power, politics, networking, and negotiation. These aspects are crucial ones in respect to the organizational context. Power and politics are said to play significant role within the business, right from governance to how formation of decisions to allow suitable interaction amidst employees (Gladson Nwokah and Ahiauzu, 2010). Within the firm, the effects of power rely on whether organizational members utilize positive or negative power for influencing others at the workplace. Politics often impact directly upon who possesses the power as well as determination if the organizational culture promotes productivity. On a general basis, positive power within organizations includes promoting productivity. Netflix is said to conduct positive type of power, whereby employees are given adequate power to participate in the decision making process, rewarding them for effective performance, and also promoting those with highest performance. This enhances the confidence of the employees and impacts upon the higher retention rate. When organizational leaders fail to have respect from the members, they possess a negative power. This type of leader motivates employees with threatening of job loss or penalty. They also conduct favoritism and ignore hard work of several employees. This type of practice often reduces the work quality and productivity (Johnson and Klee, 2007). Organizational employees who learn navigating the organizational politics are generally more productive as compared to others. Netflix usually develops a favorable political culture for encouraging productivity. It understands that creating distinct policies as well as command chain renders it easier for members to understand the work and improves its quality (Nicholson and Kiel, 2007). The firm practices creation of climate that focuses on collaboration as well as equal treatment to prevent any conflicting situation.

Leadership and Governance at Netflix

From the case scenario it is estimated that earlier the organization Netflix used to practice kind of laissez faire leadership style earlier. Here, the leaders lack direct supervision of members. They fail to give regular feedback to their team members. Highly trained as well as experienced employees needing little supervision come under this type of leadership style. The typical style of leadership obstructs production of members requiring effective supervision (de Vries, 2012). However, when the company had made suitable come-back, it tried altering its leadership style to a more desirable one (Mahajan, 2011). In the later period of business conducts, the leadership style that is practiced by Netflix is participative one, also named as democratic leadership style. This style values the team members and their efforts, but the main responsibility of decision-making rests with the participative leader. He is responsible for boosting the morale of his team members as the members are allowed to participate in the decision-making process.

4. Netflix is said to conduct positive type of power, whereby employees are given adequate power to participate in the decision making process, rewarding them for effective performance, and also promoting those with highest performance. This enhances the confidence of the employees and impacts upon the higher retention rate. When organizational leaders fail to have respect from the members, they possess a negative power (Carver, 2003). This type of leader motivates employees with threatening of job loss or penalty. However, when the company had made suitable come-back, it tried altering its leadership style to a more desirable one. In the later period of business conducts, the leadership style that is practiced by Netflix is participative one, also named as democratic leadership style. This style values the team members and their efforts, but the main responsibility of decision-making rests with the participative leader.

References

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