Based on the who, what, when, where and why, and the five types of powers about Netflix, Please answer the following questions. Answer the question at the bottom. I appreciate the help. Thanks.
• Who: The individuals involved in the issue are Reed Hasting, CO founder, CEO, Patty McCord and employees. organization involved is Netflix.
• What: My understanding from reading the case study on the woman behind the Netflix culture, from what I gathered, the issue here is the fact that Netflix wanted to change the way it recruited its talents. In other words, they wanted to have employees who were very knowledgeable, and fit into the Netflix culture. The company believed that every position should be filled with stars. Netflix was still growing and so they did whatever they felt would help them segment the market and reach a wide audience of talented, well skilled and educated employees. the company had been growing fast, but unfortunately, “after the dot-com bubble burst and the 9/11 attacks occurred (Patty, 2014)”. This led the company to lay off a huge number of its staff, but soon after worth, things started to look good again for the company.
• When: The issue at Netflix began in the late 2001 right after the 9/11 attack. Right after that, the company laid 30% of its staff due to a setback, but it is said that in early 2002, things had started to pick up for the company, but the damage was already done because they were now short 30% of staff. It is unclear as to when the issue was settled, but if I could guess, I would say about before 2013 because the company’s stock had tripled.
• Where: The problem was within the entire organization in their location in Silicon Valley, because the company was making changes throughout the various departments. The geographic location, department, or division in which the problem exists.
• Why: Netflix wanted to have “A” performers in every department, because they felt that it would get the organization on the track they were aiming at if every department was equipped with the right individuals the company won’t have to waste money on recruiting new talents every time, but rather, they would try to retain the good ones they were able to develop to match the company policy.
• How: Netflix created a policy based on trust, honesty, and rewarding performance. “Most companies spend endless time and money writing and enforcing HR policies to deal with problems the other 3% might cause. Instead, we tried really hard to not hire those people, and we let them go if it turned out we'd made a hiring mistake (Patty, 2014)”. They didn’t believe so much in HR policies because it is costly for any company and most employees don’t even abide by them.
Five Types of Power
Official (positional) power: As mentioned in the example, Sharon has official power from the position she holds. Since Sharon is the CHRO (Chief Human Resources Officer), she can drive the organization based on her decisions which would be considered of high importance. She can drive her company to her decisions based on her designation and power.
Transactional (reward) power: Since Sharon exhibits great performance she has the attitude to reward employees with great performance who exhibit their skills to the achievement or improvement of the organization’s processes. Since Alice is an asset for the company as she has great knowledge of Excel, Sharon can reward Alice to stay back with Netflix to take advantage of her knowledge.
Coercive power: Sharon has the authority to take severe disciplinary action against employees who are violating the code of conduct or business ethics. Sharon is fair however firm.
Knowledge (information) power: Sharon has drawn great knowledge in human resources from her previous position as Vice President of Human Resources in General Electric. She has an in-depth knowledge in human resources. Sharon’s experience helps her to make Netflix the number one in all on-demand entertainment categories.
Charismatic: Sharon’s attitude is to drive the employees in the right direction helping them come up in their career. Her innovative methods and great experience in human resources helps her to contribute for the success of the company.
Principle-centered (social): Sharon is people centric. Her passion to handle people and involvement in her role as CHRO enables her to contribute to the success of the organization. In her negotiation, she can identify top performance and negotiate to retain such employees with Netflix.
Question:
1. Describe what cultural assumptions drive the organization’s policy decisions. Support your response with examples from your readings and the slide deck.
2. Explain how you would use these assumptions to engage in a severance negotiation that would result in the most beneficial outcome for the company. Support your explanation with effective examples.