3. List the criteria you would use for deciding whether another company is right for Netflix-type HR practices. Why did Netflix survive as a startup when the dot-com bubble burst in the late 1990s? Probably because, from the day he started Netflix, founder Reed Hastings believed in breaking the rules. His direct-to-consumer mail and video streaming business model certainly helped Netflix to survive.

But the firms unorthodox human resource management practices helped the company to attract and keep the high producers who design the products that are the firms lifeblood. Hastings knew that top Silicon Valley workers could choose where they worked, and high pay is pretty much standard throughout the Valley s industries. How to set oneself apart? Hastings and his start-up colleagues believed that a culture that balanced a flexible work environment with few constraints and high responsibility was the answer. They called the policy Freedom and Responsibility.

Just how unorthodox are the Netflix HR practices?

Consider this: As a Netflix professional you get unlimited vacations. One engineer takes 5-week vacations to Europe, because he likes (as he says) to take his time off in big chunks.

(An HR officer must approve time off in excess of 30 days annually.) As a Netflix employee, your pay isn t tied to performance appraisals, or even to a compensation plan.

Frequent market salary surveys and pay hikes keeps everyone s pay aligned with Silicon Valley competitors. Each employee decides whether to take his or her pay in cash or in Netflix stock. Options vest immediately. Netflix doesn t recruit much at college job fairs, instead hiring mostly highly experienced professionals. There s no training, professional development, or career planning at Netflix (except for legally required training, such as diversity training). You re in charge of your own career