Peter Fisk

In an exclusive extract from my forthcoming book Business Recoded, meet one of the most inspiring business leaders, shaking up today’s world. She embraces the opportunities of relentless change, the power of disruptive technologies, and the courage to create a better future in her own vision. In the book, I explore the stories of many of the world’s most fascinating leaders right now, and develop 49 codes that help you redefine the future of your business, and yourself.

The Leadership Code of Cristina Junqueira

Cristina Junqueira was working at Itaú Unibanco, one of Brazil’s more traditional banks in 2013, managing their credit card portfolio when she gained the largest bonus of her career. She quit immediately,  realising that she wanted to change people’s lives, not just make money.

Within months, she got together with two friends, David Velez and Edward Wible, to launch Nubank, a Brazilian fintech company that seeks to make banking more accessible to everyone in a company with a huge underclass. Nubank is looking to tools like low-interest, no-fee credit cards, high-interest savings accounts, and an app-based credit system to seeking to serve 45 million unbanked Brazilians, neglected by competitors.

In the early days of start-up, Junqueira found herself doing everything from leasing a small office in Sao Paulo to designing the company’s new website. “If somebody called our customer service line, it would ring on my cellphone,” she says. For Junqueira, it was an even more challenging time, because she was pregnant with her first child.

Junqueira is most proud of how Nubank has developed for women. She says that HR policies were very much informed by her early struggles. “Many of the structural choices we’ve made in terms of gender equality and inclusion are reflective of the fact that I have been here from the beginning,” she told Quartz magazine.

“Looking back at my corporate career, I remember how tough it was to work in those predominantly male environments and do things like wear suits just to fit in,” she recalls. “At Nubank I was determined to create a working environment without all the stupid barriers that are very detrimental to women’s career development.”

Nubank’s policies that address gender equality include bringing more women into its technology teams with events like “Yes, She Codes!” a recruitment process specifically targeted at female software developers.  The company also uses blind recruitment to minimise gender biases, and has a mentoring scheme specifically for female leaders, which involves discussion groups aimed at tackling unconscious bias, and a program that allows new mothers to stay connected while they take maternity leave.

All this translates into a more inclusive work culture. Women make up 43% of the digital bank’s 2,000 employees, including 30% of all senior roles, compared to 8% in the sector.

By 2020, Junqueira has a second child, and Nubank is ready to spread its wings further, into new markets such as Mexico and Argentina, and exploring new products like personal loans, investment products, and accounts for small and medium-­size businesses. The credit card was the first to allow Brazilians to apply for and check their balance entirely via mobile, and Nubank is now the world’s largest digital bank outside Asia, and is valued at over $10 billion.

 

Crisis and downturns are the moments of shake-up … when companies drive innovation, and entrepreneurs disrupt markets. Now is the time to look forwards not back.

“The best way to predict the future is to create it” said Abraham Lincoln.

The best opportunities for business – to find new growth, to engage customers more deeply, to stand out from the crowd, to improve their profitability – is by seizing the opportunities of changing markets. The best way to seize these changes is by innovating – not just innovating the product, or even the business itself – but by innovating the market.

In the old world we accepted markets as a given – the status quo – and competed within it, with slightly different products and services, or most usually by competing on price. Most new products were quickly imitated, leading to declining margins and commoditisation. Most companies now receognise that this is not a route to long-term success in a rapidly changing world.

Fast-changing markets demand fast-changing businesses.

Winning in this new world requires a bigger ambition – to change the game, not just play the game. Winners recognise that markets are malleable, geography is irrelevant and categories are outdated, that boundaries blur and new spaces emerge, and that practices and perceptions can be shaped to your advantage.

“Gamechangers” innovate their market, and then innovate their business with exponential impact. They start from the future back, making sense of change, seeing the new patterns and possibilities, harnessing the power of ideas and digital networks to win in new ways. This requires new leadership thinking, and for the whole business to innovate.

Who are the “gamechangers” of Chile right now?

Next month I will be working with Chile’s Banco BCI, to explore the challenges and opportunities of a changing world, with many of Chile’s business leaders.

Chile is often called “Chilecon Valley”, ranking among the top startup hubs in Latin America, and in 2019, it was considered the region’s most innovative country.

E-commerce to m-commerce, clean energy and agritech, are increasingly important sources of innovation in the country. In fact, with 44.2% mobile penetration and 82.3% of its population using the internet, Chile has one of the fastest-growing e-commerce markets in the region.

Here are some of the most interesting companies:

Algramo … smart plastic refills by tricycle

In a pilot that the Chile-based startup Algramo has been running since May with Unilever, customers can bring a reusable plastic bottle back to a vending machine mounted on an electric tricycle that travels around the city offering refills. An RFID code on the bottle gives discounts on future purchases, creating an incentive for customers to bring the same package back over and over again.

Cornershop … the Uber of home delivery

Cornershop is a Chilean-Mexican last-mile grocery delivery startup that operates in five Latin American countries, as well as in Canada. The company’s recent $450M acquisition by Uber is pending as the Chilean government continues to investigate the transaction and how it will affect the market. However, Cornershop’s expansion throughout Latin America remains unscathed as it starts 2020 with full operations in Brazil and enters the Colombian market.

NotCo … AI-driven plant-based foods

NotCo is a foodtech startup that uses AI algorithms to recreate animal-based foods like mayonnaise and milk, using only plant components. The startup recently caught the attention of Jeff Bezos, who decided to make NotCo his first investment in Latin America. NotCo was also recently featured in YouTube’s ‘The Age of AI’. With plans to go public by 2021, NotCo is expected to be Chile’s first unicorn. NotCo’s products can also be found in Brazil, Argentina, and the US.

Jooycar … smart car insurance

Jooycar is a connected-car and user-based insurance platform seeking to disrupt the auto insurance market in Latin America. The platform informs users about maintenance checks, efficient fuel usage, and how they can improve their driving, among other features. The auto tech platform currently offers its services in Chile, Mexico, and Peru, and plans to launch in the US in 2020.

Join me for Business Recoded: What Happens Next? online with Banco Bci, 10 November 2020.

Image: Unsplash

The engineers and scientists at NASA’s Jet Propulsion Laboratory have a strange tradition. At crucial moments in every space mission, they chomp on peanuts. This phenomenon began when a Ranger spacecraft successfully launched after a long run of failures. An engineer had brought a bag of peanuts into mission control that day. Since then, peanuts are eaten at every launch to ward off bad luck.

This shows that even the most scientific among us fear uncertainty. That’s why we engage in strange rituals – like eating peanuts or wearing our lucky jeans – to regain a sense of control. We can’t help feeling this way. Fear of the unknown helped keep our ancestors safe from saber-toothed tigers. But when we avoid uncertainty altogether, we close ourselves off to new possibilities.

Changing your attitude towards uncertainty opens you up to discovery.

Scientists don’t see uncertainty as something to fear. When faced with a dark, shadow-filled room, they don’t turn away like most of us. They poke around in it until they find a light switch. Once that light’s on, they can evaluate what they’ve found. There might be something curious in the room, or there may be another door leading to yet another mystery.

https://www.youtube.com/watch?v=0-Te-enCEE4

Here’s what the book also explores:

• The single principle Elon Musk used to revolutionize the aerospace industry (and how you can use the same principle to transform your life)
• An unstoppable astronaut training strategy that you can use to nail your next presentation or product launch
• How invisible rules constrain your thinking (and what to do about it)
• The one word you can use to boost your creativity (The use of this word is backed by several research studies, and I personally use it on a weekly basis both for myself and my team)​
• What George Costanza and rocket scientists have in common, and what you can learn from both in starting your next project
• What you should do first in tackling an audacious goal (and what you should NEVER do when tackling an audacious goal)
• My 2-step process for squashing fear of uncertainty and failure before it stops me from taking action
• What Einstein’s biggest blunder can teach you about how to launch your next project
• The fascinating story of the billion-dollar author and her eight-year-old secret weapon
• Why doing “nothing” is more valuable than you think

Here are some of the practical worksheets to get started.

In an exclusive extract from my forthcoming book Business Recoded, meet one of the most inspiring business leaders, shaking up today’s world. He embraces the opportunities of relentless change, the challenge to realign business with the environment, and the courage to create a better future in his own vision. In the book, I explore the stories of many of the world’s most fascinating leaders right now, and develop 49 codes that help you redefine the future of your business, and yourself.

The Leadership Code of René Redzepi

Redzepi is the world’s most celebrated chef. He could not have had a better education. His apprenticeship was served in two of the world’s greatest restaurants – Catalonia’s el Bulli and California’s The French Laundry.

Under the guidance of the great Ferran Adria he developed a passion for experimentation, and a love of seasonal ingredients. In Napa Valley he was instilled with a commitment to working with local suppliers.

In 2003, aged 25, he opened Noma in his native Copenhagen (an abbreviation of the words “Nordic” and “mad”, which means food in Danish). He wanted to create a cuisine that represented the environment in which he found himself, giving rise to the term “new Nordic cuisine.”

Redzepi sought to develop a cuisine that reflected the soil, topography and climate of the place. He says “All of the people who work in the kitchen with me go out into the forests and on to the beach. It’s a part of their job. If you work with me, you will often be starting your day in the forest or on the shore because I believe foraging will shape you as a chef.”

From this a 10-point New Nordic Cuisine Manifesto was drawn up in collaboration with other Nordic chefs, with an emphasis on seasonality and simplicity.

The aims of the New Nordic Cuisine are:

• To express the purity, freshness, simplicity and ethics associated with the region.
• To reflect the changing of the seasons in every meal.
• To base cooking on ingredients and produce whose characteristics are particularly excellent in Nordic climates, landscapes and waters.
• To combine the demand for good taste with modern knowledge of health and well-being.
• To promote Nordic products and the variety of Nordic producers – and to spread the word about their underlying cultures.
• To promote animal welfare and a sound production process in the seas, on farmland and in the wild.
• To develop potentially new applications of traditional Nordic food products.
• To combine the best in Nordic cookery and culinary traditions with impulses from abroad.
• To combine local self-sufficiency with regional sharing of high-quality products.
• To join forces with consumer representatives, other cooking craftsmen, agriculture, the fishing, food, retail and wholesale industries, researchers, teachers, politicians and authorities on this project for the benefit and advantage of everyone in the Nordic countries.

More than the ingredients, people became his passion. He sees eating as a deeply human experience, emotional and personal, achieved as much through the service and style of his staff as what people eat, and where they are.

His staff have become a family, as he describes them, without the typical hustle and stress of a busy kitchen. Best known to customers is his long-serving maitre’d, Ali Sonko, a tall Gambian in his sixties, with an infectious smile, who started as a dishwasher in the kitchens when it first opened, and now owns a 10% stake in the business.

Equally, his partnership with local suppliers secures him the freshest produce, and their collaboration in creating dishes that continue to inspire both him and his clientele.

The original Noma in Copenhagen closed in 2017, with Redzepi and his team seeking to reinvent the restaurant. Initially they open an incredibly popular pop-up in Mexico, a kind of vacation to gain new inspiration, whilst they established a new restaurant, less than a mile from the old one.

Situated on a beautiful lake, the new Noma is a former ammunition storage facility for the Danish military, with numerous greenhouses where the produce is grown. Designed by famed local architect Bjarke Ingels, the buildings have been converted to resemble an old Danish village.

Originally, menus were based on what ingredients were most readily available, although using meet and fish throughout the year. It has now moved to a three season model – focusing on seafood for 4 months, then vegetables for 4 months, and then game.

Of course getting into the restaurant is probably the hardest part. Noma release reservations three times during a year, with thousands of cultured diners waiting to click on the website the moment it opens. You also need to pay at the time of booking, typically around $350 per person, although a meal typically consists of around 20 courses.

As a quick taster, the first course might be a plant pot with a thyme plant. Take a straw, and you’ll find an exquisite soup inside. A tart of crisp potato and nasturtium flowers might follow, and then a salted seaweed roll, fresh from the local beach. Quail’s eggs topped with fresh berries are next, then cucumber skin cannelloni filled with nuts and mushrooms. We’re still on the starters, at this point. You’ll need to visit to discover the main course.

“I think that in our part of the world, Scandinavia, we are one of the pioneers of showing that gastronomy can be something – high gastronomy can be something very, very present and doesn’t have to involve, you know, what is perceived as the normal luxury items that belong in a high gastronomy restaurant” he reflects.

With two Michelin stars, Rene Redzepi’s Noma has been voted the best restaurant in the world on four occasions.

© Peter Fisk 2020. Business Recoded will be published in December 2020. Order your copy now.

In an exclusive extract from my forthcoming book Business Recoded, meet one of the most inspiring business leaders, shaking up today’s world. He embraces the opportunities of relentless change, the challenge to realign business with society, and the courage to create a better future in his own vision. In the book, I explore the stories of many of the world’s most fascinating leaders right now, and develop 49 codes that help you redefine the future of your business, and yourself.

The Leadership Code of Hamdi Ulukaya

The Turkish-born Greek-style yogurt maker prioritises people over profits, believes in growth through gratitude, and has donated most of his wealth to refugees.

Ulukaya grew up in a Kurdish dairy-farming family in Turkey near to the Euphrates river, where they made cheese and yogurt. They led a semi-nomadic existence, herding their sheep. Ulukaya was actually born on one of the family’s long mountain treks. He left to study political science in Ankara and then emigrated to the USA in 1994, settling in upstate New York, an area which reminded him of eastern Turkey.

He studied English, and then business, while continuing to make traditional feta cheese in his kitchen, to earn some money. With a loan from the US Small Business Administration, he bought an old yogurt plant in 2005 and developed a recipe inspired by his Kurdish heritage. Two years later he started selling yogurt, under his brand name Chobani, derived from the Turkish word çoban meaning shepherd.

Within 5 years, Chobani was a billion-dollar business, riding on a wave of interest in protein-rich, low-fat yogurt. At the same time Greek-type yogurt grew from 1 to 50% share of the US yogurt sector. EY recognised him as their Entrepreneur of the Year in 2013, his personal fortune grew rapidly to over $2 billion, and Chobani is now the top selling strained yogurt brand in America.

However Ulukaya calls himself the “anti-CEO” because he dislikes many aspects of capitalism, particularly the notion of maximising value for shareholders (“the dumbest idea I have ever heard”). He hasn’t forgotten his humble roots, and has continually spoken about the rising inequalities in our world, blaming business for the suffering of the poor. He argues that too many of his fellow leaders blindly follow a “broken playbook”, calling for leaders to be more “noble”, to make more personal and financial sacrifices.

In an interview, he said “business people should promote a sense of purpose in their corporate culture to create a climate of positive change in business and the world. He stated that companies should focus on humanity and not just on their bottom lines. “Business is still the strongest, most effective way to change the world.”

© Peter Fisk 2020. Business Recoded will be published in December 2020. Order your copy now.

“Biomimicry” is the imitation of animals and plants, the models and systems of nature, to inspire new ways to solve complex human problems.

An early example was the study of birds to enable human flight. Although never successful in creating a “flying machine”, Leonardo da Vinci, who trained as an anatomist was fascinated by the flight of birds, inspiring his designs for mechanical flight. Centuries later, the Wright Brothers succeeded in human flight, apparently inspired by racing pigeons.

Otto Schmitt developed the concept of “biomimetics” in the 1950s, studying the nerves in squid  to engineer a device that replicated the biological system of nerve propagation. A decade later, Jack Steele coined the term “bionics” as “the science of systems which have some function copied from nature”.

Examples of innovations in today’s world inspired by nature include

• Bullet trains inspired by the kingfisher: the world’s fastest train is enabled by a nose cone that imitates the bird’s long beak, reducing noise and increasing speed.
• Climbing shoes such as the Vibram Five Fingers are inspired by geckos mimic the tiny hairs on a geckos toes which allows it to climb up vertical surface, creating an adhesive force.
• Wind turbines have become quieter and more efficient, producing 20% more output, by imitating the bumpy edges on the flippers of humpback whales. Scientists assumed smooth edges would be better, but nature showed differently.
• Surgical glue inspired by slug slime is non-toxic and super-sticky, enabling surgeons to repair heart values, patch-up holes, and repair cartilage.
• Bionic leaf creates hydrogen fuel from sunlight while removing carbon dioxide, through artificial photosynthesis inspired by the common leaf

“When we look at what is truly sustainable, the only real model that has worked over long periods of time is the natural world” says James Cameron, the producer of the epic sci-fi movie Avatar in which humans and technology fuse with the natural environment.

Scientist Janine Benyus is a leading authority on biomimicry as a way for innovators to be inspired by the ways in which the natural world has evolved over 3.8 billion years, in particular pointing to its interconnected systems, which we can learn much from.

Benyus’ organisation Biomimicry 3.8, based in Montana USA, has created a fabulous set of tools to support nature-inspired innovation. This includes the Design Lens (below) which sets out a framework for exploring how to design better solutions, in ways that might create better products for consumers, and also solve some of our biggest global challenges.

 

The world is on fire. Global contagions and unstoppable wildfires, social inequality and melting ice caps. Demanding consumers and disruptive technologies, unexpected shocks and stagnating growth.

Human CO₂ levels need to fall by 45% from their 2010 levels by 2030 if we are to avert a climate catastrophe (according to IPCC). 26 people now have more wealth than 3.8 billion people (Credit Suisse). We can’t afford to wait for political attitudes to change, or governments to act. Instead we should use the power of business to change our world.

It’s time for business to step up and be more. To reimagine brands as the most powerful, and inspiring, platform for change, driving innovation that solves bigger problems, inspiring consumers together to create more positive impact.

Think about its unique assets, resources and reach. Brands change hearts and minds, emotionally engaging with people’s aspirations and passions. Products and services can be innovated in ways that they do good as well as meet needs. Consumers and employees engage with brands every day, and collectively they can engage with each other to multiply their impact.

Watch my TED Talk, “Spider Silk and Sizzling Burgers” …

However we still have a long way to go … Today, the global economy is only 8.6% “circular” (even less than two years ago, when it was 9.1%).

The global “circularity gap” is widening, according to a new report, The Global Circularity Gap 2020, published by the Dutch organisation, Circle Economy. The negative trend can be explained by three related, underlying trends: high rates of extraction, ongoing stock build-up, and low levels of end-of-use processing and cycling.

The report finds that total resources entering the global economy have increased by 8.4% in just two years from 92.8 billion tonnes in 2015 to 100.6 billion tonnes in 2017, the latest year for which data is available.

In that period total extracted resources have increased by 9%, from 84.4 to 92 billion tonnes. But the total of materials that are reused has grown by just 3%, from 8.4 to 8.7 billion tonnes, and fallen as a proportion of overall material use.

Despite all of the facts, most companies are still locked into the “take-make-waste” tradition of the linear economy.

The report finds that total resources entering the global economy have increased by 8.4% in just two years from 92.8 billion tonnes in 2015 to 100.6 billion tonnes in 2017, the latest year for which data is available.

In that period total extracted resources have increased by 9%, from 84.4 to 92 billion tonnes. But the total of materials that are reused has grown by just 3%, from 8.4 to 8.7 billion tonnes, and fallen as a proportion of overall material use.

Despite all of the facts, most companies are still locked into the “take-make-waste” tradition of the linear economy.

Traditional levers such as regulation and taxation could force change, but a far better approach is to create desirable, positive change. This is where we come back to business, aligning consumer needs and aspirations, with better ways to solve them.

Brands like Toms trailblazed this new mindset. Blake Mycoskie’s “one for one” program, giving a free pair of shoes to children in poverty for every pair bought, created a powerful, desirable brand. Many brands now put sustainability at the core of their proposition (not just a supporting “CSR” initiative), creating better products, while also doing good:

• Adidas has just launched its latest “Futurecraft” sports shoes, spun from recycled threads that eliminate most waste, creating even lighter, better fitting shoes.
• Eileen Fisher, the American women’s fashion brand, “upcycles” consumers’ old worn-out clothes, turning them into beautiful, individual collectors’ items.
• Icon, has created a 3D printing process for house building, able to construct a new home for $4000 in 24 hours, in particular for refugees or disaster relief.
• LanzaTech, a Canadian renewable energy company created by Sean Simpson, captures carbon from the atmosphere, then converts it into clean energy.
• Selina, a Panama-based travel company for digital nomads, has created 47 beautiful vacation locations around the world, combining voluntary work with travel.

In today’s world, business can aim for a net-zero impact through a more circular economic model, but they also have the potential to do more – to create a net-positive impact.

“Saving our planet, lifting people out of poverty, advancing economic growth… these are one and the same fight. We must connect the dots between climate change, water scarcity, energy shortages, global health, food security and women’s empowerment. Solutions to one problem must be solutions for all” says Ban Ki-Moon.

We need to shift our minds from paradox to possibility – aligning short and long-terms, purpose and profit, humanity and technology, creating more from less, resource and replenishment, accessibility and exclusivity, equality and wealth.

Now is the time for a new kind of capitalism, seizing the opportunities of disruption and change, harnessing the power of business to create enlightened progress. Now is the time for business leaders to find a new code for business success.

• Explore more in my forthcoming book … Business Recoded: Have the courage to create a better world
• Get a free copy of my previous book … People Planet Profit … on sustainable innovation 

Spider Silk

There are only 31 types of fibre in the world, the last developed in the Second World War. Indeed 60% of the world’s textiles are made from polyester, a carbon-based material that is not biodegradable.

Spider silk has long been the Holy Grail of material innovation. It’s strong, biodegradable, and it can be used in everything from cosmetics to clothes. Many have attempted to grow the material in labs, but only a few companies have succeeded.

Dan Widmeier of Bolt Threads uses genetically modified yeast, sugar, water and salt, to develop a closed-loop process to bio-engineer a new protein fibre mimicking the structure of spider silk. It requires neither the polluting chemicals of petroleum-derived materials nor the land, water and pesticides of conventionally farmed fibres.

• Case study: Bolt Threads. Synthetic spider silk for a better luxury world

Sizzling Burgers

Biochemist Pat Brown wanted to create the world’s best burger. But he also wants to eliminate animal-sourced meat from our food chain, given its huge damage to our environment, from the destruction of rainforests to the emission of carbon.

Brown realised that the challenge was not to persuade vegetarians, but meat eaters. And they loved the sizzle, smell and taste of real meat. He created Impossible Foods, and identified methods and ingredients to naturally recreate everything – the sights, sounds, aromas, textures and flavours. The result? This impossibly delicious game changer of a burger.

“Because we use 0% cows, the Impossible Burger uses a fraction of the Earth’s natural resources. Compared to cows, the Impossible Burger uses 95% less land, 74% less water, and creates 87% less greenhouse gas emissions. And it’s 100% free of hormones, antibiotics, and artificial ingredients.”

• Book extract:The Leadership Code of Patrick Brown, founder of Impossible Foods
• Case study: Impossible Foods: Can a burger save the planet?

Here are 30 facts about sustainability:

• The term sustainability has its most known roots in the 1987 Brundtland Report which officially defined sustainable development for the first time.
• In 2016 many world leaders adopted the United Nation’s 17 global goals/Sustainable Development Goals to improve life all around the world and preserve the earth’s resources and fight climate change.
• The concept of circular economy looks beyond societies’ current take-make-dispose model to create a more restorative economy which designs out waste, keeps products and materials in use for as long as possible and regenerates natural systems.
• Climate change is defined as “a change of climate that is attributed directly or indirectly to human activity, that alters the composition of the global atmosphere, and that is in addition to natural climate variability over a comparable time period.”
• China is the world’s top polluter emitting 10,357 metric tons of carbon dioxide, followed by the United States, India, Russia and Japan.
• Mpumalanga province in South Africa has the highest levels of air pollution in the world, in terms of nitrogen dioxide levels, due to a high concentration of coal power plants.
• Human-caused emissions of carbon dioxide need to fall 45% from 2010 levels by 2030 and reach net-zero around 2050 to limit climate change catastrophe.
• Energy is the dominant contributor to climate change, accounting for around 60% of total global greenhouse gas emissions.
• If people worldwide switched to energy efficient light bulbs the world would save 105 billion euros annually.
• Lighting accounts for 15% of global electricity use. Switching to LEDs will use 90% less energy and last far longer than with the use of incandescent lights.
• 70% of the world is covered by water, yet only 2.5% of it is fresh and only 1% of it is easily accessible for human use.
• The right to safe drinking water was first recognized by the UN General Assembly and the Human Rights Council as part of binding international law in 2010.
• Water use has grown at more than twice the rate of population increase in the last century.
• The use of water efficient fittings and fixtures has the ability to cut water use in homes by 45%.
• If the entire world ate like the average American, there would not be enough water in the world to sustain the global population.
• Plant-rich diets reduce emissions and tend to be healthier, leading to lower rates of chronic disease.
• Agricultural Emissions could be reduced by as much as 70% by adopting a vegan diet and 63% by adopting a vegetarian diet.
• Nearly half of the solid waste produced globally is organic or biodegradable.
• When organic matter is landfilled it decomposes and produces gas methane which is up to 34 times more powerful than carbon dioxide over a century, thus contributing to climate change.
• When organic matter is composted, organic matter is converted into stable soil carbon, “while retaining water and nutrients of the original waste matter.” This results in carbon sequestration and the production of a high quality fertilizer.
• Recycling one ton of paper saves 2584l of oil, 26498l of water and 2.5 cubic meters of landfill space.
• Germany has the best recycling rate in the world followed by Austria, South Korea and Wales.
• Recycled paper produces about 25% fewer total emissions than conventional paper.
• Recycling one ton of paper saves 17 trees.
• The process of Aforestation (creating new forests where there were none) creates a carbon sink. This draws in and holds on to carbon and distributes it into the soil.
• The production of plastic is largely reliant on fossil hydrocarbons, which are non-renewable resources which contribute to climate change.
• Plastic bags and Styrofoam containers can take up to thousands of years to decompose leading to marine animal death and the contamination of soil and water.
• The most common finds during international coastal cleanups are cigarette butts, plastic beverage bottles, plastic bottle caps, food wrappers, plastic grocery bags, plastic lids, straws and stirrers, glass beverage bottles, other kinds of plastic bags, and foam take-away containers.
• 36 million people live in modern slavery today, many of who are working in the supply chains of Western brands such as that of the fast fashion industry.
• The world’s indigenous population makes up just 5% of the global population yet protects 80% of global biodiversity.

• Article: Adidas to Allbirds – sustainable fashion brands embracing the circular economy
• Article: Upcycling. Reinventing fashion to be more sustainable, interesting and unique
• Article: P&G’s Ambition 2030, sustainable innovation as “a force for a good and a force for growth”
• Case study: Agua Bendita. Handmade swimwear from the colourful scraps of Colombia
• Case study: All Birds. The world’s most comfortable shoes
• Case study: Positive Luxury. The butterfly mark you can trust
• Report: New Green Radicals: Alstom to Toast Ale, Loop to Lush, TerraCycle to Triodos
• Survey: The World’s Most Sustainable Companies 2020: Denmark’s Orsted tops the list

In an exclusive extract from my forthcoming book Business Recoded, meet one of the most inspiring business leaders, shaking up today’s world. He embraces the opportunities of relentless change, the power of disruptive technologies, and the courage to create a better future in his own vision. In the book, I explore the stories of many of the world’s most fascinating leaders right now, and develop 49 codes that help you redefine the future of your business, and yourself.

The Leadership Code of Piyush Gupta

Piyush Gupta leads DBS, the largest bank in Southeast Asia, and widely recognised as the world’s most innovative bank.

As a CEO, he has a relatively unorthodox background, having grown up in the technology and operations parts of banking. During his 27-year Citi banking career, he did 22 jobs in multiple countries, including a one-year stint as a tech entrepreneur leading his own start-up. He built a very broad-based understanding of commercial banking, how people work together, and how digital can enhance it.

He joined DBS in 2009. At the time, the bank, which was founded in 1968 by the government as the Development Bank of Singapore to help fund the young city-state’s industrial development, was inefficient and bureaucratic, running on outdated technology. “Damn bloody slow” some called it.

Like many banks, DBS was defined by complex products, drab locations, and long queues. Gupta went to branchesincognito to speak to customers, to see for himself the cause of their dismay. He realised that the bank had unwittingly made itself difficult to do business with, creating safeguards on people’s money that also made it difficult to access. Managing the bank was not easy either. No central data was available to show which of the bank’s branches were profitable and which were not.

Gupta spent time looking at other banks, but also looking at tech companies like Alibaba and Tencent who were moving rapidly into banking. He believed that such companies were about to redefine banking in substantially new ways – redefining the whole concept of financial services, not just creating a more digital approach. He decided that DBS needed to have a tech company mentality, with all the agility and inventiveness that would imply. “Banks are yesterday’s story” he told the Financial Times.

Gupta started by focusing on the customer experience, and then having addressed the basic culture and processes, on innovation, specifically embracing technology. His approach was driven by employee “hackathons” to spur collaborative thinking and diverse ideas. Rather than relying upon industry-proven solutions, DBS looked outside for new ideas and solutions, by for example taking a stake in Kasisto, a banking chatbot and AI start-up. DBS also become the first bank in the world to develop a methodology for measuring digital value creation, which shows the impact of digitisation on earnings.

DBS seeks to deliver a new kind of banking experience that is so simple, seamless and invisible, that customers have more time to spend on the things they care about. “If we just tried to apply technology to the existing banking model, we would just end up being an efficient bank” he says, which he sees as ok, but not exactly ambitious. What he really wanted to do was transform the concept of banking, to make people’s lives better.

The bank’s slogan “live more, bank less” has a double meaning. “Bank less” meant saving time, by making banking fast and easy. “Live more” meant enabling people to do more, by embedding banking and payments into everyday life, whether that be helping small businesses to access suppliers at preferential rates, or embedding DBS into a real estate company’s system, to give you an immediate mortgage quote while viewing a new home.

Gupta called his strategy “the invisible bank” where financial transactions are embedded deep within the activities of everyday life – from travel to shopping, eating to entertainment. No longer do people need to think of banking as a separate activity, it is part of everything.

DBS’s transformation is seen by many as the most radical of any incumbent bank. Internally, DBS’s 26,000 employees have embraced a start-up mindset, with a priority to develop and deliver simple and effortless services, with a focus on enabling customers to do what they do better. Digital platforms now account for 48% of DBS’ business. Innovations include Digibank, India’s first online-only bank; PayLah!, a mobile wallet app, Treasury Prism, a cash management tool for corporate finance departments; and Smart Buddy, a wearable lunch payments and savings wristband for school kids.

In 2019, DBS became the only bank ever to simultaneously hold three global titles: “Bank of the Year” by The Banker, “Best Bank in the World” by Global Finance, and “World’s Best Bank” by Euromoney.

2020 has been a phenomenal year. If you’re a tech company. But then, you could argue that in some ways every company should be a tech company, in structure and culture. And human too.

As the pandemic hit, Apple’s stock price has looked more like the Burj Khalifa, than the more expected symptoms of Covid-19. Since mid-March, it’s market value doubled in just 21 weeks to be become the world’s first $2 trillion company, having taken 42 years to reach $1 trillion. While Tim Cook and team haven’t sustained the relentless product revolutions of the Steve Jobs era, they have profited from extending its global reach, fuelled by content and applications.

Pandemic Economics

It might seem contradictory, but as society locked-down, and the global economy shrank faster than ever before, some companies have thrived like never before. Consider the growth by market value of these businesses over the first 6 months of 2020:

• Amazon: Market cap added = $401.1bn. While the online retailer struggled initially to cope with demand, it spent $4bn enhancing its distribution capacity.
• Microsoft: Market cap added = $269.9bn. The Azure cloud has dominated growth, while user numbers for Teams and Xbox both mushroomed to over 100 million.
• Tesla: Market cap added = $108.4bn. Becoming the world’s most valuable auto maker is not really the story, for Tesla is much more about energy, and specifically batteries.
• PayPal: Market cap added = $65.4bn. Online payments grew dramatically with online retail, but the real secret was PayPal’s new Venmo app for peer to peer payments.
• Pinduoduo: Market cap added = $55.2bn. 628m people used China’s #2 shopping platform with a gamified, group-based approach to ultra-low prices (see the Pinduoduo case study).

Tech companies all, but equally retail and communication, gaming and transport, energy and finance. The rapid convergence of sectors, digitalisation of interfaces, and power of networks is everywhere. 2020 has become a year of dramatic shake-upwhere the growth companies in every sector realise that the innovative application of new technologies is key to their future.

For the many of us, for who the year has not been so phenomenal, the lessons are obvious.

Post-Pandemic Consumers

It is clear that lockdown has had a profound impact on how we live. The fear of contagion, the experience of isolation, and the economic uncertainty that continues, are changing consumer behaviours for good. As new synaptic pathways take shape in our brains, new habits typically form in around 66 days.

Digital behaviours most obviously accelerated – how we work, learn, shop, socialise and play. Zoom’s daily user base rocketed from 10 million to 200 million in 3 months. Disney’s new streaming service, Disney+, achieved the same growth in 5 months that Netflix achieved in 7 years. Online shopping grew more in 8 weeks than the last 10 years, telemedicine went from 2% to 98% of all initial health appointments in 15 days.

Analysis by McKinsey illustrates how behaviours are changing around the world: 

The importance of health and wellbeing is set to endure, as we become used to low-touch experiences. At the same time, we value humanity more, caring for society, family and neighbours. As a result, our physical shopping behaviours change too. Local proximity, but self-service, less frequent visits, baskets of flour and detergent, rather than clothes and cosmetics.Sustainability became a more or less significant issue depending on safety and economics.

Nesting in our homes, we became more subdued too. Our wanderlust to travel was quashed by quarantine, as airlines and hotels have perhaps been worst affected, typically losing 90% of their business. Most people lost confidence in using public transport, so roads became more congested as we slowly ventured out, while many city centres have remained ghost towns.

Socialising, except for the initial youthful exuberance to party again, has been more moderated. Many restaurants still operate as kitchens for home delivery, fuelling the continued rise of delivery companies like Deliveroo and Just Eat, who have added groceries and medicines, in a similar way to the Asian super-apps like Grab and Meituan Dianping. And our love of small brands, like craft beers, has given way to a trust in larger, familiar brands.

 

In an exclusive extract from my forthcoming book Business Recoded, meet one of the most inspiring business leaders, shaking up today’s world. He embraces the opportunities of relentless change, the power of disruptive technologies, and the courage to create a better future in his own vision. In the book, I explore the stories of many of the world’s most fascinating leaders right now, and develop 49 codes that help you redefine the future of your business, and yourself.

The Leadership Code of Reed Hastings

“If you want to build a ship, don’t drum up the people to gather wood, divide the work, and give orders. Instead, teach them to yearn for the vast and endless sea.”

Reed Hastings likes to quote Antoine de Saint-Exupéry, author of The Little Prince.

Hastings revolutionised how the world watches movies. He cofounded Netflix in 1995, the same year he sold his first company, Pure Software. Having grown up in a world of VHS videos, usually rented from a local store, he got the idea for Netflix when he owed his local Blockbuster store $40 for a movie he had misplaced. A new format, DVD was emerging, and he started offering them to be delivered and returned by mail for a flat monthly subscription fee, challenging Blockbuster’s high costs and inconvenience.

He famously said “as an entrepreneur you have to feel like you can jump out of an airplane because you’re confident that you’ll catch a bird flying by. It’s an act of stupidity, and most entrepreneurs go splat because the bird doesn’t come by, but a few times it does.”

In 2011, he went further, introducing an online streaming service, at a higher subscription fee. Netflix’s stock price stumbled, and the Huff Post called him “monumentally stupid.” Today, Netflix has a market value almost identical to Disney, a model for engaging consumers through the power of big data and AI, to understand them more deeply, and to create content that is personal and compelling to them.

“Entertainment is a core human need”, says Hastings. “It changes how we feel and gives us common ground. The invention of motion pictures 120 years ago, and then of television 70 years ago, were the first two entertainment revolutions. The third revolution is streaming, personalising any-screen anytime anyplace video, which allows Netflix to provide better entertainment at lower cost and greater scale than the world has ever seen.”

While Netflix is admired across the world for its innovative business model, Hastings realised that it needed to innovate how it works inside too – how people engage in work and lead others – in order to deliver the external promise and sustain its market momentum.

Netflix’s “Culture Desk”, subtitled “Freedom and Responsibility” has been described by Sheryl Sandberg as “the most important document ever to come out of Silicon Valley.” It was developed by former chief talent officer Patty McCord. She and Hastings were unimpressed by most organisations, and didn’t want Netflix to be the same.

Download a PDF of Netflix’s Culture Deck: Freedom and Responsibility

The document describes “the unusual ways we work together so we can eventually entertain everyone”.  Instead of listing the company’s core values like every other company, they decided to write down the things the company valued, what mattered to them, what they expected of their people.

They started with “Like many great companies, we strive to hire the best and we value integrity, excellence, respect, and collaboration. What is unique and special, though, about Netflix is how much we encourage independent decision-making by employees; share information openly, broadly, and deliberately; are extraordinarily candid with each other; keep only our highly effective people; and we avoid rules”.

They agreed that there would be no vacation policy and no travel policy, and everyone is paid more than their market rate.  You can book your meeting in “The Matrix” or “Dr Strangelove” conference room. And if you need some noise-cancelling headphones, just swipe your ID on one of their “tech vending machines” and they’re yours at no cost. “If you look at an innovator’s mind, the innovator never says we should look around and see what everyone else is doing and do it a smidge better” says Hastings, “we just took risks with the people stuff, just like we took risks with the business.”

It’s not all fun and freedom, however. There is a hard edge. He admits that in reality much of Netflix’s approach has been about tolerating a level of chaos and error, to stimulate innovation. But that gets more difficult as you grow in size and locations.

Judgement is key, he says, although admitting that judgement is subjective. “Brilliant jerks” are sacked, and Hastings describes the company as “a team, not a family”. Employees are subject to the so-called “keeper test”, where adequate performance is rewarded with “a generous severance package”. He describes the culture as “jazz rather than orchestra”, managing through values and context, so that everyone is doing the right thing without central coordination.

Hastings has spent the last 18 months trying to capture the essence of Netflix’s culture in a new book, written with INSEAD’s Erin Meyer. Having worked with Meyer, who is best known for The Culture Map exploring how different cultures can work together, they seem like polar opposites. The digital entrepreneur comes across as rambling and folksy, while the Paris-based academic is smart and precise.

No Rules Rules is written separately by both, in alternating chapters. Indeed Meyer admits that her first reaction to Netflix’s culture was “hypermasculine, and downright aggressive”. However it’s an interesting, inspiring, read. And timely too, given that many of us have spent much of the last 6 months, sustained by multiple Netflix series.

Netflix’s culture started with The Culture Deck as a set of principles and aspirations, written by Hastings and his Chief Talent Officer at the time, Patty McCord, which still appears on its website:

Entertainment, like friendship, is a fundamental human need; it changes how we feel and gives us common ground. We want to entertain the world. If we succeed, there is more laughter, more empathy, and more joy.

To get there, we have an amazing and unusual employee culture. This document is about that culture.

Like all great companies, we strive to hire the best and we value integrity, excellence, respect, inclusion, and collaboration. What is special about Netflix, though, is how much we:

1. encourage independent decision-making by employees
2. share information openly, broadly, and deliberately
3. are extraordinarily candid with each other
4. keep only our highly effective people
5. avoid rules

Our core philosophy is people over process. More specifically, we have great people working together as a dream team. With this approach, we are a more flexible, fun, stimulating, creative, collaborative and successful organization.

Real Values

Many companies have value statements, but often these written values are vague and ignored. The real values of a firm are shown by who gets rewarded or let go. Below are our values, the specific behaviors and skills we care about most. The more these values sound like you, and describe people you want to work with, the more likely you will thrive at Netflix.

Judgment

• You make wise decisions despite ambiguity
• You identify root causes, and get beyond treating symptoms
• You think strategically, and can articulate what you are, and are not, trying to do
• You are good at using data to inform your intuition
• You make decisions based on the long term, not near term

Communication

• You are concise and articulate in speech and writing
• You listen well and seek to understand before reacting
• You maintain calm poise in stressful situations to draw out the clearest thinking
• You adapt your communication style to work well with people from around the world who may not share your native language
• You provide candid, helpful, timely feedback to colleagues

Curiosity

• You learn rapidly and eagerly
• You contribute effectively outside of your specialty
• You make connections that others miss
• You seek to understand our members around the world, and how we entertain them
• You seek alternate perspectives

Courage

• You say what you think, when it’s in the best interest of Netflix, even if it is uncomfortable
• You make tough decisions without agonizing
• You take smart risks and are open to possible failure
• You question actions inconsistent with our values
• You are able to be vulnerable, in search of truth

Passion

• You inspire others with your thirst for excellence
• You care intensely about our members and Netflix’s success
• You are tenacious and optimistic
• You are quietly confident and openly humble

Selflessness

• You seek what is best for Netflix, rather than what is best for yourself or your group
• You are open-minded in search of great ideas
• You make time to help colleagues
• You share information openly and proactively

Innovation

• You create new ideas that prove useful
• You re-conceptualize issues to discover solutions to hard problems
• You challenge prevailing assumptions, and suggest better approaches
• You keep us nimble by minimizing complexity and finding time to simplify
• You thrive on change

Inclusion

• You collaborate effectively with people of diverse backgrounds and cultures
• You nurture and embrace differing perspectives to make better decisions
• You are curious about how our different backgrounds affect us at work, rather than pretending they don’t affect us
• You recognize we all have biases, and work to grow past them
• You intervene if someone else is being marginalized

Integrity

• You are known for candor, authenticity, transparency, and being non-political
• You only say things about fellow employees that you say to their face
• You admit mistakes freely and openly
• You treat people with respect regardless of their status or disagreement with you

Impact

• You accomplish amazing amounts of important work
• You demonstrate consistently strong performance so colleagues can rely upon you
• You make your colleagues better
• You focus on results over process

It’s easy to write admirable values; it’s harder to live them. In describing courage we say, “You question actions inconsistent with our values.” We want everyone to help each other live the values and hold each other responsible for being role models. It is a continuous aspirational stretch.

In describing integrity we say, “You only say things about fellow employees you say to their face.” This attribute is one of the hardest for new people to believe — and to learn to practice. In most situations, both social and work, those who consistently say what they really think about people are quickly isolated and banished. We work hard to get people to give each other professional, constructive feedback – up, down and across the organization – on a continual basis. Leaders demonstrate that we are all fallible and open to feedback. People frequently ask others, “What could I be doing better?” and themselves, “What feedback have I not yet shared?”

We believe we will learn faster and be better if we can make giving and receiving feedback less stressful and a more normal part of work life. Feedback is a continuous part of how we communicate and work with one another versus an occasional formal exercise. We build trust by being selfless in giving feedback to our colleagues, even if it is uncomfortable to do so. Feedback helps us to avoid sustained misunderstandings and the need for rules. Feedback is more easily exchanged if there is a strong underlying relationship and trust between people, which is part of why we invest time in developing those professional relationships. We celebrate the people who are very candid, especially to those in more powerful positions. We know this level of candor and feedback can be difficult for new hires and people in different parts of the world where direct feedback is uncommon. We actively help people learn how to do this at Netflix through coaching and modeling the behaviors we want to see in every employee.

Dream Team

A dream team¹ is one in which all of your colleagues are extraordinary at what they do and are highly effective collaborators. The value and satisfaction of being on a dream team is tremendous. Our version of the great workplace is not sushi lunches, great gyms, fancy offices, or frequent parties. Our version of the great workplace is a dream team in pursuit of ambitious common goals, for which we spend heavily. It is on such a team that you learn the most, perform your best work, improve the fastest, and have the most fun.

To have an entire company comprise the dream team (rather than just a few small groups) is challenging. Unquestionably, we have to hire well. We also have to foster collaboration, embrace a diversity of viewpoints, support information sharing, and discourage politics. The unusual part is that we give adequate performers a generous² severance package so that we can find a star for that position. If you think of a professional sports team, it is up to the coach to ensure that every player on the field is amazing at their position, and plays very effectively with the others. We model ourselves on being a team, not a family. A family is about unconditional love, despite, say, your siblings’ bad behavior. A dream team is about pushing yourself to be the best teammate you can be, caring intensely about your teammates, and knowing that you may not be on the team forever.

We have no bell curves or rankings or quotas such as “cut the bottom 10% every year.” That would be detrimental to fostering collaboration, and is a simplistic, rules-based approach we would never support. We focus on managers’ judgment through the “keeper test” for each of their people: if one of the members of the team was thinking of leaving for another firm, would the manager try hard to keep them from leaving? Those who do not pass the keeper test (i.e. their manager would not fight to keep them) are promptly and respectfully given a generous severance package so we can find someone for that position that makes us an even better dream team. Getting cut from our team is very disappointing, but there is no shame. Being on a dream team can be the thrill of a professional lifetime.

Given our dream team orientation, it is very important that managers communicate frequently with each of their team members about where they stand so surprises are rare. Also, it is safe for any employee at any time to check in with their manager by asking, “How hard would you work to change my mind if I were thinking of leaving?” In the tension between honesty and kindness, we lean into honesty. No matter how honest, though, we treat people with respect.

One might assume that with dream team focus, people are afraid of making mistakes. In fact, it’s the opposite. We try all kinds of things and make plenty of mistakes as we search for improvement. The keeper test is applied as a judgment of someone’s overall expected contribution.

Within a dream team, collaboration and trust work well because your colleagues are both exceptionally skilled at what they do, and at working well with others. In describing selflessness we say “You make time to help colleagues. You share information openly and proactively.” We want new colleagues to feel very welcome and get all the support they need to be effective.

People like loyalty, and it is great as a stabilizer. Employees with a strong track record at Netflix get leeway if their performance takes a temporary dip. Similarly, we ask employees to stick with Netflix through any short term dips. But unconditional allegiance to a stagnant firm, or to a merely-adequately-performing employee, is not what we are about.

On a dream team, there are no “brilliant jerks.” The cost to teamwork is just too high. Our view is that brilliant people are also capable of decent human interactions, and we insist upon that. When highly capable people work together in a collaborative context, they inspire each other to be more creative, more productive and ultimately more successful as a team than they could be as a collection of individuals.

Succeeding on a dream team is about being effective, not about working hard. Sustained “B” performance, despite an “A” for effort, gets a respectful severance package. Sustained “A” performance, even with a modest level of effort, gets rewarded. Of course, to be great, most of us have to put in considerable effort, but hard work and long hours is not how we measure or talk about a person’s contribution.

Being on a dream team is not right for everyone, and that is OK. Many people value job security very highly, and would prefer to work at companies whose orientation is more about stability, seniority, and working around inconsistent employee effectiveness. Our model works best for people who highly value consistent excellence in their colleagues.

To help us attract and retain stunning colleagues, we pay employees at the top of their personal market. We make a good-faith estimate of the highest compensation each employee could make at peer firms, and pay them that maximum. Typically, we calibrate to market once a year. We do not think of these as “raises” and there is no raise pool to divide up. The market for talent is what it is. We avoid the model of “2% raise for adequate, 4% raise for great”. Some employees’ market value will rapidly rise (due both to their performance and to a shortage of talent in their areas) while other employees may be flat year-to-year, despite doing great work. At all times, we aim to pay all of our people at the top of their personal market.

Note that if our company experienced financial difficulty, we wouldn’t ask our employees to accept less pay. A sports team with a losing record still pays top of personal market for the players they hope will get them back into a winning position. On the other hand, if the company does well, our broadly distributed stock options become quite valuable.

Ultimately, your economic security is based on your skills and reputation, not on your seniority at one company. At Netflix, you learn a lot working on hard problems with amazing colleagues, and what you learn increases your market value. Knowing that other companies would quickly hire you if you left Netflix is comforting. We see occasional outside interviewing as healthy, and encourage employees to talk with their managers about what they learn in the process.

While our teammates are fantastic, and we work together very well, we know we can always do better. We strive to have calm confidence, and yet yearn to improve. We suck compared to how great we want to become.

Freedom and Responsibility

There are companies where people ignore trash on the floor in the office, leaving it for someone else to pick it up, and there are companies where people in the office lean down to pick up the trash they see, as they would at home. We try hard to be the latter, a company where everyone feels a sense of responsibility to do the right thing to help the company at every juncture. Picking up the trash is the metaphor for taking care of problems, small and large, and never thinking “that’s not my job.” We don’t have rules about picking up the real or metaphoric trash. We try to create a sense of ownership so that this behavior comes naturally.

Our goal is to inspire people more than manage them. We trust our teams to do what they think is best for Netflix — giving them lots of freedom, power, and information in support of their decisions. In turn, this generates a sense of responsibility and self-discipline that drives us to do great work that benefits the company.

We believe that people thrive on being trusted, on freedom, and on being able to make a difference. So we foster freedom and empowerment wherever we can.

In many organizations, there is an unhealthy emphasis on process and not much freedom. These organizations didn’t start that way, but the python of process squeezed harder every time something went wrong. Specifically, many organizations have freedom and responsibility when they are small. Everyone knows each other, and everyone picks up the trash. As they grow, however, the business gets more complex, and sometimes the average talent and passion level goes down. As the informal, smooth-running organization starts to break down, pockets of chaos emerge, and the general outcry is to “grow up” and add traditional management and process to reduce the chaos. As rules and procedures proliferate, the value system evolves into rule following (i.e. that is how you get rewarded). If this standard management approach is done well, then the company becomes very efficient at its business model — the system is dummy-proofed, and creative thinkers are told to stop questioning the status quo. This kind of organization is very specialized and well adapted to its business model. Eventually, however, over 10 to 100 years, the business model inevitably has to change, and most of these companies are unable to adapt.

To avoid the rigidity of over-specialization, and avoid the chaos of growth, while retaining freedom, we work to have as simple a business as we can given our growth ambitions, and to keep employee excellence rising. We work to have a company of self-disciplined people who discover and fix issues without being told to do so.

We are dedicated to increasing employee³ freedom to fight the python of process. Some examples of how we operate with unusual amounts of freedom are:

• We share documents internally broadly and systematically. Nearly every document is fully open for anyone to read and comment on, and everything is cross-linked. Memos on each title’s performance, on every strategy decision, on every competitor, and on every product feature test are open for all employees to read. There are some leaks, but the value of highly-informed employees is well worth it.
• There are virtually no spending controls and few contract signing controls. Each employee is expected to seek advice and perspective as appropriate. “Use good judgment” is our core precept.
• Our policy for travel, entertainment, gifts, and other expenses is 5 words long: “act in Netflix’s best interest.”
• Our vacation policy is “take vacation.” We don’t have any rules or forms around how many weeks per year. Frankly, we intermix work and personal time quite a bit, doing email at odd hours, taking off a weekday afternoon, etc. Our leaders make sure they set good examples by taking vacations, often coming back with fresh ideas, and encourage the rest of the team to do the same.
• Our parental leave policy is: “take care of your baby and yourself.” New parents generally take 4-8 months.
• Each employee chooses each year how much of their compensation they want in salary versus stock options. You can choose all cash, all options, or whatever combination suits you⁴. You choose how much risk and upside you want. These 10-year stock options are fully-vested and you keep them even if you leave Netflix.
• There are no compensation handcuffs (vesting) requiring you to stay in order to get your money. People are free to leave at any time, without loss of money, and yet they overwhelmingly choose to stay. We want managers to create conditions where people love being here, for the great work and great pay.

You might think that such freedom would lead to chaos. But we also don’t have a clothing policy, yet no one has come to work naked. The lesson is you don’t need policies for everything. Most people understand the benefits of wearing clothes at work.

There are a few important exceptions to our anti-rules pro-freedom philosophy. We are strict about ethical issues and safety issues. Harassment of employees or trading on insider information are zero tolerance issues, for example. Some information security issues, such as keeping our members’ payment information safe, have strict controls around access. Transferring large amounts of cash from our company bank accounts has strict controls. But these are edge cases.

In general, freedom and rapid recovery is better than trying to prevent error. We are in a creative business, not a safety-critical business. Our big threat over time is lack of innovation, so we should be relatively error tolerant. Rapid recovery is possible if people have great judgment. The seduction is that error prevention just sounds so good, even if it is often ineffective. We are always on guard if too much error prevention hinders inventive, creative work.

On rare occasion, freedom is abused. We had one senior employee who organized kickbacks on IT contracts for example. But those are the exceptions, and we avoid over-correcting. Just because a few people abuse freedom doesn’t mean that our employees are not worthy of great trust.

Some processes are about increased productivity, rather than error avoidance, and we like process that helps us get more done. One such process we do well is effective scheduled meetings. We have a regular cadence of many types of meetings; we start and end on time, and have well-prepared agendas. We use these meetings to learn from each other and get more done, rather than to prevent errors or approve decisions.

Informed Captains

For every significant decision there is a responsible captain of the ship who makes a judgment call after sharing and digesting others’ views. We avoid committees making decisions because that would slow us down, and diffuse responsibility and accountability. We farm for dissent; dissent is not natural or easy, which is why we make a concerted effort to stimulate it. Many times, groups will meet about topics and debate them, but then afterwards someone needs to make a decision and be that “captain”. Small decisions may be shared just by email, larger ones will merit a memo with discussion of the various positions, and why the captain made such a decision. The bigger a decision, the more extensive the dissent/assent gathering should be, usually in an open shared document. We are clear, however, that decisions are not made by a majority or committee vote. We don’t wait for consensus, nor do we drive to rapid, uninformed decision making. When the captain of any particular decision is reasonably confident of the right bet for us to take, they decide and we take that bet. Afterwards, as the impact becomes clearer, we reflect on the decision, and see if we could do even better in the future.

Disagree Openly

If you disagree on a material issue, it is your responsibility to explain why you disagree, ideally in both discussion and in writing. The back and forth of discussion can clarify the different views, and concise writing of the core issues helps people reflect on what is the wise course, as well as making it easy to share your views widely. The informed captain on that decision has the responsibility to welcome, understand, and consider your opinions, but may not agree. Once the captain makes a decision, we expect everyone to help make it as successful as possible. Later, if significant new information becomes available, it is fine to ask the captain to revisit the topic. Silent disagreement is unacceptable and unproductive.

Context not Control

We want employees to be great independent decision makers, and to only consult their manager when they are unsure of the right decision. The leader’s job at every level is to set clear context so that others have the right information to make generally great decisions.

We don’t buy into the lore of CEOs, or other senior leaders, who are so involved in the details that their product or service becomes amazing. The legend of Steve Jobs was that his micromanagement made the iPhone a great product. Others take it to new extremes, proudly calling themselves nano-managers. The heads of major networks and studios sometimes make many decisions in the creative process of their content. We do not emulate these top-down models because we believe we are most effective and innovative when employees throughout the company make and own decisions.

We strive to develop good decision-making muscles everywhere in our company. We pride ourselves on how few, not how many, decisions senior management makes. We don’t want hands-off management, though. Each leader’s role is to teach, to set context, and to be highly informed of what is actually happening. The only way to figure out how the context setting needs to improve is to explore a sample of the details. But unlike the micro-manager, the goal of knowing those details is not to change certain small decisions, but to learn how to adjust context so more decisions are made well.

There are some minor exceptions to “context not control,” such as an urgent situation in which there is no time to think about proper context and principles, or when a new team member hasn’t yet absorbed enough context to be confident, or when it’s recognized that the wrong person is in a decision-making role (temporarily, no doubt).

We tell people not to seek to please their boss. Instead, seek to serve the business. It’s OK to disagree with your manager. It’s never OK to hide anything. It’s OK to say to your manager, “I know you disagree, but I’m going to do X because I think it is a better solution. Let me know if you want to specifically override my decision.” What we don’t want is people guessing what their manager would do or want, and then executing on that guess.

Highly Aligned, Loosely Coupled

As companies grow, they often become highly centralized and inflexible. Symptoms include:

• Senior management is involved in many small decisions
• There are numerous cross-departmental buy-in meetings to socialize tactics
• Pleasing other internal groups takes precedence over pleasing customers
• The organization is highly coordinated and less prone to error, but slow and frustrating

We avoid this by being highly aligned and loosely coupled. We spend lots of time debating strategy together, and then trust each other to execute on tactics without prior approvals. Often, two groups working on the same goals won’t know of, or have approval over, their peer activities. If, later, the activities don’t seem right, we have a candid discussion. We may find that the strategy was too vague or the tactics were not aligned with the agreed strategy. And we discuss generally how we can do better in the future.

The success of a “Highly Aligned, Loosely Coupled” work environment is dependent upon the collaborative efforts of high performance individuals and effective context. Ultimately, the end goal is to grow the business for bigger impact while increasing flexibility and agility. We seek to be big, fast and nimble.

Seeking Excellence

New employees often comment in their first few months that they are surprised at how accurate this culture description is to the actual culture they experience. Around the world, we live and create our culture together. In fact, hundreds of our global employees contributed to this document.

We do not seek to preserve our culture — we seek to improve it. Every person who joins us helps to shape and evolve the culture further. We find new ways to accomplish more together. Every few years we can feel a real difference in how much more effectively we are operating than in the past. We are learning faster than ever because we have more dedicated people with diverse perspectives trying to find better ways for our talented team to work together more cohesively, nimbly and effectively.

Summary

As we wrote in the beginning, what is special about Netflix is how much we:

1. encourage independent decision-making by employees
2. share information openly, broadly, and deliberately
3. are extraordinarily candid with each other
4. keep only our highly effective people
5. avoid rules

Finally

Antoine de Saint-Exupéry, the author of The Little Prince, shows us the way:

If you want to build a ship,

don’t drum up the people

to gather wood, divide the

work, and give orders.

Instead, teach them to yearn

for the vast and endless sea.