Leadership
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Context Not Control

What does Netflix have in common with a nuclear submarine? Although at first glance they couldn’t be more different, their exceptional leadership culture is very similar. Reed Hastings, CEO of Netflix, prides himself on making as few decisions as possible and preferably none at all for an entire quarter. And Captain David Marquet decided to stop giving orders on the nuclear submarine USS Santa Fe. Both rely on context instead of control and are very successful with it.

Taking Command

For over a year David Marquet prepared himself for his new task as captain of the USS Olympia. He learned every detail about this nuclear submarine. Everything went as planned until he had to take command of the USS Santa Fe at short notice. These two submarines both belong to the same class of nuclear-powered fast attack submarines (Los-Angeles class), but since the USS Santa Fe was a much newer type, David Marquet knew little about this submarine when he took command of it.

So David Marquet did what he had to do and acted as he had been taught. He went to work and gave commands. After all the USS Santa Fe was at that time the submarine with the worst performance and morale in the whole Navy and therefore the situation demanded a strong leader. Didn’t it?

During a drill in the first month of his command, David Marquet realized the danger of a team trained in obedience and a boss with limited knowledge. The drill simulated the failure of the main reactor and, accordingly, the USS Santa Fe had to run on a battery-powered electric propulsion motor (EPM) for the duration of the reactor repair. To challenge the crew a little bit and increase the pressure, David Marquet finally gave his officer of the deck the order “Two thirds ahead! The officer immediately passed the order on to the helmsman and … nothing happened!

When David Marquet asked the helmsman why he had not executed the order, he was told that – unlike on his previous submarines – on the USS Santa Fe there was no “two-thirds ahead”. Everyone on the ship knew this except David Marquet. Especially the officer of the deck knew this, but he nevertheless passed the order on to the helmsman because he was trained to obey. This was the moment when David Marquet realized that with his limited knowledge and experience he was a dangerous bottleneck in the organization and at the same time he realized the potential hidden in the collective experience, intelligence and creativity of his crew. And that potential he wanted to unleash.

Giving Control

If you want people to think, give them intent, not instruction.

David Marquet

So he decided not to give any more orders. Except for the use of nuclear missiles, David Marquet let his crew decide. In order to make these decisions he gave them the intention and the goal, gave them the full context and then helped them as a coach to make their own decisions. When he was asked for permission to submerge the ship, for example, he did not give the order, but made the officer think about whether it was safe on the one hand and on the other hand whether it now was the right thing to do in terms of the overall mission. Gradually less and less officers asked for permission, but began to think like David Marquet and took responsibility for their decisions and the decisions of their teams. Where previously only more or less incoherent orders were executed, later even in the engine room the crew was aware of the current situation and the mission of the ship and that led to better decisions, for example by avoiding noise while an enemy ship was nearby.

With this remarkable leadership culture David Marquet succeeded in turning the ship around in the literal sense of the word (which is why his corresponding and very recommendable book is entitled “Turn Around the Ship! A True Story of Turning Followers Into Leaders”). The USS Santa Fe went from worst to best in the US Navy and remained so even after David Marquet retired in 2009. In addition, the USS Santa Fe became de facto a training facility for new officers up to ten captains of nuclear submarines who had learned their profession under David Marquet. Much better and more entertaining, David Marquet tells this in this TEDx talk (see also the full story of David Marquet).

Context Not Control

Despite this stunning evidence of the impact of this “leader-leader” paradigm (instead of the far more common “leader-follower” paradigm), examples of this leadership culture in large hierarchical organizations are still difficult to find. However, at Netflix, after all the seventh largest Internet company in the world, you will quickly find this immediately in their legendary Culture Statement, which Patty McCord published as former Chief Talent (sic!) Officer in 2009. The 125(!) slides on culture at Netflix have since been viewed an incredible 18 million times and have been described by Facebook’s COO Sheryl Sandberg as the most important document from the Valley. In the meanwhile revised version on the Netflix website it becomes unmistakably clear who decides at Netflix and what the task of leadership is:

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.

Netflix Culture Statement

The most important leadership task is therefore not to decide by yourself, but to create a framework in which employees can make their own decisions. That’s why Reed Hastings makes as few decisions as possible at Netflix and that’s why David Marquet no longer gave orders on the USS Santa Fe. And that’s why the Manifesto for Human(e) Leadership says, “Growing Leaders over Leading Followers,” because we really need more of this leadership culture, especially as times get more uncertain and complex.

We tell people not to seek to please their boss. Instead, seek to serve the business.

Netflix Culture Statement

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Filed under: Leadership

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Hi, I'm Marcus. I'm convinced that elephants can dance. Therefore, I accompany organizations on their way towards a more agile way of working. Since 2010 I regularly write about leadership, digitization, new work, agility, and much more in this blog. More about me.

2 Comments

  1. Christian Schmid says

    Great article, thanks for sharing!
    Just a heads up the column starting with “During a drill in the first month of his command…” seems to be duplicated. Just a minor hickup, but thought I would point it out to you.

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