At most companies, the boss is there to approve or block the decisions of employees. This is a surefire way to limit innovation and slow down growth. At Netflix, we emphasize that it’s fine to disagree with your manager and to implement an idea she dislikes. We don’t want people putting aside a great idea because the manager doesn’t see how great it is. That’s why we say at Netflix: DON’T SEEK TO PLEASE YOUR BOSS. SEEK TO DO WHAT IS

The difference is the decision-making freedom we provide. If your employees are excellent and you give them freedom to implement the bright ideas they believe in, innovation will happen. Netflix does not operate in a safety-critical market, like medicine or nuclear power. In some industries, preventing error is essential. We are in a creative market. Our big threat in the long run is not making a mistake, it’s lack of innovation. Our risk is failing to come up with creative ideas for how to entertain our customers, and therefore becoming irrelevant.

The Netflix Innovation Cycle

If you have an idea you’re passionate about, do the following:

1. “Farm for dissent,” or “socialize” the idea.

1. For a big idea, test it out.

1. As the informed captain, make your bet.

1. If it succeeds, celebrate. If it fails, sunshine it.

“INNOVATION CYCLE STEP 1: FARM FOR DISSENT . . . Finally, one VP said to me, “You’re so intense when you believe in something, Reed, that I felt you wouldn’t hear me. I should have laid down on the tracks screaming that I thought it would fail. But I didn’t.”

The culture at Netflix had been sending the message to our people that, despite all our talk about candor, differences of opinion were not always welcome. That’s when we added a new element to our culture. We now say that it is disloyal to Netflix when you disagree with an idea and do not express that disagreement. By withholding your opinion, you are implicitly choosing to not help the company.

The big guys, Neil and Reed, were set against the idea publicly and privately. At most places this would be end of discussion. But Todd Yellin, VP of product, (who worked for Neil) had doubts. He discussed with Zach Schendel (senior user experience researcher) about running some tests to find out if Neil and Reed’s claims were accurate. Zach remembers it like this:

I thought, “Neil and Reed are against this idea. Is it okay to test it out?” At any of my past employers, that would not have been a good move. But the lore at Netflix is all about lower-level employees accomplishing amazing things in the face of hierarchical opposition. With that in mind I went ahead.