Netflix is an American media streaming provider with wide range selection of film and has served in 190 countries. Established in 1997 by two engineers Reed Hasting and Marc Randolph. It started by small DVD rental company but now the company has more than 125million paying subscribers across 450 million devices and become a $133 billion company that produces its own content and defines new notion to on-demand entertainment. The headquarters situated in Los Gatos, California US. And has 5,400 employees in total. In this report Im going to talk about the plans for future development, How are the plans communicated to staff, The budgeted, How does the company ensure that plans will be successful and who will benefits from successful future plans.
Who makes plan for future development?
Compared with the vast majority in typical corporation, Its very interesting with this media companys structure because when it comes to the decision-making its not only rely on the management boards aspects besides its from many different view of the whole company.
Due to the Information Gap which exists between management and the board. Chief has less well-rounded comprehension of the company because of their limited exposure to Day-to-Day activities and also some directors in a large corporation find the presentations heavy on data but light on analysis and insight. In other words, Overall image of the directors could missed the details that might contribute benefits to the firm.
By avoided this common mistake between management and the board all the employees in Netflix can access which means all the information is interconnected.
The board memo itself consists between 20-40 pages of information which highlighted and divided in different category e.g. Business performance, Industry trends, Competitive Developments also include the strategy and governance issues.
The Data summarised in charts and graphs, Embedded links within each section written and shared by the specialist. Hence the reader can easily connect with supplemental, data, analysis and others detail that expand the organisational knowledge.
In addition, this function permits you to pose for a clarification directly within the digital memo in case you need more comprehension about the certain subjects. This process takes the collection of a huge amount of data that proceed on a daily basis by the firm and distils to a consumable format for everyone in the company.
Apart from the datas accessibility the notion of the company is every position in company must know the different layers of the operation. They divided people in to three groups and split their members in to every board meeting. From This you will see the dynamic and feel the move in every steps company has been processed.
1. R-staff/Reeds staff meeting (important strategic and issues the firm facing) 2. E-staff/ Executive staff meetings (policies, workplace issues, competitive threats) 3.QBR/Quarterly business reviews this section gathers top 500 employees of the company. 1 board member attend R-staff meetings, 1-2 attend E-staff meetings and 2-4 attend quarterly business reviews. 2 Directors are expected to attend the meeting to observed not to influence or participate in any discussion.
Followed this procedures theres good spectrum from wider perspective due to the dept and insight information all employees have well informed hence they can commit and decide in the decision to operate the company together.
The foundation of Netflix culture is to think in the long term rather than in short sight. So the board Governance approach is to be the responsibility to everyone and the culture to inform the knowledge for you
How are the plans communicated to staff?
Based on Netflixs culture and approaches they provide employees Freedom and Responsibility Context not control candour and transparency. The policies include encorage the level of comfort and transparency among people.They open to the discussed and debated. Focuses on overall images rather than Micromanaging which also means Netflix focuses more on the question and discussion rather than presentation in order to contribute their employees to discussed openly with no editorializing no censorship because they believe this is the best way to propel the firm in the long term direction. without the intimate information it would be real difficult to make an accurate decision.Its fair enough to say that Standalone company such Netflix has been through huge challenges that most company dont even have done one. e.g. they did DVD distribution over the web,commited millions of dollars in content,moving into international market and from streaming licensning to original content.One Netflixs director compared the firm with another where participations between the board and executives are formal and well scripted including they have to be carefully orchestrated,Contrast with Netflix that the members staff doesnt even need to edit or tell what to display. This is another factors that urge the culture and environment in Netflix to be a very reflective company. These processes are the tools that using to communicated with well trained staff here.According to Reed hasting The board processes gave the board confidence in management during these challenges.
How is the future development budget for?
Reed Hasting CEO of Netflix estimated to be worth about $ 3.7 billion according to Forbes. In every year Netflixs expenditure spends more than $150million to improving its reccomendation system. In 2019, Netflix plans to premiere dozens of Originals content. According to Scott Stuber(Netflixs original chief) There are two main divisions- Originals and Indie films. The streaming service has plans to release 20 Originals whose budgets will range from $20million to $200million and with the Indie Films whose budgets will be fewer which is below $20 million.Apart from that Netflix planning to produces 90 movies per year and releases 12 local languages original series also 20 local languages film. By 2022 Netflix plans to boost around $16 million to ensure that the content can still be enjoyed at your own place. Obviously, large amount spending to improve the content affected the companys market price but the greater benefits would be back in turn in a long terms. The more investment you spending,the more people will finding the content that they love and the more value in the service Said Netflixs CEO Hasting during an investor interview. Netflix is essentially spending money to make money and also spending money to create its own content. This helps the company regulate the cost and make the compettitor wants their contents instead of Netflix has to licensed contents from another.
How does the company ensure that plans will be successful?
Recently,Netflix has more than 125 millions paying subscribers with 300 million profiles across 450 million devices. In order to attract the international audience it needs content that will appeal to viewers across different territories. Obvious aspects that we get from this company is they dont concentrate the content by country but they view at different tastes.
By gathering these kind of Data they are able to streamline the viewing process,exploring scrolling habits,click rates for content and overall entertainment. Including the content chosen specifically by audiences based on watch history, Main selling factors etc. They are all do A/B Testing, adding large top of screen banners, notification and reccomendation to see how the customers engagement. The preferences adapt along side with the time so they always updated and stay activated with custumer tastes and marketing strategies.
who benefits from successful future plans?
Not only the firm that will be benefit from the succesful plan but also the audiences can be more reliable on their preferenc content because of their microgenre selections rely on user taste.
Netflix employees earn an average wages of $182,607,with the top earners (around 10%) earn more than $329,070. Divided to five sections (25th percentile earn about $ 101,763,average is $ 182,607, 75th percentile earn $ 228,614 and top earner $ 329,070).