Brutal or brilliant? Scaling Up Excellence details what it’s really like working for Netflix and other Silicon Valley companies

IT’S pumped out hits such as House of Cards, but working at Netflix is like having psychopath Frank Underwood for a boss. Check out how it treats staff.

“FOR those of us climbing to the top of the food chain, there can be no mercy. There is but one rule: hunt or be hunted,” said Congressman Frank Underwood in Netflix’s hit show House of Cards.

The famous quote could be used to describe working at the booming media company which has a ruthless reputation for hiring and firing staff.

“Netflix is really the extreme case,” said Robert Sutton, a Stanford engineering professor and author who has recently published a book called Scaling Up Excellencethat dishes secrets on how some of the world’s most famous companies work behind the scenes.

“Their argument is … from the top down is that we’re a sports team. They fire you if you’re not great. They pay you a fortune if you are.”

Stanford Professor Robert Sutton has written a book detailing inside secrets of Silicon Valley Firms. Pic: Claudia Goetzelman.

The book, written in conjunction with Huggy Rao, describes how under Netflix CEO Reed Hastings, the strive for “talent density” means the company pays a fortune to staff who have plenty of freedom, but doesn’t hesitate to cut dead weight from the ranks.

“If you’re not a superstar you get fired. They’re very explicit about that,” Professor Sutton told news.com.au over the phone from California.

“Everybody at Netflix understands the deal.”

The unorthodox strategy means staff get huge pay rises of up to $100,000 without having to ask. Although the “Darwinian approach” also means one third of a 75 person team was cut within 24 months for merely doing an adequate job.

“Netflix makes sure that every employee understands the bargain, you are given much and expected to give back much in return — or you are sent packing,” Professor Sutton writes.

Pic: Screengrab.

The sentiment is backed up in reviews by employees at job site Glassdoor, and Netflix’s own website which states “we’re like a pro sports team, not a kid’s recreational team.”

Managers use a “keeper test” to determine which staff are worth keeping. If they’re not worth fighting for the company will give them a “generous severance” package to open the spot for someone else.

The inside word on Netflix is just one in a fascinating series of revelations about the Silicon Valley culture that has produced some of the world’s biggest and most profitable companies including Apple, Google, Twitter, Oracle, Yahoo and Microsoft.

While the perks are well known, Professor Sutton said there is a dark side that goes along with working in such a competitive environment.

“Silicon Valley is a pretty sick place to work … It’s just hell,” he said. “The competitive pressures for those organisations, they’re just so brutal.”

He described the tech scene as a “brutally competitive market” where divorce rates are high and potential for a life outside work is low.

Personal life? Forget about it. Netflix employees get unlimited leave but rarely have time to take it, according to one former worker.

“I had this great student with two job offers. One from Google and one from [consulting firm] McKinsey. The understanding is that you don’t take a job with Google if you’re a guy unless your girlfriend also works there, it just won’t last. It’s like you’re going to prison or away in the military if you take these jobs.”

Professor Sutton also noted that despite high profile female executives like Marissa Mayer and Sheryl Sandberg, it’s an extremely sexist environment.

“We do have visible female executives but it’s a very sexist world out here, it’s disproportionately populated by men. They only give women the jobs that are too hard for the men to do. Marissa Mayer and Meg Whitman (of Hewlett Packard) have such hard jobs,”

“Running Google is easy, the money just comes in. A 12-year-old middle of the class kid could do just fine running Google,” he said.

Apple was renowned for having a culture of secrecy under the late Steve Jobs, according to the book.

And although tech giants might seem similar, they can have vastly different internal cultures.

Professor Sutton said Google staff are renowned for having a “sunny native California disposition ... no matter how much you’re suffering,” while Apple is far more secretive.

“If you look at Apple vs. Google, Google is the kind of place where they look for a complete person. They think of you growing into the role and having subordinates and someone who can grow with the company.”

“Apple is interesting because they largely look for specialists, people who are very focused on doing small things. As people get more senior they get more specialised. I’ve never heard of that in any other organisation.”

However life in the valley is not all bad, the Professor said. He used Pixar as an example of a culturally positive organisation where staff are permanent and invested in their projects.

“Even companies that are less positive still have a source of pride in their work. It’s something that runs throughout the culture there,” he said.

Scaling Up Excellence can be bought online here.