How Netflix builds a culture of excellence | Elizabeth Stone (CTO)

Lenny's Podcast: Product | Growth | Career

Lenny Rachitsky

Technology, Business, Entrepreneurship

5 • 1.5K Ratings

🗓️ 22 February 2024

⏱️ 74 minutes

🔗️ Recording | iTunes | RSS

🧾️ Download transcript

Summary

Elizabeth Stone is the chief technology officer of Netflix. She previously served as vice president of product data science and engineering, and as vice president of data and insights, at Netflix. Before Netflix, Elizabeth was vice president of science at Lyft, chief operating officer at Nuna, a trader at Merrill Lynch, and an economist at Analysis Group. In our conversation, we discuss:

• Elizabeth’s advice for career advancement

• Netflix’s unique high-performance culture

• How, and why, Netflix maintains a high bar for excellence

• Intentional leadership practices

• How to foster an “open door” culture within your team

• The Keeper Test and how it contributes to maintaining a high bar for excellence

• The power of transparent communication

• Much more

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Find the full transcript at: https://www.lennyspodcast.com/how-netflix-builds-a-culture-of-excellence-elizabeth-stone-cto/

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Where to find Elizabeth Stone:

• LinkedIn: https://www.linkedin.com/in/elizabeth-stone-608a754/

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Where to find Lenny:

• Newsletter: https://www.lennysnewsletter.com

• X: https://twitter.com/lennysan

• LinkedIn: https://www.linkedin.com/in/lennyrachitsky/

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In this episode, we cover:

(00:00) Elizabeth’s background

(04:36) Life as CTO vs. VP of Data

(05:57) The role of economists in tech companies

(08:32) Using economics to understand incentives

(10:07) Success and career growth

(20:15) Setting expectations

(25:02) Advice for how to avoid burnout

(27:44) Netflix culture: high talent density

(30:31) Netflix culture: candor and directness

(31:45) The Keeper Test

(39:01) Maintaining a high bar for excellence

(43:54) Netflix culture: freedom and responsibility

(46:18) Unconventional processes at Netflix

(47:55) Examples of candor

(51:44) Data and insights team structure

(01:00:12) Staying close to teams

(01:02:31) Advice on being present

(01:07:40) Lightning round

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Referenced:

• What to Know About the Netflix Cup, Today’s First-Ever Live Sports Event: https://www.netflix.com/tudum/articles/netflix-cup-live-event-date-news

• Ann Miura Ko interview | The Tim Ferriss Show (Podcast): https://www.youtube.com/watch?v=h2GO0Ks_VGg

• Netflix culture: https://jobs.netflix.com/culture

• No Rules Rules: Netflix and the Culture of Reinvention: https://www.amazon.com/No-Rules-Netflix-Culture-Reinvention/dp/1984877860

• Reed Hastings on LinkedIn: https://www.linkedin.com/in/reedhastings/

• Netflix’s “Keeper Test” and Why You Need It | Lorne Rubis: https://www.highlights.lornerubis.com/2015/08/the-netflix-keeper-test-and-the-courage-to-take-it/

• The Hunger Games: https://en.wikipedia.org/wiki/The_Hunger_Games

• Nan Yu on LinkedIn: https://www.linkedin.com/in/thenanyu/

• Work Life Philosophy: https://jobs.netflix.com/work-life-philosophy

• The Scoop: Netflix’s historic introduction of levels for software engineers: https://blog.pragmaticengineer.com/netflix-levels/

• Chaos Monkey: https://www.techtarget.com/whatis/definition/Chaos-Monkey

• Ali Rauh on LinkedIn: https://www.linkedin.com/in/ali-rauh/

• Keith Henwood on LinkedIn: https://www.linkedin.com/in/keith-henwood/

• Jeff Bezos’ Morning Routine of Puttering Around—How It Works: https://medium.com/illumination/jeff-bezos-morning-routine-of-puttering-around-how-it-works-9d73f359ac8d

• What I Talk About When I Talk About Running: A Memoir: https://www.amazon.com/What-Talk-About-When-Running/dp/0307389839

• A Fine Balance: https://www.amazon.com/Fine-Balance-Rohinton-Mistry/dp/140003065X

• Triangle of Sadness on Hulu: https://www.hulu.com/movie/triangle-of-sadness-f60937bd-45f4-469a-938f-db95026953a1

• Beef on Netflix: https://www.netflix.com/title/81447461

• Fellow pour-over coffee set: https://fellowproducts.com/products/stagg-xf-pour-over-set

• Peloton bikes: https://www.onepeloton.com/shop/bike

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Lenny may be an investor in the companies discussed.

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Transcript

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0:00.0	we can't really have any of the other aspects of the culture,
0:05.0	including candor, learning, seeking excellence
0:09.5	and improvement, freedom and responsibility
0:11.9	if you don't start with high talent density.
0:14.3	And in some ways it's very reflective of Reed Hastings as founder of Netflix.
0:20.6	So when he founded Netflix and grew the company over time it was with a belief that there could be a
0:28.6	different approach to building a company that would make it a place that people thrived in and loved being
0:35.7	and would feel different than other places both in the quality of that talent
0:39.7	density but even more importantly like the excellence and the outcomes and that that's where people would
0:44.9	derive a lot of sense of fulfillment. So it's very deeply seated at Netflix from its original days and in order to do that, you have to really hold yourself to a lot of stuff that doesn't
0:58.6	feel like natural human behavior.
1:02.8	Today my guest is Elizabeth Stone.
1:08.8	Elizabeth is Chief Technology Officer at Netflix and as far as I can tell the first economist to ever be named
1:14.8	CTO at a Fortune 500 company. Prior to this role, Elizabeth was Vice President of
1:19.9	Data and Insights. Before Netflix, she was Vice President of Science at lift,
1:25.1	C.O. at Nuna, a trader at Merrill Lynch, and an economist at Analysts Group.
1:30.7	In our conversation, we cover a lot of ground. We talk about how an economics background has helped Elizabeth in her career and why she expects to see more economists rise in the ranks of tech companies. She shares some of her secret sauce for rising so quickly at so many companies so consistently
1:45.9	we delve into Netflix's very unique culture of high talent density radical candor and
1:52.1	freedom and responsibility.
1:53.8	We also talk about the structure that Netflix has for their data and user research teams, which
1:58.3	she believes is a part of Netflix's secret to success.
2:01.8	We also get into what biking and triathlons have taught Elizabeth
	...

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