During a dinner conversation I had at RSPA INSPIRE 2017, the topic turned to POS resellers reluctant to change. Some are adapting quickly and effectively, but too many are plodding along, unaware they are in a race to remain relevant.
As the conversation continued among the din of clinking silverware and china, I recalled one of my favorite business quotes. The source is a Netflix executive talking about how their company requires all employees to be ever-innovative:
“Adequate performance gets a generous severance package.”
I know that sounds harsh, but that’s the world we’re living in now. If your merchants aren’t thrilled with your product offering and your customer service, they’re looking – either actively of passively – for someone who is more than merely “adequate.”
Netflix has provided a roadmap for POS resellers and other small businesses to create an innovative organization. Here are the six key takeaways I’ve extracted from the presentation “Netflix Culture: Freedom & Responsibility,” which I’ve studied since it was released:
Lesson 1: “We’re a team, not a family.”
You don’t choose your family. Your brother stays your brother no matter if he volunteers to cook and carve the Thanksgiving turkey or if he chucks it against the wall after mom sets it on the table. When I talk with resellers who have turned around their business, the tipping point is often when they began to hold employees accountable, cut average performers, and upgrade their staff. “We’re like a pro sports team, not a kid’s recreational team,” Netflix believes. “Netflix leaders hire, develop, and cut smartly, so we have stars in every position.”
Lesson 2: “Great workplace is stunning colleagues.”
“Great workplace is not espresso, lush benefits, sushi lunches, grand parties, or nice offices,” Netflix says. World-class employees are looking to work with other world-class employees, not with Johnny Clock-Watcher or Suzy Complain-A-Lot. Netflix promotes and hires people who demonstrate:
And for employees who don’t exude these characteristics? See the quote above about generous severance packages. Netflix asks its managers to regularly conduct a “Keeper Test” which for reseller executives is simply asking yourself, “Which of my people would I fight hard to keep here?”
Lesson 3: “Responsible people thrive on freedom, and are worthy of freedom.”
Resellers need best practice processes and procedures, but those should serve as a foundation to your org, not your ceiling. I’m working with a 10-employee reseller who recently gave his employees more freedom after we conducted a professional development session that challenged each team member to be high-initiative. The employees have exceeded the reseller’s expectations, establishing new operational systems and communication tools that wouldn’t be as effective if they were rolled out as a top-down command. To kick off the training session, we read the classic “Message To Garcia,” but we could have also shared how Netflix describes “The Rare Responsible Person”:
- Acts like a leader
- Doesn’t wait to be told what to do
- Picks up the trash lying on the floor
Editor’s note to Vantiv resellers: If each member of your staff isn’t 7-for-7 on that list, let’s talk about how we can get them there.
Lesson 4: “Context, not control.”
This is one lesson many resellers ignore at their own peril. They say with either frustration or resignation, “Nobody can do the job as well as I can. Nobody can sell as well as I can. Nobody cares as much as I do!” But the thriving resellers I talk with don’t have this problem because they make a concerted effort to teach their team about the POS business and they effectively delegate to future leaders.
“Provide the insight and understanding to enable sound decisions,” Netflix says. “Embrace strategy, metrics, assumptions, objectives, clearly-defined roles, knowledge of the stakes, and transparency around decision-making. Avoid top-down decision-making, management approval, committees, and valuing planning and process more than results. High-performance people will do better work if they understand the context. This is why we do new employee college, frequent department meetings, and why we are so open internally about strategies and results.”
Lesson 5: “Pay top of market.”
I know this lesson will give many resellers heartburn, but paying “top of market” while also expecting world-class performance can actually save you money. “One outstanding employee gets more done and costs less than two adequate employees,” says Netflix. “We endeavor to have only outstanding employees.”
I’m working with a reseller right now on this. One of their current techs is inefficient and low initiative, causing work to fall on the plate of one of the co-owners. They’re now willing to pay more for a new tech who can do the whole job, enabling the owners to grow the business.
Lesson 6: “Support self-improvement.”
Don’t confuse this principle with mapping out a career path for your employees. I agree with Netflix that, “Formalized career ‘planning’ is rarely effective, and we don’t try to do it. We develop people by giving them the opportunity to develop themselves, by surrounding them with stunning colleagues, and giving them big challenges to work on. High-performance people are generally self-improving through experience, observation, introspection, reading, and discussion.”
While these six lessons may seem daunting to execute, especially when you’re busy reacting to immediate customer needs, they’re not impossible to achieve. And you don’t need to go about this quest alone. My job as a Reseller & ISV Business Advisor for Vantiv’s PaymentsEdge Advisory Services is to work with Vantiv partners to help them with hiring right, building effective (yet not too restrictive) systems, developing staff professional development programs, and more. Contact me if you’re interested in a one-hour consultation (it’s free) where we can determine a go-forward plan to turn your business into an innovation organization.
“We keep improving our culture as we grow,” Netflix states. “We try to get better at seeking excellence.”