Equity on Demand: The Netflix Approach to Compensation Harvard Case Solution & Analysis

Netflix was among a small group of companies in Silicon Valley to get out of technology bubble in the late 1990s as the clear winner in terms of growth, market share and profitability. Netflix it possible not only to get the better of this competition, but to thrive in large part due to the culture of freedom and responsibility introduced founder Reed Hastings. To promote this culture, the company has a number of unique employment practices that were to attract, retain and motivate the type of employee, Netflix valued. Among these practices was the compensation system with several non-traditional opportunities. While most companies have provided compensation packages with a given mix of cash and equity-based payments, Netflix was the model on its head and allowed employees to request their own mix. Management was interested to know whether this practice is maintained or distracts from the main objective of the company to its employees. "Hide
by David F. Larcker, Allan McCall, Brian Tayan Source: Stanford Graduate School of Business 21 pages. Publication Date: January 15, 2010. Prod. #: CG19-PDF-ENG

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