The two faces of Org Policies

In the month of December, I spent some time reading this book by Reed Hastings and Erin Meyer. The most intriguing thing is how Netflix revolutionized their culture and while at it, introduced what many call unorthodox principles within the organization.

Figure this – you’re so used to having 21 days of annual leave/vacation (at least this is what we have in Kenya). So, within the year, you can apply for vacation that has to be approved by your supervisor and strictly subject to 21 days limit. That’s the policy. Then one day, the leadership wakes up and announces to all staff that the leave policy is scrapped. No, this does not mean that people cannot take leave any more. It means that you, the employee, has 100% control of how many days to take vacation in a year and when. No approval is needed by anyone and the organization will not be tracking anyone’s leave any more. So, you can take 30 days leave or even 45 if you wish – up to you. Sounds insane, right?

Reed admits that this idea gave him nightmares at night. He would dream getting to the office early in the morning with a time-tight assignment only to find the office empty.

“During this time, I often woke in the night with one of two nightmares. In the first, it’s summer. I’m late for an important meeting. I rip into the office parking lot and spring into the building. The preparation I have to do is gigantic. I will require the input of the entire office. I run through the front doors calling out names: David! Jackie! But the office is dead quit. Why is the place empty? Finally, I find Patty (HR) in her office wearing this white feather boa. ‘Patty, where is everybody?’ Patty looks up from her desk with a smile. ‘Oh Hi Reed! Everyone’s on vacation!’”

Imagine a scenario where everyone is at liberty to take leave any time for as long as they want and no one is tracking that and no approval is needed. I know a colleague who would take vacation for the entire quarter! Just kidding.

Netflix did it with extreme success. Ever since other organizations have copied this. Some have succeeded to replicate this practice. When Richard Branson heard about this, he said, ‘I believe that it would be a very Virgin thing to do not to track people’s holidays’.

That’s the first story.

As I was reading this, I kept reflecting on policies and what exactly they mean in our organizations. For many years in my previous jobs, I really never used to think much about leave and honestly, I used to take only about 10 days off in a year – unless on sick leave. I had whole 21 days but used to take just half of that. With some of my employers like Copia, I never took a single day leave. Would I take more days if my employer introduced the ‘Netflix No Vacation approval policy’? Definitely not.

Do policies in your organization serve you?

Policies are great to have in many organizations. This is what defines the norms and behaviors of the employees. They standardize ways of doing things. Without them, many organizations would be chaotic to run. But Reed says that some of these policies can be eliminated (as did Netflix) if the organization hires the right talent. He says that high performance teams will do the right thing with simple guidance and consistently so even without the policies. They just don’t need policy reminders to do the right thing.

But policies can also stifle the organization and stunt the creative minds. Policies create high walls and if not well thought out, they will kill innovation and thinking within the organization.

Let me give you an example.

Recently I took my family out for lunch at a restaurant with a good name. We all settled and waited for our order. But when the food was brought, it was stale. Kids refused to eat. I went to the counter to request the lady serving us to take the food back and instead bring us something else fresh. There was two more customers complaining about the food as well. You know what she said, ‘as per our policy, we cannot take the food back once served’. I requested for a refund and she told me that I have to write an email to the HQ. We left the premises disgraced - without food and without a refund. Will we be back again? Of course not. Policies just kicked us out.

Policies should give us guidance and also should leave room for managers to exercise managerial discretion in special cases and act on organization’s best interest at that moment.

Let me give you an example here:

Some years back I worked as a manager for an organization with a large logistics fleet. This time I was in charge of western and rift regions and my base was in Eldoret. One early morning, a staff came to the office panting, ‘William, one of our trucks has been involved in an accident at Matunda and our staff are in critical condition. They have been taken to the hospital in Kitale’. He showed me pictures of a badly damaged truck. I didn’t say a word. I got into my car (assigned by the company) and drove to Kitale. This is the first and the last time to drive a car at speeds above 150km/hr. As a company car, it had a tracker. Per the policy, I was not supposed to exceed 100km/hr. All our vehicles were being tracked from a central command center in Nairobi. This triggered an alarm at the control room. They could see I was driving at unacceptable speeds and everyone was calling. They had an option of switching off the car remotely but they did not. Policy violation #1. When I got to Kitale general hospital, I found one of our staff, a young lady, badly injured and lying on the bench waiting to be attended. She had started to lose consciousness and could barely recognize people due to heavy bleeding. I demanded that she be released to go to MTRH in Eldoret. The administrator and a doctor refused and said it was ‘highly unprocedural’ to release a patient in that state. Well, after a few chaotic conversations, they agreed on condition that we hired a staffed Red Cross ambulance. That was an easy option. We got an ambulance to Eldoret. When we got there, again the general wing was crowded and it didn’t look like we would get the attention we needed. I approved that the lady be taken to private wing. She survived – I later learnt from the doctor that she had 9 fractures on both limbs and hips. Luckily, no head backbone injuries.

In the evening, when all was settled, I sat back to write a report to the bosses on what had happened and the decisions I took during the day. On reflections, I realized that I might not have been in the right state of mind but I acted to the best interest of the organization and our staff. The right procedure would have been to first seek approval from the HR director before even getting an ambulance. I didn’t do all that.

After this incident, we amended the policies to include ‘exceptional circumstances’ where a manager can exercise discretion and make decisions based on available information and prevailing circumstances  – but those decisions have to be to the interest of the organization.

Maybe it’s the time we looked at the policies with both our eyes, the mind and the heart and determine if they inhibit the right, logical thinking of our teams and undermine the organization goals long term - then tune them to reflect the spirit and the dreams of the organization. The very least a policy should never do is to antagonize or create unnecessary friction with the customer that the organization exists to serve in the first place. The voice of the policies should speak to the organizations best interest. Policies should make organizations efficient but we know that, often, they can be a bottleneck to progressive thinking. There should be frequent interrogation of the policies to ensure that they meet certain standards and once in a while, involve teams in a co-creation exercise and their experiences interacting with these policies.