A VP decides which candidate to promote. This fictional case study by Jeffrey T. Polzer features expert commentary by Prasad Setty and Patty McCord.

A VP decides which candidate to promote. This fictional case study by Jeffrey T. Polzer features expert commentary by Prasad Setty and Patty McCord.

Most companies approach hiring with faulty assumptions and poor practices. They believe talent is fixed rather than contextual. They fail to create real partnerships between internal recruiters and hiring managers. And they rely too much on salary surveys and rigid compensation formulas. The author shares what she learned about making and keeping great hires during her 14 years as the chief talent officer at Netflix. The process requires probing beneath the surface of people and their resumes; engaging managers in every aspect of hiring; ensuring that recruiters deeply understand the business and are not viewed as support staff; adopting a mindset in which you're always recruiting; and coming up with compensation that suits the performance you need and the future you aspire to. These lessons may be especially relevant to fast-growing tech-based firms, whose rapid innovation means a continual need for new talent. But organizations of all types can benefit from taking a fresh look at their hiring and compensation practices.

When Netflix executives wrote a PowerPoint deck about the organization's talent management strategies, the document went viral-it's been viewed more than 5 million times on the web. Now one of those executives, the company's longtime chief talent officer, goes beyond the bullet points to paint a detailed picture of how Netflix attracts, retains, and manages stellar employees. The firm draws on five key tenets: Hire, reward, and tolerate only fully formed adults. Ask workers to rely on logic and common sense instead of formal policies, whether the issue is communication, time off, or expenses. Tell the truth about performance. Scrap formal reviews in favor of informal conversations. Offer generous severance rather than holding on to workers whose skills no longer fit your needs. Managers must build great teams. This is their most important task. Don't rate them on whether they are good mentors or fill out paperwork on time. Leaders own the job of creating the company culture. You've got to actually model and encourage the behavior you talk up. Talent managers should think like businesspeople and innovators first, and like HR people last. Forget throwing parties and handing out T‑shirts; make sure every employee understands what the company needs most and exactly what's meant by "high performance."