Hard work isn’t what makes companies into household names, says Netflix co-founder Marc Randolph.
Successful CEOs and entrepreneurs often get ahead because they have a single skill: the ability to prioritize which issues need solutions first, Randolph said during a podcast episode of “The Diary of a CEO with Steven Bartlett” earlier this month.
“I think hard work leading to success is a myth,” he said. “If I can be really smart about which problems I choose to focus on, [that] will make the difference. I don’t have to get everything right, because most things don’t make a difference. Some things do.”
At Netflix, Randolph used to “argue over every word of copy” and every photograph on consumer-facing products, he said — desperate to make sure everything was perfect before a customer saw it, he said.
Over time, he realized that customer reactions had little to do with the amount of polish on a new idea, and that his goal should’ve been to get real-life feedback on imperfect, half-finished tests as quickly as possible, he added.
“If it had even a inkling of being a good idea, no matter how bad the test was, it shown through,” said Randolph. “Customers would immediately perk their heads up.”
One of those tests was Netflix’s subscription model, which eliminated the need for late fees on DVD rentals. Customers responded positively to the simpler, less-stressed user experience — a simple fix that helped grow Netflix’s customer base, putting it on the path to its current market value of $289.29 billion.
When hard work matters
Hard work used to be defined as showing up to the office first and leaving last, but it doesn’t guarantee you’ll be a CEO or build a multi-billionaire company. Plus, a 2014 Stanford study showed productivity per hour sharply declines if you put in more than 50 hours per week.
Instead, use your 9-to-5 schedule to establish good relationships with your colleagues, especially if they can give you feedback on your work, Stacie Haller, chief career advisor at ResumeBuilder, told CNBC Make It earlier this month.
Sometimes, you’ll need to sprint — putting in long hours — especially at the beginning of your career, or if you’re starting your own company, Randolph noted.
“When you’re younger, when you don’t really know what you’re doing … you better work your ass off,” he said, adding: “Ideally, you get yourself far enough ahead … to get some breathing room.”
Eventually, constant sprinting hits a point of diminishing returns. Tactful focus separates hard workers from smart workers, said Randolph.
“So many entrepreneurs [are] up all night polishing their deck … double checking every detail [and working] so hard,” Randolph said. But “you don’t lose the deal at 2 o’clock that morning because you didn’t check the fonts. You lost the deal four weeks ago when you didn’t have some fundamentals right.”
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