By: David Jacoby on March 15th, 2023
Building a Winning Sales Culture: Lessons from Salesforce and Netflix
The success of any sales organization depends on having the right mindset, culture, and strategy. As two of the most successful companies in the world, Salesforce and Netflix have many lessons to teach about how to build a winning sales culture.
Research has consistently highlighted the importance of a strong culture, both for the company as a whole and also for the sales organization. While there is no one size fits all culture for your sales organization, organizations fall into two primary camps: Ohana and High-Performance cultures.
Salesforce's Ohana Culture
"Ohana means family, and family means nobody is left behind or forgotten." For those of you who don’t have Disney-age kids, that quote is from the classic Disney movie “Lilo & Stitch.” Until recently, Ohana was also the basis for the corporate culture at SaaS giant Salesforce.That is until Salesforce abruptly laid off 8,000 employees last month, with more layoffs on the way.
Technology companies for years sold employees on the idea that they operate as a community with shared values and where people come first.
The poster child for this culture has been Salesforce's "Ohana" culture, based on the idea that employees are part of a larger family and that the company's success depends on each member's success. The company emphasizes teamwork, collaboration, and a supportive work environment and encourages employees to build relationships and connections across the organization. The company's culture also emphasizes giving back to the community and positively impacting the world.
A core element of Salesforce’s Ohana culture was the concept of employee wellness. Salesforce boasted onsite baristas and masseuses, offered employees monthly “well-being days” in addition to PTO days, and gave employees access to a 75-acre wellness retreat center. Many other companies in and out of the tech industry have followed Salesforce’s emphasis on employee wellness.
While it’s easy to poke fun at Salesforce’s excessive wellness focus, there are some clear benefits to this culture. A positive and well-defined company culture can help attract and retain top talent, promote teamwork and collaboration, and drive innovation and creativity. The Ohana or wellness culture also gave Salesforce a competitive advantage in attracting and retaining top talent, as job seekers increasingly prioritize workplace culture and values when making career decisions. This advantage was critically important during the tight labor market over the past decade.
But the Ohana culture has its limits. According to media reports, Salesforce executives often complained that the “wellness culture overpowered high-performance culture during the pandemic.” In many cases, Salesforce’s wellness culture also applied to its sales team, with Salesforce reportedly doing a poor job tracking salesperson-specific metrics – ironic, given Salesforce’s core product offering.
During the good times, Salesforce was one big family, but as soon as revenue growth slowed over the past year, the company's culture was one of the first things that took a hit. Out with the baristas and in with the layoffs and cost-cutting. On Salesforce’s most recent earnings call, CEO Marc Benioff summed up Salesforce’s abrupt about-face by stating that Salesforce is “reigniting our performance culture.”
Netflix's High-Performance Culture
If Benioff needs an example of a tech company that embraces a performance culture, he should look at Netflix, whose culture starkly contrasts with Salesforce’s Wellness culture. Netflix’s CEO, Reed Hastings, famously outlined his vision for Netflix’s high-performance culture in a slide deck titled "Netflix Culture: Freedom & Responsibility", which is also included on their website.
Netflix’s culture emphasizes autonomy and gives employees a high degree of freedom to make decisions and take risks. However, this freedom comes with a high level of responsibility, and employees are expected to take ownership of their work and be accountable for their results. The company also places a great value on transparency and encourages employees to speak their minds and share their opinions openly.
In an interview with Harvard Business Review, Hastings furthered distanced Netflix’s performance culture from Salesforce’s Ohana culture, "We're a team, not a family. We're like a pro sports team, not a kid's recreational team. Netflix leaders hire, develop and cut smartly, so we have stars in every position."
Hastings then summed up Netflix’s performance culture, "adequate performance gets a generous severance package" at Netflix. Not exactly, Ohana.
Creating a High-Performance Sales Culture
So which culture makes the most sense for a sales organization?
Given the metric-driven nature of sales organizations, it’s no surprise that a strong sales culture values and rewards sales performance and creates an environment that supports and encourages sales activities. In other words, the Netflix model of a professional sports team over the big happy family.
Here are some key characteristics which are typically associated with successful sales cultures:
- Define and communicate clear performance expectations with your team, including specific goals and metrics for success.
- Emphasizing supportive dialogue – this means communication with your team must be in the context of improving performance (or “getting better”) and not criticism.
- Everyone is accountable for behaviors and results and is rewarded accordingly.
- And everyone, including managers, seeks out feedback on their performance.
- There is an emphasis on continuous training and development. Companies with a strong sales culture invest in ongoing training and development for their sales teams, providing them with the skills and knowledge they need to succeed.
Salesforce's Ohana culture and Netflix’s performance culture represent two different approaches to building a company culture. Salesforce's culture emphasizes collaboration, teamwork, and a family-like environment, while Netflix's culture focuses on performance metrics and accountability.
Both cultures have their strengths and weaknesses. Salesforce's culture can help create a positive and supportive work environment, but often at the expense of maximizing performance. This culture was great during boom times but may be less sustainable in a slow economy.
On the other hand, Netflix's metrics-driven culture can help create a highly competitive and results-driven work environment and enable the company to achieve its performance goals. However, it may also lead to a more stressful and high-pressure work environment.
Ultimately, the metric-driven focus of a sales organization, together with the inherent competitiveness of great salespeople, means that you should build your sales culture around Netflix’s high-performance model rather than Salesforce’s Ohana culture.
If you’re looking to create a strong sales culture in your organization that emphasizes performance, you might be interested in our High-Impact Sales Manager program. This program provides sales managers with a complete framework, essential skills, and practical tools to build, manage, coach, and lead high-performing sales teams. Take the first step towards creating a high-performance sales culture for your team today!
About David Jacoby
As a Managing Director at Sales Readiness Group, David helps large B2B sales organizations improve sales performance. Previously, David was a Principal at Linear Partners, a sales consulting firm providing sales strategy, sales operations, talent management, and interim management services to emerging growth companies. In the past, David has served as Vice President of Business Affairs of Xylo, Inc., where he was responsible for the Company's business development, sales operations, legal affairs, and financing activities.