The Keeper Standards Test: A Complete Guide to Performance Evaluation and Team Culture

October 30, 2024 Spencer James

The Keeper Standards Test is an employee evaluation method popularized by Netflix to maintain high standards and foster a culture of excellence. This test, initiated by Reed Hastings and Patty McCord, reflects Netflix’s core belief that each team member should be indispensable and irreplaceable to the company’s success. Inspired by principles in No Rules Rules by Hastings and Erin Meyer, the Keeper Test is positioned as a direct question to managers: “If this person were to leave, would I work hard to keep them?”

Using the Keeper Standards Test has allowed companies like Netflix to cultivate high-performance teams while setting a new standard in workplace culture. This article explores how the Keeper Standards Test influences company dynamics, its impact on morale, and alternative methods that may better align with more compassionate, growth-focused workplaces.

What is the Keeper Standards Test?

The Keeper Standards Test is a direct performance evaluation tool used primarily by Netflix to ensure each employee is a “keeper”—someone the company cannot afford to lose. The concept is simple: managers assess their team members by asking if they would work hard to retain them if they were to resign. Those who fail to meet this standard may face potential termination, creating a performance-driven culture with a focus on excellence.

Initially designed to streamline talent management within Netflix’s demanding, results-oriented environment, the Keeper Test addresses skills gaps, fosters employee psychological safety, and aligns with Netflix’s “freedom and responsibility” values. At the same time, the method emphasizes objective-based evaluations, which can sometimes introduce unconscious bias and risks to diversity and neurodiversity.

Pros of the Keeper Standards Test

1. Retains Top Performers

The Keeper Standards Test prioritizes retaining only the best, focusing on skills-based hiring and maintaining high standards. This method ensures the organization is staffed with people who consistently exceed expectations, contributing to team cohesion and overall efficiency. Netflix’s success with this model, particularly in producing groundbreaking content like House of Cards, reflects the impact of consistently high-performing teams.

2. Enhances Performance and Motivation

In environments where job security is closely tied to performance, the Keeper Standards Test can incentivize employees to excel, fueling continuous improvement and upskilling. For example, Netflix’s transparent culture encourages team members to strive for excellence, knowing their role depends on their contributions to the company’s goals. By aligning employee performance with rewards, organizations can see substantial boosts in company performance improvement.

3. Financial Benefits

Reducing low-performers potentially translates into reduced operational costs, allowing resources to be redirected toward top talent and organizational productivity. This emphasis on efficiency has led Netflix and similar companies to optimize teams, often reducing redundancies and lowering expenses.

4. Effective in Crisis Management

The Keeper Standards Test can be a critical decision-making tool during times of workforce reduction or layoffs. By focusing on the retention of top performers, companies can navigate crises with less disruption to operations. This approach has allowed Netflix to maintain consistent quality in its services, even during challenging market periods.

Cons of the Keeper Standards Test

1. Culture of Fear

The Keeper Standards Test can foster a culture of fear, creating insecurity among employees. The potential for abrupt termination can disrupt team cohesion, leading to a tense work atmosphere. In turn, this can negatively impact employee psychological safety, an essential factor for creativity and innovation.

2. Lack of Psychological Safety

Netflix’s test has sometimes been criticized for undermining psychological safety at work. Employees may fear sharing concerns, contributing less to collaborative projects, and limiting open communication—all of which are necessary for workplace inclusivity. A lack of psychological safety hinders meaningful feedback loops, affecting innovation and employee morale.

3. Disposable Workforce Perception

While effective for Netflix, the Keeper Standards Test may inadvertently create the perception of employees as disposable, impacting employee loyalty. Studies show that when employees feel disposable, it can lead to lower engagement and increased turnover. This can hurt a company’s reputation on platforms like Glassdoor, where potential hires look for feedback on company culture and values.

4. Risk of Unconscious Bias

Relying solely on subjective evaluations can expose the Keeper Standards Test to unconscious bias risks, impacting diversity and inclusion. Without objective metrics, personal biases can influence performance assessments, potentially disadvantaging marginalized or neurodiverse employees. For a company like Netflix, which operates in a diverse and global market, the lack of inclusivity may impact its audience’s trust and loyalty.

5. Challenges for Diversity and Inclusivity

The Keeper Standards Test may present challenges for neurodiverse employees or those who may not align perfectly with typical corporate structures. The pressure to consistently perform may be disadvantageous for employees who may excel in creative or supportive roles but require different support structures to thrive.

Alternative Talent Management Strategies

1. Prioritize Upskilling and Reskilling

Instead of abrupt terminations, companies can focus on upskilling and reskilling employees to meet evolving role demands. Netflix’s investment in high performers could be redirected to continuous training, creating a growth-oriented, positive work environment. Skills gap analysis identifies areas for improvement, empowering employees to advance while ensuring the company’s needs are met.

2. Foster an Inclusive Culture

Building a more inclusive culture with psychological safety is essential for long-term success. When companies prioritize a supportive environment, team members feel valued and are more likely to innovate and contribute positively. By emphasizing inclusivity, companies can support a diverse workforce, benefiting from unique perspectives that enhance problem-solving and creativity.

3. Implement Regular Performance Reviews

Switching from the all-or-nothing Keeper Test model to a continuous feedback approach can improve employee satisfaction. Regular performance reviews promote career development and employee satisfaction, allowing companies to address performance issues proactively. Many companies outside Netflix have adopted this approach, creating a balanced framework for growth.

4. Compassionate Layoffs

When layoffs become necessary, handling them with dignity through compassionate communication and severance options helps maintain company reputation. A structured approach to layoffs, focused on employee well-being, can foster goodwill and maintain morale for remaining employees.

5. Skills-Based Hiring and Cultural Alignment

Instead of focusing solely on performance, skills-based hiring and aligning hires with company culture can enhance long-term team cohesion. By hiring for both skills and values, companies can build a loyal, motivated team more likely to align with organizational goals.

Conclusion

While the Keeper Standards Test can be an effective tool in performance-focused environments like Netflix, it’s not without significant drawbacks, particularly regarding employee psychological safety and workplace inclusivity. A balanced approach to talent management, combining growth-oriented strategies with compassionate practices, better aligns with modern values and supports long-term organizational productivity.

Investing in alternatives like upskilling and building inclusive environments can lead to sustainable growth and help organizations develop truly high-performance teams. This compassionate approach ensures that employees feel secure, valued, and motivated to contribute to the organization’s success.

FAQs About Keeper Standards Test

1. What is the Keeper Standards Test?

The Keeper Standards Test is a talent management method that evaluates whether a manager would work hard to retain an employee, focusing on top performers.

2. What are the pros of using the Keeper Standards Test?

It retains high performers, enhances motivation, cuts operational costs, and helps during workforce reductions.

3. What are the cons of the Keeper Standards Test?

It can create a culture of fear, lacks psychological safety, may foster unconscious bias, and can impact diversity.

4. Are there alternatives to the Keeper Standards Test?

Yes, alternatives include upskilling, fostering inclusivity, regular reviews, compassionate layoffs, and skills-based hiring.

5. How does Netflix use the Keeper Standards Test?

Netflix uses it to ensure a team of indispensable top performers, reflecting its culture of freedom and responsibility outlined by Reed Hastings and Patty McCord.

6. Does the Keeper Standards Test work for every company?

Not necessarily; it may work in performance-driven environments but can harm morale and inclusivity in other corporate cultures.

7. How can companies address unconscious bias in performance reviews?

Companies can implement structured, objective performance metrics, unconscious bias training, and a focus on diverse hiring practices.