Netflix's expense policy is one line: "Act in Netflix’s Best Interest."
Some employees think it’s too vague. What exactly does Netflix’s best interest mean? How will we know?
This approach differs from what you find in most companies, where there will be a thick rulebook describing when you can expense something. e.g. "You can expense dinners up to $30 when working past 8pm and $75 with a client, but not the client’s family.”
At my first job, there was a controversy when a new employee expensed a haircut before a high-stakes client meeting (so he could look professional for it) while HR tried to interpret whether this was allowed by the rules. So they created a new rule about haircuts. Policy whack-a-mole.
I think Netflix has it right here. And that coliving communities should mostly govern themselves via principles rather than rules.
What are some examples of principles?
Doocracy
Doocracy is a principle that we rely on heavily at Radish and other communities in the Bay Area.
The principle of doocracy: “You can do anything in the best interest of the community without permission as long as it's mostly reversible.”
People can buy a new can opener without figuring out the procurement rules.
They can rearrange the living room furniture without holding a meeting first.
If you are looking for crystal clear guidance in every single situation, the principle of doocracy is not going to provide that.
Does painting a wall count as reversible if you can paint it back?
Should I get people’s thoughts before archiving a bunch of Slack channels?
What it does allow is a single principle that can align behavior without the need for a thick rulebook.
Abundance mentality
This is a principle that applies to what food people can buy. The principle: “We live in a community of abundance and everyone should get what makes them happy.”
Everyone has one food item that others might see as a bit of a splurge, but is important to them. For one person, it’s the fancy cheddar, for another it’s the frozen coffee pods. The Abundance Mentality says that everyone gets their thing. And that we are happy that our friends get their thing (think of it like buying your friend a drink once every couple months) and we have permission to make ourselves happy by getting our thing.
Can people buy lobster every night then? Well, no. Everyone sort of knows when this principle is being applied in bad faith. And if they do, you can have that conversation. In our experience, this doesn’t happen in reality.
The alternative
As an alternative, you could imagine a nightmarish tome describing things that require approval, how much approval they require, and what the process is needed to get that approval.
That tome would grow and grow over time as more edge cases are discovered and eventually you’ll need a person who can help interpret it.
Rulebooks in a world in limited attention
I believe long rulebooks undermine communities.
A community that governs by rules rather than principles is destined to spend all of its scarce time together crafting, editing, and debating rules.
This is not what you want to use your community’s scarce attention and time for! You should be using time together to strengthen bonds, tackling thorny issues, and creating together. You should not be using scarce gathering time debating whether the guest policy should be 2 days or 4 days and whether that changes when the guest was a former resident.
And inevitably, once the list of rules get long enough, people will start forgetting them. No one wants to go reference a rulebook in a Google Drive somewhere. If you have more rules than people can remember off the top of their head, it’s a good sign you need to replace them with principles.
(This is similar to the advice I gave on how to structure cobuying for vacation homes … make it simple enough to fit on a notecard)
How do you enforce principles?
A system of rules will have a set of clearly articulated consequences for breaking the rules, e.g. go above the speed limit and get a $50 speeding ticket.
Let's go back to the Netflix example. If HR thinks you are flouting the principle of "spend the company's money wisely" what will they do? First, they will probably talk to you. And then, if you continue to flout the principle, they will fire you.
Yes, people who habitually violate the community's principles, should be asked to leave the community.
And who gets to interpret whether that's the case? Well ... the community.
And what if the community is wrong? Well, tough nuggets. That's what it means to be governed by a community ... the community is going to make subjective judgments in what it interprets to be its own best interest.
Don’t forget to model the norms!
Norms are the cousins of principles. You need visible norms of behavior to reinforce the principles.
A doocracy isn’t a doocracy unless there are examples in the culture of people doing. If you want people to do, show them what it means to do.
So leaders of a community need to model the behavior they want to see to compliment the principles. Otherwise, they will just be words in a Google Doc somewhere.
I agree with everything in this post, but I think you’re missing one really important facet of any well-functioning community: conflict mediation. When people disagree, and conflict breaks out, it is extremely helpful to have very clear guidelines on how decisions will get made.
For example, when you’re talking about kicking someone out of their housing situation, it’s very good to provide actual rules with actual numbers, so that people know what rights they have. E.g. “Nobody can be forced out of the community without a 75% vote from all residents of the community, which can be held at any house meeting, as long as everyone’s given 72 hours notice about the intention to hold such a vote.“
Similar guidelines can be written for broader conflicts/disagreements. Ideally, you never have to use these rules! But if you don’t have them, conflict can get very messy. Ideally all your community rules can fit on a single piece of paper. I work at a cooperative and our company
bylaws are about 2 pages - and that’s an enforceable legal document! Surely a community house can keep it under 1 page :) And if everyone who lives there agrees to those rules, then they can actually be held to account on them.
Chalking it up to “the community decides” leaves a lot of room for gossip, and the most privileged voices to actually drive decision-making without being held accountable to it. Schedule a meeting and hold a vote! This gives everyone a guaranteed place for their voice to be heard.
But I totally agree that long books of rules are useless, principles are very useful day to day, and even voting should be a last resort!
Principles work very well instead of a laundry list of rules. This is one of the reasons why fighting is permitted in hockey. The definition of a cheap shot is almost impossible to completely define. So you let the players manage it themselves. My concern about principles instead of rules is how to guarantee the rights of the individual. In Hockey it should be noted that this fighting is mostly constrained to one-on-one and both parties must be willing to participate by dropping gloves. I support this methodology of.principles in place of rules in work and professional life. I'm not sure if I'd want my living situation to be dependent on the whims of the majority.