Bill Kerr: Companies were taking a closer stock of their internal talent before Covid-19 upended the world of work. The pandemic added impetus, whether by accelerating existing trends like automation or presenting unique challenges. In the case of Mastercard, it was the need to coordinate special projects and volunteer efforts to help customers navigate the crisis. The firm turned to the start-up Gloat for its talent management platform.

Welcome to Managing the Future of Work podcast from Harvard Business School. I’m your host, Bill Kerr. In a first-of-its-kind format for the podcast, I’m joined on both sides of the engagement—Mastercard Chief People Officer, Michael Fraccaro, and Gloat Co-Founder and CEO, Ben Reuveni. We’ll talk about how Mastercard’s internal talent marketplace took shape and look at the technology landscape. We’ll also consider the return on investment, as well as barriers to implementation. We’ll look into the implications of artificial intelligence and machine learning and how post-Covid return-to-work scenarios are influencing talent management. Michael and Ben, welcome to the podcast.

Michael Fraccaro: Thank you. Thanks, Bill. Good to be here.

Ben Reuveni: Yeah. Thank you, Bill. A pleasure.

Kerr: Michael, let’s begin with you, a bit of your background, and what brought you to Mastercard.

Fraccaro: Okay. So I joined Mastercard in November of 2012. I’ve had a number of global roles in human resources, essentially working in financial services for the majority of my career. What brought me to Mastercard was really a couple of things. One was to be part of a transformation as we begin to grow our core business to diversify, build new businesses, as well to support the growing needs of the customer base. And the other critical part was really to help transform the culture, as well, which needed to support the change that was happening from a business perspective. So, how do you tie the connection between businesses that are changing globally, as well as the cultural change and the employees that you need to attract and retain to fulfill that mission.

Kerr: So let’s dwell a little bit on what led Mastercard to identify this as a need and to want to invest and build it up.

Fraccaro: Yes. So the internal talent marketplace, we had been discussing it at the leadership team for quite some time. How do you identify what skills reside in the organization beyond what’s on Workday or some other tool that you have? And what really was the catalyst for this change was actually Covid. And I remember very vividly our CEO at the time, on one of our all-hands talks that we had for all the employees, basically said at the end of his talk, “Hey, we have to support our business in a different way. And there are five projects, and I’m looking for volunteers. So please submit your request to Michael.” And we had a manual internal talent marketplace. That’s how it started. And the response was more than we expected. It was 10 times what we expected. And we basically were able to match, manually at that point, the skills, the interest, and the capacity that people had to these projects that were linked to working with communities, with governments, digital transformation, contactless, anything that you can imagine within the payments ecosystem, we wanted people to be able to put their hands up and say, “Would you like to contribute?” And with that, that was really the starting point to say, there’s something magical here.

Kerr: Well, it certainly sounds like there was, like a two-sided platform might have, two-sided benefits—both on employee desires and engagement, but then also on the business needs. Ben, let’s shift over to you for a second. A little bit of your story and then what led to the founding of Gloat? What were you seeking to accomplish?

Reuveni: Yeah, Bill. So actually it’s quite interesting, because I actually didn’t come with an HR background, because my background, I’m actually an engineer. So I was in the intelligence force in Israel. And after that, I joined a start-up in the storage space. We got acquired by IBM. I had actually two compelling events, like life-changing events for me, that really led me to where we are today and to start Gloat. So the first one was in the army, when my manager tapped me on my shoulder and told me, “Ben, you have a bit more EQ than others here. Any chance that in 10 percent of your time, you can help us with a part-time project that will sharpen the algorithm that will find people to that specific unit?” And I saw how much I’m passionate about using data in order to solve these challenges and helping people to find their next career step. And the second compelling event was when I joined the start-up that got acquired by IBM, I saw how it is like for a small employee in a large company like IBM. I was looking for transparency. I was looking for visibility. I was looking to see what will be in my next career step within the company. And it was interesting that, after four and a half years, I wanted to see what would be my next career step. And looking outside of IBM was much easier for me than exploring within the company.

Kerr: So Ben, that’s a fascinating story—and EQ being “emotional quotient,” so the capacity to think about how to empathize with others and bring more than just IQ into the workplace. What does Gloat seek to accomplish? What are the offerings, use cases, and so forth?

Reuveni: The idea that we had, we said, “Let’s try to create an algorithm that will help people to show them their career path, to show them how they can move from one career role to another.” And that’s what led us to start Gloat. But something interesting happened after a year and a half. We saw that our algorithm showed us that in 50 percent of the time, the next career step for an individual could be within the company. And we had an “aha” moment when we said, “Let’s create an internal talent marketplace, where we are basically matching between employees and opportunities and managers within the organization, while we are showing them they can navigate their career within the company.” So we started with that internal-type of marketplace concept, and we realized, well, companies want not only that. They want to become much more agile. They can do that with two things that we are providing them. One is the talent marketplace, which is kind of a bottom-up approach. Let’s take the employees and create a live, dynamic marketplace within the company. And the second thing is everything that relates to skills foundation. How do you transform your company into a skills-based organization? What’s the job architecture that you have, the skills taxonomy? How do you look on your planning? It’s kind of our top-down approach. So both of them are actually allowing us to create that workforce agility motion.

Kerr: And Michael, this links back to the way you described the two different sides of the desire to build this internally at Mastercard. How did the senior leadership define the objectives of the unlocked project? What were the metrics that you were thinking to put into place around it?

Fraccaro: Yes. So thanks, Bill. So let me just take one step back, and really, this journey from moving from this manual matching that I described earlier to this platform that Ben has been describing to become a digital home for the skills taxonomy, as well as the talent that we’ve got in the organization, as well as the managers that have opportunities, projects, or jobs that they may have, as well as mentoring opportunities, as well. This platform also allows the connection across boundaries, across functional areas and geographies, as well, and also provides another use case, if you will, that we saw was a real opportunity for us from an employee-engagement perspective, an employee-development perspective. So January 2022, when we actually went live for what we called “Unlocked”—we branded it Unlocked. One of the metrics that we had was around utilization. How many of our employees actually went onto the platform to upload basically their LinkedIn profile? And we saw nearly 50 percent within the first month of our workforce of 24,000 going in there and actually doing it. The other key metric was around how many mentoring relationships were actually being created. We saw, again, within the first six months, 3,000 mentoring partnerships. I, myself, had a number of mentoring requests coming through. I remember one individual who had just joined at the beginning of Covid, who had not set foot into an office, was trying to figure out, “How do I learn about Mastercard?” And this individual was based in Cairo, in Egypt. And through this platform—again, this matching—it actually opened up for them what was going on, what Mastercard was all about, but also gave me an insight into what this individual was looking for, as well, from a development and a support perspective. So it captured that particular demand, as well. The other piece, one of the principles that we quickly put in place with the agreement of senior management was that this is not permission based, but more a way in which employees used this platform to share with their manager different projects or different areas that they’re looking at as part of their development plan, versus a rule that says you must seek permission from your manager first. And that also took quite a bit of negotiation. There are managers that want to hoard their top talent, not wanting to let them go. But clearly, that doesn’t work, particularly in this kind of environment that we have, where employees are valuing flexibility and freedom to explore. And that’s what this platform does extremely well. Final point I would make is that, for this to be successful, you really need to have senior-leadership commitment, and we had it from the very top of the organization, from the CEO to the rest of the leadership team, that this was going to be our single front door for all of our development and employee connections that we wanted to have. And so we’re still at the beginning of the journey, I would say. There’s other aspects, like career tracks, that we’re looking at, and a whole range of other things.

Kerr: Michael, that’s very provocative, and I think it offers to listeners some litmus test, first off, which is, you learn more about other members of your company off of LinkedIn versus what you can internally. And that’s some sign that this opaqueness is a problem that you may be facing there. Ben, I want to roll it back though to you. And you outlined the multiple use cases that you provide, from the skilling to the marketplace and so forth. Is there one of those that is for the typical customer, stage one, and then they graduate into other products? And as a second question, Michael described this tinkering, manual talent marketplace that he was doing in the background, which obviously was primed up for Gloat to come in. Are there any baseline requirements you think people must have in place before you would really think Gloat could be effective in the organization?

Reuveni: Yeah. So I’ll start with the second one, I think, and I’ll echo what Michael was saying. I think the executive support is something which is very important, because what we are providing is a change of a mindset. We’re providing a new way, a new operating system, for how you manage your talent. Mastercard was already trying to do that manually. So we were trying to show them, “Okay, so there is a better way to actually do that.” And for the first question that you ask, how do we roll it out? First is to see what the skills foundation looks like in terms of mapping between job to skills, and then taxonomy and job architecture and more advanced things. Or they want to start more with starting to create part-time projects, create movement between employees, fetch internal data from the employees, and put the employees in motion within the company. But for us, there is not a right answer.

Kerr: Ben, how do you respond or think about Michael’s earlier point about labor hoarding?

Reuveni: Something interesting that we learned in the beginning when we are rolling out with the company, typically they’re asking to put limitations on the marketplace. For example, don’t let people less than three years to explore the next career step. Don’t do that; don’t do that. But after a year, we were starting to see them open up. We started to see them removing limitations and really create that open marketplace. And you can see the value out of it. For example, cross-functional assignments, how much it’s important from someone in a marketing division to do a project in the product division, how much it’s fruitful.

Kerr: So, Michael, what are your reflections about the need to really jump into this and integrate the company and try to get those high sign-up percentages that you are describing, versus a more staged approach?

Fraccaro: Yes, Bill, it’s a great question. The way to win the hearts and minds of the senior executive team is to really ensure that they’re on the same page around what are we trying to solve from an organizational perspective, what are we trying to offer from an employee perspective, and what benefits are we going to have for our customers and for our business by unlocking and unleashing all of the capacity that exists in the organization. That has to be the starting point, because I’ve seen individuals just talking about the technology aspect of this, which is, yes, it’s interesting. But it’s this other movement that Ben alluded to—that this is about the future of work. And the more that organizations see it through that particular lens, the more they’ll see the value in what this potential opportunity is here. So then you break it down into, okay, what are some of the pain points that a business leader would think about? So let’s think about headcount constraints. Everyone may be facing, at some point in their business journey, headcount constraints because of expense and so forth. What this can solve is that there is always going to be some free capacity in your organization where someone may have the opportunity to work on a project, and that is sort of a real benefit. Therefore, the manager doesn’t have to go and recruit a contractor or a consultant for a period of time. That is one use case. The other one is really around employee retention. We’ve also seen that individuals that leverage this tool are actually more likely to stay in the organization, because it actually opens up many opportunities that they were not aware of that existed. And from a manager perspective, as well, it begins to help, as well, from a diversity, equity, inclusion perspective, because they’re bringing insights and experiences from different parts of the organization that, again, they didn’t know existed. And so there are a number of ways in which you can weave how this actually benefits the whole human-capital strategy of an organization through this single platform. And so, that’s why I’m very passionate, very excited about where we are on the journey.

Kerr: I want to continue, though, with that senior executive team that surrounds you. And one of those individuals will be the Chief Financial Officer who needs to be involved in the investment that goes into this. Let’s think for a minute about how we measure the return on investment. And you talked about cultural shifts and change, and practices that could reduce employee turnover, which is very important and really helps organizations but can sometimes be hard to measure. And so I’d love to paint a little bit more of the picture of how that particular buy-in happens.

Fraccaro: There are a couple of ways that we looked at this. One was around just from a pure retention perspective. If you have a 1 percent improvement on your retention, that translates into thousands of dollars. So that’s sort of one particular piece. There is a cost avoidance aspect, as well—that if you are leveraging the talent internally, you’re not necessarily going outside to bring in consultants. So there is that dimension, as well. And then the quality of the product, as well, is another way in which you can quantify to some extent what you’re actually doing and delivering. So there are a number of metrics that we’ve been using, as well. The other dimension here really is—and this is an important metric—how is the organization perceived internally and externally from an engagement perspective? And so most organizations have their own employee experience surveys, where you look at career development or an external, such as a Glassdoor, where people would rate you from these particular dimensions: I would recommend Mastercard as a place to stay. And we have seen in the last 12 months our scores have increased on those particular dimensions, as well. You see that the investment that we are making is actually paying off, and that helps both in terms of building pride in the organization, but also attracting new talent into the organization, as well. So there are a couple of ways in which we’re measuring.

Kerr: Ben, let’s go over to you.

Reuveni: The way we measure our ROI is for three groups. So the first one is for everything under talent, which I mean by that everything that relates to employee engagement, cross-functional hires, even DEI, retention, everything that relates to your talent strategy. The second thing is under financial. And that really ties together to the CFO. And what he cares about is the company headcount, how their workforce planning looks like, where are we hiring, where we are changing the headcount structure. So it’s very important for them to see how they’re planning ahead for the company. And the last one, which I found very important for what we deliver to companies—and Michael touched on that—is the business impact, which basically ties to the commercial leaders within the company, how much we are able to provide impact on the business. And I’ll give a few examples. We have companies that assign team projects together within our talent marketplace that have a direct effect on billions of dollars of revenues for those companies. And it’s exciting to see every day the impact we are creating on making the company much more agile and enable them to decrease dramatically their time to market for products.

Kerr: Michael, any other lessons to highlight from Gloat being involved and installed in Mastercard and helping to guide its internal people?

Fraccaro: Yes. So a couple of the lessons that we’ve learned along the way. One is that this is not something that you can just put in a tool and just let it run. It has to be curated. You need to have the infrastructure in place, a project manager, if you will, that curates content, that feeds the tool, itself, that coaches managers, as well. So, for example, where we see less success in terms of matching individuals to projects is when the project is put onto the platform, but with no clear timeframe, no clear clarity around the kind of skills that they’re looking for, no real clear definition of the project outcomes. And, therefore, they’re unlikely to get the right talent that will go into those particular projects. So helping the managers, as well, and coaching them around that is really important. The other piece is around sharing stories, as well, and ensuring that we are able to say, ”Hey, as a result of using the Gloat platform, we have seen that X number of individuals have been able to move from the project to a full-time job.” And selling and celebrating those stories is really very important, as well. The other piece is, there is a seasonality aspect, as well, to this. So, typically, there are ebbs and flows during a year, and you tend to find that, let’s say for us, it’s in the middle of the year, where it’s all about talent development and development conversations, where individuals sit with their managers to talk about how the year has gone from a development perspective, their strengths, their aspirations, and so forth. And we, obviously, see an uptick during that particular couple of months in the middle of the year, where people are using the system and the tool. And there’s, obviously, reminders around informing people to keep their profiles updated—because, again, the system and the tool gets better once there’s better data in there, and it does better matching. And so there are those kinds of things that are really important in terms of feeding the beast, if you will, to ensure that you get the better outcomes at the end.

Kerr: We’ve talked about the internal talent marketplace within Mastercard. Ben and Michael, is there a way to extend this into multiple organizations or communities?

Reuveni: Bill, it’s an interesting question, because what we are seeing right now, we are seeing a great appetite from cities who are coming to us and telling us they are looking for people to help them to advance their city’s day-to-day life. So they had an idea, why not connect those marketplaces for the companies that are using those marketplaces, and let the employees participate in a part-time project, in a volunteering project for those cities.

Fraccaro: I think it’s super powerful, Bill. And we’ve got, like most companies have got, volunteer programs. So we have five days of volunteer leave for employees, and we see a huge uptake for individuals doing works in their communities. And so, this notion of being able to have the Gloat platform connecting with other companies that are like-minded, where the cities actually say, “Hey, we need these particular skills,” or, “We need this particular help,” we will find that many employees, because it’s presenting to them options, they will say, “I’d love to participate in that.” So I think there’s another philanthropic and social good that can come from this.

Kerr: Let’s springboard straight from those lessons into, as a Chief People Officer, what you think about technology broadly, data, artificial intelligence, machine learning, what do you see in your three- to five-year roadmap? What’s the potential advantages that we could be accruing? What are the things you’re worried about?

Fraccaro: I just recently spoke about AI and the applications of artificial intelligence in the way in which we do recruitment, in the way that we’re leveraging from a development perspective, in the Gloat platform—the ways in which it helps from an efficiency perspective. So if you take, for example, scheduling, scheduling of interviews for candidates. We’ve seen a 75 percent more-efficient approach to that whole aspect of a simple thing like scheduling than it was done before with a manual process. So there are ways in which it helps productivity. It helps in this matching, which we just discussed, with this Gloat platform. We see it from the web crawler, if you will, to put a question out there around, “These are the kinds of skills and backgrounds we’re looking for; provide me with an engineer with this kind of experience that focuses on payment.” Those kinds of things are very powerful, as well as from a management perspective, using it in a way that provides managers with nudges that says, “Hey, it seems like, Michael, you haven’t met with Joe in your team for the last three months. Maybe it’s time for you to have a development conversation.” That’s where AI can be very valuable. Now, obviously, if you are alluding to things like ChatGPT and other tools, then you’re starting to get into interesting ground—interesting ground, because it can be a real enabler. But there’s also ethical questions, as well. I think that still is a journey that everyone is on, around how do we find the best of this, but also protecting from a potential risk that could actually impact privacy, integrity, a whole range of different things. And I think that’s the areas that most HR professionals are concerned about, and clearly the governments are, too, because governments are putting in place legislation to protect and to ensure that there’s a level of transparency there.

Kerr: And Ben, for Gloat, ethical AI is very important. And you are actually putting in place now the features and products that will be for the generations over the next two or three years. So talk to us about your product design, customer implementations. How are you really embodying that ethical AI?

Reuveni: So, obviously, ethical AI is one of the most important things for us as a company—that we’ve started Gloat with the idea that we wanted to remove bias. We wanted to democratize careers to everyone. So everything that relates to ethical AI is kind of a mindset of the entire company. We are following well-defined ethical guidelines. We are now about to announce our ethical AI advisory board, that combines with very experienced and professional people that are actually helping us to build our product further and creating kind of a committee that will help us to see and to test ourselves, and to check ourselves all the time with all the new things that we are creating today. Up until now, when people thought about a technology that will replace employees, they always thought about blue-collar employees, like there will be a technology with automation that will replace kind of something that you are doing manually. But now, with all the generative AI, we are starting to see that it’s actually, the bar is higher right now, and now also has an effect on white-collar employees. If you are leading a company, if you are the Chief People Officer in a company, how do you look on your workforce? How do you understand which employees you need to up-skill them, re-skill them? Well, how you redeploy your time within the company? I think that’s become a very cool thing for the organization right now to really realize, how they are planning their workforce ahead and thinking how that will affect their current employees.

Kerr: Strong impetus toward the future. We have maybe a lightning final round here. Michael, let’s start with you. As you think about your return-to-work post-Covid strategy, talent management in the future, is there something you would like to leave our listeners with?

Fraccaro: Yes. So, the world has changed. The pandemic has taught us a lot around the whole dynamic and relationship between employer and employee. For me, it is around flexibility. There may be variations in terms of how many days someone just coming straight out of college would like to work from home, versus someone who’s more seasoned, if you will, like myself, that coming into the office and so forth. But the flexibility angle is a huge one that I think most organizations are beginning to recognize, that is hugely important. And I think leaders need to move away from just measuring the success of future of work around how many days in office employees are, but looking at a whole cross-section of metrics, as well. The big question is always around productivity. You read one study, it says productivity goes up, another one says it’s down. It’s got to make sense for your business. And for us, we’ve gone down this journey around flexibility first. It links with our culture of trust, and we’ve actually gone out there in saying, “We want every team and the team leaders to develop their team charter and a team agreement around what works best for them.” So there’s not a one-size-fits-all, is sort of the key message I’d leave you with.

Kerr: And Ben, there’s a lot of entrepreneurial interest in the future of workspace. If you get the chance to speak to the students thinking about ventures in this space or other young entrepreneurs entering it, a reflection that you leave us with.

Reuveni: An interesting reflection, actually, that I realized only four years in running a start-up, which is now almost 300 employees, is that use advice from previous CEOs who did success and did their journey and use their advice. I have added Lars Dalgaard, the CEO of SuccessFactors, who got acquired by SAP. I have a few more CEOs with very successful companies that got acquired, as well, advising me. So find the right people who can help, giving you good advice. CEO is a lonely role, but I think if you find the right people that give you their advice, it really can help you do your business and help the business grow.

Kerr: So even while we may remember November of 2022 as ChatGPT’s debut, the advice of senior leaders around you can still have some extra merit there. Let me thank both Michael and Ben for joining us today. We appreciate this conversation.

Fraccaro: Thank you, Bill. Thanks, Ben. Good to see you again.

Reuveni: Thank you. Thanks, everyone.

Kerr: We hope you enjoy the Managing the Future of Work podcast. If you haven’t already, please subscribe and rate the show wherever you get your podcasts. You can find out more about the Managing the Future of Work Project at our website hbs.edu/managingthefutureofwork. While you’re there, sign up for our newsletter.