Rodrigo:

Organizations are made of people and people break or make your organization join me. As I talk with Anne Caren about people strategy how to build up your people so that they can build up your organization. She was hired to place Google on the map as a top employer in Europe today she helps Founders to scale up through their people strategy. Join me for another great conversation. And thank you for accepting my invitation. Welcome to the show.

 

Anne:

Thank you very much for having me. It’s an honour. I have to start by asking you. Why did you leave Google and started working with startups? Are you nuts?

 

Rodrigo:

Yes, I get that a lot. A lot of people when I left Google were asking me why I would leave such a company. But yeah, in total I stayed with Google for 10 years and it was Hi of time for me to leave when I joined Google in 2005. The company was still rather small globally, where only 5,000 people and in Europe where I was based. It was 1,500 people. And so, we were actually struggling a lot to attract people People didn’t know Google as an employer, then use such an engine, of course, but not so much the employer. So, we could not attract people, people were not Lying. So that’s what I was hired. It was fabulous because everything had to be built. There was no nothing in place, really, and I’m a builder. So that was fabulous. Ten years later we were 65,000 people, so quite a different company with different challenges and so, I didn’t have as much of a passion as I had at the beginning. So that’s when I left. I’m quite sure what I was going to do and meeting with people in start-up environment and realizing that. Whoa, that’s definitely type of place for me. The ecosystem was still very nice in tin in Asia, that was in 2015. So really, they were not that many startups there so, everything had to be built. It was made for me, and a big challenge is to just solve.

 

Rodrigo:

Now it makes total sense. So, what drives you?

 

Anne:

What drives me is exactly, you know, solving big problems. I think what try, I was lacking when I was at Google, was the impact towards the end to be able to really have an impact on the organization under people and the world potentially And this is something that I have found in what I do now. So, this is really what drives me. What excites me as well as working with Founders startup. Founders are often very inspiring the carry out missions that are beautiful. I get to choose those worms which is fabulous. So, this is really, really also driving me What I do.

 

Rodrigo:

And what breaks your heart about what’s happening today in the world, or around you.

 

Anne:

What breaks my heart is. When people are unhappy at work and when companies break, because the founders have not or the leaders, have not anticipated enough, he’d advance to see problem issue are people issues and that’s usually what breaks companies. Its People. And so that breaks my heart because people are unhappy, and I want to make my mission. My personal mission is to bring happiness to the workplace. And so, yeah, when I, when I, I often see startups, that have everything to be beautiful with, as I said, inspiring Founders, gorgeous Mission, amazing crew. And, you know, at some point It just breaks because there are some elements missing this engagement starts to happen. People do not really know why they’re here anymore. And yeah, that’s I fight, I find out sad.

 

Rodrigo:

So, this is a good segue to understand the topic of today, which is like people strategy in startups. So first, like, what is people strategy?

 

Anne:

Very good question. Because I don’t think it’s yet a thing. People are starting to speak more and more about people strategy now. But when I started, and I came with the terminology in in a in Asia, eight years ago, it was not really it. So usually, people stretch people sees people strategy as hate sharp, as there’s much more than just a chart of people strategy. You need to think about this in this way, companies are made of people and people will make or break the company. A business plan, which is what the company is here for, right? There’s a mission and then they have a business plan on how to execute the mission. Is only just a piece of paper until you actually have people to execute it. So, it’s all about people and so limiting, the people strategy to just hate Char is A big mistake, the responsibility, the ownership of people strategy is not with HR. It is with the founders with the CEO because as this setup, is a business strategy, right? After comes the people strategy, which is how do we deliver that and what are all the systems that can? So, it’s much broader.

 

Rodrigo:

Yeah, I think it’s such a big topic. There’s so much there to unpack but I think what I would like to go is Like, you mentioned before that, you see a lot of startups, they everything they have the mission, they have the, their Inspire, they bring the team, but at some point, something breaks. Right? What is that what’s happening with the startups, when it breaks?

 

Anne:

So, there are usually a few mistakes that they’ll start to make early State. I would say to usually starts early stage, when building the foundations usually it’s either this start building too early. So, they had too many too much complexity into the organization while they’re there. Very small and it doesn’t require that. For instance, I have seen startups as small as 10. People have 360 performance review or an employee engagement, or employee satisfaction survey. And it’s like, you know, how why adding so much complexity and driving in efficiency while you can actually speak to people. So that’s one of the main issues. The second is to build too late to teach you to focus. A lot on the business strategy, we need to get there. We need to get there to grow and to grow up to a certain scale where the problems are starting to raise and they’re calling, you know, people like me or the hiring HR saying fix it, but the foundations not being there, it’s only just you know, adding A few things here and there that are not going to fix because you don’t have the people strategy, it’s not there And usually when it’s too late, the founders are already, you know, so into firefighting that is extremely hard to get them to sit down and just think, mmm, I love that so much, so it’s about focus on building the foundation but taking into account, not to bring too much complexity at the Beginning but also, not to bring like the systems and the process that I needed to late. Right? Exactly. So, it’s hard by thinking. Hmm, then you’re extremely cautious of what you build in, which you add on your paper, right? You have a blank page of paper to start with. Yeah. Share it. Yeah. And then I’ll only be adding which is solving a problem.

 

Rodrigo:

Yeah. And I mean, you spend so much time with Founders. What are the biggest challenges that they face?

 

Anne:

Especially at the beginning when they are building their startups with people. The main challenge that Founders have is to try to be somebody else. I would say, usually they have an idea of what a great leader is or what type of Company. They want to build Google coming very often and they try to build something that is not there. So, usually by advice to them as first look in the mirror. See who you are and embrace that person because you will not build Google unless you’re Larry and Sergey, okay? And you’re not Larry and Sergey so the company that you will build Will be yours and it will be unique in that way. S, very so much that as a Founder, you need to learn in your journey things that you have never done. You know, when your founder at the beginning, you’re wearing all the hats, right? You’re the salesperson, the marketing person, the HR person, the, you know, admin person, you are doing everything, and you’re that good at everything. So, you need to learn new things. And then you’re going to move as a manager and then a leader. So, a lot of skills to take on in to learn each other’s her or her. Lee ones that you can learn overnight, you know, it takes time to acquire all those skills, so you don’t have the luxury to become somebody else on top of that. So, the main thing that I see is that Founders do not take that time early stage to identify, who they are, what, what drives them, what also really pisses them off and to build an organization based on that these, this is the of the funding. The funding is really the foundations of the culture and the values in the organization. Mm. Yeah. I like that. And what do you see as some of the misconceptions or myths that you hear around the startups? Well, so that’s a great segue to what I just said earlier culture is, is a big one. So, a lot of Founders feel that Is something that you can build, but you don’t build a culture, is it? Just is usually what we mean by culture, is how people experience working with you, write the how, what it’s like to work in your company. The reality is that you can’t, you can’t fake it. It’s just the way it is. And that’s why it’s so important for Founder’s to do this. This work of knowing who they are, because then they can identify what type of company they are, how people experience working with them. Are they more, you know, data-driven or not data driven Fern or not fun? We don’t need to be fun, you know, that you’re not going to force yourself to be fun. And there are people that actually much preferred to going organization that are, you know, just work and professional and corporate e, and all this, and that’s fine.  So, the first misconception is to think that culture is something that you build, and as a consequence people, look at values. As more as objectives, we need to be, we need to be Innovative. We need to be challenging. We need to be blah, blah blah. Well, if you need to, it means that you are not and so you can describe yourself as such. Whereas when you define your culture, it’s we are this people, they will this use those terminologies to describe, what? It’s like to work there and therefore you can hire people who fit with that environment, you can hire people who like an environment that’s and they will thrive in that environment as opposed to hiring people that you wish will bring this in your company. That is terrible mistake. It always ends badly. So that’s the first one. The second one is, it’s a, it’s quite an interesting one. It’s around incentives. So, there is there’s a belief that in order for people to be motivated to do something, you need to put a carrot in front of them, but that’s not true. That’s works for donkeys, not for people. So, in order to motivate people, you actually need to trust them. You need to provide them. Some guidance, you need to equip them. Well, they need to know, you know, what’s the objective? How to get there? What do I have to get there? And, and then trust that you hired the best person. I mean, if you hire somebody just because you believe that the right person is3, so let them do it, okay? When you do, when you have a carrot, you’re kind of doing the other around. It’s like I don’t trust you. So, in order for you to get There. I’m going to put a carrot in front of you and then you’ll get there. What happens when you do that? Is that the people instead of seeing the big problem? So that your mission and how they contribute to your mission, they will only see the carrot, which is, I need to do that. And so, it really reduces their ability to perform to be Innovative. And so, we have seen research have shown that performance. It’s actually decreases. Within in incentives and the higher the incentive, the lower the performance. So, incentives are to be banished. It’s typically the end of your bonus. When we tell people, if you do this, then you will have your annual bonus. It’s much better to bring this in in the day-to-day, right? If you what you’ve just done with that client, is Being here is feedback and you can have potentially a small reward with it. That’s how it works. Much more. But, you know, the annual bonuses is quite terrible. But there’s also one thing about the, the annual bonus that is really wrong somehow. It’s because when you have an annual bonus for actually doing what you’re hired to do, it means that the salary then is only just for you to show up. Right. And so, of course, the performance is not going to be there.

 

Rodrigo:

Wow, this! too is so big, so big. So, I do, and I see what you mean, when you started with the, in terms of culture, I see a lot of Founders, like, even going to other companies to see their values and then have as a defined, the values for their company. And as you said, like almost as an objective, what I, what I like about what you said is like, you start with yourself, you build a place, which is yourself. And then you attract the people that resonate with that, right? And you don’t need to have a company which has a culture which is not you, right? You don’t have to write and I really, really loved that. And then the second, the incentives, one is a huge one and I think we can go now a bit deeper, so maybe you can give us some examples so that we can better understand of what are some KPIs? Is that you think they are super important today for startups to me? You’re the people performance in their organizations.

 

Anne:

Yeah. So, one is what I mentioned the behaviours. So being able to measure the behaviours of our employees, their ability to perform, that’s the first one. The second that I encourage companies to keep an eye on, right? It’s those are indicators so that things that we want to check to ensure that we are in track. Is the quality of their managers performance happens in the teams. It doesn’t happen at the top. When I went in that something that must Founders have to realize. And to remember once you’re at the top, it’s you know you’re here to build a strategy but then the execution happens at the in the teams. So, the managers are extremely important to drive performance. I have never seen A performance review. Change a poor performer into a high performer. Only a good manager can do that. So, the role of a manager is to manage the team today must managers have matched meant responsibilities on top of doing the rest of their of their work. And so, it’s extremely important that we have measures that can take time for the team, coach them, Mentor them, clarify the goals. Remove roadblocks. Etc, etc. So, finding ways to measure the value and in the quality of the or management teams is very important, there is a great tool in a book that was written by Marcus Buckingham, which is called First Break, All the Rules that gives a, you know, 12 questions that you can build a survey on and assent to the teams. So that’s the second. So, the third one is the ability for a start-up to innovate. Without Innovation, a start-up cannot be a corporate cannot either, but just heard of even less. So, it’s extremely important to find ways to identify whether your organization is able to stay ahead of the curve and must start up struggle with that especially because the founders do not want to let go of the control. And when the management led doesn’t let go of the control, it means that everything is stuck with them. All the ideas, all the decisions are at the top and they become the bottleneck of the organization.

 

Rodrigo:

Can you give one example in each? One of them just an example, so that people can know, what are you talking about? When you’re talking, for example, about behaviours about quality of the manager, and the ability to innovate.

 

Anne:

So, in terms of behaviours, basically the at the That that’s usually what you would Implement at the annual review. Yeah. And so, you would have instead of checking the objectives and the achievements, you would check the how, how did they get there? So, the objectives and achievements are more illustrations of how they have shown behaviours. So, behaviours would be, let’s check just one but problem solving what is their ability to solve problems? It’s much more valuable for an organization to have people that can solve problem that somebody that managed to reach their objective once. So that’s four for the behaviours for the managers. So, I mentioned, it’s a there’s a list of questions that are in that book, but that’s their ability to, to create rapport with the with steam, how much to give feedback. Do they give does the team feel valued to the can they speak freely and provide ideas, Etc? So those are the type of things that you want to have in a good match. ER, and the third one ability to innovate. There are three elements that drive / Innovations. The first one is diversity. So, you need to have diversity in the team to be able to bring different ideas. So, checking that you have good diversity in your teams and in your organization. The second one is empowerment. So how much people can make, you know, Drive Questions, you know the ideas how much they can ideate and how, how worried they are a failure as well. So, it’s a whole thing around building a safe environment. So, seeing where the best ideas come from. If they all come from the top, you’re probably not going to be able to innovate. If you have systems where, you know, you see that some ideas have been Coming from typical example is Google, that 20% projects coming from the bottom. Okay so that would be the second one and the third one is engagement. So, people need to have to be engaged and and work on something that is Meaningful to them. That’s what I spoke about with seeing the big picture as opposed to the carrot. Mm. Yeah, I like it so much and I think there’s it’s a myself. I felt challenges. On defining exactly. What is the, what shall we measure in order to really to add value to the organization? And I love what you brought, you brought a completely New Perspectives from measured the behaviours, measure the quality of your managers manager, your ability to innovate. That’s what’s going to take you to your goals and not just focusing on the goal itself. So that’s awesome. I loved it. And if I may Yes, you may there. We live in an era where data. Is everything. The truth is indeed, ER I think it’s an error and we need to bring back the human in the equation and that’s the whole thing about Chat GPT, right? Okay. We have a lot of information but what can we do without human interpretation? And so, it’s all about that. And so, what we’re seeing and what I’m seeing in organizations today is that Buddy leaders managers. HR they’re eager to use tools that were generated data in order to solve people’s problems. And so, by doing that we are removing our selfie will further from the shoe whereas just removing the tools from time to time would help to just connect with the people and understand. I think it’s a huge one of the main China Challenge of hard time. Reconnecting people and seeing how simple it is just to speak to each other as opposed to have systems. That will it’s just that it’s in comfortable. It’s a very uncomfortable it’s a big change for managers because when they have the possibility to ask their team, how they feel or to send a survey they will all go for the survey. That’s such a huge topic, you know, I there’s so much data out there so much technology you know, but organizations are made of people is what drives the performance as you say. And in order to build more, let’s say human Centric. Organizations, what is like okay, such a huge topic, but what is something very small that leaders can do to go in that direction. Very simple. Do not do it sir. So, I said, you have to share it. Your blank page of paper. This is gold. You know, when you’re starting as a Founder, you have nothing, right? There’s no processes, there’s nothing, it’s great. That’s what that’s why in a start-up the early stage. I always seen as you know, the, the Good Old times, it’s because that we were so connected, so we need to stay lean. In order to stay lean, you need to be extremely careful about every single process policy tool that you bring in your organization. How can you be? Careful ask the question. Why do we need this is it solving an existing problem or a problem that we know is coming. If not, you’re must probably just copy pasting what other companies are doing and not really knowing what it’s bringing or using. If it’s of something, you don’t have broken, and it will create more complexity and must really problems. Mm. That’s so it’s all about not doing yeah, I think that’s a great one and for people like their leaders and they want to build a high-performance team, what’s your advice, what can they do in order to drive high performance team? If we start from the beginning first, be clear about who you are. What you want to do, okay? So, the plan needs to be clear, then you need to hire the right people in the right roles at the right time, and then you need to provide them, equip them probably in. This is when it comes with the right matchers, the right environment is safe a safe environment where they can innovate, they can ideate, they can be empowered to control things. Fail and have a positive positivity. Mm, you mentioned something that I really like, which is to bring the right people, but to the right role at the right time, but for a start-up who is starting and there’s limited resources. What is your advice to get the right people. Yes, very good question, one of the big, biggest concern of a Founders early stage. So, first thing, be clear in terms of which, which you want the thing, is that when you start, you don’t know what you need. So, my first advice is higher fast, Fire fast. It’s not something that I would recommend ever to bigger organization, but for smaller organization. That’s the best way of learning feeling is the best way of learning. So, higher fast, figure out. What goes where? Well, what goes Strong and Fire fast as well. So, get the learning and don’t worry about. I don’t want to be a bad boss, Etc. It uses can still be human while letting people go. I always say. There’s only win and lose in an organization. There’s no win-lose. So, if one of the two parties between the employee and the employer are losing, it’s a lose-lose situation. So, it’s extremely important to stay in the win all the time. So first, you need to identify what you need and go as fast as possible second. It’s true that startups do not have a lot of resources and the thing is that actually the best source of hire and the most qualitative source of hires is the one that is the least expensive. It is Network referrals, you know frames. That you meet asking friends of friends there. So, it’s all about how you phrase the question as well. Don’t ask necessarily for. Do you know somebody who is looking for a job in this, like who is the best person that, you know, in that field, who is the best person that you have ever worked with doing this? And then you speak to that person, they’re probably not looking for a job, but who cares? You speak to that person? Perhaps, they’ll come on board but worst-case scenario. The probably good people know, good people.

So, I will refer you other people, so you build your network this way. So that’s the least consuming in terms of money. It’s consuming in terms of time, obviously. So, from the moment you need to hire more people and I would say, from 20 people in the years of, from the moment you need to hire a minimum of 20 people per year, it’s a no-brainer have an in-house recruiter, the cost there, the Return of investment is immediate and frankly a recruiter doesn’t have to be expensive. You can have a good recruiter with only 23 years’ experience.

 

Rodrigo:

So, you mentioned about people strategy. But how do we ensure that we maintain trusts as an organization grows?

 

Anne:

One of the challenges that startups have during their growth is when they get into hyper groups. Because all the sudden there are a lot of people that joined the company in a very limited amount of time. There is double treat Paul within six months or less. And so, what is happening is there’s a huge distance that all the sudden is created between the leadership team and the rest of the team and that’s when Silo start just to form. And that trust Just start to be lost because in order to manage such a change between a small organization, where everybody was speaking, I mean, in, in a small organization, everybody is part of all the decision, all the challenges, they know where we are, at the know, what their objectives are. What science? They’re not all that. It’s clear. If they wanted to have a question, they could directly to the CEO and the ask for it. Now, when you have 100 people, all the sudden it’s not quite the same. So, you need to put in place some communication tools to ensure that the connection still exists between the top and the bottom. And that’s usually when this is broken or not existing that we have in the team’s people that feel that they’re not being kept in the loop that they are being told that last time, it’s been decided without them etcetera, which must organization have.

So, in order to solve that you need to create that from the foundation and or that you are building a true leader at the top. Somebody that will communicate and over-communicate all the time. That’s really one of the key jobs of the CEO, when they reached a big organization and then have good leaders, good story, good managers, that will be able to be the ambassador’s and help the team’s understand HR helps building this framework. But they’re not part of the overall system that building it. I think just to finalize this topic. I think it would be nice to just to finalize with incentive, which is a huge challenge for many startups. Then what’s your final recommendation? In terms of how do you build an incentive for employees? That really brings value to the company and also motivates employees to be part of the journey. Ah, so we need to look into what motivates people here. I mean the incentive. Why do we have incentives to motivate them? So, we know that the carrot doesn’t motivate actually, it doesn’t, or it does for the wrong reason. When you have a carrot to, you’re basically making, basically making a promise, you’re saying, if you do this, then you have that in your brain. In the employees, bring they already have it. Already when you tell an employee, your salary is going to be this fixed. Plus, this bonus, they already calculated that in total, they can have, and they will have this. So, this is not motivating at all because at the end of the year, how many employees actually have 100% of their bonus, ten to twenty percent only? In an organization. Usually, you know especially those that use the bell curve and tend to. So, it means that you have a system where 80% to, 90% of your people will be Deceived and frustrated. And the 10% there will be potentially happy, but they will most probably say, well, that’s what I’m worth, in any case. That’s so incentive, not working. What motivates people is the impact, the fact that they feel that they’re, they’re doing something that is Meaningful. And so, it’s all about getting into that positive cycle. Where I feel useful, I feel that I’m drinking and something that is Meaningful. I feel that I’m good. I’m feeling recognized and therefore, I want to do more. And so, when you get into that cycle, it’s immediate and money is only just something that needs to cover the need.

So, you need to pay people you know fairly but that’s a conversation that happens once a year the rest is about how about you and how you can you know get into that Circle where you know you’re super excited to get into a challenge to do something. It’s so you’re doing something that you love. That you feel good doing. That’s what you do today, right? I mean, you love doing what you do, so that pushes you don’t count the hours and then you get recognized for it, and then you will do more of that. And so that’s why it’s not incentive, its recognition. So bringing it back to the immediate action when you do something amazing immediately, I would tell you, fantastic that you’ve done is just great by doing this, you helped, and Number of leaders, you know, get better Clarity in terms of how to measure, performance, blah, blah blah.

 

Rodrigo:

So, do you do suggest first before startups to give bonus at the end of the year to the, to their employees or no, not at all.

 

Anne:

Exactly. Not at all. So, no bonus. Yes, and bring back bring, if you want to have to have some additional on top of the, the salary, then that on Specific occasion when people do exceptionally well. So, they go beyond the expectations of the rest is covered by the salary. Yeah. But if you do exceptionally well, in terms of either achievement, but also, it could be efforts. Somebody that spends a whole weekend working on a report to ensure that it’s ready for Monday morning. That’s exceptional. And I want to be able to recognize that an attitude is the same, you know, helping a colleague or while we’re very busy. But so, it’s something that you want to recognize because by recognizing you will get it again. Yeah.

 

Rodrigo:

What I like is that you focus on like what really motivates an employee and also and then focus on that and not just give the carrot to the, to the person really, really, really good. And we are coming to the end of our conversation. And I have a last question, which is many I’ll ask you a lot of questions, but what is one question that not many people ask you and you would love to answer.

 

Anne:

So, a lot of people ask me if I get a lot of crap, you know, questions on how to do this, how to do that. I wish I was getting more questions around what not to do from Founders and also why do we do that? Or why do we need to do that? Because if I was to receive those questions than it means that already, they are clicking. It’s like there’s an inventor sending that we don’t, we don’t have to do everything the way it has been done before. And we’re starting really getting into people strategy, which is how do we do it and why do we need to do it this way? So, so yes, what should we not be doing at every stage of growth or far? Or for a company instead of focusing on how to build. And why, why do we need an annual bonus? Yeah, why do we need incentives?

 

Rodrigo:

I really resonate with that so I’m starting my company. I learned a lot like that. So important, sometimes more than what to do is what not to do. So, I really, really, really like that. And thank you so much for coming. I’m really happy that I brought you, I know this. There are so many people out there. They have dreams, they have a vision, you know, and they have a lot of desire to create impact in the world, but somehow there’s something missing in terms of. How do you bring people with you? Yeah, so I’m happy that you are doing that job, you know, and so yeah, keep going.

 

Anne:

And thank you for coming today. Thank you very much, was a pleasure.