Leadership & Management

Masterclass: Find the Best People… and Keep Them

Learn how to find and retain talent from an HR expert.

August 31, 2022

Welcome to Grit & Growth’s masterclass on talent — finding it and keeping it — featuring Claudia Salvischiani, an expert on all things HR. From workforce trends and interview techniques to structuring incentives and performance evaluations, Salvischiani gives candid advice and insights on how to attract and retain the best people to help your business thrive.

It takes people to run a business, and the better they are, the better your business. So what can you do to not just get, but also keep, the very best? Claudia Salvischiani has a lot of strong opinions on how to do just that, grounded in real-world experience helping companies across India and Africa for over 25 years.

Salvischiani believes that leaders play an essential role in keeping people happy. “When people leave, they are actually leaving their boss, not their organization,” she explains. “Your task as a leader is to develop people. Leaders are the ones who give meaning to your work. They explain to you why things happen.”

Top Seven Masterclass Takeaways

  1. Create a sense of community, especially with remote workers. Salvischiani believes that having a sense of belonging is especially important for remote workers. Organizations need to change and she recommends communicating a lot and not just one-on-one.

  2. To find the best candidate, you need to prepare. “Be very systematic about what you’re looking for in all aspects,” she advises. It’s extremely important to have the right profile for the position before you start sorting through resumes or else you’ll waste everyone’s time.

  3. When interviewing, don’t let the candidate speak too much. “At the beginning, you speak, you set the tone, you set the structure, you explain how it’s gonna be,” Salvischiani recommends. “You steer the interview, so you’re not steered by the candidates.”

  4. Be honest when hiring. Salvischiani suggests being extremely honest about the context the person is going to be working in. Recruiting is a selling process, but you still have to be very clear about the challenges ahead.

  5. Higher salaries don’t earn you higher loyalty. While compensation is key, “you are not keeping people with the money. You’re just postponing their leaving,” Salvischiani says. And she believes creating a salary structure is “absolutely necessary” for transparency, equity, and morale.

  6. Don’t incentivize individual performance. Incentivizing organizational performance over individual performance gets the entire department or organization to collaborate and intervene if others don’t perform.

  7. Give feedback honestly and frequently. Even though it’s one of the hardest things for managers and leaders to do, giving frequent feedback, even if it’s bad news, is essential. People actually feel valued when you give them feedback. According to Salvischiani, quick quarterly check-ins help with retention.

Listen to Salvischiani’s recommendations and strategies for acquiring and retaining talent. It’s a delicate balance of understanding what you need as an employer and what your employee needs to develop and grow.

Grit & Growth is a podcast produced by Stanford Seed, an institute at Stanford Graduate School of Business which partners with entrepreneurs in emerging markets to build thriving enterprises that transform lives.

Hear these entrepreneurs’ stories of trial and triumph, and gain insights and guidance from Stanford University faculty and global business experts on how to transform today’s challenges into tomorrow’s opportunities.

Full Transcript

Claudia Salvischiani: Typically, the answer of the leader, “I have no time. I have so many problems and I have so much day-to-day.” I’m like, “If you’re going to continue like this, just taking care of your day-to-day, you’re going to go against the wall, because your people are going to just leave you.”

Darius Teter: Human capital, human resources, talent acquisition. What we’re really talking about is people, and people are hard to read. They’re quirky, self-interested, sometimes irrational, but unless we’re running a fully automated Terminator factory, we need them.

Claudia Salvischiani: So what I’m saying is, I recognize the day-to-day, I recognize the pressure. I recognize crisis mode. But don’t forget the other piece.

Darius Teter: Welcome to the second season of Grit & Growth from Stanford Seed, the show where Africa and South Asia’s intrepid entrepreneurs share their trials and triumphs, with insights from Stanford faculty on how to tackle challenges and grow your business.

In mature labor markets, it was common for people to stick with an employer for years, even decades. Recruiting was as simple as putting an ad in the paper. Staff turnover was relatively low. More employers provided pensions and more employees were unionized. Even today, Boomers and Gen X’ers in their fifties and sixties stay with their employers for a decade on average. You could give them a nice pen and a couple of promotions and they would stay with you. But times have changed. U.S. workers in their mid-twenties to mid-thirties expect to change jobs every three years and on average have five different jobs in that period. Competition for talent in some sectors is now global. The pandemic accelerated these trends, radically transforming the way that we conduct our day-to-day business. Social norms and expectations shifted overnight, and they haven’t settled yet. Managers, employees, candidates — everybody’s trying to figure it out.

Amidst those changes, there remains a fundamental truth: it takes people to run a business, and the better they are, the better your business. So how do you attract the very best workers to your company today and keep them there tomorrow? The answers to those questions are both big picture and deep in the weeds. Today, we’re looking at the nitty-gritty of talent, acquisition, and retention. What interview questions should you ask? How do you structure incentives? How often should you do performance evaluations? These are questions that our guest has been answering for over 25 years. She’s a veteran human resources executive who’s worked for large European companies and consulted in emerging markets in Africa and South Asia. Over that time, she’s seen a huge evolution in corporate best practices and develops her own methods for a range of HR functions. Allow me to introduce …

Claudia Salvischiani: I’m Claudia Salvischiani. I’m Italian.

Darius Teter: Claudia has a lot to say in the best kind of way.

Claudia Salvischiani: Italians are not good listeners, in general, so we tend to interrupt. So in general, and probably because I grew up in Italy, I think if the candidate is talking too much, I’m going to interrupt.

Darius Teter: Yeah. I don’t think that’s just Italian.

Claudia Salvischiani: I am not listening forever.

Darius Teter: I started our conversation by asking Claudia about trends that she’s observing in the workforce.

Claudia Salvischiani: First of all, I think there are, without doubt, trends in the world that are changing motivation drivers and what drives people. People are changing their ideas about work-life balance. They’re changing their ideas about being in an office all the time. There are things that are just changing. It’s a generation topic. So to this, I would say: organizations must change. There are still a lot of organizations that are not willing to change.

Darius Teter: How does the human resource function, including things like performance management, need to change to accommodate flexible and remote work?

Claudia Salvischiani: What I think is extremely important is, especially in remote work, you have to keep the contact very close. You have to communicate a lot and you have to create communities. So not one-on-one, but sense of community, sense of belonging. That’s the biggest risk actually that you have, if you do remote work. Sense of belonging is very important for people.

Darius Teter: Some luminary from the tech space said that the reason why remote work has been going pretty well for the past two years is because we built up all that social capital and sense of community beforehand. You can’t draw that down forever. Sooner or later, your account balance is zero.

Claudia Salvischiani: Absolutely.

Darius Teter: Especially with staff turnover. I mean, just to give you an example. For us, we’ve probably got about 10 percent staff turnover, plus we’ve added 10 positions during the pandemic, plus we’re spread over five or six countries in multiple time zones. We’re finally, after three years, we’re all going to get together in one place because some of us have never met each other except on Zoom. There’s something you need to do to kind of recharge the organizational battery, you’ve got to put social capital back in the bank.

As expectations have shifted, it can be harder to find and keep great people, which makes it even more important to get those day-to-day HR tasks right. I want to focus first on talent acquisition. How do you get beyond a huge stack of resumes to actually understand who the best candidates are?

Claudia Salvischiani: I would say the first thing that is extremely important is to have the right profile for the position that I’m looking for. You have the description of the responsibilities, you have the requirements from an experience standpoint, the skills, and you have the personality and cultural fit based on the challenges and the interfaces. Be very systematic about what you’re looking for in all aspects. Not only experience, not only technical skills, very clearly on personality. What kind of personality do you need?

Darius Teter: What are my options? Introvert, extrovert, friendly, jerk. What am I looking for? Or is it more about, do they fit my culture of my organization?

Claudia Salvischiani: One is the cultural fit. You have to have very clear in mind what kind of values you want to have in the companies. It’s about speed. It’s about performance orientation. Whatever the real, important values are, they have to be translated into the profile. That’s one component. The second one is specific for the position; in which team is the position? Who is the boss who’s going to manage this position? What kind of challenges are there? What kind of positive aspects are there? You need different people in different phases and in different departments. You have to combine the cultural aspect with the kind of context you’re in. Obviously, in the first step, you cannot really understand a lot about cultural fit and personality. You can judge a lot about level of experience, about the skills, the environment the person was in. The kind of environment and sequence of the jobs tells you something about the person. How often the person changes. What kind of environment does the person prefer? Big environment, slow environment, fast environment. You can understand a lot of things, but I would say, primarily, through resumes is experience and skills.

Darius Teter: Cover letters: yes or no?

Claudia Salvischiani: I honestly don’t consider cover letters very important. They write a beautiful story in the cover letter.

Darius Teter: Why they will love you and want to work for you.

Claudia Salvischiani: Yeah, why they’re dreaming about your company.

Darius Teter: While it’s important to have a clear idea of who you’re looking for, to ensure a diverse workforce, you also have to be flexible about what the right candidate looks like and build systems to address your own blind spots.

Claudia Salvischiani: I would involve, and I tend to involve, multiple players in the process. In recruiting, you find different stages and include multiple players. I don’t necessarily like numbers and KPIs [key performance indicators] and all these things. I mean, I think it’s just measurement. That is not really what matters. But actually, in Europe, there is a lot of discussion about the percentage of women that must be in certain companies. Some people are saying, “Oh, this is not good. It’s like you’re being hired because you are a minority,” and so on. I honestly think it can help, because you force something.

Darius Teter: I think this whole question of having targets is a really big one. My mother, she was the focal point for women for the U.N. system. The U.N. is a hide-bound organization. We think of it as being progressive, but it’s a lot of lifetime employees there. She concluded that if you don’t actually have targets, then nothing really changes, because of the unconscious bias of the hiring managers. If you’re trying to change something, where there’s conscious and unconscious resistance, you actually have to give people targets, because then as the workforce becomes more diverse, it becomes less necessary.

If the tool for judging a candidate’s skill is the resume, then the way you assess their cultural fit is through a great interview. Oh, but the dreaded interview. I’ve been in a lot of them on both sides of the table. They can feel awkward and cringey and, in some sense, everyone’s playing a role. How do you get from acting to authenticity?

Claudia Salvischiani: What I mean with structure is: follow certain criteria. Don’t let the candidates speak too much at the beginning. You speak, you set the tone, you set the structure, you explain how it’s going to be. You steer the interview, you’re not steered by the candidates. Sometimes people just let the candidates talk and they feel bad about interrupting and then the candidates tell you whatever they want to tell you. You have to establish: I know what I’m looking for, and this is what I’m looking for. You set the tone, you set the speed, and you set the structure.

Darius Teter: As an interviewer, should I be trying to convey to the candidate the culture of the organization and what we’re looking for, in terms of the person’s work style, personality, or is it all one way? I’m just trying to ask them a set of questions to understand if they fit a culture, without explaining to them what I’m after.

Claudia Salvischiani: My style is, I explain everything at the end. At the beginning, I test you and I try to check, because if you explain everything at the beginning, the person is going to start to adapt.

Darius Teter: They just become strategic in their responses. This is one of the fundamental difficulties of talent acquisition. The applicant wants a job, so they may say whatever it takes to get the role, whether true or not. Claudia has a questioning strategy to cut through the BS.

Claudia Salvischiani: Let’s say, hypothesis, I’m testing conflict management. I realize that the person struggles. I’m going to continue to ask you that, until I’m really clear about that. The questions depend on his answers. For instance, typically in this case, I ask, “Have you ever had a conflict? Describe a conflict you had.” First and so of everybody, 98 percent of the people, “No. No. No. No. I don’t have any conflict.” Really? I mean, life is full of conflict. You see how they react. Even in this interaction, you see how they manage conflict, because you are challenging them. They’re saying, “Oh, yeah, I had a small disagreement with my colleague, but then we talked and we clarified everything, so everything was fine.” Okay. Can you give me a little bit more detail? What was it about? How did the conflict arise? What did he say and what did you say?

Here you have to make sure he gives you the information, because people tend to be very general and not give details. It’s very important, if you’re testing the cultural fit and the personality, to speak about specific situations and behaviors and not in theory. There are a lot of managers that ask questions: “In our company’s important teamwork, innovation and this and this … What do you think?” “Oh, yeah. I am a super team player. Yeah. Super innovative, super this, super that.” Okay.

Darius Teter: Meanwhile, they’re absolutely a sociopathic maniac who can’t wait to just control everything.

Claudia Salvischiani: Exactly. You ask specific questions about behaviors and situations related to the competencies you’re looking for, or values.

Darius Teter: Okay. So I love this. Instead of asking them, do you have these attributes, ask for stories from their previous work experience that would demonstrate. It’s kind of like in fiction novels, they say, “Don’t tell the reader what this character is like, show them.”

Claudia Salvischiani: You can absolutely realize immediately whether the person is inventing things or if they’re real. You see it immediately.

Darius Teter: With so much up for interpretation, one of the dangers of the interview process is that our unconscious biases can heavily sway our judgments, but there are different strategies for how to mitigate that. One school of thought is that if you really want to be fair and try to minimize unconscious bias around race, gender, sexual orientation, whatever it is, that the interview needs to use the same questions for every candidate. That’s important to have a baseline assessment. Do you think it’s important that there be the same questions asked of every candidate to minimize unconscious bias?

Claudia Salvischiani: Not really. I honestly vary the questions based on the answers. For instance, I know I’m going to look for leadership, I know what leadership means or what aspects of leadership I’m going to look for. The questions are going to be different depending on how the candidate reacts. Now, what we have to certainly consider is that people have different levels of experience in interviewing people. What I suggest, very often, is that people are trained in how to do it. What I think is, you have to have the same structure and you have to have a structured way of proceeding in an interview, and you have to have the right people in the interview. That is what guarantees multiple points of views and multiple perspectives.

Darius Teter: When you approach interviewing this way with a goal in mind and a strategy to achieve that goal, you can break away from those tired interview cliches. What about that classic question that you always hear, which is, where do you see yourself in five years? I always thought that was the dumbest question, but …

Claudia Salvischiani: Yes. The question is, why would you ask that question? What are you looking for? For instance, in nowaday’s environment, you don’t want people who tell you, “I want this and this. I know that I want to reach this in two years and this in three years.” I’m like, “Yeah. Right. I mean, with uncertainty everywhere, you don’t even know where the organization is in one year and you know already where you’re going to be in five years.” If you are asking the question to understand how this person thinks, that’s okay, but other than that, I normally ask, how do you see your future? I mean, do you see yourself in this position, head of sales, for the next 20 years? You landed in sales and this is your home? Or would you say, “I like the experience in sales, but then I would like to move somewhere else.” If you want to understand how the person sees the developing as more a functional person or more a general management person or an open person, I think it can be a very useful question.

Darius Teter: Another one that I truly hate, but is used over and over again, which is, tell us what is your greatest personal flaw, or what would your colleagues say is the one area where you really need to grow more? Of course the joke is you always answer, “Oh, I’m a workaholic.”

Claudia Salvischiani: “I am too honest. I’m always saying what I think.” Yeah, right. I would not recommend that you ask that question, because he’s going to tell you what he wants to tell you. What I prefer, which is a little bit similar, is: What was your biggest learning in your life? I mean, implicit is where you failed and you learned because something went wrong.

Darius Teter: As I learned in my own career, you may want to change up the format altogether for key management roles. Another practice, which I learned about because it happened to me: I was interviewing for a position at a large nonprofit, and they flew me up there and they did something really interesting, which is they put me in a room with the five people who would report to me. They had a big whiteboard. Each of them posed to me a current work challenge that they were having. These were big, thorny ones.

One was, they had won a grant from a major U.S. foundation to do humanitarian work in Sudan, but in a very dangerous part of Sudan. The question was, should we do this thing? It hit me right away, they’re not expecting me to come up with the answer. They want to see how I interact with them and support them through their asking questions. It was really, really fascinating. We spent three hours in this conversation. I was blown away, but I thought that was such an interesting and useful way to get to know … because this was a leadership role, quite a senior leadership role. I think it was fair for them to expect that I would know how to unpack these thorny issues. What do you think of that approach?

Claudia Salvischiani: I think it’s excellent. I think that it’s very good when you’re hiring somebody, as a last step to have the team see the person, for both sides. Then you have to consider if it’s an absolute no-go for the team. You seriously have to consider that, and for the person to have a feeling, what kind of team do I have?

Darius Teter: While both sides are putting their best foot forward during recruitment, Claudia says you have to be upfront with candidates about what they’re getting into.

Claudia Salvischiani: One recommendation is to be extremely honest about the context the person is going to work in. I find that sometimes people think a recruiting process is a selling process, which is partly true, but you have to be very clear about what the situation is about, because sometimes there are a lot of challenges, there is change required, no tools, no processes. If you have to create processes or systems, be very honest about that.

Darius Teter: I agree with you 1,000 percent and particularly for senior roles, because I can’t tell you … This has happened to me over and over again, where I’m so excited to get this job I wasn’t asking the hard questions, which is like, do you guys have a strategy? How’s that strategy going? When was the last time you reviewed it? You’re interviewing the company, too. Don’t be afraid to ask hard questions. What I would expect from the person I’m asking is the honesty that you just described.

Claudia Salvischiani: Exactly.

Darius Teter: Hiring the right person is just the beginning. To make all that effort worth it you have to keep them and that can be even trickier. How do you keep your employees from scrolling job boards in their free time? You might think that the answer is just higher pay, and while money plays an important role, it’s not as simple as “higher salary equals loyalty.”

Claudia Salvischiani: It’s a complex topic, compensation. I think it’s a hygiene factor. It has to be adequate. The person must have the feeling, “I’m being paid fairly, based on my experience, based on internal equity and external equity.” These elements must be there, but you are not keeping people with the money. You’re just postponing. Let’s, first of all, distinguish between salary and incentives. For salaries, I think that something that is absolutely necessary in every organization, you have to have a salary structure. You have to know how much the position should be paid, depending on the level of responsibility and depending on different things.

Darius Teter: Right. You’re going to need some market data to set that salary schedule. You’ve got to know what the competitors are doing and all that stuff.

Claudia Salvischiani: Exactly.

Darius Teter: I mean, in our case, just to be super-transparent, we hire firms that give us benchmark data by industry, by country. So we pay a substantial amount of money to understand what’s fair in the market.

Claudia Salvischiani: That’s building up internal equity. The people know, if I have additional responsibilities, I’m going to be paid more and you know how to move the people. You have the so-called salary ranges and you have to keep this flexibility.

Darius Teter: If you haven’t noticed, Claudia loves structure. When there’s money involved, structure becomes even more important because you don’t want to improvise. These decisions have lasting effects on your payroll and on employee morale.

Claudia Salvischiani: I think you should have very clear boundaries on how much salary increase you want to give and how you’re going to distribute the salary increases. What I often realize, for instance, salary increases are not budgeted or they are budgeted in a totally unrealistic way. Set boundaries like the minimum salary increases and the maximum salary increases so that you don’t have discussion for 15 hours. “No, I want to give 10 percent.” Listen, the range is from 2 to 5 [percent] or from 2 to 7 [percent]. The maximum is connected to certain things and the minimum is inflation, whatever.

Darius Teter: The other piece of compensation is incentives or bonuses. How you design these rewards will, intentionally or unintentionally, cultivate certain values and behaviors among your employees.

Claudia Salvischiani: The question is, what do you want to incentivize? Do you want to incentivize individual performance or do you want to incentivize collective performance? The trend is, and I fully support this, don’t incentivize individual performance.

Darius Teter: Unless it’s sales, right? Commissions for sales.

Claudia Salvischiani: Yes. That’s different. That’s a separate system and you should have that system.

Darius Teter: Say more about what it means to incentivize organizational performance, as opposed to individual performance.

Claudia Salvischiani: Let me describe to you another situation before I answer this. Let’s say we incentivize individual performance. Everybody’s going to be concentrated on his performance, whether other people perform or don’t perform, I absolutely don’t care. The most important thing is that I am going to get the bonus at the end of the year. You have to think about what kind of culture are you actually supporting. With the collective performance, and now consider coming back to your question, my assumption is: if you give the message everybody’s getting the bonus if the whole company is performing, if the whole department is performing, people are incentivized to intervene if other people do not perform.

An example of a company in India, where I developed this, they had this problem that people were trying all the time to maximize their bonuses. The CEO came to me and said, “Listen, I kind of have a problem because I have established a bonus system in the management team, individual bonus, and I see that people, when we set the budget, they set the budget in a way that they overachieve their bonus and they’re going to get a higher bonus,” which is the typical negative consequence if you reward individual performance. Okay. Let’s do two components. The bonus of your management team is going to be defined 40 percent, if you want, by individual performance and 60 percent by company performance. The individual performance, you give objectives that are actually very much connected to company objectives.

Darius Teter: So individual goals need to be aligned with the agency goals. You don’t get any bonus for throwing your colleagues under the bus.

Claudia Salvischiani: We actually did it and it was very good. He also wanted to break it down to the next level. He said, “Actually, I would like to have an incentive system even below.”

Darius Teter: To fairly reward an employee, you have to assess their performance. Some companies have developed complex systems to measure this, but here, Claudia advises less structure, not more. Performance scoring systems — this is one that just, honestly, I have almost like a bittersweet relationship with performance scoring systems because I’ve been through every possible iteration. Four point systems, three point systems, no point systems. Every time I’ve gone to an organization and they’ve changed it up, it was because, “We’re adjusting our scoring system for performance based on best practices.” I’m just curious — Is there actually a best practice in doing this kind of review and rating system?

Claudia Salvischiani: Okay. I tell you what the trend is, in the most advanced companies, is actually to eliminate completely this and develop so much awareness and self-reflection on the other side that the person is able to say, “It was not enough and actually we need to do something.” We move everything on the dialogue level. My suggestion is kind of in between. Eliminate point systems. I think point systems are absolutely not helpful. Five, six, seven — eliminate. I will put three: needs development, fulfills exactly what’s required, exceeds. That’s it. You are basically giving the message, “You’re doing exactly what’s required in the job. Good. Very good.” “You exceed — you are absolutely a boss, so we need to discuss about next steps and additional responsibility of something else, because you’re going to get bored.” Or, “You have areas of development, we need to address this.”

Darius Teter: With companies trending toward dialogue, communication about performance is more important than ever. Let’s talk about feedback, because I think this is one of the hardest things for managers and leaders to do.

Claudia Salvischiani: And one of the most important ones.

Darius Teter: With the many companies you’ve worked with, what are the classic problems you see in their feedback process?

Claudia Salvischiani: I have much more problems and resistance with the management than with the people. The people are so happy to have this process. Typically, their reaction, they feel valued, they feel seen, they feel they are being considered, they feel they have a platform where they can say what they need. They love it. Manager: “I don’t know if I have the time. With this person, it is difficult. I know the person — we don’t need to discuss about this.”

Darius Teter: That’s fascinating, because I think the reason why sometimes managers resist this process is because they don’t want to deliver bad news or harsh judgments because they’re worried about how the person’s going to react.

Claudia Salvischiani: You have to be able to deal with that situation. It’s avoidance. The reason why feedback processes don’t work is because people avoid it.

Darius Teter: If you can’t be bothered to have the hard conversation with a staff member, it’s actually a sign that you don’t value them.

Claudia Salvischiani: This is what I was trying to say. People feel so valued when you give them feedback, really. They’re happy.

Darius Teter: Well, the other practice is that this conversation should be an ongoing conversation, not an annual conversation. Some companies try to mandate a midterm check in, because at least it’s a little bit better than just once a year. But in an ideal world, you’re able to have honest conversations about what’s going well and what’s not, with concrete examples when they happen. That’s the other thing I think is really important, is to go back and reflect on something that didn’t go well. Eight months later, you’re not actually helping your staff. You’re leaving them out there for eight months and then you’re saying, “I was not happy with how that went.” That’s actually terrible management.

Claudia Salvischiani: Exactly. The frequency. Actually, when I introduce performance managing in the companies, I say do quarterly check-in. Quarterly. Just quick check-in. You don’t have to go through the whole form. Say, “So, how’s it going? I saw some improvement here and here. Do you remember we discussed that and that? I saw this and this. I’m seeing this and this. How do you feel? You feel like you’re more supported now?” And so on. Just quick check-in. By the way, this is what keeps people in the companies.

Darius Teter: It should never be a surprise to either party. “What do you mean, my performance is unsatisfactory? How could you say that?” If that’s the conversation you’re having at the end of the year, then you weren’t doing your job as a manager.

Claudia Salvischiani: Performance management should be much more future-oriented, not past-oriented. Where do we go from here? How can I support you? What can I do? What can we do? It’s a dialogue. It’s not about, “I’m judging you, because you didn’t do this and this.” It’s not about this. It’s about becoming aware of this. How do we do it better?

Darius Teter: Speaking of the future, employees are thinking about their own career goals. Nobody wants to feel stuck. Giving your employees opportunities for development can both improve performance and help with retention. There are many ways to invest in your team’s development.

Claudia Salvischiani: This is a big topic. People tend to associate development with career development. That’s not what I mean. I associate development with growth. Growth means I learned something. I could learn something because I’m taking on an additional project. I’m learning something, because I’m doing things that are different from the ones that I’ve been doing in the last two years, because I’m sensitive for the needs of the person, so I’m discussing with him, “What do you think? What would you like to do? What would you like to experience?”

Darius Teter: I’ve also worked for organizations that tried to go through an intentional process of identifying high-potential individuals in the organization and to give them some extra attention. The extra attention might be to make sure that they have interesting projects and that they’re given opportunities to expand their own professional capacities. It’s part retention and part succession planning, in that you’ve identified these very specific individuals and they kind of have an additional or extra or slightly different management plan compared to everybody else.

Claudia Salvischiani: And rotation, honestly. Even in small companies. Many companies say, “I cannot develop my people because I’m small.” Rotate people. Let them change roles.

Darius Teter: Development can take many forms, but it doesn’t just happen. You need to be intentional and provide opportunities for your employees.

Claudia Salvischiani: Are you making sure that your people can grow in the organization, or are you just having your people solve problems? I honestly think the organizations are too much orientated to problem-solve all the time. Typically, the answer of the leader, “I have no time. I have so many problems. I have so much day-to-day.” I’m like, “If you’re going to continue like this, just taking care of your day-to-day, you’re going to go against the wall, because your people are going to just leave you.” What I’m saying is, I recognize the day-to-day, I recognize the pressure. I recognize crisis mode. But don’t forget the other piece. This is your task, as a leader, to develop the people. No one is perfect. I see that more often the managers don’t want to be mean, don’t want to be unpopular. They just want to deliver good news. Why? You want to move on, you want to develop the organization, so you have to do it.

Darius Teter: This brings us to the most important factor in employee retention: you, the leader.

Claudia Salvischiani: I think people leave, I’m going to make a strong statement here, because the leaders are not able to keep them, because they’re not happy and motivated by their leader. There is a statement that says, “People are leaving actually their boss and not the organization.” I don’t necessarily agree always. I mean, sometimes it’s really a cultural and a context issue. But leaders are the ones who give meaning to your work. They explain to you why things happen. Listen, I know it’s hard. This is happening because … Hang in there. We’re going to do this and this and this and this. People feel, “Okay. He’s considering me. He’s considering my needs. He’s considering what I’m going through.” This is not being done very often.

Darius Teter: I just want to highlight what Claudia said. People leave bosses, not companies. Leaders and managers have a huge impact on their employees’ day-to-day experience and how they envision their future at that company. Good leaders take that responsibility seriously.

Claudia Salvischiani: The attitude normal in many situations is, “Yeah, Claudia is a super change agent, an HR super change function, but you change the others, you don’t change me.”

Darius Teter: Right. At the end of the day, I like who I am and how I run this place.

Claudia Salvischiani: Actually, every change starts with you.

Darius Teter: People are complicated. There’s a whole mix of factors that cause someone to take a job or leave a job, but these structures and practices are things that you can control in your business. They provide a solid foundation that you can adapt as the workforce shifts. For talent acquisition, you must have a clear understanding of what you need, both in technical skills and personality. Push candidates beyond the stock answers and be upfront with your situation to find someone who’s actually right for the role. For talent retention, understand your employees’ needs, let them know how they’re doing, give them opportunities to grow, have a structure in place for goals and rewards and use those incentives to reflect your values.

These systems don’t operate in a vacuum. Companies that take care of their employees will be more attractive to potential candidates. The right hires will contribute to your culture and make it easier to retain employees over the long term. It’s a virtuous feedback loop. But before you go on a hiring spree, make sure to tune into our next episode with Claudia, where we explore the role of a human resource strategy in scaling your company.

I want to thank Claudia for her insights. I look forward to continuing our conversations on Grit & Growth, because despite my advanced age, human resources is one topic where I’m still learning. And Claudia is a great teacher.

This has been Grit & Growth with the Stanford Graduate School of Business. I’m your host, Darius Teter. If you like this episode, leave us a review on your podcast app. It really helps us to share the stories of these incredible entrepreneurs with as many people as possible. To learn how Stanford Graduate School of Business is partnering with entrepreneurs in Africa and Asia, head over to the Stanford Seed website at seed.stanford.edu/podcast. Grit & Growth is a podcast by Stanford Seed. Laurie Fuller and Erika Amoako-Agyei researched and developed content for this episode. Kendra Gladych is our production coordinator and our executive producer is Tiffany Steves, with writing and production from Andrew Ganem and sound design and mixing by Alex Bennett at Lower Street Media.

Thanks for joining us. We’ll see you next time.

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