Episode 147: Empowering Workforce Development with Raluca Apostol, Co-Founder and Chief Product Officer at Nestor
In this episode of Product Thinking, Raluca Apostol, Co-Founder and Chief Product Officer at Nestor, joins Melissa Perri to unveil how a people intelligence platform like Nestor empowers workforce development and helps managers build better teams. They also explore Nestor's innovative approach to skills-based talent management, the advancement of HR practices, and the role of AI in big data for effective skill matching.
You’ll hear them talk about:
[09:25] - Nestor is an innovative people intelligence platform designed to improve workforce agility, performance, and growth by leveraging a skills-based approach. The platform integrates performance management, employee engagement, and career development, offering total skills visibility and enabling HR and business leaders to make informed talent decisions. Born from the need to better manage and develop large teams, Nestor focuses on aligning individual skills with business needs, nurturing growth through personalized opportunities and development plans.
[17:54] - Nestor's data-driven approach enables tailored employee development and optimal team assembly by analyzing each employee's skills profile, including their current role expectations, acquired skills, and career aspirations. It then matches employees with relevant internal jobs, learning experiences, and mentorships based on a "smart score" that evaluates compatibility. Further, Nestor suggests ideal team members for specific projects, ensuring both business objectives and individual growth opportunities are aligned.
[20:32] - With the development of AI tools, platforms like Nestor got the chance to collect a substantial data set from various HR processes and user interactions, which enhances skill-matching accuracy and maintains data integrity, especially with diverse skill definitions. The key is to gather enough relevant data before integrating AI into your product to ensure personalized experiences for employees.
[33:32] - Recent trends in HR software highlight the importance of prioritizing the employee experience to drive system adoption. There has been a significant shift toward continuous performance management, which begins with transparent leadership and involves setting clear strategic goals, often using OKRs. As a result, performance reviews transform into a more efficient process, allowing employees to clearly see and understand their contribution to broader organizational goals.
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Raluca Apostol Human Reviewed Transcript
Intro - 00:00:01: Creating great products isn't just about product managers and their day-to-day interactions with developers. It's about how an organization supports products as a whole. The systems, the processes, and cultures in place that help companies deliver value to their customers. With the help of some boundary-pushing guests and inspiration from your most pressing product questions, we'll dive into this system from every angle and help you think like a great product leader. This is The Product Thinking Podcast. Here's your host, Melissa Perri.
Melissa Perri - 00:00:36 Hello, and welcome to another episode of The Product Thinking Podcast. Today, we're going to be talking with Raluca Apostol all about the advancement of HR practices and how she's harnessing AI to make them better. Raluca is the Co-Founder and Chief Product Officer at Nestor, which is a revolutionary people intelligence platform leveraging the power of AI and predictive analytics to drive workforce agility, performance and growth. But before we dive into that, let's go to our Dear Melissa segment. Remember, every single week, I am answering your questions about product, technology, and business right here on the podcast. So make sure that you go to dearmelissa.com and let me know what questions you have. All right, this week's question is about getting a job in product management. Let's dive in.
Dear Melissa, I'm currently pursuing a master's and have over four years of experience as a software engineer. I'm trying to get an internship in product manager roles. I want to know what qualities and skills recruiters are expecting from a candidate like me so that I can start working towards that direction. This will help me build my portfolio and resume. Thanks for your help.
So when you're trying to get an internship, which is usually your first job as a product manager, you're probably not going to have all the hard skills a product manager needs. And that's okay because I would not expect somebody in an internship position to know how to write amazing user stories or do UX or anything like that. That's what that internship is for. So let's really focus on what are the qualities that you need to show through your course work and previous work that would signal to me that you are a great person as a product manager. You will make a great product manager.
First of all, having a technical background while not required as a product manager is going to help you. So you already have a leg up right there as a former software engineer because you understand how products get built and recruiters are going to really like this. So definitely highlight your engineering experience and talk about what you did through engineering. If you ever had a chance to contribute to the product process as well or go with product managers and do discovery, things like that, you want to highlight those things. Definitely talk about it. Talk about the products you built and what they did for customers. A great way, even if you've never been a product manager before, but to highlight some things that come off Product Manager, which is not a word, but let's call it a word on your resume, is really trying to use the same terminology and language we do.
So if you can talk about the way that you built products or products you built before and what they did for customers, what the business outcomes were, and highlight what problems they solved, that language is already going to come through to recruiters and it's going to signal to them that you have the right mindset for product manager. So a lot of times, even if you didn't lead the product or you weren't the product manager, we can still formulate what we did on our resumes in a way that will signal to somebody that we have those good problem-solving skills that would make a great product manager in the future. Besides that, there's a couple of skills that I look for when I'm hiring interns, and we can break those down and figure out how do you show that through previous projects as well. So first of all, I'm looking for an analytical problem solver. Can you pull insights from data, qualitative and quantitative, and make decisions off of that? What trends do you pick up on? Can I throw a bunch of information at you and you can synthesize it and determine a direction forward? That's very important. Also, do you dive deeper into the problems that are surfacing from the data? So if you see an insight, are you curious? Are you asking why? Curiosity is a really big part of being a product manager. I want to see somebody who's going to look at that data, follow up on those trends, try to figure out what's happening, uncover those problems underneath. So that's a really good signal that you're in the right mindset to be a product manager because we're always tracking down what are the problems we can solve? Why do they exist? How can I make it better? So you want to be relentlessly driven to make things better and to solve problems for customers and worrying about the user. So that's number two.
Do you think about the people that you're building things for? So whether you are solving processes or volunteering or doing projects with coworkers or anything like that, are you thinking about the person who's going to use that product or be the consumer of that process or whatever help you're doing at the end of the day? I want to see that you're thinking about not just how you want to build it, but you're considering the other people who are going to want to build it. So can you demonstrate that through past projects? Another one is really a collaborative leader. So how do you work with teams? What kind of projects have you done with them before? Product managers cannot accomplish things on their own. We don't usually build the code. We don't usually do the UX. We need other people to help us, right? So how do you work with teams? Can you inspire a team to get things done? Do you give good direction? Do you work collaboratively with others? Can you bring a whole group of people together, listen to their ideas, synthesize those ideas, and make them feel like they're a part of something? How do you treat stakeholders who might not be on your team but are giving you feedback? How do you listen to feedback? I think all of those things are really important. As a product manager, you need to be really collaborative, not just with your team, but with your customers and with the stakeholders. You have to listen to feedback. You have to digest it. You have to make sure that you understand that it's not personal. It's not personal feedback. I want to see how you're reacting to that. Are you taking it into account? And then are you looking at why it was given and determining a path forward? So that's really looking at somebody who can inspire a team, take all those pieces, put it together, listen to others and then decide to act. That's really what I'm looking for in those positions because every single day as a product manager, you will never be working alone. You do not go off as a lone wolf and sit in the corner and build things. You have to be good with people. So that's a big skill.
Next one is communicating. So another people skill here. Can you take complex ideas or solutions and distill them down into easy to understand communication tactics, whether they're presentations or written things, anything about how you're talking to others about why you're doing stuff. Is it concise? Does it recognize what the context is for that other person? So for example, if they're not technical, are you just throwing technical terms at them? Or are you actually saying, hey, this person doesn't have that type of knowledge. How do I explain this in a better way so that they get it? I'm really looking for good communication techniques because you're going to have to do that to everybody around you on your teams, to stakeholders and to leaders. So if you can refine your communication techniques and distill very complex ideas down to easy to understand digestible bits of information, that's a really good sign. You also need to have high EQ, emotional intelligence in this area. You have to really be able to read the room, understand where people are coming from. This goes hand in hand with getting feedback, but you have to really understand the lay of the land, the people you're talking to. And you want to show that you can communicate with leaders or you can communicate with marketing or you can communicate with sales or various people that might not have the same context or points of view as you. So those are some of the things or just some of the skills that I'm really looking for when I am trying to hire somebody that's going to make a great product manager.
You have to work with people every day. So all these are people skills. They're about trying to get people on your team. And that's okay. You don't need the hard skills when you get into an internship with a product manager. I don't expect everybody to come in and know exactly what a product manager does. That's the job for the internship to really suss out for you. Do I like this? Do I not? I've seen a lot of people go into product manager internships and say, “hey, I hate this”. And that's okay too. You're going to learn all those things there. So focus on the attributes that come up through your other projects that are going to make you great at learning those skills, adapting to new environments and being able to be a successful product manager when it comes to working with people. That would be my suggestion. All right. And now we're going to dive into the rest of our podcast and go to talk to Raluca. Ever wish for total alignment with executives? The end to those never-ending debates? Results that make everyone sit up and take notice? Amplifying influence across your organization? The secret? It's not just about managing. It's about facilitating. Level up your ability to facilitate clear, powerful conversations with stakeholders through Voltage Control's Facilitation Certification Program. Learn more and get $500 off at voltagecontrol.com/product. We'll be putting that link in the show notes for you as well. Welcome, Raluca. It's great to have you on the podcast.
Raluca Apostol - 00:09:21: Hello, everyone. Thank you so much, Melissa, for having me today. It's great to be here.
Melissa Perri - 00:09:25: So you have been a multi-time founder, and you are now on this mission to help HR with Nestor. Can you tell us a little bit about what made you want to start this company? What kind of problem were you trying to solve?
Raluca Apostol - 00:09:38: Definitely, because I'm one of the co-founders of Nestor. We started Nestor back in 2018, and one of the problems that we solve at Nestor today is one of the personal experiences that I had. Prior to Nestor, I've been working in a company and I had this team of 50 people that I had to manage. My background is technical, so by education, I'm an engineer. And I had a team of about 50 people that I had to manage. So I had like three projects for different customers. And for me, it was so hard at the time to identify the right people in my team based on the capabilities that I wanted to have. And at the same time, to deliver with high performance on the projects that I was involved in. And of course, you also retain the people. So when we started Nestor back in 2018, we thought of solving this problem. How to help managers build better teams, high performing teams, and at the same time, find the right people for their team so that they can actually deliver on the projects. At this point in time, Nestor evolved. So Nestor is a little bit more than that. We don't help only managers. We are playing in an HR space. So we are HR tech technology, and we do a platform that helps organizations engage employees, help them perform, but at the same time, help HR professionals and organizations achieve that workforce agility in the end. So now Nestor is a people intelligence platform that employs skills so that we drive employee growth, but at the same time, we drive business growth as well.
Melissa Perri - 00:11:28: So when you first started out trying to solve your own problem with this, what do you think is hard about actually managing the people and doing the performance management that you were trying to solve with this new people intelligence platform? Like what's the existing industry look like in that HR space?
Raluca Apostol - 00:11:45: So because I was coming from a background where I was working for a company that had around 6,000 people, so it was a large organization. One of my struggles as a manager was to help my people grow and also prove that to the top management that they deserve to be there to the next role and so on. At the time, performance management was done like, okay, once a year or twice a year, we have this performance reviews and we look at what happened and then it may happen or not to go to the next level or I don't know, have a race. So I took another approach and I built or I embraced coaching as one of my practices. And I was really close to my direct reports to understand their needs, where they want to go, what are their skills at this point in time, and how I can better employ those skills so that we can also deliver as a team. So I focused so much on building relationships with my direct reports. And I was really fighting for them so that I could also bring the right opportunities for them to develop. So for me as a manager, it was so hard to go to the HR department and say, “hey, this person has a real potential and this could be an opportunity for him to have this training or get into that conference or another opportunity”. Or at the time was something, if this is something for this person to leave my project. And the next step for him is to accept that, then go to another project. So through Nest or at this point in time, we try to balance what are the business needs on different projects internally. What are the capabilities people have in terms of skills? And then match the right opportunities to each employee, like having that talent marketplace behind the scenes. So we connect performance management, employee engagement, and development planning through this skills-based approach. So then. We can bring the right development opportunities to each individual to develop in an automatic way.
Melissa Perri - 00:13:58: Oh, that's cool. So it's like you could have potentially all these open positions across a huge enterprise, but nobody would actually be able to match it back to, you know, somebody in one team out of 7,000. Like, how do you know if that person has the right skills or there's an area for development there? So you built that to allow people to see the skills that people are developing, move around the company. And I imagine that helps with retention, too. Yeah. So what have you seen with the retention that comes out of it? And why do people like it for that?
Raluca Apostol - 00:14:30: So the results after 12 months of using Nestor, and we refer this for companies that have around more than 1,000 employees. So we are talking about large enterprises. Around 25% of the people inside the company start making the next move into their careers. That means that either they further develop their current skills or they acquire new ones. And another interesting statistic that we got from the product, and of course from our customer success stories, is that 20% from the open positions were closed with internal candidates. And this means a lot for the cost that an organization could actually have and also for the retention of the employee because they see these opportunities and at the same time, they can apply for that. Everything is transparent. If we want to have people being retained in our company, then we need to open those opportunities for them. And, yeah, this is done for Nestor.
Melissa Perri - 00:15:33: Nice. That's so much internal mobility that you don't really see at super large enterprises because you just never would find the right people or offer it up to them. I really love that problem that you're solving. So when you started Nestor, you were looking for these opportunities. How has the company evolved over time? What did it look like in early days? How did people use it? And what did you discover along the way as more enterprises started to adopt it?
Raluca Apostol - 00:15:55: I can talk about this. And one thing that for us, it was like an aha moment was we started Nestor as a tool for managers because we want to help managers be or adopt a coaching methodology for their management while managing their people. So we tried to introduce in Nestor a lot of recommendations for the manager and also for the employee. And we started with some standard advice for the manager and for the employee. But what we've discovered along the way is that while we sell into organizations that want to have that level of customization because every organization is unique, they have their own culture, they want to promote their own values, then the advice that would come from Nestor wouldn't fit the culture they want to promote as well. We learned that we need to do some of the changes in the product. And if we had sold those recommendations at the time, then we stopped. So we removed them from the product because companies wanted more customizations from this point of view. This is how it evolved over time from a product that we wanted to target only for the managers towards platform that is used by every employee in the company, every manager, every department, and of course, helping HR professionals and top management have those standards and people data that they could rely their decision making on. This is how we evolved over time. And now we are looking at those advices from a different point of view. We don't look at how we actually do the standard thing and we bring that to the people, but how we learn what we learned from the existing data and build the recommendations that are actually interesting to them and that are customized for the company and for their position in the company.
Melissa Perri - 00:17:54: What types of recommendations can you get out of the data and how people interact with it?
Raluca Apostol - 00:17:59: So first of all, what I can say in here is that when you have a skills profile as an employee, just a little bit about how Nestor works, every employee in the company has a skills profile. And first of all, you have what the company would expect you to have in your current role. So let's say I'm a project team lead. I would have some of the skills that the company would like me to have. And then I want to work against those gaps in order to perform on my current role. The second thing on your skills profile would be those acquired skills that you may have from other experiences in other companies or from other hobbies or activities that you are doing. Like I could have some other skills because I'm complex from a person perspective and I can do multiple things besides the required skills on my role. So you can enhance skills from this point of view. And lastly, you can also have in there like what would be your desires as an employee, where you want to go, what you would like to do and so on. So Nestor as a technology looks at your skills profile, looks at your work activities because you can work in projects, you can have like objectives in there, you can have some of the KPIs that are really close to the operational work that you are doing. And then it also looks at what is happening in the company from opportunities point of view. These opportunities could be like either internal jobs that are opened or learning experiences or finding some of the mentors out there or joining, I don't know, internal project. In terms of the recommended thing is that Nestor looks at your interests and then it looks at what is available. It brings a match score. We call it a smart score. And then it says, “okay, you are 89% fit with this opportunity. You want to look at it, you want to apply for it and so on”. And on the other side as well, like for the opportunity manager, if you want to build like on the fly a team, which is, I want to have a project manager for five hours this week and I want to have like a developer involved like two hours per week and so on. Nestor would start suggesting you what would be the best fit people that could join this team so that we can also deliver on the business goals. But at the same time, this could be opportunities for growth for their people as well.
Melissa Perri - 00:20:31: Yeah, that's really extensive. That's cool. So in the beginning, you were using a lot of manual recommendations that you came up with to help people match. And then you started to incorporate AI. At what point did you realize that you could incorporate AI? And how did that come about?
Raluca Apostol - 00:20:45: Yeah, we could incorporate the AI when we've seen that we have enough data to play with. So when we started to gather like a million of records, because we can get data from different perspectives, from HR processes like performance reviews, one-on-one conversations, other operational objectives, development plans, and of course, like surveys, we identified that we can get data for the skills profiles from multiple points of view. So once we had all these data points, then we said, “okay, this is the moment when we need to employ AI and the matching algorithms behind the scenes so that we can do like the recommendations the employee wants. And at the same time, also recommend for the projects what your ideal team would look like on that one”. So this was the moment when we started to do that. And of course, another thing that we identify is when we've seen, because you also as an employee, if you have a skill that you cannot find in our library, then you can suggest it. So people were starting suggesting skills and also companies came with different CSV imports for the year already existing skill data. So they ultimately ended up having multiple variants for the same skill. We identified. A way of how we can help HR professionals maintain that data clean and relevant to the employees. And at the same time, finding a way of helping them managing this. So we identified a way of creating a similarity score for the description of the skills. And this was like a way forward for us to help HR professionals and also help employees that are using the system to maintain that common language for skills at work, because you may refer to collaboration from one perspective and other person could, I know, define it in a different way. So this is the moment where technology helps us maintain that common ground for both of us.
Melissa Perri - 00:23:00: When a lot of people are getting started with companies and they want to build AI companies too, what you've said right now, I think triggers a thought here about you needed to have a ton of data at the beginning. You did the personalized recommendations first. Was that like more manual or how did you think about like before we have data, how do we approach this? Or was it something like we didn't even consider AI until we had a bunch of data and we said, “hey, this could be easier”. I think a lot of people are out there trying to start AI companies first. Let me put it that way without data. And they don't know how to get started or how to approach this or how to even test with customers. If you don't have like millions of pieces of data, how do you think about when to introduce AI or what would your advice be for people who want to start companies with AI?
Raluca Apostol - 00:23:45: This is an interesting thing because it will take me a little bit back in 2018 when we were doing this research for Nestor tool. So at the time we were saying about us as a product that the product itself was like coaching assistance for managers together with some coaches from International Coaching Federation. And based on the research that we have done in the market, we collected a set of advice of recommendations that we could match with some of the initial activities and actions that a user could do in the platform. As soon as we started to deploy that to the users, we learned that even though we have some of the data and some of the recommendations that we could use, these were not so personalized to them. So we just cut that down from the product. And for me, it was like a hard moment to do that. But you need to do that if you want to have that sense or that stickiness to the user or bringing value to the final user. And this is another story on our side because we are a product-focused now more towards enterprise level. And this comes with so much complexity when it comes to the user type. Like we do have employees, which is the end user. We do have managers that don't buy us. We have HR professionals that use us, but they actually influence our decision. And we do have the buyer persona. So kind of complexity in here. From this point of view, if you want to start something that looks like personalization, you can use some standard models out there. This is what we've done together with the coaches, we identified some of the recommendations. We tried to match some interests, but we wouldn't have enough data to make the final personalization customization that the employee is looking for. You could start with that, but AI cannot be done without the data. So you need to be patient and identify a way of collecting all that data. And then to identify what would be the most important thing that you could bring to the product so that it can bring back value to the end user. Otherwise, it's just like a notification that they treat this.
Melissa Perri - 00:26:03: It sounds like too, like what you were trying to solve, like the problem was strong enough where even if you tried to solve it without AI, it was still better than what existed today. Does that sound right? And then AI made it better and closer to what everybody wanted at the end. To me, that's like one thread that I'm getting from your conversation. It's not that, you know, AI was going to take this problem that already existed and had been solved and make it so much better. It was like, we are introducing a product that solving this problem, we're first doing it without AI, but people still like it, but it would be better if we had AI once we have the data to make it better. Do you think that's an accurate assessment?
Raluca Apostol - 00:26:40: Yes and no, because when we started to look at AI as a potential added value to the user, it was the moment where we felt that the technology should help us from this point of view to bring the value. You don't have to market yourself as an AI product if you don't have, or you don't intend to include that later on. I think this is my take from this point of view. When you feel that the moment is right to bring odds or to maximize value to the end user, you need to start employing doing this.
Melissa Perri - 00:27:12: Okay. I think we're aligned there. I'm just like expressing my thoughts, but it sounds like you looked at AI as a tool to drive maximum value rather than the solution itself.
Raluca Apostol - 00:27:22: Yes. This is my opinion. You don't have to use AI just because it's trendy. If you feel it brings value, then you start doing that. If not, just leave it on the table and identify the right moment to do this.
Melissa Perri - 00:27:37: Yeah. I see a lot of people out there just using AI because it's AI. Like, I'm going to make a GPT thing just because GPT is new, or I'm going to use AI because it's a trendy word and machine learning and all that wonderful stuff. But they're not really honing in on the problem. And to me, what I love about your story is that you first came from a very strong customer-centered problem and then tried to solve it in multiple ways and then said, “hey, AI can actually solve this better as well. So let's incorporate that after we got in there, we started digging in and we realized that this is a big problem. And I love the way that you just progressed through it to make it a stronger solution”. So when you're thinking about AI too, I feel like we always have to talk about, especially in an HR space, ethical considerations of AI. How are you thinking about protecting the people who's inside the organizations with these skills matches and acting in the best interest of people from an ethical standpoint? What kinds of things or principles do you incorporate?
Raluca Apostol - 00:28:34: When we are building that matching score for each employee, which regards to the opportunities that are existing, that exist in the company out there, or our latest feature is around how we can suggest a potential career path for the employee, it's very important to look at their capabilities. Because lastly, we don't want to employ technology to take decisions for the individual, but we want to employ technology to help the individual make the right decision for him. So we come with just suggestions, but they are the ones that have the final input on that. So we don't say about you, you are at this proficiency level for one skill. We just use data so that we can bring up to the manager, to the employee, to all the data that we collect around the skill so that you are the one that makes the final decision. So we help you with this data. This is one thing. And on the other one, we don't consider at this point in time, we don't consider anything like your race, your religion, your gender. So basically, we look at you with your capabilities. It doesn't matter where you come from. You are unique in your way and you have your unique ways to succeed. So this is our approach. This is our take on this.
Melissa Perri - 00:29:59: When you're getting the capabilities into the system, do you manually put it in as a staff member? If I was a product manager on a team, I can enter my own capabilities or are you assessing them in different ways? How does that information make it into the system?
Raluca Apostol - 00:30:14: The information comes into the system from multiple data sources. We can integrate through APIs with the other systems that the company has already in place. We are, again, a tool that is integrated with other tools inside the organization. Because they have an infrastructure and we live with that. So we can do that directly from import or doing also things manually in the app. But also users like employees can add those skills in the profile as well. What we can also do is just to suggest other skills that may be like close to your existing profile. But of course, we don't do that like, okay, this is your skill because you did this, this and this action. You are the one that takes the final decision. And for the assessments is the same because we get the information from the manager, from yourself as a self-evaluation, from answers to some of the surveys that are run by HR department or from your peers as well. So, again, what we are doing is just to enhance this profile with data, but the final proficiency level and the final assessment is done by the employee in collaboration with their manager.
Melissa Perri - 00:31:30: With this, have you seen any outcomes about, you know, reduction in bias with hiring or anything like that? Definitely see that happening.
Raluca Apostol - 00:31:38: Definitely, because we support a lot the internal mobility problems and we help solving that problem as well inside the large organizations. So you could definitely come and access some of the opportunities out there because this is your history. So it's something that is not I get a recommendation from one person or another one. Everything is transparent. And because we bring this transparency inside the company, it's something that helps a lot eliminating the bias. So the data is there. The history is there. Who is able to access that, then you will see that it's nothing that you can basically, I know it's not any wrong data. It's something that is filled by humans in there. What we do is just to employ technology to bring the data in a more useful way for your decision making.
Melissa Perri - 00:32:31: Yeah. From what I know about hiring or what I've seen too, a lot of these opportunities really only come up for people you know or people that are around you or people you saw that you thought were good. And this feels like a little bit more of an objective way to get the right people into the right places. So I like that it cuts down on just the smaller pool that you might know in an organization to recommend somebody into that position.
Raluca Apostol - 00:32:57: Definitely. So this is done automatically by the system. Once you open and also you as an employee, you have the ability to say on your profile that, okay, I want to be involved into different kinds of opportunities that exist in the company. So first of all, you need to opt in. If you don't opt in, then we don't send you any option, any recommendations on that. So you are the person that is willing to participate in that. And once you open your interest, then we learn about your interest and then we expose you the right opportunities for you that we have collected from the organization.
Melissa Perri - 00:33:33: What have you seen in trends in HR software going forward? How people are looking at performance reviews? I feel like performance reviews or engaging in how do I evaluate my employees or how do I understand if they have the right skill set is such a touchy subject and hard one to nail down. So in the industry, besides just what you're doing with Nestor, but maybe including what you're doing with Nestor, what types of practices have you seen emerge that make performance reviews better or more concrete or more of a objective way to actually evaluate people, right? Rather than subjective of do you show up to the like, do I like you and do you show up to the office? What have you seen the trends there?
Raluca Apostol - 00:34:13: What I'd love to share is that HR tools in general are not loved by people. So this is one of the problems out there because the adoption of HR tools is not so high. We've seen so many platforms that are used just because they need to be used because someone from the top management or from the HR department needs some data in there. But when we started Nestor back in the days, we said, okay, we have three main stakeholders. We have the employee, we have the manager, and we have the HR professional. And for us, the employee was the most important stakeholder because if we show to the employee what's in it for me, then you will be the one that is driving the adoption of the system. Of course, a huge important is how we implement the system in a larger company, let's say with more than 1,000 employees. But you as the employee, if you know what's in it for you in there, then you'll be the one that goes back to the system and you will see this platform, a tool that is helping you and is not bringing you more problems or more situations for justification and so on. So one thing that we've seen and more and more companies started to take is approaching performance management as a continuous way. Like we, first of all, it starts from the leadership, from the top management. You need to adopt this idea of being more transparent and working with, let's say, goals. And some of them are also implementing OKRs because we do also have this module in Nestor doing everything in a transparent way, saying that this is the strategic direction that we take as an organization. And then this is the way we cascade down.
And then this is the way our employees will also contribute from the bottom up towards our mission with their initiatives. And doing that like on a weekly or biweekly basis, then the performance review is just a moment in time. And this is one thing that we achieved through Nestor. Like from periods like three weeks, we shortened the process to a few hours for the manager because they just one needs to see this is the form, okay, this is the activity that happened over time. I know about this activity. I just need to make this check in here. And on the other side, getting the feedback and collaborating on transparent goals, then this is something that also helps the individual to be more engaged into that. Because what's in Nestor, when you actually hit your target or at least progress against your target, you'll see that you are also progressing against the organizational and strategic goal as well. So it's like helping the individual identify the contribution towards the company's strategic direction. And it's not just an activity that is done in isolation and it is evaluated by your manager. So everything in Nestor is almost transparent. Of course, as much as you want the transparency to be. But we enable that and most of the companies that implemented Nestor adopted that level of transparency.
Melissa Perri - 00:37:35: Cool. That sounds like a much better way to engage things. When you're looking at the OKRs, I think this has been a hot topic, especially for product managers. I've seen personal development metrics. Here's what I need to do as a personal to get better at my job, to move up the ladder. And then there are like company goals that you are tied to. How do you think about and what's the right way, I guess, as somebody who's studied this a lot, what's the right way to balance and measure how people go towards company-driven goals like OKRs and personal-driven goals? Because some of the pushback that I've heard, especially from product managers or people in organizations is what if I can't hit the OKR that I've been assigned? Because of things that are like outside of my control, right? Other things are happening. And if we just look in a performance review or an evaluation at just the OKR, did you hit it or did you not, that might not tell the whole story. So how do you think about baking into Nestor or helping leaders understand those situations and what's happening around just these numbers in a point of time to actually evaluate people's performance?
Raluca Apostol - 00:38:44: That's a huge struggle. And I think this ties more towards how we look at OKRs from an implementation point of view, because what we advise at least teams and leadership teams, or when you start implementing OKRs, you need to look at two things from our point of view, our point of view at Nestor. First of all, are the lag measures like, okay, I need to achieve this number of customers in the next period. So I need to sign them up. And are the lead measures like, what I need to do in terms of process so that I can get to hit that measure, like those number of customers. You may have at some point a change in the market that basically is not something that you can control. It's like the pandemic and everything like messed up. You couldn't hit the numbers, even though you had all the needs out there. So is not measuring what happened or what the end result, but measuring what takes you to that result. And also this will keep you really motivated because when you will look at one performance review and you say, okay, we didn't hit that. We need to identify is something that we could control or is something that I don't know how I should approach some of the things. And then is the moment where you are looking at your personal goals and your capabilities. So what we've done in Nestor, because we learned so much from this area is that when you do a performance review, you don't look at what happened in terms of results. You look at what happened in terms of the behavior towards and what you have done so that you could, or you try to achieve those results. And then you look at your critical skills on the role. Do I miss something there? Do I have so huge gaps and my personal goals should be tied towards those gaps that you need to fill. And then once you achieved some sort of performance on the current role, then you look at what's next for you in terms of career. So a development plan for you as an individual would be like, I should perform on the role and then I should think how I could exceed my role so that I can get to the next level.
Melissa Perri - 00:41:05: Great. Nestor robust way of actually looking at it. One of the things I hear people struggle with as well, especially product managers, I keep bringing this back to product managers because that's our audience, but going from individual contributor, let's say up to a managerial level, when you're looking at skill development, especially inside an HR organization or areas like that, how do you help people understand how to make it to the next level, right? Like what do you advise companies do to make that transparent? And then what's your advice for somebody who does want to move up into a managerial role about how they should look at their skills and how they should start to think about that?
Raluca Apostol - 00:41:40: From my point of view, first of all, you need to define what means this language from the skills perspective. Because you may refer to one thing, one manager from one department would consider, let's say, collaboration in one way. Another manager would consider it in some other ways. So the HR and what we've done for Nestor as well is for the HR department to be the facilitator in this alignment. Because once you have some skills in the library, then you can contribute to enhance that. This would be one thing. And then what it means for you as an individual to be, let's say, aware of on this skill and what it means for you to go to the beginner level and then proficient level and then advanced level and specify. And if that is the sense for you as a product manager to make visible to your direct reports what this means in our team you can do that in Nestor as well. So providing so much clarity in this direction is so important for the employees because it will remove frustration. It will also adds for each individual. It adds so much clarity in what I need to achieve in order to do that or what behavior should I adopt in order to go towards that. And one thing we also introduced in Nestor later on is how we help managers learn more about the behaviors and the skills of the team level. This is. Huge, huge information for the managers and also for the individuals, because you may answer some questions around that are around some behaviors, but Nestor will bring up the skills at the team level, like how we collaborate, like those interpersonal relations that could bring to the manager so much information about their managerial potential, like the leadership part. And then for each individual, where I am compared to the average in my team. So we bring data on both sides so that you as an individual, you know what you should be expecting when you go and you'll be a manager one day.
Melissa Perri - 00:43:50: Another part of this too is people who want to move into a role that requires people management experience. Let's talk about that. That's a hot topic. It could be any role. And if you're looking at the job description, right, it says must be able to manage people. But if you're an individual contributor, a lot of times you don't get the ability to manage people. How do you help show maybe even like potential or how to get started to make that leap? Because I've seen in a lot of roles, and it's not just product management, I think it's everywhere in tech, that leap between I work as by myself on a team, right, with a team, let's say I don't manage a team, but like I work with a team to now I manage people and they have my direct reports. It's a big skill leap. And if you've never managed people before, a lot of leaders will look at that and be like, oh, you don't qualify, right? But that is the next jump. And there's no other jump. And you want to progress and you want to get there. So how do you help surface up those types of skills or show like potential to learn in those types of areas?
Raluca Apostol - 00:44:50: First of all, from my point of view, you need to be intentional about this. You need to be in the position that I want to go there. You cannot do something if you don't want. But from application point of view, like what Nestor is doing from this point of view is like at an organizational level, there are some of the skills that we want to see based on our culture and based on the values that we promote some behaviors in all our employees, like collaboration in this way, or I don't know, being positive or maintaining that positivity at work. But when you are a people manager, then one critical skill would be like to be able to solve conflicts, let's say. So when you will see your, let's say, your next move in Nestor, or you are an individual contributor and you want to go into a managerial role, you'll see that you have this gap, like solving conflicts. And if you start to get with your manager, a developing plan to acquire, or at least to be aware of what solving conflicts mean, then you may be in the position to show potential into that direction, just having one or two activities so that you are able to learn more about solving conflicts and then to be involved in at least one situation where you prove that you can solve one conflict, even though it's just like an exercise, let's say. This is how we help individuals learn what I need to start acquiring when I'm looking to a potential managerial role. And if I'm intentional about this, then Nestor will learn about this.
Melissa Perri - 00:46:28: I like how you're basically breaking out what people, I think, misconstrue as people management, right? They think of it as one skill. They don't think of it as a collection of skills that you need actually to be able to manage and lead a team of people who actually report to you. So that's really interesting. So you break it out into individual things like conflict management, all these things, and you can do that as an individual contributor.
Raluca Apostol - 00:46:48: Yeah, definitely. Because we in Nestor, we don't have like just the skills library. We have multiple clusters and we can cluster skills depending on the context as well. So if you are looking from a leadership perspective, you'll see a bunch of skills. And if you are looking from a customer service perspective, let's say you will, you will may see some of the skills that are also in the leadership perspective as well. So we blend these clusters and depending on your actions and depending on the career path you take or the next move you take, then we can help you see the potential. And also make very small improvements that takes you to the final goal ultimately.
Melissa Perri - 00:47:30: Great. That's really cool. So Nestor is not your first startup. You've done this many times before. What have you learned from previous startups that you took with you to Nestor to get it going?
Raluca Apostol - 00:47:43: One thing that I would love to share is when I started Nestor together with my co-founder, I started Nestor not out of one passion that we had, but out of one problem that we felt so hard. And we said at the time, let's see if this problem is out there. And if it is after talking to people, then just let's build a solution and let's build a first version because being working in iteration is something that is in our culture. So let's do something small and try to get feedback. And if I would compare this to prior experience to Nestor, where I started to build product that had a lot of features and it was amazing and it worked perfectly, but when you would see how many users would be and would use that and would benefit out of that solution, it doesn't compare with what is happening in Nestor because we started like, let's search for the problem, work together with the community out there because prior to Nestor, we had like 400 interviews so that we can validate the problem that we found. And after that, we built our first iteration of the product that was like a very small portion of what Nestor is today. So yeah, I think this is the most important thing, your connection to the problem, your way of doing this, of solving this problem without any software, and then validating it with the community or other potential users that you may see at the time for the product that you will be developing.
Melissa Perri - 00:49:24: I think definitely good advice for people out there who are looking to start their own companies as well. Thank you so much for Raluca for being with us today. If people want to learn more about you or Nestor, hopefully, where can they go?
Raluca Apostol - 00:49:37: LinkedIn profile. I'm pretty active on LinkedIn. So roll out a postal and you can find me there. And I'll be really happy to connect with anyone. And thank you so much for having me today, Melissa. It was a pleasure.
Melissa Perri - 00:49:52: Thanks for joining us. And we'll link to all of those links in our show notes. So if you go to Product Thinking Podcast, you can find all the information that you seek right there. Thank you so much for listening to The Product Thinking Podcast. Come back next Wednesday where we'll have another fabulous guest and make sure that you submit any questions you would like to have answered on the Product Thinking Podcast to dearmelissa.com. We'll see you next Wednesday.