Karat – Building Diverse Teams How To Evolve Hiring Processes For DEI With Jeffrey Spector

Music: 00:00 This is Recruiting Daily’s Recruiting Live Podcast. Where we look at the strategies behind the world’s best talent acquisition teams. We talk recruiting, sourcing, and talent acquisition. Each week we take one overcomplicated topic and break it down so that your three year old can understand it. Make sense? Are you ready to take your game to the next level? You’re at the right spot. You’re now entering the mind of a hustler. Here’s your host, William Tincup.

William Tincup: 00:34 Ladies and gentlemen, this is William Tincup and you are listening to the Recruiting Daily Podcast. Today we have Jeff on from Karat, and we’ll be talking our topic today is Building Diverse Teams, how to evolve hiring processes for DEI. And Jeff and I have talked a bunch before, and I can’t wait to kind of unpack this topic with him. Jeff, would you do us a favor and introduce both yourself and Karat?

Jeffrey Spector: 00:59 Yeah, it’s a pleasure to be here. Thanks so much for having me.

William Tincup: 01:02 Sure.

Jeffrey Spector: 01:03 I am Jeffrey Spector, as you mentioned. I’m the president and co-founder of Karat. My career started in China, actually at a startup out there. I was employee five. It grew like crazy. We kind of realized that there was a better way of hiring than what we did. We made a lot of mistakes. And so I learned a lot of valuable lessons there of what not to do. But it was a great experience. Prior to starting Karat I was at the Gates Foundation where I was working as Melinda Gates’ chief of staff. I was very fixated there on helping people get jobs more easily. They had work in the post secondary space and so I dug real deep in there. And broadly speaking, just stepping back, I’m really passionate about solving problems that are at the intersection of business and social good.

And that kind of brought us to Karat, and the founding of Karat. Karat is the world’s largest interviewing company. Every company in the world interviews, but interviewing is typically something that is done in an ad hoc manner. It’s not anybody’s primary responsibility. You’re not usually hired for your ability to assess other people in the same job you’re getting. And we felt like interviewing was this thing that should be treated like a sacred craft.

It’s so important to the outcomes for the candidate. And also for the trajectory of the company and where they’re trying to get to. So we made it a job. We made it our job. And we interview on behalf of leading companies like Amazon or American Express, Walmart, through a network of engineers that we call interview engineers who are specialized in how to interview. We have conducted about, last fall we said we had done about 150,000 interviews, and we’re on pace to kind of double that this year. And we’re the company that says, out of the thousand people you’ve send us to interview, here are the hundred you should move forward in your process and that you should hire.

William Tincup: 02:50 That’s fantastic. And the folks that we’re interviewing, is it all over the spectrum? Hourly? Is it more technical? What’s our sweet spot?

Jeffrey Spector: 03:00 Yeah, we focus on technical interviews. And the people that are interviewing are all software engineers, all qualified. Most of them have many years of experience in tech, and they tend to be very passionate about the interviewing process. One of the things that we have found, I mean, this sounds pretty straightforward actually. When I was at the Gates Foundation, we spent a lot of time and resources figuring out that teachers were the most important aspect of a kid’s education, which seems pretty straightforward now when you think about it.

Same thing happens for interviewing. The interviewer makes a huge difference in the outcomes, making sure that it’s a predictive interview, but also it’s an enjoyable one and that the candidate feels great. And so there, it’s the number one thing we receive feedback on. We ask every candidate after an interview to give us feedback on the interview. And the interviewer is the number one thing they’re commenting on. So the people around the world are all people who are either, they’re not just technically inclined, but they’re also skilled in things like time management and empathy. And they have a passion for ensuring that we bring out the best in the candidates.

William Tincup: 04:05 That’s smart on so many levels. Because especially with the tech talent that you’re doing with, they just don’t want to waste time. And if they feel like their time’s being wasted, oh boy, it’s just not a good experience. And they’ll tell people. So I love the fact that you’ve got experts there that are, that can navigate them through the system. You know I love Karat. So we’ll just stop talking about that. Let’s let’s talk about, or we can spend the entire show talking about Karat.

We’ve got a wonderful topic in terms of building diversity, and building diverse teams. And the things that you see in the evolution of the hiring process towards DEI. It’s on everyone’s mind. It’s top of mind for everyone. I know everyone that you all deal with calling the client side. Let’s start there. Let’s just unpack what you’re seeing, and how people are changing so that they can get a different outcome.

Jeffrey Spector: 05:07 Yeah. I mean, I think you’re exactly right. The last couple years has really brought DEI to the forefront. Obviously with some of the incidents in 2020 and the George Floyd murder, those kind of laid bare some of the injustices in this country like never before. Or long line of what had been happening. And so companies were really ramping up their focus on building more inclusive hiring processes. One thing that’s interesting is that we definitely felt, we were getting asked a lot about like, what are our processes like and how do I hire more inclusively? We just did a survey with the Harris Poll, and I was kind of surprised to find that only 48% of the engineering leaders, we surveyed about 500 engineering and TA leaders, and only about 48% of them strongly agreed that DEI was a strategic priority for their company. In their hiring process.

And so while I think a lot of companies are out there talking about it, is that really actually translating to somebody who’s willing to invest resources? So I think a lot of what we talked to our clients about is like, how serious are you about building inclusive hiring processes? Interestingly, in that survey, also the C level execs rated it much higher than actually the managers and line level employees. And so it may be that it’s actually more of a priority for certain leaders than it is the rest of the organization. But whenever we sit down and work with our clients, we’re kind of like, how do we make sure that you are really invested in doing this and building this right?

William Tincup: 06:41 So again, you got executive buy in, super important. But for the hiring managers, for the folks that you also deal with on the customer side, they want to move the needle. You’re dealing with people there that also feel this, not just pressure. They feel this desire to want things that are different. What can they do in the interviewing process to change the outcome?

Jeffrey Spector: 07:08 Yeah. So we talk about our approach at Karat, and I think it extends over to what others can do as one that, you try and make sure that you’re building a structurally sound process. So it’s a lot harder. Everybody should be thinking about unconscious biases, but it’s a lot harder to every single time check your individual biases, and recognize them in the moment. And so the first thing you do is just look at your whole process and say like, where could there be potential bias that I just don’t need to expose the process to? So for example, our interview engineers do not look at resumes heading into a technical interview. There’s no real reason. They’re not doing a, tell me about a time you built something? They don’t need to know a lot about specifics in the background if they’re just going to test the underlying fundamental skills through coding problems and other things.

And so they don’t look at resumes. There’s no bias there from, like pedigree bias. They are also not actually making a recommendation as to who should move forward in the process. We have very structured rubrics as to what does success look like in the interview? And so they’re actually just documenting exactly, here’s how the candidate did against those rubrics. And then you can just tabulate the rubric up to say, “Yes, did they make it to the next round or not?” And that eliminates likability bias. There’s no ability for somebody to say, well, maybe they didn’t do so well, but we went to the same school. Or we really bonded about this one thing and therefore I should move the person forward.

It’s really about the underlying competencies that matter for the job. And then we do things like we record all our interviews, and we quality control them all. So we have another set of eyes on every interview that goes by to make sure that there was no bias that showed up in that process. So the first thing I would just say is making sure that your process structurally, you can kind of revisit every single aspect of it, to eliminate bias.

William Tincup: 09:03 So one of the things I love about that is there’s an objective analysis of the candidate. Their skills, what they can do. The true outputs, et cetera. And so that’s abilities and experience and all kinds of things, that kind of all mixed together. And I love that, again, being able to look back on a particular interview, then it becomes kind of collaboration software. Kind becomes kind of a way that you can go back and look at things together. If you weren’t on that interview, you can go back and look at it or evaluate it as a well, to make sure that we’re being objective.

Jeffrey Spector: 09:44 Yeah. I think the going back and looking at data is really, really important in doing this right, right? Let me give you an example. Some of our clients will find, so Karat after every interview kind of recommends to the clients, we kind of tier based on their hiring preferences and their hiring bar, and the waitings about what competencies matter. We’ll kind of tier different candidates. So into, let’s say four tiers. And generally, what we were seeing with some of our clients is that if we had recommended someone who was really strong, they were moving them on site at the same rate if you were a man or a woman. And if they did not do very well on the interview, they were also moving forward around the same rate. But the people right on the bar, there was a huge gap between the percentage of men and women that were actually getting invited.

So they did the same on Karat, but then there was a gap after us. And so, because we were able to look at the data with our clients on that, we can then say, hey, what’s going on here? Can we look at that part of the process? It’s, who is making that decision? And what’s the criteria by which they’re making the decision when someone is right on the bar for the company? So being able to kind of be structured also allows you to look back at the data and start to make observations like that, where you can then start to refine. Because DEI is one of these things where there is no silver bullet. You have to be very aware of every single part of your process, and constantly vigilant that you are going to eliminate bias at every step. And so that’s something I think you’re getting at looking back at the interviews, but I would say that, that extends to the whole hiring process as well.

William Tincup: 11:19 Right, right. When you said structured process earlier, what’s your take on structured interviews? Is it similar, different?

Jeffrey Spector: 11:27 Oh yeah. The vast majority of interviews should be structured, even if you’re doing culture interviews or anything, it should be like, you should be defining what success looks like. One, you can actually make it a better candidate experience because you can alert the candidate about the things that matter heading into the interview. So there’s no surprises there. But two, then everybody has a common definition of what success looks like. I think the hard part about hiring consistently is that everybody views things differently. And so rather than making decisions at a candidate level, where every single individual, distributed interviewer, is like, yeah, this is what my definition is good. If you can get together and actually really get clear on what that is, then you just have a lot less room for interpretation and biases to creep in.

William Tincup: 12:16 So we’ve used the word evolve in our subject. How do people know, how do your customers and the people that you interact with, how do they know if they’re reaching the goal? You said earlier, set goals. Okay, got that. But there’s death by a thousand cuts. There’s a million different places in the hiring process. How do they know where the break points are? Or how often they should audit their processes? Plural?

Jeffrey Spector: 12:49 Well, it’s interesting. I think what we found, so interestingly in this poll, this survey that’s going to come out, one of the things that it showed was the companies that are the most successful in hiring are also the ones that invest the most in the process. The ones that actually have the best outcomes. They’re the ones who interview the most. They’re the ones who spend the most time analyzing their numbers. They’re the ones who put the most time into interview training and selecting who those interviewers are. So that it’s not just who has availability, but it’s also, who’s actually good at interviewing and who’s skilled at it. And so I think it’s one of these things where I think you constantly need to be monitoring your numbers, right? It should be something you’re regularly reviewing as a recruiting manager, as a TA leader, as an engineering leader.

And you’re kind of going back and looking for any areas. It’s not just DEI. This is just good practice for like, are we efficient in our sourcing? Are we closing candidates at the right rates? Are people getting stuck in the process? What’s my overall time that it takes to actually make a hire? That is just something that you should be fine tuning at all times. And so one thing also to note is that a lot of people talk about like a trade off between hiring inclusively and hiring well and fast. And we kind of feel like that’s a false trade off. Because a lot of the same things you’re doing to build an inclusive process, leads you to build a faster, better process. And interestingly, in that same survey, we saw that people who focus on DEI were twice as likely to have hit their hiring goals and to hire successfully as well. So we just don’t think that there’s like a, as much of a trade off, or if a trade off at all, in terms of building your system to be inclusive, and building your system to be efficient.

William Tincup: 14:37 I think that’s just a cop out that people have used quite frankly. Is an excuse for not hiring in one case like female developers. It’s just been an excuse that people have just, it’s crutch that people have used, historical crutch. Hopefully it’s not as bad today.

Dumb question alert. Should we be more upfront? Do you think that brands should be more upfront in terms of what they’re doing, and kind of their process? Or do you think it should be the treatment and the actions that just take people through the process?

Jeffrey Spector: 15:15 Oh, I think that’s a major area of challenges of like some candidates know what’s going on and some don’t. We started a program called, Brilliant Black Minds, which is an initiative. We stepped back and we looked and we noticed that only 5% of the software engineers in the industry are Black. It’s one of the least represented populations in tech. And they were facing systemic obstacles. One of which was fewer, or more limited access to computers and computer science. But also more limited networks in tech. And so therefore the understanding of what goes into an interview, and what goes into the hiring process is it falls short compared to other peers who may have a cousin who worked there, a family member, or some somebody in their network. And there’s no reason why you should not be getting a job because you don’t have a family member that works at the company.

It should come down to the underlying competencies. And so Brilliant Black Minds is an initiative that we have created where we offer free practice interviews to aspiring Black software engineers. And we give them multiple rounds of interviews with feedback, and more visibility through workshops and everything around, not only how to do better technically, but also what does a hiring process look like? Can you negotiate a salary? What happens as you move from the screening phase to the onsite? What should you expect and how to prepare for that? And really just trying to level the playing field. So the only thing that matters is your competency and ability to do the job.

William Tincup: 16:44 So diverse teams, I want to get your take on this while I have you. Typically or classically, we’ve talked about race and gender, sexual orientation, et cetera. But as we think more about inclusion, we’re thinking about all kind of diversity of thought, diversity of people’s background, socioeconomics and all kinds of different, I don’t know, layers of diversity and layers of inclusiveness.

How are you currently thinking about diversity in terms of when people are putting, because building diverse teams, that could mean a lot of different things to a lot of different people? So it could be just straight up they’re dealing with a bunch of pear shaped middle-aged white guys, and they want a diversity of just gender. Okay. Straight, cool. But they might be a little bit further down the path and so they’re looking at diversity in a different way. So how are you thinking about it currently, and how do you help your clients think about it?

Jeffrey Spector: 17:45 Yeah. If you’re at the point where you have amazing diversity in terms of gender, race, neurodiversity, kind of some of the key categories, you’re already way ahead of the game. And if now what your discussion is, is that only focus on diversity of thought and some other types of diversity, then you probably have done a lot right to get to that point. You can just look at the industry statistics. Like I was talking about, only 5% of software engineers are Black. A lot of the big tech companies, that maybe 2% or 3%, right. And so kind of, also, I think there’s just lived experiences in being in gender diversity and racial diversity that will generate diversity of thought.

So you can’t separate those two out completely. And if you aren’t hitting your goals around, or you’re not building a diverse team by gender and race, that’s kind of like at the bottom, the base of the pyramid. You have to do that before you can move on. Not, you couldn’t do it in parallel, but it has to be there. And so most of our work right now is actually helping our companies to improve in that respect because it’s so glaring of an area of an opportunity.

William Tincup: 19:01 So I get to ask this question a lot, I’m sure you do too. Who’s responsible for diversity? So when you’re thinking about that funnel, you’re thinking all the way from sourcing, and all the way through the process, right? And you’ve already given people the advice of looking and auditing different places, making sure that, again, they can have insight into those things. Visibility and insight into that so we can tweak that. But I’ll ask you the same thing. Who’s responsible? Is it a sourcing? Is this a sourcing conundrum? Is it a recruiting in a way that we recruit, where we recruit, how we recruit? Is it hiring managers and potential biases that we have to overcome there? Is it a leadership thing? What’s your current take?

Jeffrey Spector: 19:46 I’d say my take is that it’s everybody’s. It’s everybody’s responsibility, right? It has to be something that the entire company cares about. And you look at Karat, right? We’re a mission driven company, every single person at this company that we hire cares about this. It’s the number one thing we assess for in our interview process to make sure that people really believe in unlocking opportunity in our mission. And making sure every interview is fair, predictive, and enjoyable. And it starts with all of us. And the reason is that innovations can come at any point in the process. So if you think about, I’ll call it two things that we’ve done that we think can extend to any company, but has a huge impact and could come from anybody in that process.

So one is that we interview 24/7, right? We allow people to interview around the clock. And that really matters to people that don’t want to have to leave, and lie say they’re going to the dentist at 3:00 PM. And they want to interview at night so they’re better prepared. But what we found is that the flexibility in scheduling, like women of color interview at 20% higher rates outside of the nine to five hours than the average candidate. You need to make sure that you’re building the most inclusive processes. So the person who’s like, hey, this is an idea that I have about how we can do it more inclusively is like, maybe people don’t want to interview nine to five and they have other responsibilities there. We could actually build a more inclusive process by interviewing at more times.

The second thing that has been really impactful is we offer every candidate a redo interview. So that means that if you interview with us and you feel like you could do better, and it could be for any reason. It could be that you just woke up on the wrong side of the bed, and didn’t have a great day.

William Tincup: 21:29 Bad day.

Jeffrey Spector: 21:30 But it also could be, like last week I had COVID racing through our house here and I was with my two and a half year old the entire week. And I can tell you, I was not as productive on every call that I was in. He was kind of bouncing around in the background, and I probably wouldn’t have done very well in an interview that week. And so we offer every candidate a redo. And what we found is it disproportionately helps underrepresented talent because, to the points earlier, they’re not as familiar with the interviewing process.

And so going through it, even if we tell, say this is what it’s going to be, that experience of going through it is very different. And currently, our companies have already made, our clients have already made a thousand hires through the redo. It boosts hiring yields by 17%. And so we’re kind of saying, look, every company should do this. Because the efficiency of the redo is nearly on par with the efficiency of a net new candidate. And it’s a way better candidate experience because it reduces the stress in the initial interview, knowing you can have another chance. And as I was saying, it helps underrepresented talent. So those are just two examples that those innovations can come from anyone. Those innovations can be driven by anyone in this process. Could be the engineering leader, could be the TA leader, it could be the recruiter.

William Tincup: 22:41 I love that. What are your clients, what are you seeing and hearing from your clients around language, in terms of being interviewed in the language, in their natural or their first language? Let’s just say it like that. And also, what are you seeing or hearing from clients in terms of accessibility?

Jeffrey Spector: 23:01 Yeah. So on the language front, this one is more of a question for the companies of like, do they expect, let’s say English language, if that’s the default, as being the language of the company? And then it actually is a competency that they care about. So again, going back to the competencies, if that’s not something they care about, then obviously you don’t want to bias against somebody who doesn’t speak great English.

Because they could be in their local language. So I think it really comes down to what the company cares about. We do things though that, like some people are actually better at reading than speaking. It’s kind of like really getting clear on what you care about. Because, for example, in our interviews, we will cut and paste in the question so that the candidate can read it and it’s not just like audible. And therefore, some people actually can understand it and groc the question better if they actually see it. But if the interaction and spoken language was really important to our clients and to success at that company, then obviously that would be more of a screening criteria than if it wasn’t.

William Tincup: 24:04 And accessibility is people with learning differences and learning challenges, et cetera. But also people with disabilities. Are you hearing anything on that front?

Jeffrey Spector: 24:18 Yeah, definitely. We get a lot of questions about neurodiversity as well. And I’d say that almost all of our clients ask us about like, what is the process for accessibility? And so I think you just have to build it in your process. You have to kind of make it up front where candidates can actually indicate what accessibility feature they need, or what’s the accommodation that they need in the process. And then you need to flex and have enough interviewing capabilities, or product capabilities to do that. So for example we have some, we’ve done interviews with blind candidates before. We definitely extend the length of time on interviews when a candidate requests it.

William Tincup: 25:01 Accommodation.

Jeffrey Spector: 25:02 Because of disabilities. So it really is a customized. You just have to design the process so that you can handle the wide range of accommodations. But again, getting back to the other concept, which is like, actually in doing that, we’ve had to build a better process overall for all candidates. So, designing for everyone. Designing for all of us by all of us, makes the best products.

William Tincup: 25:29 I love that. So last question. And it was around competencies. You had mentioned earlier, the question is, garbage in garbage out, related to job descriptions. Like when your client comes to you and says, or your customers come to you and say, okay, we want to hire for a full stacked developer. A hundred full stack developers. And here’s our job description. And it’s garbage. Like you all know what a front end developer, the competencies and skills and experiences, especially if it’s junior or senior and things like that. So you already gritted out, you all know what that should be. Do you find yourself coaching them or helping them through this process?

Jeffrey Spector: 26:11 Yeah, it’s a really important point. Because front end developer can mean a wide variety of things.

William Tincup: 26:16 Hundred percent.

Jeffrey Spector: 26:16 Depending on the scenario. And so, yeah, we definitely will. I mean, a lot of our work is to say, take the job description and then tease out, what actually are you asking for? Because I don’t think a lot of companies are having that discussion. So I would encourage like, sit down and go, okay, what are the underlying competencies that we really, really need? There’s a lot of studies, I’m sure you’re aware of that. The more requirements you put on your job description, the fewer diverse candidates will apply. Because there’s kind of a different approach of a lot of white males will be like, hey, if there’s one aspect on this thing I will apply.

And then a candidate who is more diverse may actually, or an underrepresented candidate may look at it and say, there’s one thing I don’t have and not apply. So really limiting the job description to just the comp, or just the competencies and the requirements that are absolutely critical to the job, and kind of leaving the rest off. Or as putting them as nice to have, is such a big, is such an important point of getting people to apply more inclusively. Or getting more people to apply. And there are tools out there like Textio and things that will help you with the language used too, so that you don’t bias in the actual language. But yeah, it’s a really important thing.

We don’t have a product right now that helps people rewrite their job descriptions, but it’s definitely something that we are kind of advising on. Because a lot of what Karat does also, not just help you with the actual interviews and conducting those in your behalf, but because we’re in a really privileged position in the middle of your hiring process, we can kind of reflect on all the other aspects in terms of, from starting from the job description all the way to, how are you closing candidates, and how are you onboarding them? And making sure that they’re successful in the job.

William Tincup: 28:02 Drops mike, walks off stage. Thank you so much, Jeff. Appreciate you.

Jeffrey Spector: 28:06 Really appreciate it. Thank you so much for having me.

William Tincup: 28:08 Absolutely. Thanks everyone for listening to the Recruiting Daily Podcast. Until next time

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