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HRx Radio – Executive Conversations: On Friday mornings, John Sumser interviews key executives from around the industry. The conversation covers what makes the executive tick and what makes their company great.

HRx Radio – Executive Conversations

Guest: Arthur Matuszewski, VP, Talent Acquisition at
Episode: 334
Air Date: August 2, 2019


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Important: Our transcripts at HRExaminer are AI-powered (and fairly accurate) but there are still instances where the robots get confused (or extremely confused) and make errors. Please expect some inaccuracies as you read through the text of this conversation and let us know if you find something wrong and we’ll get it fixed right away. Thank you for your understanding.

Full Transcript with timecode

[00:00:00] Today’s Show is brought to you by the Human Resources Executive Magazine’s HR Technology Conference and Exposition held October first at the Venetian in Las Vegas. Join me and thousands of your colleagues at the world’s largest exhibition of HR Technology.

Good morning, and welcome to HR Examiner’s Executive Conversations.

Today, we’re going to be talking with Arthur Matuszewski, who is the head of Talent Acquisition at Better Mortgage, Arthur I’ve been talking to for six months or so now and he is the smartest thinker about recruiting strategy that I’ve run across and so with that Arthur why don’t you take a moment and introduce yourself.
Arthur Matuszewski:

Bold introduction John. Thank you and appreciate the opportunity to chat today. Originally coming from Bridgewater where I spent the better part of four years figuring out how to find folks that were

[00:01:00] successful in a uniquely transparent and the uniquely meritocratic environment spent a lot of time building out predictive modeling and predictive assessment.
Following that worked for a number of years inArthur-Matuszewski- Innovation strategy and so helping big organizations like Samsung or Coca Cola become more creative the thinking through all the people structure inherent in that and was fortunate to spend the last number of years with Wayfair helping them grow from 7,000 to 14,000 overall finding the 10,000 was a very different challenge than finding the one in 10,000 and here at Better I’m thrilled to
I have the unique opportunity to book do both or we’re looking for folks with mix of values abilities skills that match our period of hyper growth along with the scale needed to grow our market share and continue the trajectory that we’ve been fortunate to be on

So, how’d you do it? Let’s let’s start at the beginning.
How did you end up at Bridgewater? And

[00:02:00] what did you learn there? I mean the Bridgewater is famous for being meritocratic is an interesting way of saying merciless but a very tough environment very tough performance oriented environment. How did you end up there and what you learn?
Sure. So in University, I floated around the humanities as always fascinated by understanding why people and institutions come to Value things that they do but studies social philosophy policy studies and organizational psychology that a mix of things prior but finding Bridgewater originally came through an article in New York Magazine.
I believe the description was if you took Ayn Rand and mixed her with Deepak Chopra and put it on a line of fortune cookies, you have the principles and to me that sounded like if nothing else a singular and unique

[00:03:00] experience on my way to Bridgewater while they were still figuring out their recruiting process in the wake of all this press and they scaled from being smaller Boutique pre the financial crisis to right on the heels of it being the world’s largest hedge fund.
The experience of Bridgewater fundamentally was one where we knew what success look like in our environment? Because the business model had been perfected over the course of the fund’s history and the core objective was how do you create an environment where you’re less likely to make bad decisions?
Where the margins spoke for themselves and where the core of the operations of the company had already been so systemized and commoditized the objective was finding folks that were willing to debate to the very end to be able to preserve the high standards and the excellence that was required to consistently outperform in the markets.
That’s interesting, let me ask you a question.

[00:04:00] I was just in a conversation earlier today about whether or not all of the improvement that people have invested their money in the business has actually resulted in making better business decisions. And and so so I’m curious about how you told if you were making better business decisions, is that simply a question.
Achieving or exceeding stated goals or is there something more to making it that business decisions than numbers?
Sure, I think the goals and metrics are the b aseline I think for us the cultural fit and the ability to create an environment where you were consistently improving whatever better meant.
There was no endless onslaught of questions around whether or

[00:05:00] not we’re on the right track or the wrong track. I think we were. Unique environment where 11 exceptional analyst coming in either out of undergrad or out of b-school could rise up through the ranks and become our CIO and that would return many fold in terms of the metrics and the financial returns.
And so we were very optimized for finding that one individual much more so than we were trying to optimize for people tenure people. Day satisfaction or people they flick growth any in short-term period we were invested in the long-term. And so because of that we operated more like an asset manager like a think tank than a traditional asset manager.
So so to run this to its conclusion there you were looking for the one home run and everything was focused. Getting

[00:06:00] that one home run you went to Wayfair which is growing and you shifted to how could you get a whole bunch of people which means working with averages rather than home runs. And so what is what’s going on at your current company?
What’s the challenge there? Sure. So we’re in a unique place where we’re trying to disrupt an industry that has become largely stagnant. The broader mortgage space is the embodiment of what a lot of folks have come to call the filing cabinet business has supported by regulation its burden by process and the cost of manufacturing loans has increased exponentially and most of that cost of unfortunately been born by consumers in low resolution.
Environment and particularly a prolonged great environment were very. Susceptible to large surges and our need to grow our

[00:07:00] capacity. We’ve been tremendously oversubscribed in terms of demand for our product which is a fortunate business position to be in but from a human capital perspective exposes us to all the difficulties with growing with both a high caliber of talent in the volume required to meet business demands.
And to do so quickly and ideally sustainably the pitch to report potential employees has to be something more than you know, the business is going gangbusters. Now, we have to be able to communicate complete business plan that will limit some of the procyclical risk for us. And we also need to be able to create an environment of assessment where you can be clear on where you can and is where your trajectory goes at the continuing as a company continues to expand.
So most most recruiting operations don’t have to directly confront the fact that the business

[00:08:00] itself is hypership local and. Imagine because it because of what caused the last recession I imagine that everybody who comes to work in the mortgage industry is either aware before they get there are aware soon after they get there that that the next time the the cycle fails it’s going to be time to hunt for another job.
How do you recruit with that kind of environment? Sure, I think transparency and being forthright is key fundamentally in terms of our employer value prop were communicating as much about the mortgage process as we are about how we’re uniquely positioned within that I think one of the things that 2008 exposed is that doing things just for style and you know issuing face is falling through show.

[00:09:00] Growth up and to the right it’s not enough as a society. And so one of the things that we pride ourselves on is through the process providing the same sort of financial education that we provide to our borrowers so that when candidates come in we’re giving them grounded realistic view of how the mortgage industry works and more broadly how homeownership in America has changed from a process that.
Previously LED primarily by Banks to one that is now led by other smaller home loan Originators and where we as the digital Vanguard are trying to replicate a lot of the safeguards that the Consumer Financial Protection Bureau. And otherwise I put in. But a lot of context and that’s a lot of pre-sell that we aim to provide candidates and then fundamentally it’s aligning candidates on our mission, which is not just to tear down an old and archaic industry, which I think is

[00:10:00] some of the refrain you hear from a lot of tech disruptors, but it’s really to build a new industry that.
Is more consumer-oriented and doesn’t have the same commission structure the same feeds the same various exchanges that happen before the money actually materializes in the form of a place for families to have a home that’s interesting but substitution. It sounds like you’ve bought into that vision.
No II assume that when you got there. This is a this is a digital company. I assume financed with Venture Capital. Yes, correct. Yes, right. And so so so I good hiring strategy is not part of the tool kit that you get when you get a bucket of venture money. So I assume that that when you got there you got there because.
You demonstrated that you knew how

[00:11:00] to do some things. What’s the process of taking what you found and moving it to where you want to go look like. Sure, that’s a great great question agree. I think you know sometimes in Silicon Valley and in the broader Tech ecosystem, you see a lot of these examples of companies but rush to grab market share by hook or by crook.
One of the things that I appreciate it meeting with the team and that I’m hoping to bring to our recruiting strategy here is a key alignment with the operating model and the financials. I think one of the challenges you find is that for a lot of companies recruiting an HR Broadway can sometimes be seen purely as back-office call center.
And I think my background has one of those towards looking at Talent acquisition as growth strategy for the company. So in the same way that you can model out the

[00:12:00] potential incremental value that a go to market higher could provide for a business. You could also model out the opportunity cost of not having people in the roles or of having the wrong people in roles relative compare Al relative to Performance relative to whatever KPI’s using to vessel.
So in the short time, I’ve been here the opportunity to go in depth and operate model and begin putting dollars and cents to the recruiting performance and expanding that north of the pipeline has helped make the business case for. Building a quality recruiting function more self-evident as well as the business case for continuing to invest in better ways to discover people to attract people to engage people and to assess people.
I think one of the challenges with a lot of the HR Tech ecosystem is that there’s a lot of Solutions in search of problems, but the core problem that’s on the mind of. Executives board members or Venture Capital investors is how do I

[00:13:00] know whether or not we’re on the right track and hear what I’m hoping for is to create an ecosystem where we can have those metrics in real time and particularly given the dynamism of the industry that we’re playing in be able to adjust those levers depending on what makes most Financial sense for the business.
Sounds like I mean order to do some of the things that you just described you’re doing yeoman’s work inside of the rest of HR as well because to do what you describe you’re talking about the granular elements of good workforce planning. Which requires that you know what you’re after and what it takes to get it and what the likelihood of success is.
And so I assume that you have this growing wall of metrics that you pay attention to do as you are

[00:14:00] architecting a way of doing Talent acquisition that’s going to have a broader impact on the company. That might look like at first sight. Reasonable thing to ask. Yeah, I think having metrics is key and I think the metrics Journey for a lot of organizations and let’s regardless where you are starts out with first getting the data getting the data to a place where it has integrity and where you believe that the things that you’re experiencing are the things that you’re seeing.
I think from there you can begin to set expectations. And so the second stage of the data journey is talking about. Are you would like to be and starting this that baselines based on historical performance and expected performance depending on continued investment and then ultimately in the third stage getting to insights and so beginning to probe that Delta between reporting and expectations to actually start to come up with things that might

[00:15:00] seem uncommon or unexpected But ultimately which will be the governor’s to a the Bridgewater parlance.
I. Evolving chain, I think a lot of the input and output equation is something that is still being debated and continued upon others before me such as Rob MacIntosh and otherwise has done a good job of articulating the. Network routing metrics are never just the burden of a greeting they are fundamentally the burden of the business and so understanding the business metrics and how they flow backwards into the recruiting metrics is critical.
I think that’s unfortunately a gap that a lot of organizations struggle with whether it’s for resources or capabilities or general belief that these are metrics that you can generate and that are critical to the continued growth of a business. So you you think about the talent acquisition problem much more like an engineer than like a

[00:16:00] human resources person.
So I got two questions or would you would you agree that that’s a fair characterization and and B does that cause you trouble? Yeah, I think there’s definitely you know changing the garden if you will in terms of how folks are approaching the talent acquisition and the human resources space more broadly.
I think as you see us continue in a prolonged unemployment environment as you see continued increases in Market liquidity particularly for key roles whether their data scientists are warehouse workers. Becoming a matter of Education a matter of how you tie evaluation systems and early childhood to Collegiate education to what’s expected in the workforce.
And whether it’s an engineering mindset or a

[00:17:00] commercial mindset, I think the expectation is that has those drivers continue to increase the competition and increase the scarcity of. Challenge required today to do things that will look very different tomorrow. You need to start threading the needle more discreetly.
I think historically there was a lot more of a wink and a nod to the idea that you know personnel management or became human capital became people became Talent regardless of what you call it. It is now at the table with the CFO and with the video. And they ultimately understand that their company will be made or lost by the virtue of 80% of most growth stage companies spend if it’s in people, then you need to start seeing yourselves more as portfolio managers figuring out whether we need to buy hold or trade the talent that

[00:18:00] you have to get to where you’re trying to go.
I think it’s more likely that that’ll be what the world like what’s like in the future and so I’m grateful for the experiences. I’ve had to be able to buy them, but it’s definitely not the conversation that is easy to come by and so finding that alignment of. Even Capital team and executive team that believes that human capital is on par with financial capital is a critical part of the equation of actually accelerating expectations for human capital function broadly.
So well I hear you, but but I wonder if if it’s really the case that that’s the future it might be the future for the universe of. Companies that behave like things are controlled by Banks, you know, so so anything in the fortune 2500 or any thing

[00:19:00] might adopt the kind of viewpoint that you think that the vast majority of companies exist in small communities where the question isn’t an engineering problem.
That’s that’s something that you can do in an urban environment where there are. Relatively infinite resources if you have enough wallet and it’s different if you are in Omaha where there’s a it’s an island two hours in any direction away from anything else and so you so the major competition is within the market for the existing talent and it isn’t finding the best.
It’s what can you Arbitrage inside of the shed? So so I wonder I wonder how the future gets into those sorts of places where it’s not about Bank level metrics, but it’s about it’s about optimal integration of the company in the community.

[00:20:00] It’s a good point John. I think ultimately. You start staying at at the margins.
You see it in companies like HubSpot or companies that are bringing sort of the tools of these growth Fortune 500 companies to smaller scale business. You see it in you know, if you go an hour or two hours outside of any major city seat in the communities are struggling to find enough Hospitality workers enough workers to support the service economy.
And I think for a lot of even smaller employers the challenge is the same in a world where there are frankly is more data. You still have the Mom and Pop Shop. Owners looking their potential employees up on social you have them posting on Craigslist more than just putting up a sign in the window. I think

[00:21:00] increased competition for jobs will continue.
Hopefully a other sectors in the market particularly as you see Mobility rates decrease think of the drivers of social Equity as education and credit and you see this refrain. Only where you know as the nation are we following behind are we preparing our people for the workforce? And I think to really deal with social Equity problems at a community level.
I think it’ll take more time for the market Cycles to catch up. But I think you will see more resources and more tools devoted towards increasing the distribution of talent. That’s that’s a great answer. But you know part of what you said is that now 25 years later the small businesses in little communities are starting to use the internet for recruiting

[00:22:00] so.
Yeah, yeah, it may be it may be that this is a metric driven World 25 years from now, but but but I wonder so so you’re in a position because you because you’re coming to this place fresh and they’ve got you in your you’re the talent. You must be just parted with offers to use various kinds of AI in your work.
How do you make sense? Sure, I think definitely true. I think the proliferation to clean the u.s. Of open-source web data has made clean quote AI technology more commonplace. I think finding the balance between humans and AI. Is the challenge I think there are things that automation is excellent at which is distilling patterns

[00:23:00] from large somewhat disparate data sets.
It’s great at taking remedial repeatable tasks and putting them into a process workflow where you’re clicking buttons instead of. Shuffling calendar invites around with in recruiting specifically that usually looks like discovering candidates sending messaging and scheduling. I think once you get into assessment and a lot of these predictive models around best fit and likelihood to respond and all that.
It’s not necessarily truly AI it’s basically a statistical referencing and one of the things challenges with them with this space. Is that the solutions that are being. Old are ahead of where the technology currently is. I think there is an opportunity to build this ideal Fusion of what humans are good at which is not just finding the patterns, but in intuiting how to structure

[00:24:00] the data to make finding those patterns easier and connecting with candidates to communicate the value prop and provide more education than purely, you know pre-recorded pitch.
Imploded email and I think what we’re going to continue to see is push back where we need to be cautiously optimistic about what technology can bring but not expect it to. Solve all of the problems from day one because it always comes down to integration and ultimately defining what the company needs and the right now and what the company is looking for tomorrow and I think most companies aren’t at the place of doing that well and so by Nature all the tools that are trying to do that will I think more likely fail than succeed unless they’re able to bring their clients along and upskill the thinking around Talent.

[00:25:00] Okay, so so are the risks of working with how do you describe what you said? You said the solutions that are being sold are being sold ahead of the market meaning that that the hype and the reality don’t quite. intersect perfectly and and I’m going to assume that that’s that’s because. In the current VC model, the customer has to learn at the same time that the supplier who has to learn but what is the risk what are the risks of of installing the stuff in this state?
What should somebody be aware of? I think ultimately the lowest bound of risk is that you spend a lot of money and you spend a lot of time and you don’t quite get the outcome you’re looking for. I think the upper bound risk is your actually introducing and

[00:26:00] replicating a lot of endemic biases that come with any recruiting process and you’re amplifying them by codifying basically bad decision making.
Whether that’s a bias towards minority groups, so there’s bias towards certain educational profiles. You can train an AI to be just as malevolent or if not actively ill intentions them just as ignorant as human assessment. And so I think the risk is if you don’t have a defined framework for what does psychometric what the skills base what is cognitive and what is behavior?
That’s look like in our environment you will continue to perpetuate and in certain cases amplify those problems and then ultimately by introducing the enter environment the lead to more disengagement in the workforce and less productivity. Wow. Well, that’s it. That’s

[00:27:00] that’s a pretty daunting.
Suggested that what ought to be conservative in their decision-making here. That’s that’s that’s fruit for another whole conversation. We’ve zipping that data and equals bad data out regardless of you know, the the system your building and I think I meant that to do their part to clean that up rather than expecting machines to clean it up for them.
Which is in a remote picking up dust it’s deciding hearts and minds and human life. Yeah, it’s such a fertile area of conversation because the question is if you clean all the bias out of the data, do you have anything left good question indeed indefinitely fruits for a longer conversation. Yeah.
So let’s do that sometime. Thanks for taking the time to do this. Would you re introduce yourself and tell people how they might get old? Of course, I appreciate it.

[00:28:00] Again. My name is Arthur Matuszewski better mortgage. Feel free to reach out to me on LinkedIn or via Arthur at I’m very willing to talk shop and trade notes and have learned the most from the folks that have done this for much longer the appreciate the time John and excited to continue the conversations and whew.
Okay. Thanks. You’ve been listening to HR Examiners Executive Conversations. We’ve been talking with Arthur Matuszewski, who is the head of Talent Acquisition at Thanks for listening, and we will see you back here next week same time. Have a great week. Bye. Bye.

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