Transforming a global company like Mastercard into an AI-powered, future-focused, skills-driven organisation takes more than just bold ideas—it takes visionary leadership and a deep connection between the people and business strategy. 

In this episode of the Digital HR Leaders podcast, David Green sits down with Michael Fraccaro, Chief People Officer at Mastercard, to gain insight into how he and his team are shaking things up in HR. 

A conversation packed with inspirational actions, you’ll learn about: 

• How Mastercard are using AI to rethink leadership 

• Why they’ve gone all-in on becoming a skills-based organisation 

• How their internal talent marketplace, Unlocked, is helping employees grow and thrive 

• Insights on navigating the rise of the gig economy  

• How to connect and retain younger generations 

This episode, sponsored by Workday, is packed with practical takeaways for HR leaders who want to lead their own organisations into the future. 

Workday is a leading provider of enterprise cloud applications for HR and finance, recognised as a leader in the Gartner Magic Quadrant for Cloud HCM Suites. 

Organisations ranging from medium-sized businesses to more than 50% of the Fortune 500— including Netflix, Sanofi, AstraZeneca, and Rolls Royce—have chosen Workday to build their HR systems and implement Workforce Analytics solutions. Join them and learn more at workday.com 

Links to More Resources: 

• MyHRFuture 

• Insight222 

[0:00:00] David Green: One thing that I love about hosting this podcast is that I get to speak to senior HR and People analytics leaders across the globe, and learn about the work they are doing to transform HR and drive business strategy.  One HR organisation that is leading the charge is Mastercard.  The way they have aligned their business strategy and people strategy is truly impressive.  From integrating AI into their HR processes, to becoming a skills-based organisation, Mastercard is setting the standard for how the people function can be a strategic partner to the business.   

So, in today's episode, I'm thrilled to be joined by Michael Fracarro, the Chief People Officer at Mastercard, who has been at the forefront of this transformation.  We'll explore how Mastercard is using AI to enhance leadership development, how they're preparing their workforce for the future, how their internal talent marketplace, Unlocked, is reshaping employee experiences, and how their culture health index helps shape discussions and drive decisions with their board and senior leaders.  So, let's get started with Michael giving an introduction to his background. 

[0:01:24] Michael Fraccaro: My journey before Mastercard actually started off as a high school teacher.  So, I graduated university, started my career in one of the high schools in in Sydney, Australia where I grew up, but then found a calling to enter the world of HR.  And I then worked with a technology company in Australia which supported credit unions, so not-for-profit financial institutions in Australia, did that for a number of years.  And then, I had another calling which was to go global, and I found a job in Saudi Arabia.  So, I moved to Riyadh and stayed there for a couple of years, working for one of the banks there.  And the role that I had was Head of Training and Career Planning, returned to Australia and then the urge to move abroad again came up.  I joined HSBC, moved to Hong Kong and I was with HSBC for about 12 years in a variety of HR generalist roles, as well as COE role, so I sort of pivoted between the two.  

Then, end of 2012, Mastercard came calling.  My wife and I moved from Hong Kong and we moved to New York and I've been with Mastercard ever since, since 2012, and in the role of Chief People Officer since the middle of 2016.  And so, I'm here today still with you.   

[0:02:49] David Green: Before we get on to some of the work you're doing, from a personal perspective, how have you seen the role change over the last eight years?   

[0:02:56] Michael Fraccaro: It's been a significant change, the work with the board, dealing with issues around culture, so organisational transformation and culture and boards have been very engaged in terms of the topic of how is culture an asset and not a liability, and how can they detect, in the few meetings that they have with management, around what's really going on beyond an employee satisfaction survey.  So, we've spent quite a bit of time on that, and our board's been very engaged in that particular topic.  And obviously dealing with various crises, whether it's geopolitical tensions around the world, exiting operations, as we did in Russia, or dealing with the pandemic, which a lot of my colleagues and peers as CHROs, we had to navigate that and work with cross-functional teams to do all of that.   

So, I think HR has evolved significantly in addition to all the work that we've been focused on around org design, succession planning, capabilities, talent, all those kinds of things.  These other dimensions have really elevated, I think, the role of HR.  And I think the piece around wellbeing and the whole sustaining a workforce has been a big feature in the last few years, particularly in the time that I've been in this role.   

[0:04:14] David Green: How are you seeing that this alignment is changing the way that HR supports the business?   

[0:04:20] Michael Fraccaro: I've had the good fortune that this topic in the early days was around HR has to have a seat at the table.  And when I came to Mastercard, HR already had a high degree of credibility with the senior leadership team, the CEO at the time, and the board.  And so, that wasn't the challenge for us.  It was more about, how do we demonstrate value around the whole human capital proposition?  So, we very much focus around what are the growth algorithms for Mastercard.  So, we think about our business, how do we grow our core business, how to diversify, how do we build new businesses?  So, this whole notion about the business strategy and connecting the people element has always been there.  And we view HR like other enabling functions, such as marketing, so our brand, our technology, our franchise that we have, our data, which has become increasingly important, and obviously the people.   

So, that aspect around the interconnectivity between the business and its success, and the people and the skills that we need and how we think about integrating acquisitions that we bring into the org, all of those aspects have someone from my team being a part of those conversations early on, whether it's a due diligence, whether it's a restructure, whatever it may be, there is a people dimension to it. 

[0:05:49] David Green: And obviously, one aspect that we're seeing increasingly, particularly as Mastercard, a technology company operating in the financial services sector, that's changing the way that HR is operating and supporting the business is the integration of AI and generative AI into the workplace.  Now, I know that Mastercard has shared some of the work that you're doing in that area, but for our listeners, Michael, how are you currently using this technology within HR at Mastercard?   

[0:06:20] Michael Fraccaro: Yeah, so we've always had AI within a lot of the products that we have.  And obviously, in an organisation that has focused on payments, and obviously a key feature of payments is making sure there's trust in the ecosystem, and there's trillions of volume that is transacted every year, we need to make sure that your experience, when you're tapping out at the merchant, is seamless; and all of the background friction that happens to make sure that you've got sufficient funds in your account, that there's a clearing, an authorisation and a settlement, all of that happens within seconds.  And so, we've always built in technology and AI to be able to do that, as well as from a fraud perspective, making sure that we're able to detect where there may be suspicious behaviour in terms of people's payments, and so forth.  So, it's always been a part of it.   

As we see now the evolution of AI beyond just the products, we're also looking at it from a workforce perspective, the deploying of various AI tools in the way that we're thinking about skills gaps, how do we identify skills gaps?  So, coming back to your earlier question around, as we think about workforce capabilities and the kind of businesses that we have, strategic workforce planning is a really important part of what we do.  And so, being able to deploy some of the tools that we have to look at the 34,000 employees' profiles, skill profiles, and being able to identify who has got a particular experience or a skill in an area that we're looking to invest in or grow in, these tools are able to provide that information far quicker than what we were able to do before.  And this tool enables the tool to learn my behaviour and my preferences and my interests based on how I engage with this particular tool and platform.  So, it serves me up projects or jobs or whatever that may be a good fit for me.   

We also are a partner with Microsoft, and so we have deployed Copilot into our Teams environment as well.  And so, we're already beginning to see productivity improvements and also employee experience benefits as a result of deploying some of these tools to the wider Mastercard employee population.  So things like, if I'm traveling and I miss a particular meeting, I am able to pull out a summary or recording of a meeting that I may have missed.   

Then the last example I would use is, in the last few months, we've deployed a number of software engineering tools to be able to help our engineers do coding at a much faster rate than what they did before.  And we're seeing great success in the initial pilot that we did, where the compiling of the code is far quicker than what it was done in the previous manual environment.  It's those kinds of things that we're beginning to see a lot of benefit and upside.  But again, David, you've got to do this in a thoughtful way and a responsible way.  There are many people that are anxious about, what's this going to do to me and my job, and so forth.  And so we're taking people on a journey. 

[0:09:52] David Green: From your experience as someone that's rolling this out across Mastercard, how do you see AI transforming leadership and managerial roles, for example, at Mastercard?   

[0:11:08] Michael Fraccaro: Yeah, it's a great, great question.  We've actually done a lot on this particular topic because -- so let me take a step back.  So, leadership and talent development and building the future pipeline to ensure that we've got resilience in our whole critical roles that we've got is a real top-of-the-order priority for me and the team.  Late last year, we put out there a new Mastercard leadership profile, which basically articulates what we're looking for for leaders in Mastercard, so that's one aspect.  So, things like leading and driving change and driving results, all the way to anticipating what changes are happening in the marketplace, and obviously the other aspect around team and team leadership, so all of these aspects there.  So, that's one piece.   

In terms of leadership development, we've also spent quite a bit of time investing in our leaders and the leadership development programme.  So, we've done things like coaching circles and thinking through aspects around, what are some of the tensions that leaders need to work through?  And quite often for a leader, it's not necessarily a one or the other.  There's the 'and' in between and managing these changes.  So, an example would be in one of our behaviours, we talk about collaborating and getting different perspectives, but at the same time moving fast.  And those listeners to this podcast know that quite often, those aspects can come into tension, because on the one hand you're saying, "I need to collaborate and socialise my ideas, but at the same time you want me to move fast.  If I collaborate and socialise ideas, it's going to take a lot longer".  So, we spend quite a bit of time with our leaders to talk through some of those tensions to make sure that we get to the outcome that quite often it's not an either/or, it's an 'and', and that's an important aspect. 

[0:13:20] David Green: Can you share a little bit more about your transition to be more skills-based, why you're doing it, how you've done it and maybe some of the benefits that you're experiencing? 

[0:13:32] Michael Fraccaro: Yeah.  So, this whole area of skills-based hiring, skills-based development, all those aspects are really, really key.  And I think in our industry, and I know many of the listeners, their own industries, the world is changing very fast.  And so, the dependency or reliance on, you learn something and that's it, doesn't cut it, four-year college degrees don't cut it.  And we tell our interns when they come here, the four-year degree is just the start of the learning process.  Actually, it's got to be ongoing.  And so, that aspect around if you're creating a culture of innovation, entrepreneurship, results-driven, you want to be able to make sure that that muscle in the organisation is really bred deeply across every level, and I mean every level.  And I mentioned earlier the early example with the board; it does go through all the way through.  And so learning is really key.   

So, skills-based, why is it key?  Because if we want to be competitive, if we want to win, we need to make sure our workforces have got the adaptability or agility to learn different parts of what we're doing.  So, if we've got someone who has grown up very focused on products in a particular area, and now we're moving to blockchain or crypto, they need to be able to develop the skills and the knowledge about, what does that mean, how is that going to impact the work that I do?  And equally within HR, we encourage our teams to continually learn and adapt on the different aspects of the role of a HR professional, whether it's on the compensation reward side, benefits, external trends.  We spend quite a lot of time not just focusing internally on our pulse surveys and so forth, but equally what's happening externally.  And I think that's a really important shift that's happened in the last few years as well, that you need to be really clear about what is also happening that you can bring in to your organisation as well.  That external lens is really, really key. 

[0:15:53] David Green: And in terms of with that transition to more skills-based talent management practices, you've implemented a talent marketplace, I think you call it Unlocked, at Mastercard.  How have you seen it impact the experiences that employees have within the organisation? 

[0:16:11] Michael Fraccaro: Yeah, so it's changed quite a lot.  I mean, we just finished our third quarter pulse survey.  And one of the dimensions I was really pleased to see, that pulse was around career development and career growth opportunities.  And we saw a nine-point improvement in that particular dimension.  And so, what we're beginning to see is that people are adapting to this approach of this skills-based architecture that we have that has democratised access to projects.  So, a good example is that a manager based in Colombia put a project onto Unlocked that they needed particular skills and resources, so someone that had some data, expertise, someone who was focused on government relations.  Anyway, they compiled a team.  Some of the resources that volunteered, so they've got 30% of their time, volunteered to this project and they were based in other markets.  So, one person was based in Singapore, another one in Australia.   

So, what happens then is these individuals are getting access to projects they wouldn't normally if they stayed within their business unit silo.  And equally, the managers are getting these diverse perspectives and skills that they haven't had to hire in a consulting firm, they're actually getting it real time from some of our own employees that have got these expertise and skills that are being utilised in new and different ways.  And I think that's part of the future of skills-based organisations, to continually up your game.  We have learning guilds as an example.  So, we've got these guilds in our technology area that are focusing on special parts of tech evolution.  So, whether it's to do with customer delivery or it's to do with software engineering or cloud, people can actually enrol in programmes in these different guilds that we have.  That's another way of complementing all the other formal and informal training that we've got.  So, you're basically building an ecosystem, a growth ecosystem that just provides people with opportunities that may not have been there before, and I think that's a really important part of this skills-based organisation.   

[0:18:38] David Green: We recently had Lynda Gratton and Diane Gherson on the Digital HR Leaders podcast to talk about the rise of the gig economy or the blended workforce, and there is research that suggests that younger generations in particular are opting for independent working or pursuing side gigs to expand on their skills.  Are you seeing that with Unlocked and this approach to this internal talent marketplace that you've got, that you are retaining and connecting with these younger generations maybe more than you were prior to that?  And I'd love to hear your opinion around the blended workforce as well, and the impact that that's having or maybe not having at Mastercard. 

[0:19:16] Michael Fraccaro: Yeah, no, look, I think it is.  And I think Lynda and Diane are great examples of really professing that that's sort of the direction.  And as we think about the multi-generational workforce that we have, and we look at Gen Z in particular, what is it that motivates them, quite often it's a sense of purpose and mission.  We've just spent some work ourselves doing a look at our employee value proposition, and a couple of the things that we saw coming out around what is it that really connects individuals, things like technology innovation, social purpose, obviously growth opportunities, but this whole mission and purpose is a very, very important thing.  So, we've got a couple of things that we do that allows people to extend themselves beyond the day-to-day work.  So, things like volunteer programmes.  So, we've got extensive volunteer programme.  Every employee can take five days of leave to work on their charity or their community projects, and we celebrate it.  We have an annual CEO Force for Good Awards which we highlight individuals that have gone above and beyond to help a particular community on whatever issue it may be.  That's a great way to be able to extend your skills outside of the workplace.   

On the internal talent marketplace, I think I gave a couple of examples.  The one example I didn't share, which I think is another one linking to your point, we've also partnered with government.  And so, with the New York City Government, we've connected with them to basically say, "Hey, if you've got particular projects in aid of community, we also have individuals that can volunteer to help you".  And so, some of the projects are things like data, working on data projects, working on cleanup projects, so all kinds of projects.  And we're thinking through this other aspect, David, where using this internal talent marketplace, being able to deploy some of our teams to work on projects with our customers.  So, we've had customers that are saying, "Hey, Michael, we love what you've got and what you're doing.  How do we get access to some of your talent in your organisation?"  And so, we're now piloting this idea of the customer putting a project, so in our case it might be a bank or a merchant or a government, but basically putting a project and people apply into it.  So, again, we've got those aspects as well.   

So, I think it's looking at this whole multi-dimensional approach to skills and agile workforces, remote working, gig workers and so forth and contracting in people to work on a particular task or activity.  These are all things that I do believe they will be part of the future maker.   

[0:22:13] David Green: You've talked a lot about culture, and certainly what it appears to be and what I know that I've seen published in the past and speaking to some of your team, culture really is centre stage within Mastercard.  You talked right at the start about how you've worked with the board and the leadership team to show the benefit that culture has on the business.  Love you to share a little bit about that, because I think sometimes culture can be this slightly nebulous thing in many organisations, but it sounds like you've gone much further than that at Mastercard and really connecting it to business outcomes. 

[0:23:46] Michael Fraccaro: Yeah, so quite a few years ago, I think back in 2019, our Chair of the Board at the time asked me to put together a dashboard on how culture looks at Mastercard.  So, if you think about you're a pilot and you're sitting in the cockpit, you want to be able to look at all the different dials to see what is the health of your organisation.  And so, we put together a culture health index, which basically looks at culture through the lens of obviously people, so the strength of our succession, engagement, sentiment, so we've got one aspect there; we have another lens within the culture health index, which is around inclusion, so how do people feel from a sense-of-belonging aspect; we have one around brand, so how well is Mastercard perceived in the external world through the lens of social media or through patents that our teams develop, and thought leadership articles that we put out there, so partnerships with academics or academic educational institutions as well; and then the final thing, we have an index on innovation, so this whole aspect around how quickly we move products from concept to scale, production and then obviously a return on the investment.   

With each of these indexes, we have a score, a range, which we look at every 12 months.  And every quarter, we basically look at how we're progressing against these different aspects of what we determine the health of our culture.  And I then present that back to the board to demonstrate where we are sitting.  And why this is really important is because obviously, we give ourselves a pat on the shoulder when things are going well and we're in the range.  But if there is one quarter where we see a particular indice dropping outside of the range, it is a signal.  And we ask ourselves, "Is this a systemic issue that we need to really tackle that we're going to see an ongoing downward trend, or is this transitory?  Has an event happened in the past quarter that's impacted sentiment?"  So for example, if you're announcing a restructure, people are going to be anxious and therefore you may see one of those indices dropping down, which in fact we have seen.  So, we then have to say, "What do we need to do?  What muscle do we need to flex to ensure that we bring people along that change journey that we can address that".   

So, that's what we've been doing.  That's why this is such an important aspect, that we are constantly looking and monitoring the health of our culture, because ultimately, it is the differentiator in terms of if you're going to be successful, not just hit your numbers but the way in which people feel about your brand, about your organisation. 

[0:26:51] David Green: I mean, if we were to sum up our conversation, I think it's probably, I don't know if you agree, but I think it's probably fair to say that the HR function at Mastercard has shifted to be a real strategic partner to the business, rather than what maybe we see in many other organisations where HR is a support function, (a) do you agree with that; and (b) what guidance would you give to maybe other Chief People Officers that might be listening to this or other senior HR leaders that want to move their HR function along, or progress upward? 

[0:27:28] Michael Fraccaro: Yeah, look, your summary is spot on.  It really is seen as a strategic partner enabler to the success of the business.  Advice that I was given, which I thought is really important, is around aligning quickly with your executive team, particularly the CEO and the board.  And I think those partnerships and those relationships are critical in terms of ensuring that you're aligned in terms of your vision and what they want to achieve, as well as how HR can really help enable that vision to come through and to be realised.  So, I think those partnerships are really key and ensuring that for the CHRO, also having partnerships across the organisation, particularly the Chief Financial Officer, the General Counsel, the communications team, the investor, all those partnerships are really, really key.  So, that's one.   

I think the other piece is having a very clear picture as well around what value you bring.  And so, developing a people strategy, which answers the question about not just how you're attracting, retaining, and developing talent, but what is it that you're doing to differentiate that's going to help enable and drive the business?  I've done two now, people strategies, where every year we iterate and we look at what's going on and what's working, what's not working.  That's a really important part to ensure that the people strategy is enabling the business strategy and vice versa.  They're really critical things, David.   

I think the final thing I would say is having the right team and transforming our own HR functions as well, being the role model that you're expecting other people in the organisation to do.  HR has to sort of eat its own medicine or swallow its own medicine as well.  And so, leading transformation, leading innovation, being proactive, looking at what's happening externally and so forth, I think there's a role that we have to play as well, and making sure that we're investing in upskilling our own teams to be able to take that and earn the right to be that strategic partner to the leadership of the organisation as well. 

[0:29:51] David Green: That's really good.  We have a huge opportunity as HR professionals, but as you said, the opportunity means that we have to continue to be reskilling and upskilling ourselves, not just focusing on helping the organisation and the workforce to do that, but we need to be doing it ourselves as well, don't we?  And that gives us the opportunity through data, analytics, AI, to really support the organisation in that transformation.   

[0:30:14] Michael Fraccaro: Definitely. 

[0:30:15] David Green: Michael, this is the last question, and this is a question we're asking everyone on this series of the podcast.  It may help you summarise some of the stuff that you've already mentioned, it might allow you to provide another example.  How can organisations use workforce data to drive culture, inclusion and engagement? 

[0:30:35] Michael Fraccaro: Yeah, so as I mentioned at the beginning, just recently, the data helps drive the insights that you need.  It's like, as I said, the analogy of the pilot in a cockpit of an aircraft, CHROs and HR teams need to have that data and insights to know where to invest, where there is utilisation, where there's not, where there's alignment, where there's not.  Data really is a critical aspect.  And for me at Mastercard, I've doubled down on building up my people and data and analytics team.  I think I've got a great team, but we're still on the journey, and I think building up that acumen within the team.  But everything should be data-driven.  But then the HR professionals are real differentiators providing the context as well, around how this lands in a particular area.   

So, if there is a particular area where you're saying, "I'm not making enough progress on some of my hiring, or some of the skills I need.  Why is that?"  Being able to then interrogate the data to understand what is the context, what's driving behind some of that data is really important.  So, I think data, technology, all of these things combined really are essential tools for the future HR.   

[0:32:01] David Green: Well that's a great place to end our conversation, Michael, thank you so much for being a guest on the Digital HR Leaders podcast.  Just before we go, could you share with listeners how they can find you on social media and maybe follow the great work that you and the team are doing at Mastercard?   

[0:32:19] Michael Fraccaro: Yeah, so if they go on to LinkedIn, they can look up Michael Fraccaro, or they can also search Mastercard, and we've got a number of handles there that they can see what we're doing.   

[0:32:29] David Green: Brilliant.  Well, Michael, again thanks for being a guest on the show.  Look forward to the next time maybe I have the privilege of moderating a session that you're in at a conference or seeing you in person, and thank you very much again for your time.   

[0:32:46] Michael Fraccaro: Thanks for everything you're doing, David, in amplifying the voice of HR on your podcast, so it was really great to be here.