If you’re dealing with unmotivated employees, performance or high turnover, these problems need to be the highest priority of your HR managers. But the challenge is, they don’t have time because they spend most of their day dealing with paperwork. In order for you to do right by the people who work for you, and the clients that they serve, you need to free up HR from the burden of repetitive, soul-draining procedures, and that’s what this episode is all about.
In this conversation, Rhamy Alejeal, author of People Processes, reveals how you can streamline your personnel operations. He takes you through all the components of HR workflow and lays out the steps for you to optimize procedures like onboarding, scheduling, payroll, reporting and communication. By the end of this episode, you’ll know how to boost your ability to attract and retain the best people in your industry.
Rhamy Alejeal: I’ve been in this limited world of employee benefits for almost 10 years now. Over time, I got to know my clients better and better and the issue became less about finding this product that their employees needed and more and more about the systems and communications surrounding it.
One of our long time clients is this nonprofit, it’s been in business like 60 years. They had been very, let’s just say, stable. Not much happening, they’ve had the same number of employees, they’re doing the same thing, the executive director had been in the role for 20 years.
Before that, the person had been in that role for 25 years. A new executive director came in to this organization, her name was Christy. Christy was ecstatic, she had a great background, incredibly well educated, well-traveled, she wanted to run this nonprofit. It was really close to home in terms of what they did, it was her life. They helped disabled children, and she just thought she had found her dream job.
When she came in, it was a stagnant mess, all the top positions were filled, turnover was extremely low, which was great, but the organization wasn’t growing. It couldn’t retain smart, young people. They had nowhere to go. The operational budget had been basically the same for 15 years.
Christy just wasn’t having any of those. She was dynamic, aggressive—she was going to go in there and make changes. And she did.
“She changed that organization.”
In six months, with her at the helm, that nonprofit increased their revenue 15%, reduced overhead by 10%, existing community partnerships got deeper, and new ones came together and formed. A few of the people had been there forever, and some of them found new jobs, some of them adapted.
By doing what she did, she was able to completely change the spirit of that organization and hugely accomplish their mission better.
The main way she did that was by focusing not necessarily on the mission, what they did in the community, but focusing internally. That has been the recurring story of what our organization does and what I deal with every day.
Discovering People Processes
Rhamy Alejeal: I had the same thing, my company grew hugely, we doubled in size, and at some point, I realized I was just completely stressed and worried about the ability of my team to do the things that I promised we could do.
There were issues with turnover, there were issues with deadlines and things like that, and the transition from a company that provided a product to an HR company that advises and does service occurred. We solve what Christy had done. She had done a lot of stuff with us, and we looked at our own organization and were able to implement those same changes. It just completely changed our company.
“It revolutionized our company.”
Our turnover dropped, we were able to do more with the same amount of people, we’re much more efficient, and our people are much happier. We have a line out the door of people who want to come work for us.
This book is very much about that. It’s about the processes and systems that we put in place and that our clients have put in place in order to change what is often really hard part of business: the management of employees and the employees’ problems and the employees’ mistakes into something that makes your company have a competitive advantage, a differentiator that absolutely gives you an advantage in the marketplace.
Day to Day Processes
Charlie Hoehn: I want to dive a little deeper into what that looks like day to day for a business owner who’s doubled in size, or their company has doubled in size numerous times over time. What are the typical stresses they’re dealing with?
Rhamy Alejeal: I think the kind of flags that should be going off in people’s heads are when they’re concerned that either they cannot attract or keep the right people and that the people they do have are dropping the ball, or at least, as a business owner, you’re lying awake at night. What you’ve been doing the last few years is going out and making sales and working on your organization and processes in terms of your product and your service, but you start feeling like the constraint, the letdown is this administrative swamp that is going on inside your company.
People having internal disagreements, having lack of motivation, the lack of engagement—on top of that, when you do hire somebody, it takes months and months to get them to where they’re even remotely competent. And the people have been there for many years and should know their job really well – they’re stagnant, right?
“They’re not necessarily growing the organization.”
They’re just doing a bunch on the clock and doing what they do.
If you have those feelings, if you’re looking around your organization and seeing that, then this is going to help you minimize those problems and start opening up new opportunities.
Most business owners, whether it’s an organization, nonprofit, a college, or a guy who runs a manufacturing shop or a doctor’s office, you spend your first many years thinking on how you’re going to deliver your product or service. You know, if you’re even remotely competent, that you have to have systems and processes around delivering your product. In my case, getting people on their HR systems and getting it all done. If you’re a doctor, it’s getting people in and out and healthy. If you’re a podcast host, you guys have great processes here. You’re very focused.
“Everyone should be focused on delivering that product or service.”
Compare it to the amount of time and effort you’ve put in to systematizing and organizing the single biggest expense, the single biggest multiplier in your effectiveness, the make or break thing inside your organization: your people.
If you look at that and say “Man, I’ve put hundreds of thousands of man hours or tens of thousands of my own hours, many years of my own work into getting this product delivery or service delivery right,” and then you look at the team that you’ve assembled and you think, when they get hired, they’re handed a stack of paperwork and told to go do their job—go for it, you can do it.
When you feel that, it’s like, there is a disconnect there. You can get great gains by changing your focus internally for a couple of months. You can make huge organizational changes.
Who Benefits from People Processes
Charlie Hoehn: Your focus really with this book is helping the millions of other normal businesses that operate day to day, just like you said—doctor’s offices and that sort of thing.
Rhamy Alejeal: Absolutely, I think this book is going to be great if you’re a startup and you got five, ten employees, and you’re still working in that range. This will give you a lot of ideas and tools to really help your business.
When the inefficiencies around employees really start adding up, this is normally sometimes around 20 employees, you start hitting a lot more compliance, and it’s also when often people have been in business long enough that there’s some serious inertia that sets in. Your costs really start to go crazy when it comes to employee time or management time. Perhaps even more so.
I guess I would say if you’re a five-man, a ten-man shop, this book is still great. I think it’s going to help you. But I think where most people who really start looking for this information is when they’ve got 15 or 20 employees, up to maybe 400 or 500.
That kind of realm is when your efficiency per employee can take a nose dive and your cost of bringing on new people, your cost when someone is terminated and you have to replace them, can really just skyrocket if you don’t have the processes in place to rapidly turn someone who has never heard of your organization to a star performer who knows their stuff.
If you’re a five man shop and you only hire one person every four years, then this stuff still helps. But it’s not going to be the bang for your time as much as going out and getting more clients, probably.
People Processes in Onboarding
Charlie Hoehn: What is a great onboarding procedure that a startup might be able to implement?
Rhamy Alejeal: Man, technology has made this so achievable for every sized company. I think the most important thing to keep in mind with onboarding, and this is for the business owners out there, this is the mental shift. Consider it like you do your client onboarding. This is the moment when you’ve made the sale, your client and in this case your employee is probably most excited about coming to work there ever going to be on their first day, right?
This is the time to capitalize on that excitement.
A modernized and streamlined onboarding process normally entails early communication, prior to the first day. That communication can hopefully be structured in such a way that is easily accessible, not just on a desktop, mobile phones, it can be done via text messaging, all those kind of things to get the employee access early to the information they need.
For example, one of our clients, one of our first big clients which have been with us four or five years now are a home health care organization. It’s a tough business. They’re paid primarily by the state, and they have a very limited control over their pricing. It’s an industry that has high turnover in general.
This company that has 450 or so employees has to replace around 50 of them every month. They’re hiring 50 people a month.
The previous way they on boarded was you came in, you drop off an application, you did your interview the next time and then when you were hired, you start on the first of the following month. You come in that day and they had two to three days of immediate orientation.
It’s primarily filling out paperwork. Understanding benefits and going through some basic training and then they were sent out to whatever their location was in order to actually begin training on their work.
“It just cost a huge amount of paperwork.”
Every single employee hired cost around eight hours of administrative time after they were hired, just to get them into the various systems for timekeeping and billing and state reimbursement.
Think about 50 people getting hired every month—not including interviewing, not including marketing for just getting people into this. You need like five full time employees just to process the paperwork.
Instead, they’re now on a modernized system that my company provides, and basically, from the moment they’re hired, the entire recruiting process is built into it. Once they click the hire button, the employee gets an email directly to them with a single click where they set up a username and password, and they can do it right there on their iPhone. They can do it on a computer. It’s all agnostic and well optimized.
The first thing they get is a video from the CEO of a company welcoming them to the company.
They’ll walk through a couple of little documents like electronic signature consent, fill out their W-4, their I-9, they take care of their direct deposit information, they fill out their uniform information.
Then they get videos from their department head, their location head who actually made a video just for any new hires who are joining that city’s location.
And then they get a quick series of two minute videos from different departments inside the organization explaining what they do and when they should go to them.
Then they’ll walk through their benefits, and they’re able to sign up, name their beneficiaries, understand their benefits—again, video based. There’s of course documents as well, they can research, they can in one click and look up who’s in their network and not.
All of that information flows directly into the various systems needed, whether that’s their retirement system, their time keeping system, their payroll system, their benefits—all of that is all in one place.
What Missing Processes Cost
Rhamy Alejeal: They send that out two weeks prior to hire date. By the time the employee walks in, they’ve already met their boss, they’ve met their boss’s boss. They know the department layout, they know where they’re going, they know how to use their time keeping systems. They’ve made their benefit selections, and day one, they’re starting with the actual training on how to perform the job that they need to do.
We’ve cut three days out of the employee onboarding experience for the employee, we’ve got a full day’s work out for HR, and more importantly, the employees are happier, better acclimated.
It costs the company nearly nothing.
Charlie Hoehn: What is that in terms of dollars Rhamy? For a typical company, how much would that end up saving them?
Rhamy Alejeal: The dollar savings are just ridiculous and it’s going to of course depend on how many people you’re hiring, but if you think about it just as a $12 an hour employee and you’re talking three days’ worth of labor there, that’s 288 bucks. And then you talk about an HR person, at 30 bucks an hour and saving them eight hours. That’s another two or three hundred bucks.
“That’s easily six or seven hundred per hire.”
That’s when everything goes right, you know? When you bring on a lot of people and you’re using antiquated systems, someone’s going to be sick and something else is going to get dropped through.
My favorite mistake—at one point went through the paper applications for a client, hit about 200 applications. On 30 of them, people had written their date of hire in their date of birth field. Which sounds silly, but if you send that into an insurance carrier, it’s going to reject it, you’re going to add two to four weeks of back and forth in order to get that employee’s kids covered on their insurance, right?
That causes a pretty big traffic jam right as someone’s getting hired, right when they’re just learning about your organization. They learned that HR and management is the place where things go to get screwed up. Not where you take your screw-ups to be fixed.
What People Processes Really Save
Charlie Hoehn: Yeah, that’s exactly what I was thinking. You know, the dollar savings, that’s one thing, it’s great. But really, it’s that first impression of this is a direct reflection of how this company operates internally and did I make the right decision
Rhamy Alejeal: Well, it’s just like bringing on a new client to your business. Imagine someone, they spend weeks evaluating you, they’ve researched you, they’ve been through multiple in person meetings with you. They finally make the commitment to come to work with you and then two weeks later, you mail them 400 pages worth of materials and say, “Congratulations, you’ve bought our service, good job, call us if you need anything.”
You’ve done nothing. You’ve killed that client.
“That’s what happens to employees all the time.”
If you don’t make it a scalable but also effective and entertaining solution that’s easily accessible on their time via their comfortable devices, you’re deferring many problems.
Things that they should learn from management that are built in—like how do I request maternity leave?—will instead be glossed over. Well there’s three pages on that, ignore, next.
Once you fill out the first page, once you fill out your name, address, social and date of birth 16 times, you stop paying attention to the forms. And that stuff kills you.
It kills the experience, it kills how the employee feels on day two of their company. But three months down the road or hell, six months down the road when they need to know something that should have been covered there, instead of knowing it or having it easily accessible for them to review, they are going to ask Tad in the cubicle next to them.
And who knows exactly how that’s going to work?
Charlie Hoehn: Especially because his name is Tad and you’re like, “I don’t know if I trust a guy named Tad.”
Rhamy Alejeal: Yeah, I mean his name is Tad. I mean Tad if you are listening, sorry. I know, I’m sorry.
But maybe you wind up with a bunch of tribalistic stories. You wind up with, “This guy,” and over here, “Oh you just ask our manager. She takes care of it.” But over here, “Oh you fill out this form,” and over here, “There’s an online system for that that works with your email.”
If you don’t control that experience, you have severe repercussions down the road that add more and more to that administrative burden of having employees.
And your employees get more and more caught up spending days, whether that’s in HR or intermediate managers or the employees themselves. Trying to navigate and interact inside your company, crap that should take seconds.
Offboarding after Resignation
Charlie Hoehn: Let’s talk about the opposite of onboarding. So what does a typical experience look like and what should a typical experience look like?
Rhamy Alejeal: I think off boarding is one of the five kinds of lifecycle events that we cover in the book, and it is part of the employee lifecycle. There are a few things that people should keep in mind during off boarding.
Obviously, off boarding changes depending on whether it is an employee leaving you or you leaving the employee, whether you are confident that this is a guy who’s got to go, you are firing him, or they have left you for another business.
It hurts, and there are a lot of emotions involved in it either way. There’s some different objectives depending on which way that’s going. I would say is in an overarching fault that I want people to change how they look at offboarding.
One, if a client left for another company, in this example we are talking about an employee who is leaving you to go to somewhere else, it could be because the client is going out of business. It may be something that you can’t handle, maybe the employee has an Etsy store that’s just taken off and now they’re going to make metal works instead of practice as an accountant or work as an accountant inside your firm. Sometimes that just happens, and that is something to know.
“When you lose an employee, it should trigger the same thoughts and actions as if you lost a client.”
When you lose an employee, it should make management sit up and go:
“Where in our processes did we overpromise, under deliver, make an error, put an employee with an underperforming manager? What happened here that’s costs us this employee?”
Because they are really expensive, and they’re a key way you deliver your services to your clients. So, it should trigger a review internally of what you did wrong, and you probably did do something wrong if an employee is leaving. That’s another thing to think about.
The vast majority of times when someone off boards or quits, I would say 95% of employers think, “Well it’s that guy’s problem. He is a terrible employee anyway.” Or “she always had an attitude, she never liked us.”
By the time an employee quits, it is normally pretty far down the road, and I want the number one takeaway to be, when an employee quits your organization, it should be just as jarring as if a large client left your organization.
If you have 20 employees and an employee quits, it should trigger the same thoughts as if 5% of your business clients just quit you. I think that is one of the key points of changing how you think about when someone quits.
The other thing is, when it’s a termination, the other side of that, is not when someone is quitting but when you fire someone is you have to do the things needed to be compliant.
You need to minimize the likelihood of a lawsuit. You need to do all of these things, which are covered broadly in the book. But the other thing to think about in terms of termination is the remaining employees.
“It is super important to think about the perspective of people who didn’t get fired.”
Look at terminating employees as a necessary evil. Of course, you’ve got to be able to do it. Anyone who’s been in business knows sometimes you have to be able to let people go.
But how you treat that terminated employee should not be worlds different than how you treated someone who joined the organization. The culture is going to show in the tough times, and if you can treat an employee that you have to let go well, even though they deserve to be fired, it is an investment in the remaining workforce.
If you are going to terminate somebody and you have decided, “Hey this is going to come out of the blue at 10 AM. We are going to invite them into the office, we’ll have security escort him out, he is not going to stop at his desk and say goodbye, no one gets to talk to him and he can go file for unemployment.”
Maybe it’s necessary because he’s a criminal, but outside of that, what you are telling your other remaining employees is, “Hey this could happen to you too.”
If you don’t have a strong communication and narrative over what happened, if someone just disappears, it really hurts your remaining employees.
So the process is around off boarding should be structured in such a way that it’s focused on who’s left.
The employee is either gone because they quit or because they’re fired. You have to do that right. The key focus on off boarding should be the people who are being off boarding. How do you communicate with them, what changed, why it changed, what are you going to do to fix it?
Offboarding after Termination
Charlie Hoehn: What makes sense there? What are some good examples that you’ve seen?
Rhamy Alejeal: So in the case of a termination when you have to let someone go, I think the first thing, the simple brass tacks is, as a rule you need to be using severance agreements.
You can use it as a compliance tool to help get the paperwork you need signed to lower the chance of a lawsuit. On the other hand, if you are going to terminate someone, you need to be able to budget an extra month, two, three, whatever is needed in order to allow them to find a new job.
Now you may hate this guy or gal. They may not deserve a severance package, and to some degree, you have to deal with that. But in most cases, the investment in that employee’s termination is really an investment in the remaining employees and how they feel about that person leaving. Even if they agree that this guy has to go, taking care of that person will make a big difference. I would say severance agreements are a key part.
Separately, communication plans for the people who are going to have to pick up that guy’s slack when you recruit someone else, and of course, client communications as well. How do you let the clients know that the person they’ve worked with is gone if that’s necessary, and what are you going to do to replace them? So if you can tell your employees, we had to let – we’ll call him Tad, poor Tad.
“We’ve got to let Tad go. He’s gone now, he left this morning, we had to terminate him. Here’s the plan, we had to terminate him because his performance is not cutting it. We gave him a lot of chances. Just so you know, he’s going to be taken care of. We gave him a three-month severance. I hope we can all work together to get through this.
“We have a recruiting team opening up, they are going to have this job filled. Their goal is to have them filled within two months. In the meantime, we’re going to need you guys to pick up the slack. Here’s the communications that we need to get out into the clients, and here’s what we expect you guys to do help take care of it.”
I will tell you that that happens in less than 20% of terminations, would be my guess. I would say the vast majority is, “You know Tad’s gone?” How do you know? Because Tad didn’t show up that morning and you’re asking around, “Why did he got fired? What happened?” You are messaging him on LinkedIn.
And that kills your productivity and kills your time.
So instead, have a process, and it doesn’t take much. There are only maybe 20 or 30 things, just like in a company FAQ for your clients, that you need to make sure you have premade and ready to go, and a system to communicate.
That’s a lot about what the book is about—setting up those processes and systems so that you can manage these things at scale.
People Processes and Non-Profits
Charlie Hoehn: What has been your ultimate favorite success story of a company who has really turned it around?
Rhamy Alejeal: I think my favorite kind of story is one that is featured in the book. It’s when you have an organization that has a strong mission. That’s what attracts me. I am a business man. I like businesses that make widgets and sell widgets and work in accounting and do all of that stuff too. But to me, the clients that stick with you the most are nonprofits who have an incredibly strong reason to go to work.
The employees love what they do as a mission.
I think the biggest turnarounds I see are when those organizations that are stagnant in that mission can free up their employees to really pursue the mission. A lot of times these nonprofits are established players. They have been around a while, they have a staff that average age is 71. Not that it is a bad thing. I am not talking about age discrimination here.
But I am saying there hasn’t been much change in this organization. Those people still love their mission, but the mission has gotten harder and bigger and maybe the budgets have gotten tighter and there’s a true sense of almost despair for a lot of the people there.
What they do is so important, but they spend half their day dealing with crap that isn’t relevant. In those organizations. By modernizing and streamlining the people processes, you can hugely affect change in the world.
Because in those organizations when the executive director or CEO can take a minute and focus internally on their people, the effect is just staggering.
“They love what they do, they just hate their job.”
So if we can make the job better, if we can make the environment they work in, the way they interact with the actual company, you are able to turn people from sad and unmotivated to just absolutely super stars, rock stars who are out there changing the world. Those are the ones that stick with me.
So, some of those have been small collages that have had a professorial staff and then administrative staff that’s been pretty stagnant for a while, and even though they can grow, it’s like everybody is just wondering about the work that it’s going to bring.
They all had the fire in their belly five, ten, twenty years ago. The organizations start because there is a strong reason for them, but as you grow, the amount of crap you have to deal with— whether that’s employees taking a lot of sick leaves and maternity leaves to a lot of government regulation—starts to just suck the life out of the people who are supposed to take care of the employees, the HR people, but even the owners and the executive directors.
They feel like they spend 20 or 30 hours a week dealing with crap inside the organization. And when you’re doing that, you are not moving the organization forward.
They need that kick in the pants, and they need a new system to get their people free to accomplish their mission.
Work with Rhamy Alejeal
Charlie Hoehn: Rhamy, what is the best way for our listeners to connect with you and talk with you if they wanted to?
Rhamy Alejeal: Well they can find us at peopleprocesses.com, that’s the name of the book. We have a three times a week podcast where we are covering compliance and HR updates and we do some interviews with business and HR leaders.
It is a great way, if you are an HR person or a business owner who just wants to stay on top of any regulatory changes and kind of get refreshers about best practices and things that change.
They are normally 10 minutes or less. It is just a great little thing to hit on your way in.
You can find us @poplarfinancial on Twitter and LinkedIn and Facebook and at poplarfinancial.com you can contact my organization for help. Finally, you can email me at [email protected]. Just put Rhamy up at the top and I will look at it.
We have a couple thousand employees who we are helping every week get paid. We are able to work in all 50 states, and when someone reaches out to me directly, you are going to hear from me directly. I can help you address whatever it is that is maybe holding you guys back. I would love to take a swing at it.
A Challenge for Listeners
Charlie Hoehn: Can you give our listeners a challenge, maybe one thing they can do from your book this week that could make a positive impact?
Rhamy Alejeal: Absolutely. The road map for 100 days has a couple different pieces, but the number one thing you can do, just like with your business, is write down what it is you do now.
It’s like losing weight, right? If you write down what you eat, you change what you eat. I want you guys to get out a word document or, Lord forbid, a piece of paper.
“Write onboarding, off boarding, and annual review.”
And just write out what your steps are for onboarding as if this was something that you’re going to hand off to somebody else to get done, even if your processes are terrible. Even if it is “Ask Jenny what to do when someone says this.”
Writing them down is going to give you a big start, and that is the first step on our roadmap for a 100 days is to really document everything you’re doing now. We give you prompts to kind of look each one of these very common events.
By doing that step, you are going to be immediately drawn to the holes in your process and your inefficiencies. If you are having an employee fill up the same information more than once, you’ve got an inefficiency that you can address. That will jump start your thinking about how to get these things addressed.