Sabrina

Welcome back to the HR Connection, the podcast designed solely for those managing human resources in a small environment, 1 to 500 employees. If that's you, now would be a great time to subscribe. Today, Marie and I are talking about what to do when HR feels broken. Maybe you've stepped into a new organization, or you're just constantly reacting, feeling like you're in a reactive mode. We're going to walk you through our exact process when we onboard clients who always are broken when they come to us, and how we get them to a stable state. Let's get into it.

Marie

Welcome back to the HR Connection. My name's Marie, and today we're going to talk about something I think a lot of people in small business HR experience but don't always know how to say out loud. What I'm talking about is really that moment when you look around and you realize that HR is completely broken. You know, I think about people who took over a mess from the person that came from before them. You know, I think about companies that grow faster than HR can keep up, or maybe people are just so busy putting out fires every day that they don't have any time to actually fix anything. If that resonates with you, this episode is for you, but take a quick second and subscribe so you can hear more content. Today, Sabrina and I are going to talk about how to know if HR is actually broken, why you can't fix everything at once, and most importantly, talk through a practical framework for where to start. Sabrina, this is literally what we do when clients come to Acacia feeling completely overwhelmed.

Sabrina

It is the entire reason we have a business. If there were not businesses that felt like their HR was broken, a mess, just all over the place, we wouldn't have a business at all, and you and I would be doing something very different. Every client comes to us because something happens. We've kind of talked about that before, where there's this trigger point where they realize they need HR, and that trigger point is never before they actually need it. It's always, always when something breaks. They have a lawsuit. They have way more employee relations issues than possible. Their benefits are a mess. Something is broken, and they realize, oh my goodness, now we need human resources. And so they either bring somebody in-house, like our listeners, or they bring in fractional support, sometimes both, to help navigate this mess, right? I always say our clients drop this huge mess in our lap, like this huge knotted ball, and we have to unravel that thing one string at a time, and sometimes it takes a really, really long time, but it's never I don't know that we would know what to do if a client came to us with, like, perfectly set up HR, that we were just taking over. It happens maybe in our larger firms when we're just supporting an HR leader, but definitely not in our smaller firms where we are the first HR or we're taking over from maybe, like, a marketing person doing HR. It's absolutely a mess and the entire reason that we exist.

Marie

Yeah, yeah, absolutely. And I want to talk about the difference between HR not being perfect, which, I mean, you just said it, in a small business, we're not really going to see perfection like we would in a larger organization. But I want to clarify the difference between HR not being perfect and HR is actually broken. So I just want to take a second, and I want to paint a picture of what broken actually looks like. So when I think about this, I think about folks who are constantly anxious about what they might have missed. This is, like, laying in bed at night and thinking, oh God, did I miss a deadline? Is there something I forgot to file? This is when things are just, like, actively falling through the cracks, right? So we have that. We have compliance risks, so people being aware of compliance risks, but you haven't addressed them because you just don't have the time to do it. Your handbook, it might be from 2015, or maybe you don't have one at all. There are no real clear processes in place, right? So I think that onboarding is going to look completely chaotic. Offboarding, that doesn't even exist, right? But the biggest tell that we talk about often is that folks are 100% reactive every single day. They're running around, they're putting on fires, and there's really just no time to actually fix anything because everyone's just too busy dealing with whatever crisis came up that morning.

Sabrina

Yeah. And I think it's important to note that HR being broken doesn't mean the person is broken. You are in a tough role, right? Being in HR in a small business, you know, we recorded a different episode this morning, and I said on that that small business HR is not a subset of HR. It's an entirely different skill set. It is an entirely different discipline. And I absolutely believe that. And I would fight anyone to the death. You know how I do these things where I'll just fight you to the death about the fact that HR in a small business is uniquely difficult, way more so than in a large enterprise. And so these things that you just mentioned, it's 99% of the time not the person's fault that's managing human resources. It is the nature of the beast. It is the nature of being in a small business. And it's not just HR that's like this. It's marketing. It's finance. It's product. It's literally probably every other department, because that's what happens when you scale a small business, and especially when you scale one that grows faster than your structure and your processes.

 

Marie

Right, exactly. It is not all of their fault. And I think so much about the folks who just kind of take over or inherit these HR messes, right? So like we were talking about earlier, so many times we find small businesses, they're bringing in HR once something has happened, right? Whereas before, maybe they were having an office manager or a marketing person kind of just handle as much of the HR as they could. So when they do hire somebody full-time or they hire a fractional support, they're just coming in and they're having to pick up where someone else left off. And these folks, they sit there and they're like, oh my gosh, where do I even start, right? In that situation, those people, you know, they could be the only one who can see how broken everything is, right? Like, employees, they don't know where to go with their questions. Leadership, they expect you to handle everything, but you have absolutely no foundation to work from. You know, I think about what makes it even harder for these folks is that they probably already knew that the things are broken or knew that they were broken when they were coming into that role, but nobody is going to listen until, you know, something actually goes wrong.

Sabrina

Yeah. Well, you know, one of the things we talk about in small businesses a lot is that they have no idea what good HR looks like. So it's like they know something's wrong. They know this feels hard. They know things are potentially broken, but they don't know what, and they definitely don't know how to fix it. So then they bring in an HR person who they think is going to fix it, and sometimes they hire maybe somebody who is more junior in their career, and they're expecting them to do all of this. And this, you know, we've had clients who they, for years, only hired HR generalists to literally build their HR infrastructure, not just HR generalists, but new grad HR generalists. And so if you are a new grad walking into a small business, and this is your first HR job, you have no idea where really to get started for HR infrastructure. You're barely figuring out HR. And so I think that, you know, you have practitioners who walk into these situations. They inherited a mess. They also have leadership that has no idea what good looks like or what good should be. And they alone, the practitioner alone, has to figure all of that out, convince everybody that this is what we need, and then implement it all by themselves.

Marie

And when they're going in to implement it, it's probably because they've reached a point where they just can't ignore it anymore, right? So it's like you get that EDD notice or a DOL notice, an employee files a complaint, or you're just trying to, like, run a report, and you realize that your data is just completely skewed. So here's the thing. Once you realize it's broken, the natural instinct to just fix everything, like, I'm going to just fix a handbook or implement a new HRIS or even, like, build a new review process, you get this excitement to do all of those things, but it just doesn't work. Why is that?

Sabrina

Because you're by yourself. You cannot fix everything all at once inside of a small org by yourself. So I think about in this business, right, I started this business by myself. For years, I was alone, lonely, lonely, lonely, HR department of one for clients. And I had we don't work full-time with any client, but I had multiple clients, so I was working full-time on multiple clients. And even me, with my prior experience, trying to fix all the things for all clients was just not happening because I only have so much time, and I only have so much brain capacity and mental health capacity in a week, and I had very limited resources. When I think about the difference of what I accomplished by myself versus what we accomplish now that we have multiple team members, it's very, very different. And so for anybody who's especially in an HR department of one situation, when they have come into a mess or they have a mess, they cannot try to fix it all at once. And it can be really daunting then to try to figure out what to fix, which I think is where kind of our mindset about this is a little bit different than what traditionally may be thought of. But I think the first, like, hurdle they have to get over is realize I'm not going to be able to fully fix everything all at one time. I'm going to have to just do what I can do. And certainly, the framework that we use helps them understand that. But you don't have the time. You don't have the resources. And sometimes, let's be honest, you don't have the support at all from your leadership team, your employees, nothing, to actually make the changes that need to be made. And so that's why you have to kind of give up on this idea of I'm going to do all of the things, and I'm going to fix all of the things and see them all the way through to completion right now, because it's just not going to happen.

 

Marie

So let's not prolong this any longer. Let's just go ahead and dive into our framework. So we have three phases that we're going to talk about today. The first one is stabilize. The second is streamline. And the third one is build. So when we think about stabilizing, this is going to be, like, weeks one and week two in your process. You're putting out fires. You're addressing urgent compliance issues. You're stopping the bleeding, and that's it. That's what you're focused on.

Sabrina

Yeah. And I think the key here is to look at the bleeding across the organization. So there are going to be things that are obvious to you, but there are going to be other things that might not be so blatant. We always suggest, and I'm sure I'm probably jumping ahead for you, but we always suggest, like, doing an audit, an HR audit, when you come. And if you are in a new HR position, I don't care if HR was there before. Like, when we come into a new client situation, the first thing we always do is an audit. And I don't care if they've had HR before. I want to audit stuff. And that's going to help show you where things are broken, where things are really bleeding. And then you can look at what is compliance-based. You're always going to start, of course, with your legal risks and what is compliance-based, but creating a list of all of the areas where you think improvement needs to be made, and then making sure that you are doing actions as you have time, which I understand we're running against the clock here, but making sure that you are doing actions that stabilize each of those, right? So you cannot, as an HR department of one or in a small space, you cannot give all of your attention to just one thing, to one process. So let's say your onboarding process is broken, your leave process is broken, and your benefits administration process is broken. Those are all massive processes, right? There's no way that somebody in a small environment can sit down and say, OK, right now I'm just going to fix onboarding, and then I'm just going to fix benefits. Because if you do that, then while you're working on onboarding, benefits is just going to compound and keep getting worse and worse and worse. And so when we say stabilize, what I mean is you can certainly pick the worst one to give a good amount of your attention to, but you have to give attention to the others just to get them stable. So what is one small action you can do to stabilize them? I think we were talking offline, and you did give a great example of, like, if you have six debts, if you have student loan debt, and you have six of those, then what I'm saying is you might be putting all your extra dollars into one, the one you're trying to pay off, but you're still going to make the minimum payments on the others. And that minimum payment is what I mean, that what is that one or two things that you can do to stabilize the others kind of quickly so that they at least don't keep getting worse? You might not fix them. It may not be your end result, but just get stuff stabilized so that they're not getting worse while you're working on at least the next part of our framework for whatever your main focus is. Does that make sense?

Marie

Yeah, it does. And that's exactly how, you know, HR departments of one or, you know, your folks who are just trying to manage HR are going to be successful in this space. This is how you go from working as one human to, you know, being a team of three, but just yourself. The second phase of our framework is going to be streamlined. So this would hypothetically be, like, weeks two through four in your process. So in this phase, now you are fixing what is broken. You're buttoning up the processes that exist but aren't working very well, or you're making what you already have more efficient.

 

Sabrina

Yeah. And, you know, we have, like, we're saying stabilize weeks one and two, streamline weeks two and three. We understand that this could be stabilize could be one to three months. It could take longer, right? This is if you wanted a set, like, action plan, and you wanted to sit down and really get serious about something. If you had a time, which I know this could be laughable, but if you had a time where there was a lull in the business, you know, we have some clients that they have seasonal businesses, and so there are times in the month where the HR department can do way more than other times. But ideally, once you've got everything stabilized, then you're going to look at, OK, what process needs the most attention, and how do I fix that fully? So everything is kind of stable, but now really where can I dig in and streamline and make sure that we're being efficient, that we have a really good complete workflow? So let me give you an example of this. If you come into an organization and you find out that the benefit admin is broken, so maybe deductions aren't getting entered into payroll correctly, and there's not really a good handoff between when employees fill out their paperwork to getting things into payroll, to getting them the cards that they need, and, you know, getting them all set up on their benefits. So the broken piece there, the stabilizing piece, is those payroll deductions. Like, you have to fix that first, right? Because that legally could be an issue. It's, you know, a nightmare to have to go back and take back deductions. So in that whole thing, your whole ben admin needs to be fixed. But you're going to first stabilize the payroll deductions. And then when you can get to the rest of the process, you go and streamline. Now you come in and you say, OK, here's the entire process of an employee comes in. Here's how they get their benefit info. Here's how they read about their benefits. Here's how they sign up for benefits. Here's the broker interaction. Here's how I get a report about payroll, and I, you know, double-check and make sure deductions are entered correctly. So the streamline piece is, like, you've stopped the bleeding, and for a while, that may be all you do with that process. But then when you have time to get back to it, now we're going to streamline. Now we're going to go, you know, step one, step two, step three, what actually happens in this entire process to make sure that it is clear for both me and the employee, easy to navigate, and that it is efficient and not causing me these massive headaches every single week.

Marie

OK, let's wrap up this framework. So phase three, this is going to be build. So yes, in our hypothetical timeline of things getting done quickly, this would be, you know, this is 60 days and beyond, but maybe for you, it's nine months. Maybe you plan out this process over an entire year. But really, the build phase, so this is when you are going to finally get to create what doesn't exist yet. So think new systems, strategic initiatives, and long-term improvements.

Sabrina

The build phase is where the fun starts coming in, right? Because the stabilize and the streamline, those are, first of all, stabilize, you're just trying to stop bleeding. You're just trying to, like, create some kind of order inside the chaos. So that is a very stressful time. Streamlining gets a little bit easier because now you're trying to build out things that at least partially exist, so you're just trying to refine them. But I think the build part is where things are really can get fun. And as an HR person coming in, the build is where you get to put your stamp on things. That's where you get to put your own flair on things. One of the things you know that I always talk about and preach to our entire team is that while we have standards, we have Acacia Way standards, it's exactly what we call them, of how we handle performance management, benefit admin, leave of absence, whatever, if a client needs customization, we do that because no two small businesses are the same. And so you cannot just assume that the performance process that worked here is going to work here. And I think the build phase is where you get to put a little bit of that flair on what your organization is doing. And I think it's one of those things that makes small business HR so unique and so can be so fun is because you are building something that didn't exist before you. And so you get to build it in the way that suits you, that's kind of your idea of things, but obviously needs to be fitting the business and, you know, make sense for them. So once you I think that a mistake sometimes that small business practitioners can make is that they come in, they want to build first. They want to look at what doesn't exist. Let me build that. And we really flip that and say, that's really broken. For us, I would never come in and build first. I'm always going to come in and do that audit, stabilize first. That's the biggest thing. Then let's streamline what already exists. And then when that is all running like a really well-oiled machine, OK, now let's build the new stuff and do that in kind of a fun and unique way.

Marie

Yep, exactly. I see all the time HR folks or even our clients, they are resistant to going through that stabilized phase because it is stressful. It is uncomfortable. Nobody wants to sit and assess and kind of sit in their mess that either they've created or taken over. But you can't skip it. And, you know, I think that some people, they feel guilty about that. They feel guilty about, you know, what you're trying to work through. You know, they might feel like they should be further along, or they should be doing the strategic stuff. We'll talk about strategy a little later and what that actually is. But at the end of the day, if your compliance is a complete mess and you try to layer it with fancy HR programs and processes all on top of that, it's just going to collapse eventually. OK, so let's get really tactical. So you have reached this point where you realize that your HR is broken. There needs to be some changes that get put into place. And you know you can't fix everything at once. So we've gone through the framework, but where do we actually start? What is step one?

 

Sabrina

So step one we mentioned a little earlier, and that is an audit, right? You should do an HR audit. And I know definitely if you're coming into a new HR role in a small business, you should do an audit. I don't care if they had an HR person before you. I would still suggest you do the audit just to make sure, just to double. And I think we have an HR audit checklist in our downloads, right? So there is a download on our website. We'll make sure it's linked in the show notes. But there's a download that you can use. That is the HR audit we use with our clients. So it's not some watered-down version. It is the exact process we use with clients. You have to understand what is broken. So you have got to go through the thing that I like about our audit too, Marie, and I know you're going through it right now with a client, is that it doesn't just look at compliance stuff. It looks at HR infrastructure and strategy. So we talk about engagement surveys in our audit. We talk about performance management. We talk about things that aren't just legal. And so it gives you a complete picture of what is missing and what is really on fire. Like, obviously, those compliance tasks are things that are definitely on fire if they're not being handled correctly.

Marie

Yeah, absolutely. I want to touch on a little bit more on our HR audit checklist. So, you know, you talked about the first one. You really have to go through, and you need to assess what's broken, right? So these are typically processes that exist, but they don't work. The second bucket is going to be what's missing. So these are things that should exist, but they don't. And then bucket three is what's urgent. So these are going to be, like, compliance risks, your legal exposure. I think something that could be helpful for folks too is that, yes, we have our audit checklist on our downloads, but we also have the HR health assessment on our website. So if you really aren't ready for an audit yet, and you just want a gut check at where your HR department is, go take our assessment on our website at acaciahrsolutions.com. You'll go through, like, a 10-question quiz, and then you'll get ratings around your infrastructure, your strategy, and your compliance. And that will be a signal on where to start. So as you're going through your audit, there's something very cathartic about getting all of that information out of your head and onto paper. It's still overwhelming, yes, especially seeing it all documented, but at least you can see it. So once you have done your audit, step two is always going to be to start with compliance. Now, I know this is not sexy. This is not fun. I know that everyone would rather be building a beautiful performance review process. But compliance is what protects the business overall. And more importantly, compliance is what's going to protect you as the HR professional in your organization. Again, while you might really, really want to build that beautiful performance review process, if your I-9s are a disaster, that has to come first. It just has to. Compliance will always come first.

Sabrina

It does. We always talk about this, and we will be one of the topics we'll have in our upcoming cohort launching in April is to get the back of the house in order. We often hear from HR professionals that they want to be strategic. They want to have a voice in what's going on in the business. And yet they want to do that while their I-9s are a mess, while their payroll process is a mess, while benefit deductions are wrong. And no one's going to trust them to be strategic. No one's going to trust them to actually help move the business forward if that back of the house is a mess, and this compliance stuff is the back of the house. And on our checklist, we actually put an asterisk by things that have a legal concern. So you'll know if you use our checklist, you will know exactly which of these things we consider to be of legal importance and to be compliant. And those are the things that you would want to prioritize first. And then, you know, I think that once you have that stabilized, once you have your compliance piece, then it's those it's where else do you need to stabilize that's maybe not legal. So what are those quick wins, things that you can do? What are those little pieces you can put in place that just make things even 1% better, right? We've all seen the meme, I'm sure, floating around, like, 1% a day, what that equals in a year. And so thinking about once you're stabilized in all of your legal aspects, what are those little quick wins? And they can be micro. This is the beauty of a small business, is that you can do something so simple, so small, that makes a huge effort. And I think about I actually have an example. A couple of years ago, we had a client who just was somebody was always coming to human resources for forms because they didn't have forms anywhere. They didn't have an HRS at this time. This was a small business that didn't really have one. And we just created, like, a SharePoint site with all of the standard forms loaded. So something super small. This does not have to be mega. You don't have to do big things. But what is, like, these little quick wins that are going to help you streamline because this is kind of in the phase you are in now? What is going to help you streamline the processes that you already have? And a good way to do this is to think about what are the questions you're always getting? What are the things that people are consistently coming to you and asking you? And how can you make it so they can maybe find that answer on their own?

Marie

OK, so before we wrap up these steps, I just want to recap. So first is our audit. Once we've done our audit, we're going to focus on compliance. And then we're going to highlight some quick wins. Once we've done these three things, we're going to sit down, and we're going to create our roadmap. Now, your roadmap, it could be 30 days. It could be two months, three months, six months. It could be 12 months. But the point is you need to sit down, and you need to create a plan for how you're going to fix everything. You need to sit down, and you need to make a real, meaningful process around your progress. I'm not going to take our time to really map out what that roadmap will look like. But definitely check out our downloads after this episode because we'll provide a template that you can use to start this process.

Sabrina

You know what's interesting about this, Marie, and I think what is important for us to share is that this is our new client onboarding process. Everything we just have laid out for you is how we onboard a new client. And I think that's important. Again, one of the things that I always want to make sure we're doing on this podcast is not just giving you what consultants think you should be doing, but what we are actually doing that we know works. And this wasn't always our new client onboarding process. I am not well, I am ashamed, but I'm not shy to say that I used to just jump into a client and start putting out fires and whatever was hitting me every single day. Or even as we added team members, it was a very different onboarding. It was a very different look than it is now because we've learned that this is really how you do that. And so this is the exact way that we bring on clients. But even if you're not new, even if you're somebody who's been sitting in this company, in a company for two to three years, but you just feel like things are really messy or things are broken, you can still stop today and go through this process, go through an audit, go through stabilizing the processes that you need to, and then look at how you streamline, and then how do you create this roadmap? How do you create a roadmap that says, OK, next month I'm working on this. The next month I'm working on this, just to give you a clear picture. I think doing that and then showing your leader that you've done that, showing your CEO, whoever you report to, that you've done that immediately just makes HR more relevant. It immediately just takes away some of that, like, HR doesn't really have that voice. You are claiming that voice by doing things like that. And I think we have seen that in our new client onboarding where clients take us so much more seriously early on because we have come in with such a distinct model of we are going to stabilize, streamline, and then build. And they appreciate that. And they're just really let us go and let us run with it because we know it works.

 

Marie

Yeah, yeah, absolutely. As you were talking, I was just thinking about, you know, years one and years two in this organization. And then, you know, after you launched the onboarding process, what a game changer it was. Yes, it was a game changer for the clients and how they looked at us and how seriously they took the work that we do. But also the peace of mind that it gave to all of us internally on how to manage those processes because it's so easy to get derailed by clients because they're eager to build. But having a process like this in place, it really keeps us on track and moving towards something that will actually make an impact in their business way quicker than having these derailing conversations or side projects going on. OK, so let's talk about what you don't need to worry about right now because I think HR people, especially in the small business space, they put way too much pressure on themselves to do everything. So if HR is broken, you don't need to worry about building a performance management system if you don't even have job descriptions. You don't need a fancy new HRS if employee data is currently a mess. That'll just be garbage in, which equates to garbage out. And these aren't bad things. They're actually really great things. So they're signs that tell you that you're going to get there. But it might not happen today. It's not going to happen when you're in stabilized mode.

Sabrina

Yeah, I think, you know, to your point of things that you just said, even when the HR practitioner wants to do things that maybe feel more sexy or they feel more, you know, productive, I guess, in their brains because it's not compliance. It's not just doing that stuff. We get that founders or CEOs want that same stuff. So they might be urging you to focus elsewhere or to build bigger things. I think of the example, you know, I always give this example of the CEO who walked up to me and said, we need to do 360 performance reviews when they had never given feedback before in their lives to anybody. Like, managers didn't give feedback. So I think that the trap that can happen or the thing that can happen is that CEOs, founders, they hear these things. They hear like, ooh, this is cool. I want to do this in my business. And that pulls you away from this stabilizing, streamlining, building framework. And so really showing them, like, we have to build a foundation first. We'd love to do 360 someday. That'd be amazing. But we've got to build this foundation first and get all of this stabilized and streamlined. And then we'll have the time to move on to some of those things.

Marie

Yes, that is such a good example. I actually think about that client all the time. I also think about, you know, we've had a couple of other clients who come in, and they want to do, like, a culture study or a culture initiative, or they want to enhance their culture, right? And I love these projects just as much as the next person. But if your handbook is from 2015, and you don't have an onboarding process, you've got bigger problems that we need to solve first. But in thinking about all of that, you know, sometimes it's really overwhelming. And sometimes you just can't do that alone. And so when you find yourself in need of support, we would love for you to come back and think about us because that's exactly why we're building the HR community and exactly why we are going to be hosting our cohort. Sabrina, our cohort will be launching April 17, I believe, is what we talked about, right? So right around the corner. This is the perfect place for folks to come in and get that extra level of help when they just feel like things are just too much once they've gone through that stabilized period.

Sabrina

Yeah, I mean, I think if you think about the content that you're working on for the cohort, it fits right in this. Like, it's almost going to take them deeper into how do we do some of these things, not necessarily all of it, but deeper into how do we when we're talking about stabilizing, what do we really mean? And what are we stabilizing?

 

Marie

Yeah, yeah, absolutely. I also want to mention that I feel like a lot of times HR folks, especially HR folks who are trying to do it alone, they feel a lot of guilt for asking for help. Or they just feel a lot of guilt for not knowing what the right solution is. And so I hear people say to me, or just in general, you know, I should be able to figure this out on my own. I should be able to handle this. But from a business perspective, if something is broken and you don't have to or you don't have the bandwidth or the expertise to fix it, bring in that help, find that help. And it really is the responsible choice at the end of the day. And it's what you would do for any other broken business function as well. OK, so to wrap this up for today, if HR feels broken where you are, you're definitely not alone in any of this. And the good news is that you don't have to fix everything at once. And really, you can't actually fix everything at once. So start with an honest audit. Prioritize compliance first, even though it's not sexy and fun. Stabilize, then streamline, then build. Create a roadmap so you have a plan, and you can actually see your progress. And if you need help, please ask for it. That's not a weakness. That is actually very smart. Thanks so much for listening to the HR Connection. If this episode resonated with you, we would genuinely love to hear what your biggest HR challenge is right now. You can reach us at akasiahrsolutions or follow us on LinkedIn. And remember, you are doing hard and really important work. So even if it feels like everything is broken, we see you. We're here for you. See you next time.

Sabrina

See you next time.