- PNC is proud to support Business Forward where community leaders discuss the issues confronting business in Central Illinois.

(light music) (light music) (light music) - Welcome to Business Forward.

I'm your host, Matt George.

Joining me tonight, Erik Christian.

Erik is the principle at HR Fit, welcome.

- Thanks for having me, glad to be here.

- Yeah, I'm glad you're here.

So let's start off with you and then we're gonna talk HR, very important topic.

So how long have you lived in Middle Illinois?

- Whole life.

- Okay, so you grew up where?

- Dunlap, my dad went to Dunlap, aunts and uncles and Mom went to Central, so I'm a Peoria guy.

- There you go.

Well, that's pretty neat stuff.

So you started this company.

I've known you for a long time.

I knew you back when you were running HR in school districts and all of the sudden, I think it was about 2014 or '15, we had a discussion and you said, "I think I'ma start my own business."

Is that about the right timeframe?

And you said, "I'm gonna start my own consulting business "for human resources."

And I thought, that's interesting.

And you've always had as long as I've known you, you've always had that entrepreneurial mind anyway, I have always thought.

But you started this company and I just thought, what a unique business.

And if you think about it, every business that I know needs you.

(Matt laughs) - [Erik] I agree.

(Matt laughs) (Erik laughs) - Because if you think about it, everyone has HR.

HR has just grown in the importance of it in business even now more than ever.

Is that a true statement?

- Yeah, I think so.

I mean, we see good HR really is a competitive advantage for a business and there's a number of reasons for that.

We can go any number of ways, but really it comes down to good HR is about good relationships with your employees.

They wanna be a part of something, they wanna be valued.

Your top performers and as many employers will tell you, right now as we sit here in October of 2022, the labor market is tight.

It's loosened a little bit, but boy, it is hard to find good qualified people.

We see that in our business.

And you name it, they're hard to find.

And so good HR is gonna help pull those folks into the business and then they're gonna stay, they're gonna perform better.

Ultimately, that translates into a competitive advantage for you as the employer.

- So tell us what HR Fit is.

- HR Fit is a human resources consultancy.

And so we're a strategic human resources consultancy, we see in that we do pretty much everything in that HR vertical.

So those folks who maybe have an in-house HR, you can think about it, we're gonna do it.

Take the hiring process.

We're gonna help with the job posting, the sourcing, the recruiting, screening, hiring folks, onboarding if they want us to.

So that whole employee life cycle through employee relations whatever.

And then we also do things that are more strategic in helping them build their HR infrastructure.

Making sure that their compensation structure and strategy makes sense for them and is defensible.

Making sure that their employee handbooks and policies, again, make sense for them, are clearly outlining the expectations for staff.

Doing any number of other things in that space.

And then we do a lot right now of outsourced HR for folks, that employer who is big enough to where they have employee needs, they're feeling it, but they're not so big that they need an HR staff member full-time.

Or that they could maybe afford the one with the level of expertise that they need.

So that's the gap that we help to fill.

And we do that for employers of all types.

- Well, I hired you once, actually a couple times, but when I did, I thought I actually knew as a CEO, I thought I was really good at HR until I met you.

(Matt laughs) I'm being serious.

And so what I realized was policies in human resources just like other policies get outdated, but it's not just the policies, it's the processes.

So it's almost like the strategy for your department, especially if you're scaling.

So let's say a company has 100 employees, the next thing you know, you have 200 and then 300 and you're scaling quickly like a Rivian as an example.

They went from 80 employees to 13,000 worldwide.

So from an HR mindset like you have, that whole department from processes, but just hiring and onboarding and training and retention and all those things that are with it, they explode.

So I had you come in and I found it interesting because there were some things I felt were dated and they were.

And so one of the things that you did is you came in and helped strategically get our processes back going the right way.

Do you do that a lot?

- Yeah, and those kind of HR reviews, process improvements, those are the kinds of things that we'll do and those are great because it helps to get a sense of where things are right now.

And then it also gives the employer a roadmap of how they might wanna improve, whether they do it in-house or we help or whatever.

But to your point, those policies really should be reflective of something.

I mean, there's some of that boiler plate stuff that you just need to have in there, harassment policies and things like that, and those are important.

But when you come to policies and procedures, those really should reflect something.

There should be a reason why you're doing those.

And you should be rooting that reason in your business needs.

They should be aligned to your mission and we should be intentional about that because that's gonna help you both operate more efficiently because you're really thinking about, well, why do we hire this way, why do we need this, why do we evaluate this way?

But then it also down the road is it's going to put you in a better position if anybody ever makes some kind of a claim that they were treated unfairly.

You didn't give me this raise because of whatever, it's retaliatory for this or that.

And you get to say, no, we did it this way 'cause this is the way we do it.

And we've got our documented procedures, this is the way we have done it and there's a good reason for it.

And so it does both those things.

And I think good HR is always keeping an eye on both those things.

It's certainly about the compliance, but it's also trying to make sure that there is a value-add there that it really is helping you be strategic and much more effective.

- So I got this from talking to you, you say we are positive-thinking, client-focused, I like this, solution-oriented.

One of the things that you just touched on was I'm just gonna call it an audit.

So you come in, you do an HR audit, I'll call it, and then what I liked about the process was you didn't say here's where you're not doing too well.

You said, here are three or four different options and avenues that you can go down because you really in your business, it's just really what strategy I have as a CEO and what direction I wanna go.

Now, there's some things you just have to tie up.

But in terms of strategy, is that how you look at it?

- Yeah, I mean, there's oftentimes more than one solution to a problem.

And oftentimes, those problems, they can be more opportunities.

I'm not the first one to say that, of course, but there are those opportunities there to make this better.

And you also, we understand as the employer, you've only got so many resources, whether that's dollars or time or staff or whatever.

And so if we come in and we're saying, these things may not be as strong as they need.

We're gonna say here's some different ways you could go about shoring that up and maybe here's a timeline you wanna go.

Now, if there are some things where we're like, this is on fire, put this out, but then there's gonna be these other things and we'll give you some different ideas about how to go about that because it didn't get that way overnight.

It's probably not gonna get fixed overnight and that's the piece we wanna help everybody understand to take a deep breath, you'll get there, we'll get it fixed.

- Yeah, I think you said something that I liked.

You said, understanding human resources was really about human relationships.

I like that.

And because a lot of times, if you think about it, in companies, HR gets a bad rap.

People just think that they're just firing people and that's not it at all.

It's actually a safe place in terms of having the back of the employee.

But a lot of times, employees don't look at it that way, do they?

- No, this kind of classic, I'm gonna send you to HR.

I'll do it, don't make me do it.

And that does two things negatively.

One is it erodes the authority of the manager, it erodes the credibility of the manager.

If I'm the supervisor and I'm the boss and I'm trying to lead my people and really be a leader and I'm like, don't make me send you to HR, now I've just said they're the ones who are gonna hold you accountable.

You don't really need to listen to me.

And so we don't want it to be that way.

The other piece goes back to a point you just touched on in that HR needs to be this kind of safe space.

If it's only being seen as punitive all the time, then that's gonna be an impediment to people coming forward with real concerns, and not just ways to in general improve the workplace.

It would be nice if we had donuts on Fridays and things.

That'd be great, but we're talking more serious stuff.

Let's say there is a harassment issue going on.

Let's say that somebody is being subjected to a hostile work environment.

Every time they go over to so-and-so's work area, they gotta hear the jokes or they gotta whatever and they feel like, boy, I wish I could talk to somebody, but if I go to that HR ogre, it's just gonna make it worse.

I mean, HR needs to be a place where employees can go and know that they're gonna be taken seriously and valued and that there's going to be action that will happen in a positive way.

And that perspective is really important.

- I think as businesses grow, I think your business has opportunities like no other time because what's interesting right now is there are a lot of businesses that struggled during the pandemic, but there are a lot of businesses that ramped back up.

And some of these businesses and new business, and they've started and it's like you sit there as an owner or a small business owner or a manager, whatever it is and you'll sit there and you'll go, I need someone.

I need to hire a full-time equivalent person to just be in HR.

And then you get to the point where you go, I need someone else, I need someone else, but you don't necessarily need someone else all the time because you're making decisions.

One of the things that you could do is go in and help me understand really what position I needed within HR, right?

- Yep, that's one thing we do, too, is when we do some of these reviews, but then we talk about, hey look, here's different ways that you could potentially structure this.

And I have told clients going through that, be like, you could use us to run your HR, but frankly, I think you're too big or your student will be too big and it'll make more sense for you to hire somebody in-house and then we can supplement them if you need.

But that's certainly part of what we will do.

And part of what happens, too, is oftentimes we'll get a call because somebody has an acute HR need, an employee issue.

And what I mean by that, maybe it's a harassment issue, maybe it's just a more smaller business.

They're like, look, I've got this person and it is just not working out.

They're having trouble working with everybody, I keep getting complaints.

I've never dealt with this before, what do I do?

And maybe it's because they used to be a team of six or seven or eight and they were all pretty tight and they knew and now they've blown up and there's 20 or 30 people and they just can't stay in touch.

So that's a place where we can help them and try to navigate that situation in a way that hopefully is best for everybody.

Either get that employee back on track and help them understand what is needed or frankly, part of what HR has to do sometimes is help people understand this might not be the place for you.

But there are ways to do that that really are still good for the employer and not as detrimental to the employee if we can help it.

- When you are looking for jobs out and about and there's job boards and all these different things, you see jobs all the time that say HR generalist.

It kind of sounds generic to me.

So what is a generalist?

If someone was out there wanting to apply for HR jobs, what does the generalist do?

- So the generalist is usually gonna be at a place where they are going to be doing entry to mid-level HR, the organization's probably not so big that they can get specialized.

And so they're gonna be handling most any HR stuff that comes in for the organization, if they need to post for a new position and hire.

Well, let's just take it through the employee life cycle.

Somebody walks in and says, hey look, I got a new job, I'm done in two weeks.

All right, so now the generalist is gonna say, okay, now, I'm gonna process his term out of whatever human resources information system they have, tie up his last benefits that he might have, then go forward and post for his replacement, coordinate that posting, the phone screenings, the interviews, help make the decision, then that person's hired.

Now they're bringing on the new paperwork and setting up all the benefits and whatever.

Let's say in the meantime, they get a call from a manager saying, hey look, so-and-so's been late for the third time this week and so we need to sit down and have a conversation.

So they're gonna have that conversation.

In the meantime, maybe benefits are gonna be... We're getting on open enrollment season.

There might be things they have to do with that.

And there's a number of different ways that depending on the organization, maybe they get to do payroll as well and all that fun, but a number of things in those spaces.

Usually if you see a generalist, that type of position is doing most everything.

- And then there's this piece of you touched on it a little, but you're talking about this compensation strategy because am I right that in the past year or two years that the market's so tight that pretty much everyone's strategy for compensation has blown up?

- What you thought would work two years ago, I'd be very surprised if that is still working now.

And so many employers have had to do just market adjustments.

Essentially, I think stay pay increases, please don't leave me, which is understandable because that is just the way the market has started to go.

And so you gotta make sure that that comp structure is aligned and it's in the right spot, but that also isn't just gonna blow your whole budget out of the water.

And I will say comp is so important, we talk a lot in the HR space about culture and man, culture makes a huge amount of difference.

At the same time, you can't compete only on culture.

I mean, if you're paying $20 an hour and across the street's paying $30 an hour, it doesn't matter how many ping pong tables you have or casual Fridays, that person's going across the street for 50% more.

- And everyone's seeing it.

- And that's all there is to it.

So you really gotta make sure that that stuff is aligned and I'm not saying culture can't overcome that, but it is incredibly rare and hard to do in my experience and then culture helps to make the difference and tip the scales.

- You know what's interesting, too, and I think the media does not do a good job of this because they'll say they should pay more, they should do this and you read stories and all that, but what people don't understand is in that strategy for compensation or that, that if you change pay here, it goes to each level of the agency or the business, whatever it may be and it's a trickle down that could, like you just said, blow your business up.

- Trickle down, trickle up, that wage compression issue is what we call it in HR.

So you think, well, I gotta start the lower salary folks here, so now I've started here.

Well, maybe my manager was already here and pretty soon, the manager's like, why am I working so hard?

So you need to move that and can go all the way up.

So on its face, the market is saying pay these people more at whatever level, but that has impact throughout the organization that you have to consider.

- Yeah, and so this minimum wage stuff that's been going on for the last few years, and I'm not against it at all, but it does change the way you manage your business because if you were at 13, $14 an hour and you think you're doing well in paying that, now, to compete, you're paying 18 or 19, well, now that's equivalent to almost $40,000 a year salary, it changes everything.

And I think that's where sometimes people don't understand the innards of running that part of the business and it's hard.

Another thing that you do or can do is coach.

So you can come in, hold somebody's hand and help them.

- Yeah.

That's gotta be fun.

- It is a lot of fun.

- [Matt] I bet you that might be one of the most fun parts.

- It is, and we do most of our coaching is with that HR professional.

Usually I'll do the coaching with somebody who is either maybe new to their expanded role in HR, but especially somebody who's a director, VP, whatever kind of thing you wanna call it.

Somebody who for the first time is really having to organization wide strategic HR decisions.

And so helping just walk through them or walk through that process with them and say, okay, what are our priorities?

And then also help them think, okay, understand if you pull this lever over here, what it's gonna do down there.

Things like wages like we were just talking about or why do you do evaluations the way that you do them?

And are you doing them?

And how are you doing them?

- [Matt] You doing them right?

- Exactly, all these kinds of things to where it's actually going to help or if it's just going to end up making things tougher.

One of the trickiest things with coaching I think that I've found, especially with your best coaching clients is helping them pick their priorities, putting the brakes on it.

A lot of them, especially your high performers are like, let's get it done.

- [Matt] Yeah, they would have 20 things.

- You gotta understand, look, let's back this off.

We need to build momentum here and we need to build your credibility as a leader.

Maybe the whole organization already really likes you, but now they're gonna have to start seeing you in a different light.

So let's find those things that are gonna be some quick wins, help you build momentum and credibility now and then we'll get to the big things.

There's plenty of time.

- What makes for good HR?

(Erik laughs) - Relationships.

- [Matt] Do we have enough time to talk about this?

(Matt laughs) - Good HR is relationships from my perspective.

And good HR is really when HR is sitting in this middle.

They're helping to connect the organization to the employees and connect the employees to the organization and understanding that.

Certainly, they represent the employer, but the idea here is that they are supposed to be the one from the employer's end who is really making sure the employees are connecting.

I mean, HR should be the keeper of the culture in so many ways.

And I have found it best when HR is looking at two customer groups, employees and then managers.

But we talk a lot about employees and we should because we wanna make sure for all the reasons we talked about that they have a good relationship with HR.

But a lot of what HR does if they're doing stuff well and really trying to make some change and have a positive effect is working with those managers because for all practical purposes, your boss is the company to you.

I mean, you don't get to see the CEO.

Even a small company, you probably don't get to have real conversations with the CEO day-to-day.

And probably don't even see HR day-to-day, but you were seeing your boss every day.

And so for all the other kinds of things that we might say about culture and mission and all these kinds of things, how they're immediate supervisor treats them, that is the company.

Further, that is really where most of the tricky stuff can happen.

I mean, they are the employer, so if they said it, the employer said it, if they heard it, the employer heard it, the frontline supervisor, and so HR really needs to help them understand how they should be interacting with employees, what they should be saying, what they should not be saying, when they should step in if they hear somebody saying something inappropriate or treating somebody else, making sure they don't just blow that stuff off.

And that piece is really where I think HR can make some of the most difference in the organization and really helping develop leaders is walking them through some of those employee relations issues.

- Interesting, so some of the trends that I look at when I speak all the time on just business in general, one of the things that I'm seeing and feeling in talking to a lot of different CEOs is there's a war out there for getting that talent.

And it's gonna be like that for a long, long time, right?

- Yeah, I don't see that changing any time soon.

I mean, July of '22, nationally, we hit a 50-year low in unemployment.

50-year low, that has started to inch back up, but even if we go by leaps and bounds, it is not gonna be something that just fixes itself overnight.

And that's more acute in some positions or some industries or some geographic areas than others.

But I just don't see that changing very quickly.

And just the way work has changed now, technology making a huge impact.

Many, many positions can work wherever they want, which can be great for cities like Peoria.

They don't have to go to Chicago or St. Louis or whatever.

But it also starts to level the playing field for a lot of employers and you are going to have to be able to make sure that you are competing for talent both in comp, in culture, in benefits, all that kind of stuff.

You need to be more intentional about it because that's gonna be with us for a bit.

- Yeah, I was talking to a business owner in Galesburg just a week ago and they're saying it's almost like bidding wars.

Like, I have this person and I'm offering 60, the next person, 65, it's like being an auctioneer.

I know, 70, 75, 80.

(Erik laughs) That's what it feels like.

- Yeah, I believe it.

- It's crazy and then tied to that's the remote work and that's here to stay.

And so I will say this, you're in a very, very interesting time and I think it's gotta be very fun for your team because you have a very strong team and they all have different skill sets, but when you look at business today, I started off the show like this, you actually have an opportunity to help every business that's working right now.

And not too many businesses can say that.

- Well, I hope it's fun for the team.

I'll let them answer how it was like working for me.

But I think that they like the work.

And we feel like, I know 'cause we've had conversations about this, we feel like we are able to really help and really able to help connect with those folks, especially smaller businesses, family-owned businesses because when you make an impact for them, it goes a long way.

- Well, you do great work.

Erik Christian, with HR Fit.

Thank you for coming on the show.

This was awesome.

I'm Matt George and this is another episode of Business Forward.

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