Episode Transcript
[00:00:00] Speaker A: Before we dive in today's episode, I want to take a moment to share something that's been on my heart, something I've been working on behind the scenes for a while now. I'm officially writing a book. This book is called let's Be A Practical Guide to Leading Through Change. And it's deeply personal to me. It's built from real experiences. The uncertainty, the challenges, the moments where I didn't have the answers but had to lead. This isn't just a leadership book filled with theory. It's about navigating uncertainty when there's no clear direction, building internal clarity when everything around us feels unclear, having courageous conversations even when they're uncomfortable, and leading with value, especially when it's the hardest to do so. I'm also going into topics that don't get talked about enough, like what it feels like to be challenged, overlooked, and even bullied as an adult in the workplace. And how those moments shape the kind of leader you become. This book is for anyone who's ever thought, how do I lead when I don't feel ready? How do I show up when I don't have all the answers? And how do I stay true to myself in environments that challenge me? If this is you, this book is for you. I'll be sharing more about the journey behind the scenes moments and opportunities for you to be part of it as we go. So stay tuned because this is more than just a book. It's a movement around how we lead through change together. Alright, let's get to today's episode.
[00:01:25] Speaker B: Opinions expressed in this episode are personal. They do not necessarily reflect the views of this streaming platform.
[00:01:34] Speaker A: Good day, wonderful people, and welcome to another edition of let's Be Diverse. I am your host, Andrew Stout. This episode is dedicated to all my loved ones who have supported me through this journey. Those who have left us will always be in our hearts and will never be forgotten. Our topic today is if people matter, why is HR an afterthought? Our guest today is one fantastic human. Her name is Andrea Diaz. Andrea, thank you so much for joining us today. It is a pleasure to have you on as a guest.
[00:02:03] Speaker B: Thanks for having me. I'm excited.
[00:02:05] Speaker A: We're excited to have you. What has been energizing you these days? Give us the tea, give us the deets, give us it all. What's going on, man?
[00:02:12] Speaker B: Of course, AI has come up on my list frequently, but also what motivates my everyday life. Being an HR consultant is really helping HR be the strategy in the room, which I'm sure We'll talk about today. And that's what I'm always building towards.
[00:02:29] Speaker A: That's good that you were doing that. And I think we all should be doing that a little bit more. But again, we'll probably talk about that as a conversation goes. But yes, 100% with you on that. And good for you for making that part of your strategy. I think we always want to be better, or most of us do. So if we can do that on a daily basis, I. I think it's great.
[00:02:49] Speaker B: Absolutely.
[00:02:50] Speaker A: So thanks so much for that. Before we begin, Andrea, I always have a fun, thought provoking question that I always ask my guests to get things going. Are you ready for yours?
[00:03:01] Speaker B: Sure. A little nervous.
[00:03:03] Speaker A: Oh, there's nothing to be nervous about. This is actually an easy one. This is really easy.
[00:03:08] Speaker B: Great.
[00:03:08] Speaker A: Andrea, your question today is what is your definition of happiness?
[00:03:13] Speaker B: Oh, my goodness. You said it was easy, but that is so thought provoking. You know, I haven't been as goal driven of a person I am.
And being an entrepreneur and always chasing that carrot, it wasn't until I met my husband that I realized how much of a luxury it is to wake up one day, have nothing planned and just relax. I never did that before I met him. And I think that that's like true happiness is being just content with not thinking what's going on next, what your goals are. Having nothing planned for a day is like the biggest bliss I think one could have.
[00:03:59] Speaker A: I am 100% on board with you on that. When we don't have to plan something because you're right, we plan things for all through our lives and even to the fact of what we're going to have for supper today, there's something that's.
[00:04:11] Speaker B: Exactly.
[00:04:12] Speaker A: There's always something that's continuously going in our professional and personal lives that we have to plan. So if there's like an opportunity to just say we're just going to wing it today and we're just going to see how the day goes and where the day takes us is truly amazing. And I have done that too as well with my wife. And they're some of the best days. Even if it's just sitting there watching like two or three movies. Like it.
[00:04:37] Speaker B: Yes.
[00:04:38] Speaker A: It's just amazing.
[00:04:38] Speaker B: Yeah, we refer to them as rot days in our house where you literally rot on the couch. We nap, we. We don't plan our food, we just order in, watch tv, binge, watch something. And it's the best. It really is the best. Highly recommend.
[00:04:54] Speaker A: Yeah, I highly recommend it too. For anybody that's listening and hasn't done that, I definitely highly recommend it. And, and I think it opens up your, your mind as well and your mind becomes fresh and you, I find you be, you become more creative when you, when your mind is resting. So great, great idea, great thoughts. I love that. I love your answer. See and you were worried and you did so well.
[00:05:16] Speaker B: I know. Thank you.
[00:05:18] Speaker A: You did amazing. You did amazing. Thanks so much for having fun with me to get us started. Andrea, who are you and what really drives you to do the work that you do?
[00:05:26] Speaker B: Yeah, so my name's Andrea Diaz. I'm the founder of Dominica IT fractional HR and compliance firm that I launched in 2022. So about four years in now what I do is I step into organizations that are their most vulnerable moments. So that's either you know, a business hiring for their first employee or they're scaling multi state global employment, M&As, restructuring, investigation, audits, you name it. And what I do is I come in and build or rebuild people infrastructure that maybe should have been there from the start. But what's really unique about the work that I do is actually who I work with. So sometimes I'm working with the founder or CEO who has never had a thought about people strategy before and they need someone to come in, speak their language, risk, money, outcomes, growth. And then sometimes I work alongside an HR leader who is brilliant in what they do, but they're completely buried by like the everyday administrative work reactive cycles. And they desperately need like a strategical partner that can come in and they can help them get out of the weeds and put them back into the conversations that matter.
And both of those people are my people. So I'm very rewarded by what I do with both of those I can say. And even with the organizations I step into, there is a similar pattern that I see that almost every time the root of what is broke isn't a compliance gap that's on paper, it's that HR wasn't in the room when a decision was made in the first place. And that's what motivates me. When you ask me what drives me, it's that I know what it looks like when HR gets it right when we're the strategy in the room and not just the cleanup crew.
And right now, especially with AI, you know, AI is starting to make these workforce decisions and the stakes have never been higher for hr. So if HR isn't at that table, the not just for the people decisions, but technology decisions, risk decisions or Design decisions, someone else is going to be making those calls and then we're going to have to deal with the fallout. So the too long didn't read of it all is what drives me again is just helping HR become the strategy in the room. And that's what I'm always building towards for my clients and for the profession as well.
[00:07:52] Speaker A: Andre, you have my attention. This, that, this whole thing that you just said, and what I'm gathering from that, is that you want to make sure that HR is in the room. And I'm sure we'll talk about this as the conversation goes, but through my conversations with people in leadership, business owners, HR people, there are situations where HR only can do certain amount of things before ownership comes in and steps in and says, okay, this is how far you can go and that's it. And when we're not allowing our HR people to be innovative and creative and help people and come up with solutions, because this is what they specialize in, then I think we are, I think those companies are missing out on those ideas of those HR people. So I love that you do that.
[00:08:43] Speaker B: Yeah. When I go into an organization and I am tasked with finding compliance gap gaps and, you know, possible resolutions, I know notice instantly if leadership has a mindset that HR is just a people service function and not a business function. And that's where a lot of those compliance gaps come from.
[00:09:04] Speaker A: So organizations often say people are a greatest asset. What does that statement actually look like in practice? And where do you see the biggest gaps between the words and reality?
[00:09:16] Speaker B: Ooh, that's a great question. So that phrase is like everywhere now. I, I feel like it's pretty overused.
People first. It's honestly become a buzz phrase, not just in like leadership internal messaging, but within HR itself. HR professionals use people first to describe their work, their approach, their identity, if they're a consultant like me. And the problem is that it is a sentiment, and no matter how genuine it is, it doesn't have very much impact on business.
Business impact comes from data decision and systems. And what I see most often is the statement lives in a culture deck and then dies in a budgeting conversation. So the moment things get hard, revenue is down, a restructuring is on the table. People become the first variable to adjust. It goes out the window. And that's not being people first, that's being people convenient.
So the biggest gap is between the declaration and then the infrastructure that supports that declaration. You can say that people are your greatest asset all day long, and then you haven't benchmark your compensation in three years if you are not doing anything with your exit interview data, if your managers have never been trained to leave before, those words are then just words.
So the asset is then depreciating and nobody is measuring it. People first has to show up your systems, your data and your decisions, not just in your messaging.
[00:10:52] Speaker A: What a great answer, Andrea. And I'm smiling as you're talking about that because what's coming to my mind when you say that, it is absolutely a buzzword. And what kills me right now is particularly in job postings, when a company posts a job and they use the word family orientated, that drives me up the wall because there's so many bad things about those words. And the first thing I'm gonna say is that lots of people, not everybody gets along with their family.
So why would people want to go to a company that is like their family? And I've been having these conversations for four years now, and this is what I'm gathering from people. They're saying, please don't put that in your job posting because I don't want to apply to a company that has that. So again, I was smiling as you were. You were talking and saying what you said.
[00:11:43] Speaker B: Are you saying they are saying that their culture is, we're all family here and you're coming to work, you're working for a family. Okay. Yeah, that's interesting to me. It's, it's funny because I always think back to when I was in college. I put myself through school and of course I had a few full time jobs in the meantime. And one of my favorite, favorite jobs was being a server at a restaurant. And this restaurant was known for being super flexible with their employees. A lot of musicians that went on tour worked for them. Single moms, yoga instructors. And they built this awesome culture where they understood that people just came in to do a job, a good job. They loved being there, we loved our shift, we loved our customers. But then at the end of the day, we had lives and we had to leave. So. And I always look back so fondly at that restaurant and working there because I was like, wow, bigger companies could really learn a lesson from this, that some folks, they appreciate what they do, but that it doesn't define their entire life and they want to come in, do a good job and leave.
[00:12:52] Speaker A: Yeah, I wish that more companies were like that or realize that because that is the essence of what you just said, is of what people are, are looking for. Or wanting. And if companies I think, realize that, I think they would definitely see a higher engagement for sure. Because you're not just telling them something or giving them buzzwords or word service. What you just talked about at your job is, was actually showing people that you cared. And that was probably what kept people there a long term because that type of job typically is something that is, there's a high turnover.
[00:13:30] Speaker B: Right.
[00:13:30] Speaker A: So if you're able to, to keep those people there long period of time because of that, well, you're, you're doing something right.
[00:13:38] Speaker B: Absolutely.
[00:13:39] Speaker A: So angel, what are the consequences for employees, leaders and organizations when HR is viewed primarily as an administrative function rather than a strategic partner?
[00:13:50] Speaker B: Yeah. So I'll do this in three parts because there's a lot of folks involved. Right. So the consequences are layered and, and they compound over time.
So for employees, it means that the people responsible for their experience, that is, tends to fall on hr. They're buried in paperwork instead of paying attention to what actually drives retention. So the culture then erodes quietly and by the time leadership notices, all the institutional knowledge has already walked out the door. So like we just spoke about, retention is just not good. And then for the leaders, it means making these million dollar decisions about org structure, compensation, AI adoption now without a strategical counsel that they need. So they think they're keeping HR small and operational. And this is a new trend now that you'll see. A lot of folks are getting rid of how big their HR team is, but what they're actually doing is they're accumulating risk that they can't see yet. And then for the organization, the consequence shows up in cycles. So this is what I see constantly is a continuation of reinventing the wheel. So there's constant restructuring, we do massive layoffs, and then the same problems resurface every 18 months because no one has fixed the root cause. They're just managing the symptom or the fallout. And that's exhausting and it's expensive. So it shows up also in numbers. You know, the average cost to replacing an employee is now around $28,000.
So if you multiply that by your turnover rate that nobody was tracking, that number becomes staggering. And it doesn't. I bring up retention a lot because it's like a really easy example to provide. But I had a client recently where we caught a mistake in their benefit cycle and through their HRIS data, it was a systematic error that was quietly running in the background. And we fixed it and it saved them 250k annually. And that's the kind of thing that only gets found When HR is looking strategically in their data driven, not just administratively with, you know, being stuck in the day to day cleanup. So by the time I get called in, the organization is already paying for a decision to keep HR reactive. And my job, my job is usually to find the problem, stop the bleeding, but the real cost has been paid long before I show up.
[00:16:25] Speaker A: I just want to piggyback on something that you said where organizations are reinventing the wheel. So when you're talking about this, are you talking about. So for example, let's just say you have a leader in a position and they hire somebody for a particular position and the person doesn't last like even like through their three months probation period. And let's say in like a year and a half you've had four people in that position. So when you say reinventing the wheel, would that be something that you'd look at to say, hmm, something's not right here because there's been four people in the last year and a half and there's something wrong here. Is it management? Is it training? What is it?
[00:17:08] Speaker B: I mean that's definitely a good example that I see over and over again is we're really not finding the precipice of the problem and we are just keep on hiring and keep on trying to plug the hole where the boat is leaking from instead of finding the root cause. But also like just in like procedure or process alone how we respond to things, you know, are we restructuring our teams constantly? And we are always on the conversation of should we restructure this role? Are we changing people's titles constantly? And if that's so, like why, like why, why do we have to fix this every year or so? Or why are we having to do massive layoffs every, every year or so? What's the root cause of that? And why do we have to keep reinventing a department or policies or procedure if it was done correctly in the first place, if it had some people strategy behind it, we could potentially, you know, do it right the first time and then save us all some time and money and heartache for sure.
[00:18:10] Speaker A: So what role do leaders play in ensuring HR has a seat at the table and what mindset shifts need to happen for that to become a reality?
[00:18:20] Speaker B: Yeah. So leaders play the most critical role. The seat at the table is granted by the people running the organization. Right. And it reflects if they actually believe about what they actually believe about people strategy, not what they say they believe. The shift for leaders is moving HR away from that service function, only to seeing it More as a business function. So inviting HR into decisions early, before the agenda is set, not after the fallout begins and you're just having them clean up the mess. This would be some examples that I've already mentioned. But like compensation conversations, restructuring, planning, technology rollouts is a big one.
HR should be in the room from the start. But I also understand that we have some like HR leaders that could be listening today. Right? So I think that this shift also goes both ways. For HR leaders that are listening, delegate and automate. So for all those mundane tasks or just those time sucking tasks throughout your day that are taking a lot of time and energy from you, like investigations, any administrative tasks, the reactive task, right? Hand those to the capable members of your team, utilize the technology that you already have or bring in an outside consultant, I happen to know a good one. But free yourself up for that strategical work. If you are an HR leader, become that technologist, become that law expert, know your H R I s inside and out. Understand the legislation that's coming locally, nationally, before it lands on your desk in a crisis. And that's the difference between being reactive and proactive. And then start presenting those business outcomes. The C, the CEO and any member of the C suite, they're not going to care about your cost per hire, but they will probably care about the cost of a bad hire. So you brought up that great example of just getting someone in and then they're leaving and then hiring someone else and then they're leaving.
What is the cost of that?
Consistently rehiring for a role, speak that language and the seat at the table may follow.
[00:20:39] Speaker A: Inviting HR early. Such great thoughts on that because I know that there's a lot of organizations that don't do that. They decide something and then they bring them in after. This is what we're going to be doing when, if you invite them in, then they can let you know, well yes, this is something that we have to look at or like the gal, the legalities of this is what we have to look at if we're going in that direction because then it just adds, I think so much more work after to fix. Right? So I mean a good rule, I mean something that I go by is I, I always ask a question. If I don't know the answer, I'll always ask a question because for me something can always be fixed. But if you talk about it earlier, then the fix is going to be a lot easier. If we let something fester for a long period of time and we don't fix it, then yes. That's going to take a long time to fix for sure.
[00:21:34] Speaker B: Yeah. Why don't we talk about like the risk that's in the room, you know, being risk adverse versus dealing with the fallout, dealing with a lawsuit later, dealing with a violation from the state.
[00:21:47] Speaker A: For sure. For sure. So for organizations that generally want to put people first, what are three actions they can take today to move HR from an afterthought to driving force behind organizational success?
[00:22:01] Speaker B: Ooh, I love this question because, you know, I'm all about the outcomes. So first, I would start with an HR event, any HR event, and audit your data. So let's take turnover. It's a great example. It's probably the easiest one.
Know your turnover rate, your average employee life cycle, your exit interview themes, how your compensation compares to the rest of the market. That data is all sitting in your HRIs right now. And if you're not pulling it and presenting it to leadership meetings, you're leaving your most powerful position on the table. I would say secondly, benchmark your compensation. And I mean your total compensation, which includes like benefits, pto, the things that you offer your employees to. Being appealing employer. Where are the discrepancies? Where are the gaps in equality and or transparency?
Most of the time if your pay is below market, nobody ran the numbers until people started voicing wage discrepancy concerns or leaving. It has to happen proactively, not as a reaction to a resignation letter or a lawsuit. And then third, I would say, you know, get HR in the room before the decision is made. Pick up one upcoming. Pick one upcoming business decision and invite HR into the planning conversation from the start. Or if you are an HR leader, listening, ask. Ask to be part of the room and bring the metrics, see what changes and then make that the norm. None of these options or things to do today require a big budget or a new framework. They just require intention. And intention is free. And like I said before, if you are an HR leader and you're listening to this and you're like, I just don't have the capacity to do that, then look into automation, delegation and outsourcing the audit.
[00:24:03] Speaker A: Your data is so prevalent to me because data doesn't lie. I've learned that over the years. Data does not lie. And I don't think that we use the data enough. So, for example, people are leaving a company and they do an exit interview. I don't believe that there's a lot of companies that actually use that information. I think they just do it just to say, we're Going to do it. We need to do this. We need to find out what's going on because we're just going to be in a rabbit hole if we just keep doing the same things and like you said before, keep hiring and, and people are leaving, what have you. Well, you gotta look, like I said before, if somebody, if there's someone, it's let go three times in four times. You know, you're not. In a year and a half or in the past six months, there's been 25 people that left the company of like 300 people.
Like, that's. That data is very informative for me. And I would be something that I would be like, wow, we need to look at this because what is the reason why are these people leaving? Is it like you said, is it compensation? Is it they're not engaged? Is it that they're not happy? Is it they're not getting along with a leader or a coworker? What are the reasons? And then if you're seeing something that's very repetitive, well, then that's something that's gotta be fixed pretty fast.
[00:25:23] Speaker B: Yeah, and I see two barriers too for collection of data, right? So the first one being that a lot of times there's just no process in place, like a regular practice for HR teams to pull this data regularly and audit themselves. So if there's not a process in place, you know, create one for exit interviews, creating a standardized process to receiving those responses. And then in second part, you know, the second barrier is that technology aspect. What technology do you have at your disposal right now at your fingertips that you're not utilizing? So how can we work smarter, not harder, and utilize the technology? We have to collect those results and then present them in data. So, yeah, those, those are the two common, like barriers that I see for sure.
[00:26:10] Speaker A: And I noted a lot of listeners are going to probably say, well, yeah, you know, those exit interviews are not used. And, and companies are going to say, well, yeah, well, we don't want to do them because they're just going to bash the company. I get that. But there is some data that you're going to be able to use. Like if I'm reading somebody's answer, sure, I can look at the stuff that they're talking about probably bashing their leader or the company. But there's some truth or there's some information from that answer that I could take from it. Maybe not the mean thing, but there's something in there that I could take that I could use as something that we, that we could look at for sure.
[00:26:48] Speaker B: Right. And you know, and I know HR professionals know this already. But not having such like a limited view of what the results are showing you. So it's not, we're not just looking at the exit interview responses. We're looking at them compiled from the last few months. Is this is the same role having exits? What is the retention data on this role? How long is the typical employment life cycle on this? You know, we're taking like all this data, we're compiling it so that we can have true answers when we go to these important meetings that they are making decisions before without us. But now, now we come prepared.
[00:27:28] Speaker A: For sure. For sure. So, Andrea, before we wrap up today, what is one key takeaway you'd like our listeners to remember from this episode?
[00:27:36] Speaker B: Yeah. So people first. Keep it as a value. You know, it matters. Caring about your people is not the problem here, but people first as a strategy. Let's retire it. A philosophy does not get you a seat at the table. Data does. Language does. Outcomes do. So your job, whether you're a leader, an HR professional, or a founder that's building something, is not to just say people come first. It's to build systems that are so well designed for its people that nobody has to say it out loud. The culture proves it. The data proves it.
[00:28:14] Speaker A: As a call to action, I would like everyone to like, share and follow this episode. I wanted to take the time to thank you for coming on, Andrea. What I admire about you is your work ethic, your friendly demeanor, the impact that you make on everyone that you meet, your outgoing personality and your energy. It's been an absolute pleasure to have you on as a guest. Thank you so much for joining us today.
[00:28:41] Speaker B: Aww, Shugs. Well, the pleasure has been all mine. This has been awesome. So thank you so much. I've. I've had a blast.
[00:28:47] Speaker A: Well, we're glad you had a blast. On behalf of myself and my guest Andrea, I would like to thank you all for listening today. And until next time, be safe. And remember, everyone, that if we all work together, we can accomplish anything.
[00:29:02] Speaker B: You have been listening to. Let's be diverse with Andrew Stout. To stay up to date with future content, hit subscribe.
