HR Shared Services? It's not all Greek to Chobani.
Greek yogurt maker Chobani has experienced an unprecedented amount of growth going from zero to $1 billion in revenue faster than any organization before it. But, with great growth comes growing pains. Craig Gomez leads Chobani’s team as Chief People Officer. Having led in all areas of Human Resources for Hi-Tech, Manufacturing, Financial Services, Customer Service Centers and Packaged Consumer Goods companies, Craig has significant expertise in the areas of Leadership Development, Change Management, Organizational Development, Corporate Education and Training.
As Craig navigates Chobani’s transition into an HR Shared Services Model, he and his team tell how they try to establish a process that would yield a quicker staffing solution with less administrative burden at a lower cost to the company.
Like Chobani, there are a lot of companies who are still trying to develop their shared services model or infrastructure. Either they don’t really know how to navigate shared services or are in the trial and error stages. Could you walk us along your own journey into shared services?
We have had an unprecedented level of growth and change in our organization. We have been part of the fastest startup in the history of free enterprise and went from zero to over a billion in revenue faster than anybody’s ever done. And so our challenge has been getting some structure. And you know when I came in, we were just on the front end of trying to put some of that infrastructure in place.
When I started we had no compensation function. We had no leadership development function. We had no talent acquisition function. What I’m talking about is really installing some basic block-and-tackle HR infrastructure where there was none. A shared service model may be two or three clicks down the road from what I’m really describing here.
So we basically have tried to install processes, first off meet our organization at its need level, and don’t fall for problems they don’t have or don’t feel the pain of yet. And so in the example of talent acquisition, we wanted to do things in a more efficient way to drive costs down and efficiency up and close out opening positions more quickly. And so you have kind of a burning platform of those needs. And you can move the organization in that direction and it’s the old, "If we build it they will come."
And so what we try to establish is a process that would yield a client with a quicker staffing solution, with less administrative burden and lower cost to the company. And so that’s what we’ve tried to do. And from a compensation standpoint, for us to go from no internal resource to giving the function a resource so that they knew based on market data and internal equity that they were making the right kind of a job offer to an external candidate, or doing the right things around how we pay people internally, again, addressing a problem and a pain point for the organization is, I think, the best solution to change management.
Because if you’re trying to force something, force an organization in a direction they don’t see the value in going, it’s very much an uphill battle. But if you can build something that solves a problem for them and meets them at their need level, people tend to gravitate. So we’ve gotten very positive feedback on the things that we’ve done in those two areas, as well as in the leadership development piece. We put an infrastructure in place wherein we were able to assess each individual’s performance and assess their developmental needs and capture recommendations. And we’ve been trying to do that on a quarterly basis now. There’s been a lot of positive reaction to that, because it gives an engaged leader the opportunity to take a more robust look at their organization and make efficient and effective
recommendations for development that actually yield immediate benefit to the organization.
So you mentioned that you’re trying to keep costs down and efficiency up. Is there an example you can provide us of how you’ve been able to do this?
Oh, a real simple example. When people needed to hire somebody they would go out and hire an executive search person to do it. Because we didn’t have the internal infrastructure, what we’ve tried to do is create a model that, at full utilization, would cut that expenditure in half or more. So instead of going to an external executive search firm we would handle those internally. We’ve been able to take some costs out of the equation to the degree we’ve been able.
How has your HR department of 30 employees been able to lead change management within an organization of more than 3,000 people? How have you opened communication channels with your employees and alleviate the uncertainty that’s sometimes surrounds change?
Well I think we’ve been really selective in what changes we’ve tried to implement; we have picked items that add tremendous value and do not unduly burden the client with administrative headache. Our quarterly people and organizational review is on a per-employee basis that has been streamlined to take around in the neighborhood of five to ten minutes. So somebody with a dozen reports could knock that out in thirty minutes, but have a good cross-reference. And it was as much about the value of the conversation that we had after they completed that exercise, wherein we were able to give them options relative to developmental opportunities, for example. I think it’s about adding value without adding bureaucracy.
You have experience at other companies that are more established, like PepsiCo and Cisco, and your experience spans human resources management, as well as organizational development and leadership development. How are you able to translate your past experience into this current position where you’re essentially starting from scratch?
When I interviewed and talked with Hamdi, I talked about how it was not my desire to recreate GE, or recreate Cisco Systems, or recreate PepsiCo in a new environment. It was really more about assimilating into this environment, understanding why things were the way they were and then looking across my portfolio of experiences and picking out kind of the greatest hits album of things that I thought would have high impact and meet this organization at its readiness level.
I think, with all due respect to all of my peers in HR, a lot of times HR comes at an organization with a set playbook and they just lead with a set list of things that they think that every organization should have, instead of really listening to the client and really matching up what they deliver with what the specific client’s points of pain are. And I did a pretty good job of listening to what Hamdi wanted; what his vision was, what he wanted to accomplish and where his points of pain were. That drove my decisions around which functions I put into place and what processes I implemented in each of those functions.
We know that a successful company is by and large driven by a happy, hardworking team. Can you name a strategy you’ve used that has led to increased employee satisfaction, which then of course leads to increased customer satisfaction?
Hamdi has built a great organization. When you do things from an HR standpoint that make investments in developmental initiatives that help employees be better employees and leaders be better leaders, there’s a level of satisfaction that comes from that. When you give people the tools that they need to do their jobs, it creates a higher level of engagement and satisfaction. It’s just as simple as that. We look to implement things that would add value and would allow employees to give people the tools that they need to do their jobs better and allow employees to feel like there were additional investments being made in them. And as simple as that sounds, I think it does make a difference.
Finally, what’s next for Chobani’s HR strategy?
Well I think we’ve had a great first act and we want to have an even better second act. I think in every single area that I’ve mentioned we’re looking to make those programs more robust and build them out. To pick a real world example, we have really been straining just to keep up with the growth around talent management and talent acquisition, but as we go forward and get more mature, we want to start thinking more in terms of succession planning and other items that more established organizations take for granted. On the compensation side of things we’ve got an infrastructure. We’re rolling out a banding system to give a more robust structure to our compensation program and we want to enhance each planning manager’s knowledge of compensation philosophy.
So I think we just want to go broader and deeper in each of the initiatives. We want to continue in talent acquisition to drive costs down, to rely less on external resources and more on internal resources.