Rhamy Alejeal is the CEO of People Processes, he’s also an author and an HR guru. In this fun and engaging show we talk about:
- What comes first people or processes?
- What the HR systems are that business can’t live without?
- The differentials between human and resources
- What common changes occurred to people and processes since the pandemic
Transcript: Thanks to Jermaine Pinto at JRP Transcribing for being our Partner. Contact Jermaine via LinkedIn or via his site JRP Transcribing Services
The Leadership Hacker News
Steve Rush: One of the main reasons that keep business leaders awake at night, I ask that question to my network and reached out to over a hundred business leaders. And this is the top six things that they came back with that keep them awake at night. Number one is planning, planning around the short term, financial, their tactical, their team, and their strategy. Having a bad or an ill-informed plan keeps people awake at night, which is also strange. Because number two is long term strategy. So, it goes without saying, if you don’t have a short-term plan, you’re never going to have a long-term strategy. But long term to me is beyond five years. Beyond the linear.
The next thing on the list was dealing with market changes and in particular, how they’ve responded to COVID, but generally how supply chains are moving and changing around. Hybrid working wasn’t before on the list but how they can gain access to their team’s insights and behaviors while being remote and distant from them. Number five was around staff retention. We’ve heard lots of discussion in the past about the great resignation but holding onto real talent has become a real challenge for many business leaders and a final one coming in number six was finding enough diversity in their workforce through either gender, race, or just deep thoughts, because thoughts is about differentiation too. And there of course is then the elephant in the room. So, for those who listening to this who sleep peacefully at night, there’s also a reason for that. And that reason is that you’ve likely gone from an intention to an action. You’ve made something happen. You’ve made a decision; you’ve closed it off before the end of the day. And therefore, you can do what your brain’s designed to do when you get to bed and that’s repair and recover. That’s been The Leadership Hacker News. Thanks to a number of you in the community who have raised us as a subject that you wanted us to feature on the show. So please also get in touch if there’s something that you want to hear. Let’s dive in.
Strat of Podcast
Steve Rush: Joining me on the show today is Rhamy Alejeal. He’s a CEO of People Processes, or if you’re in North America, of course it’s Process and they provide the entire HR department for your business. He’s also the author of the book People Processes, How Your People Can Be Your Organization’s Competitive Advantage. Rhamy, welcome to the show.
Rhamy Alejeal: Thank you so much. I’m glad to be here.
Steve Rush: Me too. Now you have a really fascinating introduction to the world of business that started much earlier than many of us. In fact, you started out your first gig when you were 13 years old and actually made a bucket load of cash as a young man. I love for you to share the story with our listeners and how you got there?
Rhamy Alejeal: Yeah, well, I was a lucky kid. I had an amazing grandmother and I loved to spend time with her. She was in insurance sales, she sold what are called Medicare Supplements. So, for people internationally, when you turned 65 in the U.S., you get to go on the Government Health Insurance Plan. There’s a nationalized healthcare plan for people over age 65 called Medicare. And my grandmother would call them you know, right around their birthdays. And she got a big, long list of them. And I wanted to spend more time with my grandmother, but she would never let me spend the night on weeknights in retrospect, probably because she sure didn’t want to spend [laugh] needed a couple nights off, but she told me it was because, hey, those are my cold calling nights. I can’t have you come.
So, at 13 I told my granddaughter, look, I could cold call. I can figure this out. Let me cold call for you so I can spend the night. And she somewhat, I think to humor me, gave me a copy of her, you know, 24 cassettes of call training and the big Medicare Supplement Guide and scripts and told me to read and listen to it all and she’d be happy to have me cold call. Well, I don’t know that she really thought I’d do it, but I did. And I loved it. And I came in and said, hey gran, I’m ready. Let me cold call for you. And she, you know, this was back in the nineties and, you know, she said, well, let’s give it a shot. She sat me down at her desk, handed me the big, you know, line printed green and white paper. Came in a big, long green, you had to tear the edges off.
Steve Rush: Yeah, I remember them well.
Rhamy Alejeal: Of everybody turning 65 and a zip code and said, get to calling. And it was, you know, first call, didn’t go great. But on the second call, I said, hi, this is Rhamy. I know you’re turning 65 soon. And my grandmother, she helps people who are turning 65, figure out Medicare, and she’d love to meet with you. And it turns out 13-year-olds calling people turning 65 and saying, my grandmother wants to meet with you was just the perfect, [laugh] the perfect phone script for a cold approach. And it started worked very well. I wound up setting a lot of appointments for my grandmother.
And then I wound up growing that into a little bit of a dance with a couple of other agents and setting appointments for them. And by the time I was 14, I was making, you know, $50-60,000 a year setting appointment for Medicare Supplements Agents in my hometown. So that was my introduction to the world of business. It lasted for a few years before we figured out that, hey, there are some compliance problems with this, but it all went great and really gave me a good basis for understanding that world of rough cold calling and learned a lot about insurance and dealing with clients and having systems to make sure you’re consistently performing. And it was a great start.
Steve Rush: And your journey into entrepreneurialism started that way. And I think from the last time we kicked this around, didn’t you end up in insurance at some point?
Rhamy Alejeal: I did, yeah. So, I worked with my grandmother till I was 16. After that I launched a lawn mowing company for a few years that also, you know, turns out mowing lawn over the summer with three other guys and some trucks make some decent money. At 19, I bought my first investment property. My wife and I bought a foreclosure in 2007, the height of the market. Moved in, it had no floors, no walls. We learned how to renovate ourselves. And after graduating, I actually launched Poplar Insurance Agency. I got my bachelor’s degree in finance and economics with minors in math and physics, you know, so I could sell insurance like you do. And totally made a lot of sense to me. And over the years that company, Poplar Insurance Agency. 13 years later has morphed into People Processes and really helped me find my niche and the people I love to work with.
Steve Rush: And you’ve done that through a series of acquisitions, and you’ve now got a really successful business, which is predominantly around helping organizations with their HR and their people processes, right?
Rhamy Alejeal: That’s right. It started in the insurance space of dealing with employee benefits, right? So, making sure you had attractive reasonable benefits to make sure you can attract and retain good talent in your industry. And very quickly that morphed into also managing the payroll side of the business, because that was a big part of benefits at the time, you try trying to figure out how to keep all that stuff straight, get the bills paid, which led to compliance problems and understanding. In the U.S. Obamacare, the affordable care act came out in 2013. And that really changed a lot of how benefits as a regulatory environment needed to behave. And each time the market became more complex, we either acquired a company or launched our own internal so that we could provide those services broader and broader. And by 2015 or so, we were simply functioning as an entire HR department. Not just benefits, not just payroll, not just compliance, but also looking at things like recruit and retention and performance management, retirement plans, the whole piece of it.
Steve Rush: And of course, when people hear HR, it’s human and resources and they’re actually quite different things, aren’t they?
Rhamy Alejeal: Yes, [laugh]. you have a lot of humans and no resources, and sometimes you have a few humans, but plenty of money to go around. It’s an interesting world.
Steve Rush: And however, big, however, small you are, you need focus and attention on those humanistic things and the resources and processes that come with it. What’s the reason when organizations scale, they might see HR as being a side gig rather than an integral part of their business.
Rhamy Alejeal: Ah, well, especially, you know, your smaller businesses when they start out, I like to break into three stages. Imagine you are, I don’t know, a guy selling insurance, just to use a random example. You start off, you have a product, how you wound up in the industry may be relevant, may not be. Your product is likely very similar to that of your competitors. Your pricing is likely very similar. There’s a stage in the early part where you have to focus on your product to make it unique or valuable, find your unique proposition. Another way I like to put, is you just have to start by not sucking at your job, right. You have to learn how to be a provider that doesn’t suck. You’ve got to fulfill your promises. Those promises have to be unique or good in the market, and it’s a tough journey. And a lot of small businesses fail there, right. Your average tire chain shop starts off with a completely homogenous product that doesn’t differentiate, and they have to figure out how to make their product, their company special. From there, they scale their operations. They start realizing, hey, I’ve got a thing that people want to buy. I’ve got new clients coming in through the door and they realize I can’t just change all the tires myself. I need other people. And they focus on what I call operations processes. This is the E-Myth Revisited, right. This is writing down your standard operating procedures and figuring out how to benefit from labor arbitrage, where you can have somebody else change the tire, but you can focus on the overall business and continue to grow. That step alone eliminates 90% of businesses. They have enough trouble figuring out how to scale their operations,
Steve Rush: Right.
Rhamy Alejeal: But once that’s done, you now have a new problem. You may have standard operating procedures for the standard things. In my business for example, we realized, hey, we’ve got you know, when we were in one state, in really one city with 25 clients, we developed processes. We grew our staff to around 10, 15 people, and everything was going fine. But then we started to really grow. We entered 50 states. We had clients who were headquartered in LA and in New York and in Memphis and in Kansas City. And the thing that started happening is that new items came up. Not just every once in a while, but every day, things that couldn’t be written down as a standard operating procedure. My wife and I worked together; we started the company together. All we really had to deal with was the new stuff. The new stuff happened three times a day. And we were dying. That’s where people processes come in, people process. So, first product doesn’t suck. Then your operations are standardized. Then you need processes to develop people who will make the same decision you would make.
Steve Rush: Yeah.
Rhamy Alejeal: But without you, right.
Steve Rush: Yeah.
Rhamy Alejeal: And that requires a lot. That requires they have guidance on behavior. They need to know how you think. And in a small business with four people, maybe the answer is they start off changing tires and then they drink a beer with you every afternoon and you hang out and they get to know your family. And eventually they just think like you would.
Steve Rush: Right.
Rhamy Alejeal: That can work. It may take a year and a half, but eventually you got somebody you can trust to make decisions. You’ve got a leader you can trust, but that not scalable. People processes is this operating system basically that allows us to take an enthusiastic new hire to someone you can trust to make decisions when you’re not there.
Steve Rush: So, here’s a chicken and egg kind of question for you. What comes first? Is it the people or the processes?
Rhamy Alejeal: It’s a tough question, when I first thought about that question, my answer was actually people come first in that if, you know, if you have a process for requesting time off, but your top guy, you know, breaks his leg and needs to go to the hospital, and he doesn’t fill out the form first. Well then obviously people come first, the process is secondary, and that is true. You have to be a human, right. You got to treat your people with respect and realize that processes can create a bureaucracy that can harm your relationship. So, you don’t want that. On the other hand, I believe the development of those relationship so that you can trust people to not abuse systems so that you have the ability to say, hey, I know that Steve would never just not do a thing because he doesn’t want to do it. It’s because there’s a good reason and I can trust him. The development of that trust has to be a process.
Steve Rush: And it’s interesting, isn’t it? When you start to think about how that they’re not mutually exclusive at all, that they’re entirely intertwined, aren’t they?
Rhamy Alejeal: Absolutely, especially you were talking about, how do people start valuing this HR side of the business. When they start off, they’re all external. They think all about how do I get new clients? How do I make my product better? How do I make it so that the promises I’ve made actually get delivered upon? They’re thinking externally. And they’re constantly looking at that framework. The internal process is what allows you to scale up your business. And those internal processes are around people. The only thing that does anything in your business, people. So, it’s kind of like saying, if you look at it from an external focus and you think, well, what comes first? Client or product delivery processes or sales processes. And the answer is, the clients come first, but you’re never going to talk to them or they’re never going to stick around. You’re not going to be able to do a good job for the client if you don’t have those processes in place, it’s the same for your employees. You have to have the processes in place, or you’re not going to be a good employer. Doesn’t matter how deeply you care about them. If you have to reinvent the wheel every single time for every little part of the employee process, you’re not going to do a great job.
Steve Rush: Guess a lot of the systems as well that you are talking to are actually when you are small in scale often unconscious or at the back of, you know, the own operators mind. But as you grow, they need to be shared and people need to understand them.
Rhamy Alejeal: A system exists. Absolutely. It may just be that you know Steve makes a decision [laugh] every time and that’s a system, but until they are standardized, public trained, some of the key pieces that are necessary to implement a process across an organization, it’s very difficult for them to be improved. That’s the genius of a system or a process. What I often train my small business clients to do is not try to invent whole cloth a better way to deal with an employee performance management, a performance management process. Maybe that’s a bonus structure at the end of the year or an evaluation of their behavior or even a goal system. Don’t start with that. Start with what you do now. Write that down, publish that, put that in front of the employees and say, this is what we do. And you will find within weeks, a lot of times. There are obvious, you don’t need an HR expert to tell you, hey, that’s kind of stupid we should do it different.
Steve Rush: mm-hmm.
Rhamy Alejeal: Right.
Steve Rush: Yeah.
Rhamy Alejeal: And make a small improvement to it. Systems processes, the great genius of it is that you can make a change and see the result, make a change, and see the result. And until you actually make it a public system, as opposed to one that just exists in your head, those iterations are very difficult to actually stick. So, the advantage isn’t that having a system, lets people know what to do. Though that’s not a bad one. The advantage is, is that the system allows itself to improve over time.
Steve Rush: Yeah. So, I heard you talk about standard, standardization quite a bit Rhamy and I wondered how that sits alongside being agile and innovative and does one suppress the other?
Rhamy Alejeal: It can, I mean, bureaucracy can kill a business.
Steve Rush: Right?
Rhamy Alejeal: I would say, you know, there’s a line between chaos and order and you want to straddle it, right. You want the flexibility so that people can rapidly make decisions and experiment, but you need the order to make sure that everyone’s going in the same direction. The information is shared freely so that good decisions can be made. There’s a balance to be had there. What I find in most small businesses before hierarchies are heavily developed is that they are more chaotic than orderly
Steve Rush: Right
Rhamy Alejeal: Now when you’re talking, for me, a 1500 person or 2000-person organization, I’m sure in 10 and 30,000 person organizations, it has been processed to death, right. There’s a process for everything. They just may not be very good ones. They may not provide the flexibility necessary for employees to be able to well exist and grow inside of them, but in small businesses anyway, I often find that they’re too far in the chaotic sphere.
Steve Rush: Yeah, and it creates this discipline in the space, I guess, then to give that individual the opportunity to be innovative.
Rhamy Alejeal: Absolutely.
Steve Rush: Yeah.
Rhamy Alejeal: Well, think of it. Think of it. Anything that has a process removes, significant mental load off those who need to figure it out, right. So, let’s take a maternity leave as an example, right. I’m going to have a kid, I’m pregnant. It’s three months in. I’ve got six months to figure out what’s going to happen with my maternity leave. That is not the time for the business owner to be deciding what does maternity leave need to look like in our business.
Steve Rush: [Laugh] Yeah.
Rhamy Alejeal: That decision needed to be made while ago, right. And it may be that the decision they made a year ago and put in place and communicated and is easily accessible to the employee is not the optimal decision. It may very well be that. It’s better to have made a decision in most cases so that the employee knows what to expect and knows how this is going to go then to have not made a decision and have to figure that out when you’re staring down the barrel of a choice, a fun way to think about this is, perhaps you should think up the name of your child before the baby comes, right.
Or at least before the epidural and you’re knocked out on drugs, sorry, I’ve got a four-month-old. So, I’m a little into this world, right. We had to at least narrow down the list a little bit. Because if Liz, my wife had to make that decision, you know, under the epidural with the baby there, like I don’t know what we would’ve been named, but I know she really loved Godiva Chocolate during the last couple months there. And I’m pretty sure it would’ve been Godiva [laugh] even if, David was born, so we got to put some time in upfront to make those decisions better. And I think that having the decision, having been made, having it as a process allows you to remove a lot of uncertainty.
Steve Rush: Yeah.
Rhamy Alejeal: And that uncertainty is a huge mental weight on your staff and you. Doesn’t mean you can’t improve it. You should improve it.
Steve Rush: Yeah.
Rhamy Alejeal: See how it goes, run it through. If there’s an immediate obvious, problem fix it, but allow it to be a process rather than the whims of how you’re feeling that week or, oh my gosh, we can’t let that employee go on maternity, she’s too important. I tell you that kind of stuff comes up and you lose that employee. She’s too important to go on maternity. Well guess what? She’s way too important, not to, right?
Steve Rush: Yeah.
Rhamy Alejeal: So those are the kind of decisions we want to make upfront.
Steve Rush: Now Rhamy, you’ve had the opportunity of work with thousands of different people in businesses over the time and create and work with them around their systems. And I just wonder if there’s a natural leveling or a pecking order on the systems particularly that businesses can’t live without. And I just wondered if there was maybe one that sticks out above the others as being the most critical HR system or process that I might want to have in my business?
Rhamy Alejeal: Well, gosh, I think, you know, I love all my children. You need to pay your people on time. You need a payroll system. You know when they work, you need time and labor. You need to know when they’re going to work, you need scheduling. You need to know how to recruit. You need a recruiting system onboarding, off boarding. God, you need a way to fire people. And what happens when they quit? All of them are important, but I will say the one that separate the big boys from the newbies, right. I can often tell how developed an organization is by the existence at least, or complexity and depth of their performance management system. Now if you’re a small business, the truth is, if you have seven employees, you know what all of them do, [laugh], you know, if they’re doing a good job. You may not need an in depth, performance management system outside of maybe setting expectations, right.
So that the employees know what to do, at least that, but you probably don’t need an in-depth dashboard that connects and executives and HR and make sure that everything is connected. But what I often do is, one of the first things I try to deep dive in is, where are they in this performance management spectrum? On one hand, a small business where the owner provides nearly no expectations and nearly no review. And everyone is surprised when they’re in trouble. That would be the bottom of the spectrum up to something like Google, where every single keystroke, metric, time spent, thought had, contribution made is analyzed by a machine learning algorithm to generate analytics and demographic data. And they know that you’re going to quit before you do. Like, there’s a whole other world all the way over there that honestly, I like to read about, but I don’t get to play with much. If you are at marginal scale, say 20 to 50 employees, focusing on your management of your existing employees, your performance management can often have an outsized impact in both your turnover, your employee satisfaction, and your ability to deliver to your clients.
Steve Rush: And that’s where you get your marginal gains, right?
Rhamy Alejeal: They come from everywhere. But absolutely it’s much better to have a system in place that allows good employees to become great employees, right. And allows you to keep your great employees than not. And that’s probably less work or less financial investment anyway, than a system that allows you to rapidly replace top performers with new people, right?
Steve Rush: Yeah.
Rhamy Alejeal: That’s an important system too. Your top performers will leave eventually, and you need a way to do it, but for many businesses they could cut their turnover significantly just by really focusing in on that performance management piece.
Steve Rush: And I wonder as well, the whole notion of performance management can sit differently with different focus or can’t they, so some will thrive in the opportunity of having clarity and guidance and the process that follows that where others might feel a little bit uncomfortable and uneasy as they start to evolve that as well. What’s your experience about some of the psychology that sits alongside performance management?
Rhamy Alejeal: Well, that’s a very good question. People creatives, which by the way, entrepreneurs and artists have the same brain, it’s the same high risk, high reward drive a lot of times. So, you find that systems that constrain behavior are very important in a hierarchy. It’s very important in a system, a business to give people places to go and know what to do. But you will often find that creatives and those who are more entrepreneurial, like a salesperson may find those constraints significantly more constraining [laugh] right. They may chafe under that pressure or the limited pieces there. For them you want to design performance management systems that are primarily around them setting their expectations, right. And then a method of making ensure that their expectations or goals align with the company’s expectations and goals. It’s a lot more a system of alignment than it is say, giving them a track to run on.
Whereas in an accounting organization, you can be significantly more focused on very specific, measurable pieces. There’s actually a great story of a company that did customs management. So, every time someone would come in, every time a shipment would come in, they’d have to fill out all this customs paperwork. And they moved to measuring their primary KPI for their direct frontline agent was not number of cargos filled out because some cargos required hundreds of pieces of paper, some required two, and counting the pieces of paper, which were government forms that had to be filled out by hand or in a typewriter. These weren’t even digital forms because it was a customs international thing. They did it by the ounces, by the weight, by the weight of paper, they moved, literally. They had their intake and outtake replaced with scales.
Steve Rush: Yeah.
Rhamy Alejeal: And that was their primary metric every day and said, hey, are we improving or not? That sort of micro level of performance management may suit some, but likely would not do well with a group of aggressive salespeople, right?
Steve Rush: Yeah, absolutely right. Yeah, I can see that. So, you managed to gather all of this experience and you threw it into the book, People Processes. Tell us a little bit about how the book came about and what was in inspiration behind it?
Rhamy Alejeal: Well, People Processes the book came about because of a podcast that I did call Don’t HR Alone. I did a daily podcast for about a year and a half, closer two years, really. Couple hundred episodes. They were daily 15 minutes, hey, we’re going to dive in on this issue or there’s a new compliance update, or gosh, Minnesota’s changing their minimum wage. And what does this mean for you? Whatever I could find honestly, to fill a daily podcast but it did pretty dang well, and that actually led to the book deal. The book truthfully, I wrote almost 400 pages, single spaced in word over the course of six months. I’m effectively made an HR textbook. My editors took that and laughed at me and said, what are you trying to make around Rhamy?
Because this thing, ain’t no one going to read. this. [Laugh] right. Are you trying to make a college textbook that people will assign, or are you trying to make a book that your clients or your target clients would like to read? And that really changed everything. People Processes is a broad guide that lays out the key sections of the employee life cycle from onboarding to offboarding, right through termination and even alumni management. It lays out what the key processes are, what a good process looks like, what a bad process looks like. And then the last quarter of the book is actually almost a workbook. It’s exercises for you to actually lay all this out in your own organization. The first quarter is justification for small business owners and boards on why they should invest in the time and energy in necessary on these.
And the idea was, and again, I give credit to my publisher on this, was that this book would be an excellent book for all business owner to read, to get their head around or for an HR professional to read quickly. It’s nothing earth shattering in there. There’s some good fun insights and some great stories, but to read and then pass on to the executive or the boards that they have to work under because it will show them both why it’s important, and how it can be accomplished in a reasonable manner.
Steve Rush: Yeah.
Rhamy Alejeal: And that’s where the book sits. If you’re an HR professional, who’s Sherm certified and done this for 10 years, you’re going to find the book to be fun and entertaining and cover all the basics [Laugh].
Steve Rush: Yeah.
Rhamy Alejeal: But if you’re a small business owner, who’s looking at maybe be turning in inward for a little while, you’ve got the business growing, but you’re realizing that the pieces inside your company, aren’t up to the task of delivering on the promises and clients that you’ve been able to make and gather. This is the book for you, because it will give you the steps you need to get this well, moving inside your organization.
Steve Rush: Awesome. And if you think about the journey that we’ve all been on over the last couple of years through the pandemic, as we hopefully start to move beyond the pandemic, how have you seen people change their approach to processes and their people?
Rhamy Alejeal: Well, HR has been a hot topic over the last few years, of course. In the U.S., especially we had lots of diversity equity and inclusivity issues, and then the pandemic changed everything. And suddenly CEOs started realizing that their processes for keeping up with their people were heavily reliant on management by walking around, right. You had managers and they just kind of talked to their employees every day and sat next to them. That was a big part of management. That doesn’t work very well in a remote world. It doesn’t work in a global world where it may be 9:00 AM my time and 3:00 PM your time. Many companies were able to adapt very quickly to the pandemic and remote work and hybrid offices and the globalization of the marketplace very well, because they were already there. They already had the processes in place to manage remotely and not just rely on the gut of the manager, right. But the ones that didn’t were hit very hard and they, I think over the last two years, three years have learned that they have to have processes in place to be able to scale that people’s side of their operations.
Steve Rush: Yeah.
Rhamy Alejeal: Both over a larger staff, but also over time at distance.
Steve Rush: Yeah. It’s that moving from one place to another place, but if it’s not there in the first place, then you’re going to end up back in that chaotic basically you articulate earlier, right?
Rhamy Alejeal: Absolutely.
Steve Rush: Yeah. So, we’re going to flip the lens a little bit now. You’ve been leading people and teams, since you were 16 years old from those grass cutting days, right the way through to now where you’ve got a really large organization. So, I’m really keen to hack into that leadership experience of yours. If you had to dive in and think about the top three things, the top three leadership hacks, what would they be?
Rhamy Alejeal: I think there are a few places where everyone can improve. Of course, one piece of leadership is to understand and embrace that you are on stage, that what you do matters. It is the price of leadership. And it’s not really a hack. It has nothing to do with people processes to a large degree but know that your organization is a reflection of you. And I find that often my business does best when I think about improving parts of my life that are not relevant to my business, right. Being in better shape and having a closer family and having a better balance, it shows, and it matters. So, no matter what processes and what technology and where your industry’s at. Know that by signing up to lead an organization, either through entrepreneurship or in an executive role, you are signing up for a public role, a role where you will be judged in a role where the things that are not necessarily exactly tied to your performance at work matter, it’s a public role. So, some people just need to hear that and understand that is what it is.
Steve Rush: Like It.
Rhamy Alejeal: It’s a tough thing. Next up would be that the genius of processes, as we mentioned earlier, is in their iteration and improvement. Many people, especially leaders are high performing individuals who have turned in perfect papers, their whole life, right. Who have been at the top of the pack, the fastest runner, the best player, the top academic, and they’ve done it through hard work and perseverance. Business is a little different. Business never has an in season. Well, most of them anyway, unless you’re running a football team.
Steve Rush: Yeah.
Rhamy Alejeal: But most, it’s going to go on forever. And the great genius of systems is that you can put one in place and then improve it and improve it and use the scientific method. Change one thing, see what the effect is, change one thing, see what the effect is. It’s so much more valuable for you to put something in place and then improve it than it is for you in your great leadership genius, to sit in a dark room with Brandy and think hard for hours and come up with the perfect answer because you won’t, there’s no chance of it. It’s just too complicated. So, I try to pull back my clients from feeling like their unique genius has to be expressed through any system inside their organization, allow it to exist and then make sure that a part of the system is to improve itself. And it will over time become significantly better than anything you alone could have dreamed up.
Steve Rush: Great.
Rhamy Alejeal: The final piece of leadership hack that I would say is, just a random kind of piece of information is to always think at the front lines, many organizations and a lot of times in the smaller organizations, as well as the larger ones, the executives think about other executives. If you ask a small business owner, who do you want to hire? It’s always me, right. I want someone who’s going to read my email, reply to it as if it were me, make my decisions, handle my books, and talk to my clients and just do me. And that’s unfortunately not going to happen.
Steve Rush: That’s right.
Rhamy Alejeal: Instead, look at what you do on a day-to-day basis and break it into the smallest job possible. The most focused job possible. One of the exercises I have my client go through as a true hack is to design your org chart for what you envision the future of your company to be. Recognizing that there are only 12 of you now, or 20 of you now. In my organization, our org chart is about twice as large as we are currently. We actually review that org chart quarterly, and that org chart is about half empty. And we’ve done that since we had three employees [Laugh]
Steve Rush: That’s great.
Rhamy Alejeal: We had six people on our org chart and that gives you a direction to go and recognize that you, as the executive in a small business are probably doing seven jobs and your top people are probably doing three or four and that’s okay. But think about them as unique individual jobs that have different requirements, descriptions, metrics, goals, competencies, skills. Recognize that in a small business, you may be doing multiple jobs, but think about them as individual ones. And that will give you a path to growth significantly faster. It will help you understand where your next hire are going to be and what needs to be done. And then fill in from the bottom to the top, the number of seven-person, small businesses I’ve spoken with that have a CEO, a chief marketing officer, a director of finance, a COO, a receptionist and a bookkeeper, right. And I’m like, wait, hey, hang on, buddy. You got to always start. And especially if you’re new to hiring and scaling a business, start with the smallest job, you’re going to screw it up. Might as well be that rather than a partner,
Steve Rush: Next part of the show, we call it Hack to Attack. So, this is typically where something has not gone well, might have even screwed up, but as a result, you’ve learned from it. And it’s now a force of good in your work or life. What would be your Hack to Attack Rhamy?
Rhamy Alejeal: I’ve screwed up so much. It’s hard to pick. When I started my company at 22, I had $105,000 in the bank. I rent a quarter floor and a high rise because I needed a beautiful place for my clients to meet me. I was spending $5,000 a month on marketing and advertising, and I didn’t know would be successful. Six months in I had $4,000 in the bank and a payroll due of five and a rent due of five in like three weeks. And it’s only gone down from there. We did well. We survived that, but multiple times throughout my business, I have come to these points of near utter failure. I have sobbed in my office. When I first launched payroll eight or nine years for example, my sister who’d worked with me for years. Young college student, she really took it over. She took over payroll. She helped me find the company that we purchased, which she helped me with every client. She was the head of payroll. And after graduating and then getting her master’s degree, well, I couldn’t afford to pay her as much as a big accounting firm. And it was right for her to move on. But man, I sat in my office and cried [laugh], why are you leaving? I thought we were going to grow this together. And it was incredibly painful.
Steve Rush: Yeah.
Rhamy Alejeal: Some of the lessons I’ve learned, every single one of those issues has forced me to find a better way. And they have been the points of the greatest growth in my organization.
Steve Rush: Yeah.
Rhamy Alejeal: Every single time, every single time without fail, I have actually come to like when reality steps up and punches me in the face and says, you’re doing it wrong. There’s a major problem. So, try in that moment to take a deep breath and think. I’m so lucky that it happened now and not two years from now, two years of wasted work when I’m just building further into the structure that doesn’t work. So, look out for those moments and consider them an opportunity.
Steve Rush: Super advice. Thank you, Rhamy. The last part of the show, we get to give you a chance to go and do some time travel now. Bump into Rhamy at 21, give him some advice. What would it be?
Rhamy Alejeal: I’m going to say 22, because that’s when I started my company. 21-year-old Rhamy was going to be a physicist. He was pretty sure. So, that didn’t work out. But 22, the day I opened my company. Some of the advice I would give me. Some of it I wouldn’t need, but reading, learning every day is a huge value. I don’t know that I need to tell myself that I’ve read and listened every day. So, it made a big difference. I think for most, it shocks me the number of successful businesses who don’t just look at a library and salivate and go, oh my God, there’s just so much success in there. I got to go look at it. I got to go read it. So that’s my number one piece of advice for a younger person. For personally. It would be that this is going to be harder than you ever expected. And the spreadsheet you made, you know, everyone makes a spreadsheet a couple months before they start their business.
Steve Rush: That’s right.
Rhamy Alejeal: And they project out and say, hey, five years, I’m going to be making money. And in 10 years, I would tell myself, that my spreadsheet is way optimistic for the first five to seven years of my business, that I was underestimating how incredibly difficult and hard this will be. But I would also say that my spreadsheet at 10 years has way underestimated how good it can be.
Steve Rush: That’s nice. And that leads me to ask of you Rhamy, how we can get our listeners to connect with you? Find out a little bit more about the work that you and the firm do, but maybe you’ll get a copy of the book?
Rhamy Alejeal: Oh yeah. Well, peopleprocesses.com is our website. You can search People Processes on Amazon to find in the book. It’s also linked from our website. @peopleprocesses.com. We have some great free resources for subscribers, including things like overall templates to use, great onboarding checklists, ways of setting up a performance management system. Up at the top there’s an academy where you can sign up for courses. That’ll help you develop this in your own organization. And of course, right on the website, there’s a contact us where you can reach out and schedule time with my staff or even me to figure out if we can work together. We work in the United States, but our academy is internationally focused and can help you with anywhere across the world.
Steve Rush: Excellent. And we’ll make sure that’s in our show notes so that as people finish listening, they can dive straight in.
Rhamy Alejeal: Wonderful.
Steve Rush: Rhamy I’ve really enjoyed chatting to you, and it’s no surprise that you’ve made an enormous success in helping others build their business in the way that you’ve built yours. So, I just want to say thank you for taking the time out of your busy schedule, to be on our show and thanks for being part of our Leadership Hacker community.
Rhamy Alejeal: Thank you, Steve. I really appreciate it.
Steve Rush: Thank you Rhamy.
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Tune into next episode to find out what great hacks and stories are coming your way. That’s me signing off. I’m Steve Rush, and I’ve been your Leadership Hacker.