Arbonne International SVP of Global HR Karen Stout illustrates why human resources has graduated from supporting the business to fueling it.
By Charlene Oldham
For more than a decade in retail store management and operations, Karen Stout oversaw everything from merchandising to manpower, scheduling to audits. She moved into expanding roles in district, regional and then multi-state West Coast management. As a California manager for a New York-based chain, she also had to handle her own human resources (HR), all while earning a bachelor’s degree and an MBA.
“The HR function wasn’t a very robust function, so we were left pretty much to fend for ourselves,” said Stout, who started along the career path at 18 to work her way through school. “So I spent the better part of my time on employee issues. I honed my HR skills. I learned how to recruit. And I really learned from a line manager’s perspective what I needed from an HR Department.”
Today, Stout aims to exceed those goals in her role as Senior Vice President (SVP) of Global HR at Arbonne Intl., where she runs the HR Department, keeping her eye keenly on employee engagement but also on driving profitability and growth. While that may seem like an obvious approach, Stout finds that too many HR professionals view employee issues as separate from sales, production costs and other factors behind business results. Stout learned the power of a more integrated approach as a Regional Store Operations Manager and during her time as a VP overseeing HR at Transamerica Corp.
“My boss [at Transamerica] was somebody who truly believed that people were the drivers of business success,” Stout said, “and he really embraced HR, so I was able for the first time to really contribute at a strategic level.”
Stout worked as part of a team that launched new internal ventures and turned around underperforming units, all while aligning every department’s operations with the company’s core values and goals. As a result of those efforts, Transamerica posted the most profitable of its more than 100 years.
“It really laid the groundwork for me that you need to figure out what the company’s fundamentals are, what’s important and where it wants to go,” she said. “Then the HR infrastructure is built around that to provide the tools, practices and support that business managers need to achieve that goal.”
Tools That Transform
One of the tools Stout has introduced at Arbonne, which she joined in 2011, is a merit pay system that ties employees’ review ratings to raises. The merit pay system has helped transform the review process from one of entitlement to one that rewards excellence, innovation and accountability.
“If you pay for the behavior you want, if you train to the behavior you want, if you hire to the behavior you want, then you are going to get that behavior every day and you are going to drive increased business results,” Stout said.
She also upgraded a payroll system that dated back to the mid-1990s and modernized processes across the board.
“We created an entire infrastructure where previously there was almost none,” Stout said. “When I walked in the door, a company of 800 people was being run off of a poorly designed Excel spreadsheet. There were literally no systems, standards or processes in place. Heretofore, there was no way to even get an accurate headcount internationally.”
As part of Arbonne’s Pure Transformation Initiative, an internal effort playing on the company’s 2013 sales force event theme, Stout introduced additional improvements, including an automated applicant tracking system. In keeping with Arbonne’s line of premium vegan-certified skincare and wellness personal care products, she also implemented employee wellness and safety programs that helped reduce worker’s compensation claims by 59 percent.
All these changes are geared toward doubling Arbonne’s growth in the next four years, a goal Stout helps convey to all employees through a robust intranet system, email blasts, town hall meetings and other company communications systems she oversees.
“All of these are vehicles through which you communicate with employees, and make sure they are focused on what’s important to the company and understand how they contribute,” she said.
While crafting email blasts and scripting town hall meeting messages may seem like another set of daunting responsibilities for an already busy SVP, Stout believes internal communications to be crucial in changing the corporate culture and it has become one of her professional areas of expertise as an HR executive. At Arbonne, she and her team have aligned the employee performance management system with the company’s overarching goals so thoroughly that they even provide staff meeting guides for department heads and talking points for leaders so that everyone in the company is literally on the same page when it comes to driving growth and performance.
“And you really can’t do any of that without a robust communication system,” Stout said. “Managing employee communications is really critical to any sort of change management or cultural initiative. You can’t over-communicate. It’s really the pipeline to the heart and mind of the employee.”
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Karen's Key Partners:Payne & Fears LLP (Employment Law) | Resource Global Professionals ( HR Consulting Firm) | SMCI (Technology Staffing, Recruiting) | Brainard Strategy ( Aligning strategic objectives) | EW Partners Inc. (HR Consulting) | Marsh Risk & Insurance (Insurance Services) | Brown & Brown of New York (Employee Benefits Consultant) | Quest Relocation Group (Homefinding Services) | Caliper Corporation (Hiring/Talent Development)
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