Change is Hard. Don't Do it Alone.

Hey everyone - It’s Alexa, Kolective’s founder. Thanks for checking out our newsletter – our goal here is to do digestible deep dives on the topics that plague HR professionals and business owners.

This week, we’re wading into the muddy waters of change management.?

Often mishandled, often deprioritized, but when done right, change management has the ability to exponentially improve business outcomes.?

It’s about more than just deciding what change to make, it’s about understanding the tentacles of the decision and the wake of the change. It’s about communicating effectively, designating areas of responsibility, and measuring success – aka the “management” piece.?

The funny thing is, more often than not, companies go wrong long before they’re fumbling a change management process. In my experience, business owners are stretched too thin to dig deep into an issue that requires a lot of process and operational change, and instead look to find quick fixes or solve problems that seem like low hanging fruit. Not only does this not solve the greater issue, it’s also costly – both with respect to time and money.?

With that in mind, let’s talk a bit about a prospect that came to me with a “payroll” problem.?

I love getting calls out of the blue from people I know but haven’t heard from in a while.?

They typically start with something like “Alexa, I have an HR problem,” or in this example, “Alexa, I have a major payroll problem!” This most recent time, it was an old friend from the gym, Mike. Mike had just recently started managing a successful tattoo chain here in Miami.?

Davis, the owner had been growing the business steadily, but with that, came unforeseen complexities. Davis had previously had eight locations, but now was back to three because “it was too much headache”.?

“Our payroll is a nightmare,” Mike groaned. “It’s taking three of us hours, sometimes days, to sort out paychecks. We’ve got artists working in different studios, doing different jobs, and earning different commissions. We’re handwriting everything, and still, we end up with errors. It’s a mess. Davis is losing his mind over this.”?

Now, Davis’ predicament wasn’t unique. Payroll is often a colossal headache for business owners, especially those juggling multiple locations and varied compensation structures, let alone some of the less savory parts of a business like tattoos (needles, anyone?!). So, I agreed to take a look, already wondering if this was a payroll problem, or perhaps something more operational in nature.?

Unpacking the Payroll Chaos

When I arrived at the main studio, the scene was exactly as I imagined: a pristine tattoo parlor in the front, papers everywhere, sticky notes clinging to every available surface, and a whiteboard filled with scribbles that could have been mistaken for hieroglyphics in the back.

Mike showed me their process. It involved manual entries by different staff, cross-checking multiple spreadsheets, and a lot of head-scratching. Their system was a relic from a simpler time, and it clearly wasn’t built to handle the dynamic needs of a growing business.

We spent the next few hours diving into their payroll system. I noticed several issues right off the bat. Different studios had different commission structures, and there was no centralized way to track hours and appointments. Artists often worked across multiple locations, and their pay was calculated differently depending on where they were on any given day. It was a logistical nightmare. The incentives for the front desk staff were equally as complicated, and the two were not getting along - disagreements and confusion on payday were becoming a regular occurrence at every store.?

Payroll’s Just a Piece of the Pie?

As we waded through the chaos, it became clear that the root issue wasn’t just the payroll process itself. It was the lack of integration between Davis’ point-of-sale (POS) system and his payroll system. His POS system wasn’t designed to handle the complex compensation models he had in place, which meant that every payday was a guessing game.

I was honest with Mike, “It’s not just about payroll. It’s about your entire operation. Your POS system needs to fit your compensation goals and team strategy. Right now, it’s working against you.”

Putting it all Together?

This revelation led to a broader discussion about how People practices affect a business and vice versa. The right systems can empower employees, streamline operations, and ultimately drive growth. But when those systems are misaligned, they create friction and inefficiencies.

Davis’ situation was a textbook example of how a seemingly small issue like payroll can be symptomatic of larger operational problems. His POS system, which was fine when he had just a couple of studios, couldn’t keep up with his expanded business model. The disconnect between his operational tools and his business needs was causing ripple effects throughout his organization.

In addition, no system was going to work for his overly complicated commission and compensation structure. Staff members were manipulating sales numbers and no one trusted the system (shocker), but no technology could fix that. The incentives also had to be fixed.?

You guessed it, they needed a new POS AND a change management plan to drive meaningful operations improvements.?

More on that next week – thanks for reading!?