Compensation Strategies from the Chief Empowerment Officer, Nathan Christensen, CEO of Mammoth HR

Nathan Christensen is the CEO of Mammoth HR, named a top place to work by Forbes and a 101 Best and Brightest. Nathan, sometimes called the Chief Empowerment Officer, joins The Best Team Wins this week to share compensation strategies, HR best practices, and more.
































Adam: Welcome to The Best Team Wins podcast where we feature entrepreneurs and business leaders whose exceptional approach to the people’s side of their business has led to incredible results. My name is Adam Robinson. For the next 25 minutes, I’ll be your host as we explore how to build your business through better hiring. Today on the program, Nathan Christensen is the CEO of Mammoth HR, headquartered in Portland, Oregon. Mammoth is a bootstrapped company with 50 employees and was founded in 2001 by Dennis Abraham. Nathan, the best learning happens through sharing real experiences and we are excited to learn from you today. Welcome to the show.


Nathan: Thanks, Adam. Thrilled to be here.


Adam: Pretty cool, Mammoth HR was featured as one of the 101 Best and Brightest Companies to Work For and a top workplace by Fortune magazine. A lot going right for you it sounds like.


Nathan: Yeah, we do our best. One of our principles is because of our HR consultants and that’s what we do, we feel like we need to walk the walk and make sure we’ve got a best workplace, too.


Adam: Awesome. That’s great. Congratulations. Those are not easy accolades to earn. Well done, sir. We have a tradition here on the podcast. We always start off on the right foot, which is the best news, business or personal, that’s happened to us in the last seven days. Fire away. What’s your right foot for last week?


Nathan: Wow. Well, if I can go on the personal side, our three-year-old daughter just started preschool last week. She’s our youngest. It was pretty cool. She’s sort of lived in her brother’s shadows for a couple of years. It is pretty cool to see her step into her independence and walk through that school door.


Adam: Very cool. How’d she handle the separation?


Nathan: She did great. I had her sort of sitting on my lap and after about two minutes she said, “Dad, are you ready to go yet?” I took that as my cue.


Adam: Very cool. For me, I’ve got a business right foot. I’m excited because next week I have the opportunity to go guest lecture at Northwoods University, which is the only university in the U.S. with an undergraduate program in automotive retail. They train the next generation of store manager in the car business. I’m going to talk to their general management course on hiring and recruiting. I’m pretty excited for that. I’ll be flying into sunny Flint, Michigan and driving an hour and a half to Midland and enjoying myself there. I’m really looking forward to that.


Nathan: Fantastic.


Adam: All right. We’re here today to focus on the people side of your business. Before we dive in, let’s set the stage. Give us the 30-second pitch on Mammoth. What are you guys all about?


Nathan: Sure. At Mammoth, our mission is building great workplaces. We work with business executives and HR practitioners around the country to do it. Our experience is that most of those people, most of the people who handle HR for their companies are on what we call the HR island. Meaning they often function as a department of one. They’re chronically over-worked and their HR strategy is often isolated from other employers. Our goal is pretty simple, to rescue people from the HR island. We pair them with a virtual HR pro to help make sure they’re compliant, they’re using best practices and they get their action plan done.


Adam: Makes a lot of sense. How many customers are you working with?


Nathan: Well, we have both a technology solution and a consulting solution. We work with about 80,000 employers around the country on the technology piece. Then we support about 16,000 through our consulting services.


Adam: I’m no math major but 96,000 customers. That’s pretty impressive, my friend.


Nathan: Thank you.


Adam: Very cool. If listeners want to learn more, what’s the best way to do that?


Nathan: The best way to stay on top of Mammoth is through our website and through our social media [Facebook, Twitter, LinkedIn, Instagram] . We have a pretty extensive blog where we talk about best practices that we’re seeing. Folks can also follow me at @nathancpdx on Twitter.


Adam: Awesome. I’m so excited to talk to you because you live this every single day in your business. It’s always fun to talk to an expert on how they’re doing it in their own business. Let’s start with Mammoth and the people side of this people business. Talk about core values for a second. Do you have defined core values for Mammoth HR that you’ve laid out?


Nathan: Yeah, we think core values are critically important. You mentioned that our company was founded back in 2001 and in 2014, we sort of did a company reboot. We defined core values, actually, for the first time for ourselves. Now we have five core values that are our roadmap for how we travel down the road.


Adam: All right. Let’s have them.


Nathan: Okay. First core value is “Inspire and Empower”. We believe that our mission of building great workplaces, including within our own company, requires two things. The first is to provide our clients and our colleagues with tools to be great. The second is to help them create a vision for themselves or their organizations that will motivate them to actually use those tools. That’s our first core value and it’s key to what we do both internally and with our clients. Our second core value, we call “Care to the Core.” To us, it means being invested in the health, success, happiness of our clients, our partners, our colleagues, our communities, that really we define our success as their success. The third core value, pretty straight forward, “Focus on Solutions, Not Problems.” We all know we get lots of problems on our desk every day.


Adam: Yes.


Nathan: We measure success by how quickly we can transition from dwelling on the problem to finding a solution and spending our energy there. Fourth core value, we call “Innovate with Purpose.” We’re sort of this hybrid of a technology company and a services company but on both sides of our business we look for ways to improve the HR experience for employers and for ourselves. We want to make sure that we do that thoughtfully. We make sure that when we develop new tools, new technology, new processes, we do so to address a specific opportunity or pain point that our clients are feeling and not just to create a shiny, new toy.


The last one of our core values, I think is a common one, but it’s “Do the Right Thing.” Our operates on relationships, being an HR advisor to our clients. We know that healthy relationships require trust. We make integrity, honesty, leadership, hallmarks of our culture. We may not be giving advice always that a client wants to hear or we may be doing things that mean a short term sacrifice for our company but if it’s the right thing, we know it’s what we want to be doing.


Adam: Thanks for sharing those with us. I can imagine 13 years into the history of the company and you’re taking over as CEO is how that went. You’re coming into the role. You got 13 years of culture, right, that’s been developed and a value system that exists, one way or the other. You’re delivering, “Hey, guys, we need to think about our core values.” Tell us what that was like. How did you get an established company and culture to buy into the notion of defining and developing core values when you’ve been operating for 13 years?


Nathan: You know, I was lucky. At the time, our company was pretty small. It was about 16 people and about half of them were HR practitioners. They knew the importance of core values. We had never practiced our own advice on ourselves. The key for us was, not trying to invent something new, but discovering what our core values were that had driven our company, just giving them life within the company, defining them and making sure we see them show up every day in our work. It was a challenge but I had it a little bit easier than maybe some other CEOs might have.


Adam: Sure. Preaching to the choir, you hire the choir basically. You are the choir. How do you communicate and promote those values day to day? I mean, 50 people, you’re not all HR experts. You’ve got infrastructure now. You’re an operating business. You’re scaling like crazy now. We’ve talked about this in prior meetings. How do you make those real for people coming into a business that don’t have that perspective or experience?


Nathan: I could tell you that our core values are a foundational part of our employee onboarding, which they are. I could tell you they’re featured in our team guide, which is our employee handbook, which they are. They’re on the walls of our office. They’re featured in our employee recognition program. All that’s important but I don’t think that really answers what you just asked, which is how are they communicated? How do they become part of the DNA of your company? For me, the test is pretty simple. It’s whether, as a CEO, I’m hearing within our company stories that relate back to our core values. Do people in our company talk about the things that they and our colleagues are doing that show that the core values are showing up in their work? In our case, do they have a story about a time when they or somebody that they work with inspired or empowered a client? Or when they made a tough decision that they knew was the right one but was a tough one to make.


Adam: You’re interviewing people based on core values.


Nathan: I sit down every year, individually, one on one, with each employee. We have tea together. It’s an informal interview. I’m just asking them these sorts of questions and then it’s also talk in the kitchen, talk at the company meetings, things like that. For me, I know that those values are being communicated and are the lifeblood of the company when I start to hear stories within the company being told that relate to those values, maybe not explicitly but implicitly.


Adam: Awesome. Let’s talk for a second about the structure of your leadership team. When you’re showing up to the management meeting weekly, however often you do it, who’s sitting around the table with you, from a roles perspective and how are you allocating responsibility?


Nathan: We have six leadership roles in our company, other than my role. We have a director of finance and operations. We have a director of HR services. We have a director of technology. We have a director of HR content, a director of marketing and a director of sales. That’s our core leadership team. We also have our people operations manager, who has a seat at the leadership table because of our commitment to our culture. She really manages our culture and our people. That’s who’s around the table when we’re trying to make decisions.


Adam: How has that changed as your business has grown?


Nathan: A couple of years ago, we had a leadership team of three. It was essentially our finance leader, our HR services leader and our CEO. I expanded the leadership team to make sure that we’re getting more perspectives within our decision making.


Adam: How smooth a ride was that?


Nathan: It was actually pretty smooth. Everyone recognized that there were some perspectives, some expertise, that were missing from our company strategy. Everybody was aligned on the roles that we needed to bring in and that we needed to elevate.


Adam: Okay. Our listeners love hearing about the different type of models that folks use to run the business. We refer to that informally as a people model. Are you hiring generally for your business? You’re an expert-driven business. Are you hiring for experience more than utility at this point? Walk us through whether it’s expert hiring and retention, the standard consultant model, or are you looking to train people bottom up and grow them in house?


Nathan: Yeah, that’s a good question. I’d say, for the most part, our model is to hire for strong potential and a strong cultural fit. We make sure that they’re passionate about our mission, that we go about achieving our mission is an environment that they’re going to thrive in. Then we focus on giving them development opportunities to make sure that their skillset and experience are going to lead to success. That’s a little different, as you pointed out, for our HR consultants.


For our HR consultants, we do look for established expertise. The problem for us, in terms of hiring HR consultants, isn’t finding people with HR certifications. There are lots of great HR certified people out there. We’re looking for not only HR experts but also teachers. People who will come in and have subject matter expertise but also know how to communicate that in a way that’s approachable, empowering to our clients. That’s a harder fit. There again, we look for potential. We look for people that maybe had a teaching background, do some teaching on the side or just the way they communicate, has that sort of partnership model to it. We bring them in and try to give them the training they need.


Adam: Is your growth at all a function of how many of these folks you can hire and retain at the right time, based on demand you’re getting from the market?


Nathan: Yeah, it’s tied very closely. We have some ways. We build a pipeline of HR consultants so that as our client base grows we can draw from the pipeline.


Adam: What’s your approach then to make sure that you’re never stuck without a resource. This is the game. You hire in advance of the work or do you risk opportunity cost? Take us through your thought process there because that’s something most of our listeners go through every day.


Nathan: We usually hire in advance of the work but the way that our HR team functions is we have our internal team of Mammoth HR pros that handle our client relationships. We also build a team of independent contractors, who are certified HR experts out there. We will send them some work. Over a period of time, evaluate their work. At peak workload times, we’ll delegate more work to our pool of independent contractors. Then as we need more full time labor we hire from that pool of independent contractors and change their role.


Adam: Got it. Okay. That sounds like a pretty good middle ground.


Nathan: It works.


Adam: Let’s look at how that might have shifted over time. When you were 16 people, it was different than 50, functionally and exponentially different. How has your model changed as you sat in the CEO chair the last two, three years?


Nathan: As you pointed out, as we’ve grown, we’ve become a lot more deliberate about our hiring and our people development. Back when we were 16 people, 20 people, even 25 people, we were just focused on getting the work done. We didn’t really have the discipline to step back and think about, “Okay, what are the attributes that we really need for this role or this type of work and how are we going to either find somebody or develop somebody to do it?” As we’ve grown, we’ve tried to become a lot more deliberate about defining what success looks like for each role and developing strong candidates or employees to achieve that success. It’s still a struggle for us. We’re 50 people now but it’s a high priority on our 2017 strategy to really build structures around this, so it’s not just a reactive impulse but it’s something that is proactively built into the way that we work.


Adam: Sure. When you say deliberate, what does that mean to you? You say you want to be more deliberate about hiring. Define that for us.


Nathan: Our hiring process now is more systematized. It starts with creating a job description, which defines success in the role. Then we translate that into two documents that are used. One is the job posting. There’s a big difference for us between the job description and the job posting. The job posting has a marketing element to it. You’re trying to sell your company, communicate what your company is all about to an external audience that might not know anything about it. The second piece that we have is the candidate checklist. That is where our team really tries to decide what are the key attributes, what are the key prior experiences that is going to set somebody up for success in their role. Then we have the extensive hiring process that we’ve put in place in the last six months to make sure we get really good people. We have great people already in house but I think we’ve lucked into some of our hires. Now, we’re trying to be more strategic about it.


Adam: Okay. Let’s talk comp for a second. One of the things I like to think about and understand with different organizations is just their comp philosophy. Different examples might be lots of equity, lower bases, we believe in the upside. Our comp philosophy might be let’s pay market or above market and make sure we’re paying top dollar. Then others might be, hey, we’re lean and mean, you’re here for the opportunity. Talk to us about your overall philosophy on the role of compensation as you grow your company. Maybe sprinkle in a little of what you see, just with your breadth of expertise. I’d love to hear observationally what you think about that notion.


Nathan: At Mammoth, our target, and it varies a little bit by position, but generally our target is to pay market pay on base salary, then to exceed market on performance pay or incentive pay and on benefits. The reason why we chose this policy is because we think it will help us attract innovative and result-oriented people, who are a good fit with our culture and our growth plans. That way the overall opportunity for any given person exceeds the market. Observationally, we see companies all over the map. The most common characteristic we see, and I only know this second hand through our HR consultants, is that most businesses out there that fall into the small and mid-sized category don’t have a compensation strategy. It’s pretty ad hoc. It’s, “Okay. Well, we need to hire this person. How much budget do we have? Okay. Let’s see who we can get for that budget.” One of the things that we really try to work with them on is creating an overall compensation strategy to guide their hiring.


Adam: Let’s switch to sourcing for a second. What’s your single best source of new candidates, both at Mammoth and then what do you recommend to your customers?


Nathan: At Mammoth, our best source is employee referrals. I think over the last two years about a third of our employees were hired through referrals. It’s not friends and family, necessarily, although sometimes it is a friendship relationship, but a lot of times it’s a professional acquaintance, somebody somebody attended a seminar with. We ask our employees to be out there looking for people that they think would be a good fit. We have a program set up so that if an employee refers a candidate to us and that candidate ends up getting hired, that the employee is recognized for helping strengthen our team.


For our clients, our consultants really believe that the best source of hiring will depend on the industry and on the location. For some industries and some locations, Craigslist can be great. For others, there is an industry specific job board that they recommend or they recommend working with a local college or university if they’re looking for entry level talent. I’ve asked that question a number of times to our HR consultants and they always come back with the answer, “Well, it really depends.” I’ve been convinced that they’re right.


Adam: Awesome. As you’re being more intentional about your recruiting process and screening folks, it sounds like you’ve got a defined set of questions. Is there a favorite? Do you have one question you ask of everyone that, for you, tells you what you need to know or a lot of what you need to know?


Nathan: You know my favorite question is probably the most obvious question. I think it’s one of the most overlooked questions. The question is very simple, “Why do you want to work here?” Whenever I ask that question, I actually get really, really interesting answers. A lot of times we just assume they applied and just assume they want to work here and we don’t probe why. But, if you ask that question, you can understand whether the candidate understands and is invested in your mission, understands your culture, what they expect out of a relationship between themselves and their employer or their colleagues. It can actually be really illuminating.


Adam: Yeah, I can imagine. What’s an example of a right answer, something that gives you comfort or a positive feeling or confidence?


Nathan: What I’m looking for when I ask that question is, A-plus answer is, “I want to work here because I’m passionate about helping small and mid-sized businesses and I think building great workplaces for these employers is key to their success. I want to work in a place where I’m challenged, a place where we’re not afraid of change and a place where I’m going to be able to take initiative and sort of build my own success.” If I hear things like that, a commitment to continuously improving, to measuring results, to our mission, taking initiative, then I know that this is probably going to be a pretty good fit.


Adam: Okay. We’re rounding third here. What do you think you’d say is the biggest people-related, internal people management or recruiting or hiring-related lesson you’ve learned since being in charge?


Nathan: For me, I think it’s the importance of defining outcomes because what I’ve found is that once the outcome is defined and ideally, it’s really defined by the person who’s going to own that outcome, then people can really take control of their work and their lives. They can decide when to do, how to do it, resources they need, what professional development opportunities would be most meaningful. They can evaluate their own success and make sure that they’re continuously improving. If you don’t define outcomes, if there isn’t an agreement on that, then people are really either uncertain about where they stand and what their priorities are or we revert to things like measuring productivity or success through face-time or minutes in the chair. That wasn’t something that I knew coming in but it’s become really clear to me since I started.


Adam: Very good. I agree whole heartedly by the way. It’s nice to have an ally on the whole begin-with-the-end-in-mind train when hiring folks. To boil it all down here, do you have a personal philosophy regarding the people side of your business? If so, sum that up for us.


Nathan: Personal philosophy is a pretty elegant way to state it. My philosophy, it’s all about empowerment. In fact, internally here at Mammoth, my title is CEO but it’s referred to as chief empowerment officer. I really believe that the success of people and an organization is driven by how well an organization can empower the people they bring to the table.


Adam: Now a couple of quick-hit questions here. As you look at 2017, are you feeling optimistic or pessimistic about the strength of the U.S. economy?


Nathan: Wow. I’m feeling cautiously optimistic. I think there’s a lot of uncertainty out there but what I see right now, there’s some structural issues. We’re going to need to grapple with but overall I think we’re on a path to get mildly better over the course of the year but, like I said, there’s a fair amount of uncertainty around that.


Adam: Sure. As you look at staffing needs for your company and just at a macro level for your customers, do you think it’s getting harder or easier to find the people you need over the next 12 months?


Nathan: For our company, it’s getting easier. Our brand is getting more well known, which helps. We’re finding better ways to reach candidates, which helps. For our clients, the biggest concern that I hear about is actually less about finding people and more about retaining people. A lot of our clients have been voicing concerns about employee turnover or just agitation in the ranks and figuring out the best way to retain the people that are really helping drive their success. I think that will get easier as employers learn some strategies that can really help them.


Adam: What’s on the nightstand? What book are you reading and would you recommend it?


Nathan: I just finished this book called, Hooked: How to Build Habit Forming Products. I would recommend it. It was pretty good. It just talks about tools. We obviously have a software platform, like you guys do. It talks about ways to make the platform relevant, useful, valuable to clients. It was great.


Adam: Okay, maybe I should pick that up. That’s good. That’s why, selfish reason for asking that question. All right. Final question, if you were to come back on this show a year from now and report on whether or not you were able to accomplish the most important thing on your plate, what is that thing?


Nathan: We have a lot of strategic objectives and they’re all important. The overarching theme for us, the most important thing for us, is are we helping employers be a positive and creative part of their business and that their people are part of the solution for growing or sustaining their business. If we’ve done that, if our clients are feeling that way, then we’re going to go home feeling pretty good.


Adam: That’s the final word. You’ve been learning Nathan Christensen, CEO of Mammoth HR in Portland, Oregon. Nathan, thank you for being with us on the show today.


Nathan: Thanks, Adam, it was fun.


Adam: That’s a wrap for The Best Team Wins podcast where we’re featuring entrepreneurs and business leaders whose exceptional approach to the people side of their business has led to incredible results. I’m Adam Robinson, author of the book, The Best Team Wins, which you can find online at Thanks for listening and we will see you next week.