Skip to Main Content

CHROs as Strategic Leaders and What’s Ahead for the Role

Interview Transcript
August 2024

During the inaugural CHRO Xcelerator Fellowship Program, Jennifer Manchester, CHRO of Fiserv, and Maria Melendez, Executive Vice President of Human Capital at Mattress Firm, talked to Spencer Stuart's Steve Patscot and shared their perspectives on bringing a strategic mindset to the HR function, adapting to today’s political and economic climate, the unexpected realities they face and technology’s impact on CHROs today and in the future.


Steve:
Good morning, I am here with two absolutely terrific CHROs. I'm so excited to be here in the Fort Worth area with Maria Melendez, the CHRO from Mattress Firm. Good morning, Maria.

Maria:
Good morning, Steve.

Steve:
How are you doing?

Maria:
How are you? I'm doing great.

Steve:
And I'm also joined this morning, this is a doubleheader, with Jennifer Manchester, the CHRO of Fiserv Corporation. Good morning, ladies, how are ya?

Jennifer:
Good morning, doing great.

Steve:
Welcome. Welcome to the podcast.

Maria:
Power team today.

Steve:
Absolutely.

Jennifer:
That's right.

Steve:
Power team. Would you be so kind as to just introduce your company a little bit to our... You have two very different companies, so we should have some really interesting dialogue. But Maria, why don't you tell us a little bit about Mattress Firm?

Maria:
So I work for Mattress Firm, we have 2,400 stores nationwide, and our noble purpose is to help people sleep well so they live well. Isn't that cool?

Steve:
Excellent. Well, we certainly know that the wellness theme has been huge these days and the importance of sleep is probably top of that list, right?

Maria:
That is correct.

Steve:
Do you have one of those really cool beds that go...

Maria:
I do. It's actually really cool, because I didn't know how important that is for just sleep and even for you to be able to recharge, so I have one of those and I love it.

Steve:
Excellent. And Jennifer, welcome.

Jennifer:
Thank you, Steve.

Steve:
How are you doing?

Jennifer:
I'm doing great this morning.

I work at Fiserv. And so Fiserv is in the fintech industry, we're a financial services technology company and we serve a variety of clients. But our intent is to help financial institutions and our merchants to be successful with their clients and provide offerings that allow them to better serve in anything in financial technology.

Steve:
And I think one of the interesting things about having you together is, while you're in different businesses, we'll probably get into some similar challenges and some maybe very different challenges. But before we get into those challenges, maybe Jennifer, I'll start with you and ask you to tell your story a little bit.

Jennifer:
My background is a little bit more unique, because I was brought up... Went to law school and have spent most of my career as a lawyer, both externally and as an in-house lawyer. And I took the step to transition over to lead the HR function at Fiserv about a year ago.

Steve:
Congratulations.

Jennifer:
Thank you.

Steve:
And how's it going?

Jennifer:
It's fantastic. I love the people platform. I love figuring out ways that we can take all of the wonderful things our associates do and help them drive and meet our strategy.

Steve:
And Maria, tell us a little bit more about Mattress Firm.

Maria:
So I have been with Mattress Firm for five months, after my long and exciting career with Bridgestone Tires. For 17 years, I was supporting that company, but with Mattress Firm, having the opportunity to join a new company and new leadership team, new challenges, and being able to work with my team in building some really cool and needed processes, and support the great culture that they already have.

Steve:
The path to the spots that you sit in today are usually influenced by one or two really key people or key assignments. As you think about your career, a saying I heard once was, "Careers look elegant in the rear-view mirror." So as you look in the rear-view mirror and you think, "Looking back, that assignment was so important for me to... At the time, I didn't know it, but today, it's really been helpful." Or that person, working for a person could been... Is there an experience or two, or a person or two that along your journey, has been oversized influence on you?

Maria:
Yeah, I can make a long list of the people that have helped me and enabled me to be where I am. But I would say two critical events. One, moving countries from Venezuela to the U.S. back in 2013 really made me realize how important cross-cultural development is and getting out of your comfort zone. And that includes many things, it's not just the job, but also the culture, the language. Just learning different process and aspects of what could be the same brand but two total different companies when it comes to the challenges. And two, the fact that I was given the opportunity to lead the retail business for my prior company, which made me ready to assume this responsibility with Mattress Firm and really enjoy a total different industry that I otherwise would have not had the opportunity if I would have stayed in Venezuela.

Steve:
Excellent.

Jennifer:
I would say for me, probably about 10 to 12 years ago in my legal career, I had an opportunity to do different work in the legal field. And I found myself one day saying, "I really love the people issues. I love labor and employment, love the benefits work. I love working with the HR teams and influencing outcomes of the company." And it was that at that point that I started thinking about could a CHRO position be possible for me? And then when I joined Fiserv and ultimately, Frank Bisignano became our CEO, he gave me this opportunity. I had people ask me in the past, "Is that a career? Do you want to come do this for me?" And I always said no, but under Frank's leadership, I thought, "I want to do this and I want to really make a difference."

Steve:
And you mentioned strategic impact, so I'll ask each of you, as you think about how you and your teams can have strategic impact on the business, how do you think about it?

Maria:
I think about it from the specifics of our function, but linking the multiple different KPIs that we know impact the business. For any retail organization, having people in the stores is critical to deliver on the top line and the bottom line, so turnover for us is critical. Developing the right people and making the investment in hours, and in content, and quality leadership development, it is important specially for Mattress Firm, knowing that we interact with many thousands of customers every year and we want to ensure that they have the same experience. So when you look at what's strategic for the business, it is all related to our sleep expert, and the quality and professionalism of the sleep experts come from multiple angles in which HR is responsible. HR is responsible for developing the leaders that oversee those sleep experts. So it is really a system in which we have opportunities to touch every single day and that is very strategic for the success of the company.

Jennifer:
So for me, from a strategic perspective, actually, Fiserv and First Data were two companies that merged in 2019, and we went from single digit revenue growth companies to now, we're a double-digit growth company. So really transformed and are continuing to evolve into a high performance, high growth company. And so when I have built our strategy from a people platform perspective, keeping that in mind and then developing our strategy around what do I need from my people in order to actually achieve that? And where we're going as a company. So that's what I –

Steve:
What is your number one challenge facing your business and correspondingly, your function?

Maria:
I think for us, the mattress industry and the cycle in which people get mattresses is very different than probably any other product. So how do we keep our customers engaged and how do we keep our brand top of mind so they know they have a place to go for that second guest room or for the new kid's bed that they need? So I think it is really important and challenging just because of the nature of the business. And I think when you look at the HR, the workforce challenge, it is something that we experience and we feel every day. The level of influence, which I think it is actually a positive outcome of the challenge, because we have to influence and truly sell the value of our company, because what we do is important. Our purpose is to help and guide those customers to get the right mattress so they have a healthy life. So in, I think, transitioning our teams to really think from that strategic perspective, it has been one of the challenges in HR.

Jennifer:
Well, we are a really different company from you and technology is actually our largest job family at Fiserv. And software engineer specifically is the one position that we have the most associates in, so technology recruiting is such a key topic. And if you think about the type of technology companies that we compete for talent against, we look at Microsoft, and we look at Amazon, and Google, and lots of different technology companies for talents. And so that's always a challenge, getting the right talent in the locations that we're in. We're very strategic-hub focused, and so that's critically important, bringing people together in the office together. So putting the right talent in the right location is one of our key issues.

Steve:
Thoughts on kind of the state of the labor market, whether it's hourly or the high-end knowledge worker. We've gone through the cycle of The Great Resignation, some people say we're not out of that yet, some people say that we're on the tail end of it, some say it'll come back. What are you and your teams seeing in the labor market today?

Maria:
I don't think the labor market has fully recovered, to be honest, and we see that every day. We have to think, and this is part of what my team and I are influencing in the business, because sometimes we think recruiting with the same mentality or the same thoughts and profile that we were able to recruit ten years ago or five years ago is going to help us and it's actually not helping necessarily us. And when I say us, it's many companies. So how do we think differently about talent is critical, how do we move from experience-specific from the industry into looking at the skills, and the competencies, and the drive?

So I can teach you our products, I can teach you our systems. We invest probably 200, 250 hours per associate every year. So we're confident about enabling people to be successful in how to deliver an experience that will grant us five stars in Google, which we have a pretty high average with 4.9 stars in Google, and that comes with that investment. But really, making sure that our leaders and those hiring managers see why it's important to look at a different profile to be able to be successful.

Jennifer:
It is interesting. And one of the things that we're doing with our recruiting process right now in the marketplaces, we're constantly looking to see how we can refine it, make that more efficient. Because while we do see the market slowing down a little bit, at the same time, I think good people can find jobs anywhere. So it's not just the recruiting side, it's the retention piece as well that's critically important to us and making sure that we run a very good company where people think that they have lots of opportunities to grow and develop so that we actually don't have to go and recruit new talent. If we can keep our great people, that's what we want to do.

Steve:
A lot of employees and leaders don't always value HR the way we might think they could or should. Why do you think that is and what would you say to the HR detractors?

Jennifer:
Yes to everything. So when I was on the outside, looking in, I did not understand the complexity, and as Maria talked about, the breadth of responsibilities of an HR leader. And it is truly amazing in a sense of you're a partner to the management committee, to your CEO, you're leading your own team. I was doing a town hall in our Dublin, Ireland office and someone talked to me and suggested that I was the guardian of our employees, and I thought, "Wow. Number one, that's such a privilege and a lot of pressure," because it's really important that we get the right and we're doing the right thing for employees. So it's definitely far more complex than I understood it.

And thinking about all of the components that go into your people strategy, there's a finance component of what can I afford from a comp and benefit perspective? And how that impacts your merit cycle and your incentive bonuses. And I don't think when you're on the outside, that you truly have appreciation of how all those pieces come together and how important they are. So definitely, marketing our people platform, understanding all of the pieces, making sure our associates understand it. But I am fortunate that I have a CEO that really values HR and views that as critically important to the company. So I'm lucky in that sense.

Steve:
Maria.

Maria:
I think for me, speaking the business language has been critical to influence the value of HR for the success of the business. I am also very, very privileged to have worked with leaders in my past and my current company that value HR. But that value comes with how are we going to link the HR strategy into the business strategy and how are we going to prove the investments? How are we compensating our talent? How are we ensuring that we have the talent for the future? When you look at business continuity, it starts with talent, right? So when we start changing the paradigm of just HR as a compliance organization and disciplinary organization into strategic organization for the engagement of our associates and teammates, and the success of the business, I think that changes the way that the business leaders could be skeptical or could have a different point of view on how they use HR. That definitely will help evolve into a different position.

Steve:
If I called your CEOs and said, "What is Maria's superpower?" What do you think you'd hear your team or...

Maria:
I think I am an integrator, I just have a simplistic view of complex issues. I have received that feedback multiple times. I am not afraid of challenges and I simplify them. And I think I can translate that from my personal life and saying yes to many opportunities that took me out of my comfort zone. But I think it has helped me really develop that things that can be very challenging, they can be very simple as well. So how do we make them simple? How do we make them smooth in terms of the experience to our customers? Our internal customers? I would say that would be my superpower.

Jennifer:
I think my superpower is the fact that I'm calm under pressure, generally unflappable. I think everything is solvable. So when my people or management committee member comes and talks to me about an issue, I'm able to really just address it thoughtfully, calmly. I don't react in any particular negative way and I just very methodically address the issue, break it down, to your point, thinking about from a simple, "What's the issue? And how do we get to resolution as quickly and efficiently as possible?" Is really where I think I thrive.

I think just through the course of my experiences through my life. And I think my training as a lawyer has also helped with that, because I've been in situations, I've done a lot of M&A deals, a lot of high-stake issues, and you learn that you really have to be calm under pressure in order to deliver the results that your business needs from you.

Steve:
There's a lot going on in business today, economically, politically, socially, geopolitically. As you think about the challenges that your leaders face in growing double digits, creating the great customer experience, what are you and your teams trying to do? And what message would you like to send to them today to say, "Hey, look, we're trying to help you grow this business, lead better"? What is the mission your team is going to do to help those leaders?

Maria:
Well, our focus is very simple, it is about attracting, growing, mobilizing, and inspiring our talent. And when we do all of that with care and focus on our employees, and our associates, and the stores, we know and we're very confident that we're going to drive business results. Because at the end of the day, we want people to choose Mattress Firm every day, not only our customers, when they make decisions about their purchases, but our employees. And they are the biggest promoters of our brand. And making sure that they feel proud to work for a company that makes an impact in people's life is our core mission. And if we can do that in HR from sure services and how we respond to their cases or the development to our most senior leaders, we're going to do it. It's a breadth of multiple different experiences, but with those four core principles of attracting, growing, mobilizing, and inspiring.

Steve:
Excellent. Love it.

Jennifer:
It is. That's fantastic. So one of our core people platform strategies is cultivating our talent. So we have a large program together to build and continue the capabilities of our people. So right now, we're finishing our last leg of our leader academy at our senior vice president level. So it's a two-day program. We do a 360 on the front end, we'll do a 360 after the fact, to really understand and drive what has changed, how has our training helped them? What different outcomes are our leaders going to focus on going forward? Our platform is really about building well-rounded leaders. So we believe that you can't just be a great P&L leader, you have to think about all of the pieces that make a great leader. So there's the people leadership piece, as I think we've heard through the course of our time together, that some of our best managers are great HR people in their own right. And so that's a key piece our platform and our training that we're working on for people.

We're focused on really understanding risk and compliance, focused on the client first. We're very focused on elevating our game with respect to our clients. Focusing on increased better service for our clients, because if our clients aren't happy with us, then we don't have revenue. So it's a whole well-rounded leader platform that we're working on, starting with our senior vice president level. And then we're going to continue to push that down our organization and making sure that we have full alignment across the organization and that we're all moving in the same direction.

Steve:
Those are both fabulous answers. Okay, I'm going to go into a little bit of a lightning round, a few categories, short answers. Who do you go to for advice?

Maria:
I go to my colleague, Susie Long. She was in retail as a business leader and transitioned into HR. So if anyone really inspired me to be able to take on a risk and going into a different industry, was her, so I always go to her for advice.

Jennifer:
I have a key group of people at Fiserv that I talk to, but also on the outside is my father. He was the CEO of an insurance company and his wisdom is fantastic.

Steve:
Excellent. Top three challenges facing CEOs today.

Jennifer:
Well, I would just say that of the key issues is the constant expectations clients and how it's ratcheting up every single day. I think when Amazon came out with next day delivery, it just changed the game years ago. So every interaction that clients have with us, their expectation is that we should be able to do it faster, better, and we should. And so I think that's key to delivering client satisfaction for a company, which is important.

Maria:
I think how to maintain culture in an environment that is challenging financially and with that combination, the engagement of the associates. So balancing all of those three, I think is the number one challenge for CEOs.

Steve:
And the number one challenge for CHROs.

Jennifer:
I think talent.

Maria:
Definitely,

Jennifer:
Really just making sure that we have the right talent to help our businesses succeed.

Maria:
Absolutely.

Jennifer:
And continuing to build the pipeline. So it's identifying that next level or two levels down and making sure that you're giving them opportunities to succeed and develop.

Steve:
When you go to hire people directly for yourself, or senior leaders in the business, and you're conducting an interview, assessing somebody. What are the couple of things that are most critical, in addition to the classic job competencies, that you bring to your assessment?

Maria:
I think understanding if that leader is going to be a good cultural fit, because the culture is critical and it's important for the success of the business. So if that leader shows the components of our culture, I think that is the number one thing that I look into when I'm assessing talent.

Jennifer:
I think also for me, I'm looking for somebody who's hungry, someone who wants to have my job. I want 10 people working for me that want my job every day, and I want to help them get that job either at Fiserv to be my successor or on the outside at some appropriate time. I just think it's really key. And then also feeling like they can give me good feedback. I don't want people on my team that just do what I asked them to do. I want to push back, give me feedback, because I think that's how we develop the best possible policies and programs for the company.

Steve:
Okay. So I am a candidate for both of your companies, you're sitting in front of me and you're going to ask me one of your favorite interview questions to assess either my hunger or my culture fit, lay it on me.

Maria:
I love this question, first of all, because it's free form. And second of all, it will tell me a lot about what the candidate wants to convey or what are the key things they want me to know about them. So Steve, any question I haven't asked that you prepared for that you would like me to know about you?

Steve:
Yeah, so I'd like to know more about your culture. Okay, Jennifer, your turn.

Jennifer:
Yeah, Steve, I just want to know what motivates you every day.

Steve:
What do you see on the horizon? Broad question.

Maria:
Very broad. For my company, I see a lot of growth, especially with the challenges that we're going to continue to face in the industry. I see a lot of commitment from the leadership team in growing the talent and keeping people at the center of what we do. And I see associates and teammates that are engaged and committed to continue to grow this organization and position this organization really well in the market. But at the end of the day, the company is doing great, we know we can do more.

Jennifer:
I would say from a macro level, I think there's a lot of economic uncertainty and political uncertainty in the world today. And we've seen what has happened in other countries as of late, and so I think it's important for companies and particularly, we're focused on it, is being fiscally conservative, managing your expenses, really understanding where you're spending money, if you should be spending money there. And how to manage that to put yourselves in the best possible shape that gives you the best opportunity depending on what might happen from an economic perspective in the world.

Steve:
What, in your mind, differentiates good versus great HR... Not HR leadership, pure leadership?

Jennifer:
You know what? I was really focused on the conversation that we had previously around supporting each other. Really looking, one of our colleagues said this, east and west instead of north and south. So looking horizontally, looking at your teammates, figuring out how you can make them successful in their own right, even when you're at the same level. So not reporting up to you, but east and west, and figuring out how to support them. And I think if you get that right, and you're a close team, and you support each other as leaders, I think you're unstoppable.

Maria:
Yeah, I think it is very similar. I think leaders have to definitely be good at what they do functionally in their own area or business. But they also have to be able to look at the enterprise and to look at the other parts of the system, because at the end of the day, the leadership team, they are part of a system that if one of those pieces of the system or person is not necessarily either performing or providing the great experience or the culture, it affects the entire company. So as leaders, we're responsible to deliver on our function, but we're also responsible to develop the team for the entire organization. And we are also responsible to operate as a unit and we're responsible for the success, to your point, of your peers and the system, again.

Steve:
As you think about AI in two very different business, what are you the most excited about and maybe the most concerned about relative to the deployment of AI within consumer-driven business and a information-driven business?

Maria:
I think for us, AI can be very beneficial, especially with our development focus. And I think simplifying the way that our associates consume information and get familiar with the many things that they have to learn, that they have to know about the multiple products and advantages of those products. And even financially, also it can be very heavy. So how can AI just help us have the information that they need in a simple way so they don't have to spend too much time looking into the process, or the policy, or this email? So I think for us, that will definitely facilitate the learning experience and also the customer experience, so I'm very excited about that.

Steve:
Any concerns?

Maria:
I think there's always a natural concern about the replacement of the human using this technology. But I think there's always going to be the need for human in the workforce. I think that is going to force us to really continue to upscale ourself to stay competitive and relevant in a world that is always changing.

Steve:
Now, Jennifer, AI has got to be all over –

Jennifer:
All over.

Steve:
... Fiserv, and how do you think about this?

Jennifer:
Yeah, it's critically important to us and we've really revamped our customer service capabilities through AI. And having a lot of work, I would say standardized work, we're able to be answers faster. AI is constantly finding solutions both for our associates and for clients as they're calling in, logging in questions. It's really been a game changer for us, Steve. I think about it from a HR perspective and how I'm utilizing it. We're creating an AI strategy for the next couple of years in the HR team to figure out how to address the low hanging fruit. What are the mundane issues that my team is faced with and how can I deploy AI to take that work off their table? And then it's not a cost savings issue for me, it's about then leveling them up, my associates. So we take that kind of lower level work off their plates and then let focus on more rewarding, interesting work and having a better work product at the end of the day.

Steve:
We're nearing the end of our time, but before we end, I'll ask you a wrap-up question. There's a lot of people listening that are earlier in their career, aspiring to sit in the chair that you sit perhaps. If you could each give one or two pieces of advice to people who are working their way up in their career, what advice would you give to future CHROs?

Maria:
I think just say yes, be open. Take on challenges even though if they're not part of your scope of responsibilities, I think for me, has been very beneficial to be exposed and have experience in multiple areas of HR and the business. And I think those type of experiences, nobody is going to take that away from you. And ultimately, you are going to need them, you don't know when. But I think being open and being very intentional about experiences and what you want to learn regardless of titles and positions would be critical.

Jennifer:
That's a great answer. I have two additional things, because you kind of took my answer. But I would say, don't be afraid to fail. So take that opportunity, if someone is giving you the opportunity, go embrace that and do the best you can. Don't second-guess yourself, "Why did I get this opportunity? How am I going to do it?" Just go and be confident. And if you fail, learn from it. Through the course of my career, I think I've learned more from the times that I wasn't successful than the times that I just had a great project or great success on some particular issue. So I think that's it. The other piece though is, be open to feedback. I think that in the course of my career... You know you always think, "Oh, I'm so good at this," and someone gives you feedback and maybe it hurts your feelings a little bit or maybe you don't agree with it. But if someone's willing to take the time and give you feedback, that means they care about you, they care about your development. And embrace that and you can only get better as a result of it.

Steve:
This is a hard job, I respect the heck out of both of you for doing it. It can be draining emotionally. How do you stay positive? And maybe share one life hack that you use to keep your energy and your optimism high. And we'll wrap up with that, on a happy, positive note.

Maria:
I stay positive, just remembering all the great things that I know human beings are able and capable of doing. And I also stay positive because I have had a great family and a great support system. Loving my dogs keeps me sane.

That's my life hack. But I know human beings, we have been able to do incredible things for the world and that keeps me pretty positive.

Jennifer:
Yeah, that's so great. I would just say that I have a wonderful network at home. I have a husband and three boys that I adore, and so they fill my cup. So I work long hours and they're very supportive of me in that sense. And then in the office place and around the world, you always see people doing good for each other. And we do a lot of charitable contributions and programs, and I'm always just astounded at how generous our people are and how they want to help people. And so that's always just reaffirming to me of how great people really are.

Steve:
Jennifer, Maria, thank you. This time has flown by. I could ask you a million more questions, but I really appreciate your perspective, your openness, your candor. And your companies are in good hands, your employees should expect and deserve great HR and I know they'll get it. And thank you for joining me today.

Jennifer:
Thank you, Steve.

Maria:
Thank you.