In this week's podcast, we go on a journey with Tiffany (Scalzitti) Monroe, Chief People & Culture Officer at H&R Block, on how she is transforming H&R Block's people strategy to better align with the company's ambitious growth goals.

In this discussion, Tiffany shares:

• The various phases she and her team have taken to implement their new operating system, BlockOS and real-time results

• The impact the pandemic has had on the strategy's progress

• Her key learns and a lot more.

Support from this podcast comes from Charthop. You can learn more by visiting: charthop.com/digitalhr

David Green: Today, I am joined by Tiffany Munroe, Chief People and Culture Officer at H&R Block.  We will be discussing the organisational transformation Tiffany is leading to better align the company's structure to its strategy, which is designed to help the company increase effectiveness, enhance communication and make decisions faster.

Tiffany Munroe: If you think of your iPhone, it can be very elegantly designed and beautiful, but if the operating system within it is clunky, then you're not getting as much out of it.  So, we thought about, for H&R Block, we have this really strong purpose, we had this really clear strategy, and if our structure wasn't right or the ways we were working our culture weren't right, we weren't going to get as much out of it as we wanted to.

So, in June of 2021 actually, we started on the first part of our Block OS, which was aligning the structure to the strategy, so aligning the organisational structure around those three lines of business, and then having enterprise capabilities to support those lines of business.

David Green: Tiffany couldn't be more right.  You can have big growth ambitions, but if your people strategy doesn't align to support it, then it's just a good-looking iPhone with a clunky operating system that isn't fulfilling its goal.  On a mission to transform the organisation, Tiffany will be sharing the various phases her and her team have been taking to implement their new operating system, Block OS.  We will be discussing their real-time results, the impact the pandemic has had on the progress of the strategy, H&R Block's connected culture and ways of working, Tiffany's learnings, and a whole lot more.  So, without further ado, let's get started.

Tiffany, welcome to the show.  Could you start by giving listeners a brief introduction to you, H&R Block and your role within the organisation, please?

Tiffany Munroe: Thanks so much for having me, I'm excited to chat today.  So, my name's Tiffany Munroe, I am the Chief People and Culture Officer for H&R Block.  H&R Block was founded in 1955 by brothers, Henry and Richard Block, and it was founded as a tax preparation company, but the premise was that taxes are much more than just numbers on a page, they really have the ability to affect someone's life, and we still believe that today.  So, our purpose is to provide help and inspire confidence in our clients and communities everywhere.  The tax event can be very challenging and scary for people, and we are there to help them feel better about that.

For me personally, I have spent my entire career in the people and culture space.  I absolutely believe that the right people and the right culture can make businesses achieve great things, and I have been able to be part of transforming some workforces through my entire career, which I love.

David Green: And it's interesting that you've actually got "culture" in your title.  So, we hear Chief People Officer, Chief Human Resources Officer, but you've actually brought the culture right at the top of the title as well.  Is there a reason behind that?

Tiffany Munroe: Yes, I mean that's a great question.  So, when I started at Block, I was the Chief People Officer.  But as we looked at transforming our culture and looking at our greater strategy, we felt that calling HR "People and Culture" was much more on point and much more fresh and much more relevant.  It really is about, not human resources necessarily, but the people and the culture that are driving your business.  So, we decided to change my title to Chief People and Culture Officer, as both are equally important.

David Green: And I think in our conversation today, the culture piece is really going to come out, I think, as you work so closely with the leaders in the business, well you are one of the leaders in the business, but you work so closely from an HR perspective around the business transformation that you're going on at H&R Block; so, I think it's really interesting.

So, talking about the transformation, over the past couple of years, obviously you've been heavily focused on implementing a five-year strategy, which is called Block Horizons 2025.  I'd love it if you could share more with listeners about Block Horizons 2025 and they can understand the extent of what you're trying to achieve as an organisation.

Tiffany Munroe: Sure.  So, in 2019, our senior team got together over many, many meetings and started to think about how can we go beyond just tax, and how can we be there for our clients in more ways in a year-round fashion.  So we really created this concept of Block Horizons 2025, which is our long-term growth strategy.  And as we thought about that, we thought, "In five years' time, what might we want to be as a company, beyond just tax?"

So, we created these three strategic imperatives, three lines of business, if you will, the first being small business; and many people were surprised to hear that we already serve over 2 million small business clients every year, and so we already have a strong base.  What we're really doing with that small business imperative and that small business line of business, if you will, is to focus strategically on the small business owner.  There are more and more of them, with the gig economy heating up the way it has.  So, we know we can provide bookkeeping and payroll and other products beyond just that.

The second focus for us was around financial products.  So, we have offered financial products for a very long time, but they've been mainly focused around the tax event.  We know that people need help, from a financial products perspective or banking perspective, year round; so they need help saving, they need help learning how to spend, how to budget.  And so, we launched a mobile banking platform, called Spruce; we did that a little over a year ago.

Then the third imperative is Block Experience, so it really is around that tax event, but it's taking digital capabilities and blending that with what we think is our signature expertise of human expertise and care, and so really homing in on having the best possible tax experience for our clients.  Obviously underpinning all of that is talent and culture.

David Green: Part of this role, you've been focusing on transforming the organisation to better align the company's structure to the Block Horizons 2025 strategy.  What prompted this transformation?

Tiffany Munroe: So again, and as we were thinking about Block Horizons 2025, in 2019 we started asking our associates and our leaders their thoughts on the way we work and their thoughts on our culture.  So, we did a lot of surveying.  We did our associate engagement survey, we did roundtables, we did listening sessions, we started looking at calendars and what was our meeting culture, and just really did a lot of deep dives into how are we formulated; how are we working; what could we do to be better.

The themes that came out of that were that we had a heavy meeting culture, people felt there were too many meetings, unproductive, which of course you hear a lot.  We reviewed all of this information and took this all in and started to formulate what we call our Block Operating System, or Block OS, which is now in place at Block as to how we work with the ways that we work.

David Green: Was some of this work going on in the pandemic, or did you have to revisit some of this work as the pandemic, or the impact of the pandemic on ways of working, became -- well, you started to see the impact of that?

Tiffany Munroe: Yeah, we actually rolled out the concept of Block Horizons 2025 in early 2020, and the pandemic then came rushing in that spring.  So, it was really an interesting time to roll out a long-term strategy and also be in a very volatile world where no one knew what next was.  I will say that we stuck to this being the strategy, we were very open about not knowing the answers to all the things that were happening in the world at that time.  It was interesting, because it felt in the beginning like the pandemic would really push the strategy off a bit, because we were so focused on figuring out how to work in this largely virtual world.  But I remember personally feeling like, "Well, this might push 2025 into 2026".

But truly, to your point, people got into it, they understood where they wanted to go, and we've accelerated on a lot of those areas within that strategy.  So, it was a very, very interesting time to lay out this strategy, not knowing that the world would change the way that it did so substantially.

David Green: You've talked about employee listening and the variety of ways in which you were doing that.  I guess that was really important for you as an organisation during the pandemic as well, so we went through the various stages of it, and maybe planning to now return to office and the hybrid work as well.

Tiffany Munroe: Incredibly important.  I think that that is a key, key tenet for us.  Again, we are so focused on relationships at Block, and then this connected culture, that we were very, very communicative.  We did as much communication as possible, we did as many surveys as we could to talk to people about how are they feeling; did they feel safe coming back to work; if so, when?  We had multiple return-to-work days that ended up not happening, because the world was not ready yet.  But we got a lot of great feedback from our associates that at least we were communicating.  It didn't mean we were always making decisions that they liked, but they understood the why, and they appreciated the fact that we were talking to them.  We gave them as much leeway as possible as to when we might come back, and we told them we would definitely let them know 90 days in advance, so that they could fit their lives around coming back to work.

In the end, we actually returned to work this last March, and we are back Tuesday through Thursday in the office, but it's a voluntary basis only.  We'd like to see everybody together, because again that connected culture, that really being able to interact in person is important to us, and we feel like you get so much out of being together and in person; but we also understand that lives have changed and ways of working have absolutely changed.  And, while we would like to see all of our associates in Tuesday, Wednesday, Thursday, it's absolutely their choice, and a lot of people are still choosing to work from home, myself included some days; I mean, it works for your schedule.  So, it's a very, very flexible environment that we have, and we get a lot of great feedback about that.

David Green: And I think it's exciting times.  Speaking to some of your peers in other organisations, as executives we all have opinions on how many days people should be in the office, but you can ground that in data, I guess, from actually looking at what's actually happening, what's working and what employee preferences are as well?

Tiffany Munroe: We did a lot of work on employee preference, we did a lot of work in the local KC area to understand what partner companies were doing, we looked globally, nationally, did exactly to your point to inform what the data of what was happening, what trends we were seeing.  And you're right; people range from not wanting to ever come back to wanting to be in every day.  So, it really is just picking what you see as the best trend, and what you think is the best possible solution for your business, and going from there.

So, we tell people, "This is our operating model, this is how we're working, and if we do change it we will absolutely let you know".  But it's working really well, so I think we've struck the right balance.

David Green: I'd love to hear about Block OS.  So, how does it enable the success of the overall Block Horizons strategy?

Tiffany Munroe: So, when we look at Block OS, it's predicated on kind of a smart device.  If you think of your iPhone, it can be very elegantly designed and beautiful, but if the operating system within it is clunky, then you're not getting as much out of it.  So, we thought about, for H&R Block, we have this really strong purpose, we had this really clear strategy, and if our structure wasn't right or the ways we were working our culture weren't right, we weren't going to get as much out of it as we wanted to.

So, in June of 2021 actually, we started on the first part of our Block OS, which was aligning the structure to the strategy, so aligning the organisational structure around those three lines of business, and then having enterprise capabilities to support those lines of business.  And then, in June of this year, we rolled out the other two phases of Block OS, which is connected culture and ways of working. 

Like I said, the connected culture piece for us is really predicated on the fact that you are sitting at that tax desk, you are having a very, very personal interaction with someone, it requires a lot of trust and it requires a lot of connection, and that permeates through our culture.  Our culture is absolutely built on connecting and trust and empowerment, so it's really about just enhancing that within our culture, and giving it a name; because we've always been this way, but we want people to be able to say, "What's the culture at Block?  Well, it's a culture of connection", and what does that mean.

Then the ways of working, we had a team that got together, a grassroots team that said, "How are we going to attack these barriers to our working better together?" and they came up with five areas that we could create this digital playbook around, and give people the playbook of how we want to work together as a company and as individuals.  Those areas were all about empowered decision-making, definitely something that we've focused on at Block, managing time productively, which sounds really basic, but honestly it's giving people again the playbook to say, "Have a meeting that's 25 minutes or 50 minutes, have an agenda.  Have that agenda say whether this is inform, discuss, decide", just making it easier for people.

Then aligning outcomes, like we said.  If these three imperatives are the most important things, and there are a lot of projects in the works, how do we get that together and figure out what are the most important projects.  And so, we created this strategic planning group, and then just iterating for success and continuing to communicate effectively and really think about that in a deeper way.  So, that's kind of the work that rounded out this Block operating system, if you will.

David Green: Can you talk us through why you developed these approaches, and the role they play in bringing the Block operating system to life?

Tiffany Munroe: Yeah.  Really, it was again gathering data and listening to our people to say, "What is causing you to not work as optimally as you would like?"  You could look at that and there could be a kitchen sink of things as to what are the five most important things, or what are the most important things.  So, we really had to again prioritise and align on the outcomes of, if we took these five areas and really did something about them for the whole organisation, would we have a better operating system; would we be able to work together faster and more efficiently? 

That's really how that came about, was sorting through all the information, coming up with the five largest themes, and then putting tools around them to help people.  They could go online any day and get tools for, "Where should I communicate this message?" or, "How should I look at risk-taking?  And, where am I empowered to make a decision, or where am I not?" to try to just make it more clear for people.

David Green: One of the ways of working that you outlined was around empowering employees to take more calculated risks, which I really quite like, because I think we're hearing this a lot more now, trying to help employees make decisions themselves, because sometimes they're the best people to make decisions, particularly if they're with the customer at the time, or they're experienced in that. 

I suspect this is something that you're looking at obviously rolling out and supporting, because that's two things, isn't it?  Number one, it's helping people feel empowered and feel they can make decisions; but then there's a definitely a cultural element to that as well.  And I suspect, is that something that you're ensuring that around your internal talent marketplace, is aligned with the overachieving goals of the organisation as well?

Tiffany Munroe: It is.  So, the ability to be empowered to make decisions was probably one of the biggest themes that we saw, people not understanding whether they were empowered, how could they figure out if they were empowered, and sometimes your leader just says, "You can go and do that", but you don't have a clue how to gather the right data to make the right decision.  So again, we created this proprietary training as a three-part training, if you will.

So, some of it is self-study that really talks about the psychology of decision-making and empowerment, real-world examples and case studies.  I think more importantly is the conversation that you, as a leader, have with your team about areas that you're making decisions where maybe you think you don't need to, and you can give that to your team; or, them being able to push and say, "I think I should be able to make this decision", and then really having that deep conversation.

That is something that is just starting right now, as you and I speak; we're just starting to roll that out and cascade it through the organisation.  But part of that is also again a pretty easy tool that says, "What are the risks, or potential risks, of making this decision, and what is the likelihood of that risk occurring?"  You can look at it on this template and it will show you if it's low, then you are empowered to do that; if it's high, then you probably need to take some partners and think about who your stakeholders are. 

So again, prescriptive, but also a nice tool to say, "I'm following along with what this is teaching me.  I'm pretty sure I feel okay making this decision", and there are very few, as you know, decisions that you can make that can't be unmade or undone, so it's kind of erasing a little bit of that fear of, "What if I make a mistake?"  Well, that's okay, because we all do that all the time; we just have to learn.

David Green: What are the sort of steps you're taking to measure the effectiveness of this particular way of working, but maybe all the ways of working that you outlined?

Tiffany Munroe: Again, we love getting our survey data out.  So, after we had this townhall, we had 92% of respondents say, "We get connected culture, we love this way of working, we're excited about it".  The structure piece, we put that in place over a year ago and mostly got that right, not completely.  We've made some adjustments, but people are settling into that.  The connected culture piece, like I said, it's already who we are, we just put a name to it, so people feel that and they get that and it resonates.

The ways of working, we're continuing to really embed into the fabric of who we are.  So, this group, this grassroots group that took on this work in the first place, has done roadshows explaining what are these tools; how do you look at this playbook?  We have asked our leaders in each of their all-hands meetings to go over the ways of working, talk about how things are coming to life, and highlight these in their meetings.

So, we really are doing a lot of work to reiterate that this is the way we work at Block.  So, so far, so good; but again, pretty early in, and I think the work for my team and myself and my leaders is really to keep this alive, and keep pointing people back to this playbook and back to these ways of working.  But the great thing is, I hear a lot of our buzzwords right now like, "We're iterating for success.  I'm aligning my outcomes.  I'm empowering you to make this decision".  So, the lingo has definitely hit well, and we just have to continue to actually make it real for all of our associates.

David Green: What are some of the impacts that the operating system has had on the organisation so far?

Tiffany Munroe: I think the structure has helped us really align to what is most important for us to accomplish as a company.  So, we know we have things to do in small business; we know we have Spruce as this new mobile banking platform; we know that we need to continue to evolve the tax event, and more digitally enable people to have their taxes done, however they want to do that, whether it's themselves with some help, whether it's completely someone else doing it for them.  Those are all working, and we're very well supporting that structure and that business strategy.  We're seeing that people feel very engaged. 

One of the things that I have been very proud of at Block is that over the last two years since the pandemic, our engagement scores have stayed strong, and I know that's not true for everybody; but that shows me that our leaders are really working to engage their team, virtually, in-person, however that's working.  But that's, to me, very, very important.  And just seeing people have less meetings, and seeing people not send three of the same function into a meeting.  So, you're seeing that start to really take a hold.

Being there, to your point, for our clients in more ways, we're seeing that and we're getting that feedback from client surveys, that they're feeling definitely cared for by Block and by their tax person, by whomever they're working with.  So, we're starting to see really positive momentum.

David Green: Yeah, it's good, I mean it sounds like positive from engagement, from productivity, from potentially wellbeing, I guess, as well; but also, positive impact on business results and customer outcomes as well, which you couldn't ask much more from a strategy really in that respect, could you?

You talk quite a lot about engagement and surveys.  I'd love to hear a little bit more about how often, for example, you survey employees, whether that's an all-company survey, or you're doing pulse surveys as well, because I think this is something that organisations have really been looking at obviously in the last two-and-a-half years.  So, I think it would be quite good for listeners to understand what you're doing to get this feedback.

Tiffany Munroe: We do an annual engagement survey every year, and we do allow pulses.  So, the leader can choose to do a pulse in the off-season of the survey.  We have a very interesting labour model.  During the year, for the most part, we're probably 3,000-ish people; and then, during tax season, we're 80,000-some people.  So, it's very important from that January to mid-April timeframe to get input from our tax pros as well and our seasonal associates.  So, we definitely have the ability to survey whenever we want.

We also don't want to over-survey.  We want to be able to take that information, take it in, share what we heard.  That's been a big focus for us in anything, especially even through the pandemic, "What are you telling us, and what are we doing about that?  That doesn't mean that we're necessarily doing everything that you want, but we want you to understand that we heard you, and here are the actions coming out of that".  So, we do take our surveys quite seriously.  I read all of the comments, because you just never know when you're going to find a theme that is really important, that might have got lost otherwise.  But we also don't want to survey-fatigue anybody either, so we're careful with it.

David Green: And, I guess there's that real link between frequency of surveying, and communicating that you're listening and taking action on stuff as well, and telling people you're taking action.  Is that a balance that you have to get, I guess, in your role as Chief People and Culture Officer?

Tiffany Munroe: Yes, and we do have a listening strategy, so that involves roundtables or lunch meetings, or those types of things where people can voluntarily come and we can just talk about a topic; or, an executive will be available for a certain amount of time with their time, and they can open-door come and talk to them.  So I think again, surveys are great, but also having that face-to-face, or virtual face-to-face, however you want to do it, interaction is important too, because you're going to hear different things.

David Green: What have been your main learnings so far?  Is there anything you look back on and maybe think, if it was now, you might have approached it differently?

Tiffany Munroe: I don't know that we would have approached anything differently.  I feel like we were very resilient, and one of the great things I think about the people at H&R Block and our culture is that we very much are kind of learn and re-evaluate as you need to.  The company is very trusting in the strategy and where we want to go, and people believe in it in their hearts, so they're open to pivoting, meaning to change directions; and we had to do that a lot during the pandemic.  But we continue to just iterate and learn.  Things will come up that are unexpected and you face them and you make a decision, which is the best one you can make at that time, and you might have to change or learn or do something different in the next iteration, but go forward with as much knowledge as you have.

David Green: For those listening, what key advice would you give to them to help set them up for success?

Tiffany Munroe: The most key thing is that you have to have buy-in from your leadership team.  You have to have buy-in from your CEO and your peers.  It's not just an HR initiative, it really is a company priority.  For me and with my team, they very much understood and agreed that we needed to have a people strategy to underpin this business strategy, and I think you and I talked about that earlier as well.  But really truly, you can have this great strategy, but if you don't have the right people strategy or the right culture underpinning that, you're not going to get as far as you would like to.

I think another probably key piece for me was really the cross-functional nature of how we came up with this Block operating system, and what was entailed in that, and really thinking about when you're pushing that much structural change and ways of working, meeting people where they are and helping them get to where they need to go is also really, really important.  And to me, that means not having to be a top-down thing.

We stewarded it, we stewarded the strategy as a senior team, but we had people who were very passionate come on as ambassadors and champions, and they could then get that understanding and excitement out into the organisation in a way that I wouldn't be able to do if I just said, "This is how we're doing things".  So, I think that was really important.

So I would say, having your senior team with you and making sure that your associates feel like they are part of the change and the transformation, and they understand why and where you're trying to go.

David Green: What are some of the tips you would give around managing those senior stakeholders within the business as well?

Tiffany Munroe: You know, I think it is about, if you understand and you're part of the business strategy, which I am and was, for me to be able to say, "What do we need from a talent perspective to achieve this; what are we missing?  What do we need individually as a skillset, but what do we need organisationally as skillsets?" and really thinking about that right up front, so you're not just rolling a strategy and hoping that you have the right structure and hoping that you have the right talent and skillsets, but you actually already know where you're aligned, where there might be gaps, etc; and working through that with the individual senior leaders for their own functions, and then thinking about it more organisationally.

So for me, it was really about being very invested and very involved with each senior leader and what this strategy meant to them, and what that meant from a people perspective.  And then I have to be very honest, I have a very lovely, wonderful CEO in Jeff Jones, and he fully believes that people and culture are the most important underpinnings.  And so having that along with me was incredible from a support perspective.

David Green: And it sounds like you were able to provide data to support the approach as well throughout, whether it be through surveys or some of the results from the focus groups you're doing.  Is that something that, as a function, HR really needs to bring to the table; they need to bring data?

Tiffany Munroe: More and more, we need to bring data to the table.  It speaks the language of the business, they understand because they can see it, they can see what the trends are, they can see where the gaps are, so absolutely.  I think internal data, external data, as much as you can bring to make that business case will always help you get where you need to go and help the business understand how they could be even more effective in what they're trying to achieve.

David Green: Well, that leads on quite nicely to the question that we're asking everyone on this particular series of the Digital HR Leaders podcast, Tiffany.  What do you think the role of ethics is in HR?

Tiffany Munroe: I think that ethics is everybody's job, I think it should be everybody's table stakes, having an ethical culture, ethical company.  I think in HR, we are the stewards of the culture and we are hopefully a safe space for people to bring themselves and questions they might have.  So, I think that HR leaders absolutely steward the culture and we steward ethics, but it has to be something that is within every single associate and leader in the company, and within the culture of the company.  I think if you don't have that, then you've probably got a lot bigger problems on your hands, and I think that we're lucky we have such a great culture at Block.

David Green: Tiffany, great conversation and really impressive work that I think you and the team are doing at H&R Block.  Thanks so much for being a guest on the Digital HR Leaders podcast.  Can you let listeners know how they can stay in touch with you, follow you on social media, find out more about your work, maybe find out more about H&R Block as well?

Tiffany Munroe: Absolutely, so you can find me on LinkedIn and you can find H&R Block on LinkedIn and Twitter, and follow all the great work that we're doing.

David Green: Great.  Well, Tiffany, it's been wonderful to have you on the show.  Thank you very much for sharing your story with listeners.