Building an employee-driven culture: HR leadership lessons from James Killian

Guest bio

James Killian is the founder of the Customer-Driven Leader, a professor at Michigan State University, an advisor to multiple AI-driven HR startups, and the author of the upcoming book Obsessed: Cultivating the Customer-Driven Leader. With nearly 25 years as an organizational psychologist, James helps organizations navigate CHRO challenges and HR transformation by applying customer experience principles to employee experience—moving from employee-centric to employee-driven cultures.

The service profit chain: Where customer experience meets employee experience

James introduces a powerful framework for HR leadership strategy: the service profit chain. Originally published in Harvard Business Review, the concept shows that customer experience is delivered through employees, creating a feedback loop that impacts brand loyalty.

Effective HR transformation requires CHROs to empower employees to deliver superior customer experiences while attracting and retaining talent with that same customer-driven lens.

"If you are a leader, you have to drive empowerment through your employees, through your teams, to be able to deliver a superior experience to the competition. The only real ability to become market competitive or stay market competitive is to deliver a superior experience along with that product or service."

The talent acquisition pipeline mirrors sales

James draws a direct parallel: treating talent like customers is a business imperative. He points to a troubling trend: 97% of job seekers report being ghosted in the last year, with 58% saying it's getting worse.

"If you're just getting new logos to backfill the ones that you've lost because you mistreated them so badly, that's not a viable long-term condition. Same applies to talent acquisition and talent management."

This ghosting damages not only future hiring pipelines but also customer relationships, since potential employees are often fans of the brand.

From VUCA to BANI: The future of work reality

One of the most pressing CHRO challenges is adapting to an environment that has evolved beyond VUCA (volatile, uncertain, complex, and ambiguous) to BANI: brittle, anxious, nonlinear, and incomprehensible.

"When I talk about being a customer-driven leader, the whole basis of that is how do you actually forecast how to attract the right type of customer, not just today, but 12, 24, 36 months from now. And that's the exact philosophy that CHROs need to have in terms of the skills and the talent that they need."

This forward-looking HR leadership strategy requires moving from employee-centric to employee-driven, empowering employees to drive business outcomes.

Employee experience drives customer experience

James contrasts organizations that align employee experience with customer experience versus those that derail both:

Poor Employee Experience (and Poor Customer Experience):

• Discount airlines that nickel and dime customers while employees bear the burden
• Comcast with "bad profit" mentalities creating friction for employees and customers
• Organizations preventing employees from delivering superior experiences

Strong Employee Experience (and Superior Customer Experience):

• Delta, T-Mobile, Patagonia, Singapore Airlines—brands investing in employee experience to drive customer experience
• Ritz-Carlton with $2,000 daily empowerment budgets for employees
• Organizations removing friction and enabling employees to do more

"The empowerment of the employees is absolutely front and center. The friction is removed and they have the ability to actually do more on behalf of the customer and for each other as employees."

The AI paradox: A critical CHRO challenge

James highlights a significant CHRO challenge: "CEOs are actually bragging about the fact that they've been able to lay off 14% of their workforce in the name of operational efficiencies brought on by AI."

This undermines employee experience and customer experience. He notes 79% of US workers use AI daily but receive zero guidance from employers—a critical gap in HR leadership strategy.

"A fool with a tool is still a fool. You have to consider what are you using AI for? How are you using it? What are the goals that we're trying to accomplish?"

The three A's framework for AI

To help organizations define AI's role more clearly, James introduces the Three A's framework:

- Assist: The human owns the outcome
- Advise: The human decides with AI input
- Automate: The algorithm owner is accountable

"Those swim lanes frankly haven't been well defined for most organizations yet. And that's something that CHROs in particular need to weigh in on definitely in partnership with the office of the CIO."

The fractional workforce: The future of work is here

Upwork forecasts that by 2027, 50.9% of US workers will be fractional, gig, part-time, or contract—a fundamental CHRO challenge requiring new HR leadership strategy.

"A team leader's team, anywhere from a quarter to 50% might not actually be W-2 full-time employees. Then you have to start asking questions like, what technology are we using and who gets access to it and how do we handle rewarding them and how do we manage performance."

This demands HR transformation in how organizations create cohesive employee experience with blended workforces while maintaining customer experience quality.

Five pillars of HR leadership strategy to drive transformational outcomes

James outlines five critical pillars for HR transformation:

1. Build a Clear Microculture – Define team norms and expectations for consistent employee experience.

2. Define Clear Lines of Accountability – Essential for both employee experience and customer experience quality in distributed environments.

3. Enable People Through Systems Alignment – Avoid creating friction that degrades employee experience.

4. Redefine Collaboration – Design collaboration that works across W-2, fractional, gig, and part-time staff.

5. Accelerate Integrated Onboarding – Every worker needs effective onboarding to deliver quality customer experience from day one.

"It comes down to one really big thing across those five pillars: the elimination of friction."

The key to attracting better talent: Invest in employee experience

"The way for you to attract the best talent is just something very simple: build the best value proposition for employees who actually work for this company. If you built a good culture for them, not only will you preserve your best talent, but you will be able to attract talent from the outside. The key to success in talent acquisition is actually in post-talent acquisition."

Strong employee experience becomes the most powerful recruiting tool because current employees become brand ambassadors—just as positive customer experience drives customer acquisition.

What CHROs should do now: Practical HR Leadership Strategy

"Take a quick look in the mirror, figure out where's the gap that's going to have the biggest lift in the shortest period of time and just start. If you can invest in one of these pillars to move the needle faster at a lower cost and a higher value, do that."

However, effective HR leadership strategy requires C-suite alignment: "It is a holistic leadership problem from the CEO to the CFO to the COO. Everybody gets aligned at the top, because if they don't share those values, then you're not going to be able to create a culture that's actually going to sustain the talent."

Ready to transform your HR leadership strategy?

James Killian addresses the most pressing CHRO challenges by applying customer experience principles to employee experience. His insights on the future of work (from AI integration to fractional workforces) offer a practical roadmap for building employee-driven cultures.

The message is clear: employee experience and customer experience are two sides of the same coin. Organizations that invest in both will outperform those that don't.

Listen to the full episode of Skilled for more insights on HR transformation and the future of work.

Episode summary

James Killian explores CHRO challenges and HR leadership strategy for the future of work. He demonstrates how to apply customer experience principles to employee experience through the service profit chain. James discusses the shift from VUCA to BANI, AI-driven layoffs, the Three A's framework for AI, fractional workforces, and five critical pillars for HR transformation. He emphasizes that reducing friction in employee experience drives customer experience and competitive advantage.

Resources

• Connect with James on LinkedIn
• Learn more about Customer Driven Leader
• Pre-order Obsessed: Cultivating the Customer-Driven Leader
• Follow Growthspace on LinkedIn

Key takeaways

• Employee Experience Drives Customer Experience: Service profit chain principles show how employee empowerment directly impacts customer outcomes.
• C-Suite Alignment Required: HR transformation needs holistic leadership commitment, not just HR initiatives.
• BANI Replaces VUCA: Today's CHRO challenges include brittle, anxious, nonlinear, and incomprehensible environments.
• Three A's of AI: Define whether AI will assist, advise, or automate to maintain positive employee experience.
• Fractional Workforce Rising: By 2027, up to 50% may be non-traditional employees requiring new HR leadership strategy.
• Five Pillars for Transformation: Micro-culture, accountability, systems alignment, collaboration, and onboarding reduce friction.
• Post-Acquisition Wins Talent: Strong employee experience makes current employees your best recruiters.
• Reduce Friction Above All: Eliminating friction in employee experience improves customer experience and business outcomes.
• Start Small, Start Now: Identify the gap with biggest potential lift and begin incrementally.