How LEGO shapes its long term HR thinking brick-by-brick

Stuart Lauchlan Profile picture for user slauchlan June 1, 2022 Audio mode
Summary:
LEGO Group takes a long term view of its organizational strategies, including around HR and talent management, says Chief People Officer Loren Shuster.

Lego

Because we're a privately-held company, because we're a Danish-based company, we have a long term view of what success looks like.

So says Loren Shuster, Chief People Officer at the LEGO Group as he explains the building blocks of the firm’s approach to HR. Essentially the underlying message from this near-90 year old firm is that it plays a long game with its employees:

Being privately-held means that we're not governed by the public markets, which means that we do not hire and fire, we do not go through big waves - and have never gone through big waves - of bringing tons of employees on and then when we don't need them, we let them go. It goes against our principles. So we're really looking at a 5-10 year horizon in terms of our investments in people.  I think that's one of the reasons why we also have an incredibly low attrition rate and high retention rate. We also have very high-tenured colleagues, because people want to work for an organization that has evolved.

The group is about to embark on a Workday deployment, he says:

We've gone through the last few years of replacing our core HR platform, which is a basic requirement, to then enable a whole other series of applications and services. The next thing that we're going to build on top of that is what we refer to as a project internally called Lego University, which has two focus areas.

One is to provide really customized learning opportunities for different individuals, depending on what skills we either believe they should be cultivating and developing or that they would like to cultivate and develop.

And then the other part of the University will be a so-called talent marketplace and skills marketplace to create much greater transparency in the organization, to move the right people with the right skills to the right roles, the right projects, and hopefully, just get much more engagement also from employees by providing opportunities for them to grow.

As to why Workday has been chosen, Shuster explains:

Like any other organization, we obviously ran a process with multiple vendors and we decided on Workday in the end. One, we were looking for a cloud-based solution, which most of the solutions out there are We really liked the way in which Workday every six months has an automated upgrade, so you're staying fresh with the latest features, which then enable a lot of APIs to link with kind of the newest applications and services out there. 

He adds:

There's so much money going into HR tech.  I can't begin to tell you how many emails a day I get from different vendors with a lot of interesting solutions. But one of the factors that we look at is trying to assess the longevity of the solutions out there. And the way in which we do that is, we do financial analysis on how well-resourced they are and funded, but more importantly, we talk to reference clients.  Is what they're they're selling, has it been deployed in companies of our scale or bigger? How is it being used and leveraged and has the value being created?

COVID impact

As with so many other organizations, the COVID crisis has caused LEGO to take a long hard look at its HR strategy. Shuster says:

We have 25,000 employees around the world. Fifteen thousand are either factory or production colleagues who did not have the opportunity to  work from home, and retail colleagues, who when when COVID restrictions were not in place, also do not have that opportunity. So we're also very sensitive to the A and B team and trying to manage that. I think it's important to realise that one person's flexibility creates potentially an issue of flexibility for other people that they need to collaborate with.

We did a lot of research, we piloted a lot of things and then we made a belief, that's partially data-based and partially belief-based, that we're actually pursuing the same approach for all of our salaried colleagues. So, there is trust in the system for teams to manage around it and to work within that  framework. There are clearly some colleagues who are still pushing for more flexibility. But we feel that, being a Danish company, equality is a very, very important value in the Danish culture and in the LEGO Group. So it was important to us to land on something where everyone is treated in the same way.

Shuster concludes:

Maybe five years ago, certainly 10 years ago, there was a lot of hyperbole that digital revolution was going to dis-intermediate talent and talent wasn't as important. I certainly see no signs of that. There's definitely movement, where you need to place talent, what kind of skills are needed. But as we clearly all are seeing in the world today, there's a shortage of talent and great people with the right skills for the future have never been in greater demand.

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