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Transforming LEGO Group HR, brick by brick

Human Resources

Transforming LEGO Group HR, brick by brick

Published 16 February 2023 in Human Resources • 6 min read

The LEGO Group’s Loren I Shuster has an unusual background for a senior HR executive, and his remodeling of the Danish toy company’s HR-function is equally unconventional. 

Chief People Officer at the LEGO Group Loren I. Shuster spent much of the first quarter of 2021 thinking about whether traditional approaches to HR were still fit for purpose and what the function might need to change to serve the business’s needs more effectively. After conversations with other leading CHROs and influential thought leaders in the sector, Shuster made a decision: the LEGO Group’s People, Operations and Development function needed to go in a new direction.

Since then, the company has moved quickly to put theory into practice. “We landed on three core drivers of future HR success, and each of them is now in motion,” said Shuster, who before joining the LEGO Group had always worked in commercial roles rather than in HR. “We wanted to pivot from centers of excellence to communities of expertise, develop digital product management capabilities within HR, and set up a central pool of HR partners who could be deployed in a fluid manner according to where the biggest need is in the business at any point in time.” 

Change 1: communities of expertise 

Each of those shifts represented a significant change for the LEGO Group – and a move away from typical practice across HR as a whole. “I don’t want to generalize, but my experience with different HR organizations over the years is that they can be somewhat removed,” said Shuster.

I want to ensure our HR organization can have a bigger impact.
- Loren I. Shuster

The move toward “communities of expertise” is a good example of this increased impact. Shuster’s contention is that while good work is done in the centers of excellence that HR so often creates – around compensation, for instance, or talent – it is inevitably developed in isolation from the business and then foisted upon it. He prefers a model based on co-creation and collaboration. 

In practice, that means finding a group of 10 to 15 individuals for any project HR is running – not just representatives from HR itself, but also people from diverse areas of the business. This means that when the project is finally deployed, it is based on the expertise and experience of end users, instead of coming solely from HR.

An example is an ongoing exercise to reimagine learning and development at the LEGO Group, where a community of expertise is working on a project known as “LEGO U.” The individuals involved come from different parts of the business, work at different levels, and have worked at the LEGO Group for different lengths of time. 

“They are the ultimate audience for our learning and development, so their points of view are super relevant,” Shuster explained. “Because they have been through the process from beginning to end, they are effectively change agents embedded in the business. Plus, they give an initiative real credibility because the rest of the business knows it is something that wasn’t just designed by a bunch of HR folks.”

Change 2: digital product management 

Similar principles underpin the LEGO Group’s determination to improve HR’s digital product management capabilities. “It has become a real problem for HR organizations trying to support digital transformation that unless you are digitally embedded, it becomes an academic exercise,” says Shuster. “How can you support part of the business that it trying to transform itself around HR unless you have experience of that yourself?”

It is not as if HR stands apart from the digital transformation agenda. Innovators and entrepreneurs have developed multiple tools and technologies aimed at the industry over the past couple of years. The LEGO Group is using some of these not just to improve the way HR functions, but also so that its process of transformation mirrors what the rest of the organization is going through. 

For example, Shuster has appointed product managers in three areas within HR – talent, pay and time, and hire to retire – and asked them to run cross-functional teams that incorporate engineering and user experience design roles as well as end users. “We are basically learning in HR how to operate with a digital mindset,” he explained. “Then we take those learnings and apply them to the transformation that is happening in other parts of the business.”

Change 3: a fluid pool of partners 

Shuster’s third area of significant change to the LEGO Group’s HR structures is the move to a more fluid pool of partners. He says that other CHRO’s tend to be “curious and somewhat envious” when he tells them about it. “It is a capability that we are building as I speak, through time and motion analysis that seeks to understand exactly how our partners spend their time and when they have peaks and troughs.” 

In a traditional HR organization, each unit or function of the business would typically have its own head of HR plus a group of partners dedicated to supporting the unit. At the LEGO Group, however, each member of the executive leadership team has their own HR lead but the 80 or so HR partners previously embedded across each of the leaders’ functions are now in a single pool. They are then allocated to different areas of the business according to need. 

Loren I ShusterChief People Officer at the LEGO Group Loren I Shuster has radically remodeled the company’s approach to HR.

For example, the LEGO Group has recently reorganized its digital technology division, with 800 people changing jobs. “That required a huge amount of support, so we were able to deploy a large segment of our HR partners to provide it,” Shuster explained. “Equally, if we decide to build a factory in, say, Vietnam, we will be able to allocate staff specifically to that project, which isn’t trivial.” 

This is making the LEGO Group’s HR much more responsive to business needs, but it is also giving staff exposure to a greater variety of work in more parts of the organization. And as each HR partner builds their skills base, they can be deployed on projects or initiatives where their expertise and experience has most to offer. 

Managing the tension 

All three areas of change sound logical, but they have not been easy to implement. “One issue has been to clarify roles and responsibilities, because we got these tension points where people were having to rethink where their roles begin and end,” admitted Shuster. “We are still getting there, but at the very least, HR now has more empathy and understanding of what it means to go through a major transition – and that in itself makes our teams far more effective.”  

It is a process that Shuster himself had to go through: he took on the role of Chief People Officer at the LEGO Group despite a lack of direct experience in HR. “Initially, there was tension between me and the organization I was leading,” he said. “I eventually realized I was operating in a different paradigm to the team.” Shuster’s previous roles in commercial revolved around continuous change and live feedback loops, whereas HR was much more institutionalized around a longer-term cycle – based on annual performance management reviews, for example. “I wasn’t unusually demanding,” he added. “But I did operate with a different mindset.” 

Over time, the tension has eased, and Shuster is determined to take the HR organization with him as he seeks to use his broader experience of different parts of the business to ensure that HR has more of an impact. 

“I still consider myself an outsider – I do come at HR from a different starting point, because that is the way I have been conditioned in commercial and marketing leadership roles,” he explained. “That is the value I add, and it feels even more important in a post-COVID world – the HR role has become more relevant and important than ever before. It’s at the center of so many issues organizations face today: digital transformation, hybrid working, the increased need to focus on people’s wellbeing, employee activism, and diversity and inclusion. These are huge forces – and they are landing right at HR’s door.” 


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