Human relations (HR) is an essential building block for any company. But for many organizations, HR departments get stuck in a functional silo and fail to support business needs.

LEGO wanted to change that and set out to rebuild its HR function by interlocking human relations with the company’s business functions. Those efforts have helped LEGO reinvigorate its talent acquisition efforts and become more responsive to broader business challenges.

Here’s how the iconic toymaker reimagined its HR deployment, brick by brick.

Stuck In A Talent Acquisition Trap

Since its founding in 1932, LEGO has inspired generations of children with its iconic, colorful bricks. The company flirted with bankruptcy in 2003, but fought its way back into profitability with a series of strategic investments in e-commerce and direct-to-consumer sales, which currently make up nearly one-third of its business.

However, the successful rebuilding of LEGO came with a downside: functional silos, specifically in the HR department. I interviewed Loren I. Shuster about how LEGO’s efforts to get unstuck.

When Shuster took over as LEGO’s chief people officer (CPO) in 2017, he realized LEGO’s HR team was falling short of supporting critical business initiatives. He recalls looking at a list of upcoming strategic projects and initiatives where different parts of the business needed additional engagements and support and realizing, “We were scrambling and asking ourselves: ‘How are we going to do this?’”

Shuster had transitioned to HR after serving as chief commercial officer (CCO) for two years. While he was not an expert in HR, Loren was an expert in recognizing the need for more strategic, cross-functional collaboration to meet business priorities.

“Since I've taken over the function, I've been constantly trying with my organization to look at ways in which we could be more effective, more aligned, more embedded and with greater proximity to enabling the core drivers of our overall operating model and business,” he said in a May 2024 interview.

As such, Shuster began talking to experts in HR, one of whom was Josh Bersin. The Josh Bersin Company, a longtime industry leader, represented a smart resource for Shuster. The company’s report, “Talent Acquisition at a Crossroads,” found talent acquisition leaders are “grappling with a notable absence of strategic support from HR and business leaders.”

Only 32% of talent acquisition leaders feel they act as strategic partners within their organizations. By comparison, 46% feel like they’re “running around” to keep up with constantly changing business priorities, surveys revealed. More eye-opening was the fact that 40% of the survey respondents didn’t believe their company was ready to take a strategic approach to talent acquisition.

Shuster didn’t want LEGO’s HR efforts to feel disconnected, so he worked with his team to prioritize the business problems the company was trying to solve and consider the role of human relations to help solve those problems. Through that effort, he challenged HR leaders to rebuild LEGO’s HR function by focusing on a few key building blocks.

Brick 1: Refocusing Responsibilities

Under LEGO’s earlier HR structure, senior leaders were bogged down with team management responsibilities. Shifting senior HR leaders into a consulting role and offloading administrative and staffing tasks freed them to solve bigger-picture problems alongside business counterparts.

As McKinsey & Company wrote in an April 2024 essay about talent systems, “The most effective HR organizations build agility into their operating models, typically with cross-functional, flow-to-the-work resources.” These changes have helped LEGO maximize its return on talent and become what McKinsey dubbed a “true talent steward.”

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