It is boom time for the luxury goods market in Asia, where well-heeled shoppers do not mind spending US$2,000 on a handbag. Some 27% of the Louis Vuitton Moët Hennessy (LVMH) Group’s revenue of nearly ¤24 billion (US$31.6 billion) in 2011 came from the Asia-Pacific region, excluding Japan.
About a quarter, or 23,000, of the LVMH Group’s 100,000 employees are based in Asia-Pacific. In 2011 alone, the Group hired some 7,300 employees here, making it one of the highest growth regions in its portfolio, says Chantal Gaemperle, Executive Vice President, HR and Synergies, LVMH Group.
Riding on this potential, the LVMH Group recently set up its Asia-Pacific Talent Development Centre in Singapore – its first such facility outside of Europe. Located at Ngee Ann City along the busy Orchard Road shopping belt, the centre aims to grow Asian talent and boost research in luxury brand management.
Singapore was chosen because of its ability to open doors to Southeast Asia, its good infrastructure and quality educational institutions, says Gaemperle. “The plan is for this research to enhance not only our understanding and the content of our development programmes, but to increase our employer brand desirability and thus attract new talent and contribute to the wider growth of the luxury sector in Asia.
“It is extremely important in a decentralised Group like ours to provide a platform for connection for our executives,” adds Gaemperle. “If you work for a small brand here, you would be very happy to connect with your colleagues in another sector. It is very motivating, fosters a group culture, and helps circulate best practices and raise our profile locally.”
The customers for luxury goods in Asia are also becoming more sophisticated, and the company is eager to help staff raise service standards to meet those rising expectations, says Gaemperle. “When you buy a piece of luxury you, you buy a piece of history and a piece of the dream.”
Part of the talent challenge in Asia is helping staff understand the history of the brand so that they can transmit that dream to customers. Mastering attention to details, is one area that can be improved on, says Gaemperle.
Reaching out to talent
In a highly competitive market, the LVMH Group believes in capitalising on the staff already working within its different brands. “We believe it is very powerful when talents are able to identify themselves with real people who have made the jump to work with us. We partner with them and speak to students at various events, offering specific journeys into our brands. “
LVMH also brings in professors and subject experts for its recruitment talks to explain how branding works, share brand stories, and emphasise the importance of effective communication strategies. “It provides them with a mini-working session that is concrete and facilitates dialogue with managers within the company. It gives them a real feel of what it is like to work within a luxury group,” Gaemperle says.
Building talent ecosystems
Developing a strong talent pipeline is a top priority at LVMH. Supporting this ambition is FuturA, an international programme that aims to recruit and develop high potential executives. After a rigorous selection process, successful candidates are groomed over a five-year time frame to take on key positions within the Group. Specific reviews are conducted to track their success and help them grow, and this is critical in ensuring a full talent pipeline, says Gaemperle.
Efforts like this have already begun to reap rewards. Today, two-thirds of key positions in the organisation are filled by internal placements, says Gaemperle. However, achieving this was not an easy feat, as it called for a change of mindset across the whole company. The Group’s different brands had to come forward and share their succession plans, says Gaemperle. They had to learn how to anticipate future talent gaps and propose potential talent movements. “Isn’t it better to lose a talent to another brand within the Group, rather than to a competitor?”
HR heads and presidents from each of the brands meet up every three months to discuss talent mobility issues and identify which employees are in need of a change, or who the company is at risk of losing. The Group is supportive of cross movements across the different brands. “For example, the president of (travel retailer) DFS today was ‘number two’ at Louis Vuitton,” Gaemperle explains.
When Gaemperle first joined the company four years ago, one out of two jobs did not have a successor identified. Today, 80% of positions have a successor, she says. As the different brands are beginning to see the effectiveness of this talent management strategy, they are also more willing to come forward and share their experiences, she adds.
Women at work
The LVMH Group works in an industry where product buys are heavily influenced by women, and it has launched a number of initiatives to support its female employees. “It is a business imperative to make sure that our Group is taking care of promoting women where they need to go.”
While three quarters of LVMH employees are women, only 36% of executive board members are female. Gaemperle aims to increase that ratio to at least 40% by 2015.
Supporting this goal is EllesVMH, an internal networking group that was started in Paris and is now running worldwide. It gathers women around senior leaders who share their stories and experiences. For example, the president of Pucci recently hosted one of the networking sessions.
The Group’s different brands also pursue many initiatives of their own, in line with the culture of their brand. Champagne producer Moët et Chandon has an internal taskforce that addresses parity. There are day nurseries at Sephora and another champagne house, Veuve Clicquot organises the annual Business Woman Award. Initiatives like these offer young women role models that they can aspire towards, Gaemperle says.
At a glance
Louis Vuitton Moët Hennessy Group
• Number of employees in Asia-Pacific (excluding Japan): 23,000
• HR priorities: Succession planning, training and development, boosting the number of females at board level
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