Values driven leadership: Zalando in conversation with Helena Helmersson, CEO H&M Group

"I’m really excited about how we can accelerate our sustainability plans within the company, but more importantly in partnership with others.” 

Helena Helmersson, CEO H&M Group

David: Hi Helena! Great to have you here, at least virtually. For many people listening, it might be a surprise that this conversation between H&M Group and Zalando is happening, as many may not know that we’ve been collaborating for quite a while. I think it’s been three years! We recently launched Arket on Zalando. I remember the last time I saw you it was in February.

It was just a few weeks after you took on the CEO position at H&M Group, and the last opportunity for travelling before the lockdown started. And that makes me wonder a bit, how must that feel for you to come in as CEO of H&M Group in a time where, a few weeks later you get hit by this huge unforeseen crisis. 

Helena: Of course that was a very unexpected start for me, just as becoming the CEO for the H&M Group was such a big step. All of a sudden we’re in a pandemic so that was a pretty rough start, we really had to shift our agendas and deal with the crisis. Luckily I’m surrounded by amazing people so looking back, I feel that this is a journey that has made us so much stronger; how we came together and collaborated, and took quick and decisive decisions, always with the customer in the center. 

David: What do you do to keep your teams motivated? 

Helena: Companies, us included, have of course moved towards working more from home. We’ve learned how to create results and work together using digital tools. I think this has been a learning exercise for us: how can we be efficient, see great results, and also build on our transformation plans, in different ways. 

David: Yes I totally agree. I have to say, I also feel very fortunate to have a team and a team setting like we do. We also have a bit of an unusual set up, we have three co-CEOs, a great management board, a great leadership team overall, that allowed us to share a lot of the responsibility. We got together every morning and had calls with our leadership team where we discussed all kinds of measures. It was interesting because you were physically separated but we felt more aligned than ever before. In the long term, what adds to the success of the company is that we are aligned on a joint vision, we define who we want to be for the customers, we will define who we want to be for partners, we define the values that could somehow connect us all. We’ve empowered teams to come up with their own solutions and I think that’s what allows us to move quickly. I think when it comes to values, as far as I understand, you’re quite passionate about that topic.You’ve gone through different roles and stages with the company, you’ve been close to products, to production in Asia, you’ve led sustainability efforts for quite a few years. You probably know how it feels to be in different parts of the company and have those different perspectives. 

Helena: Going through a crisis, it becomes really clear how much values matter because in my 23 years in the company, I have never seen our values come to life more than during the past six months. So I really consider our values the most important competitive advantage that we have because just seeing that drive and the decisiveness and also the passion in the organization – making sure that we will come out of this stronger – has been amazing. I’ve been working almost my whole career at H&M Group, I started as a business controller in the buying office for the H&M brand and then I moved on to become section manager, working more with collections. Then I moved to Bangladesh, where I lived for two years and worked with production. My passion for sustainability really grew when I saw how we could also have a positive impact, especially for women that could make sure their children went to school because of their job in the factories. getting a job in the factories so that they could make sure their children went to school. Then I moved on to Hong Kong, and after that back to Stockholm, where I was Head of Sustainability for five years before moving back to Hong Kong again, heading the whole sourcing and production globally. What makes me passionate about this company is of course our values, and also using our size to really make a positive impact in different ways.

David: What values are important for you personally, but also for the company, for the team?

Helena: The company values that we’ve had ever since Erling Persson founded H&M in 1947, is  about teamwork, it’s about taking your own initiatives to drive improvements, and it’s of course about being cost-conscious because we are here to make sure that everyone can get access to the fashion and design that we provide, regardless of the size of their wallet. Entrepreneurial spirit is really important as well. If I then go back to my own leadership and what I’m very passionate about, is empowering people to grow and enabling them to collaborate, to reach really challenging goals. I enjoy focusing on both short and long-term at the same time, making sure we achieve great results right now but also making sure we have more transformative ideas planned for the future. Before the pandemic we thought “Should we focus on short-term? Or long-term?” But now we can’t do that, we have to be able to be those catalyst leaders where we make sure that we do both at the same time. 

David: Yes, I think at moments of crisis, values help you come together as a team, what we actually stand for becomes more relevant. At the beginning of the crisis, the first priority was keeping our team healthy and safe. Then we thought about how to protect our business in the long run. A few weeks later we saw how demand was picking up and we thought about what kind of role we could play, and that really showed us how important our partnerships are for us. So we got creative and thought about connecting all those stores that had closed down, we looked out for partners who were having trouble with cash positions. Partnerships work in such a complementary way. When it comes to leadership, the crisis underlined what we believed in before, but there are a couple of points that we really focused on: optimizing how we interact as a team, how do we define leadership, how do we define partnerships, how do we work together beyond our company, and this huge buzzword digitalization. In such a moment of crisis, suddenly it became super real. Because customers are online and if you’re not online to engage with them, you’re not present anymore. What impact did this whole situation have on what you planned for the future?

Helena: We’re definitely accelerating our plans going forward. And for us, that really means the interplay between physical and digital. How do we integrate the online with the physical, which has become really important in the pandemic. Many of our customers went online, and we gained new customers who hadn’t been introduced to our online channels before. We were very curious to see what they would do when our stores reopened, and they clearly showed that they want to meet us both in the physical world and in the online world. That’s why we believe so much in the integration part. If we look at H&M Group and Zalando, we come from first being a mono brand then becoming a multi brand, then also starting of course to work with different channels to forge relationships with our customers. It’s also about reskilling, and that goes for me as well. We have done quite a lot to reorganize and change structures to be much more integrated with the different brands and business plans going forward. 

David: I think when it comes to what we can potentially do together, it’s getting interesting. To be blunt, why are you here?

Helena: (Laughs) I think the word “frenemy” excites me a lot, I believe going forward will be much more about collaborating. If we take one topic about which I am very passionate and where I truly believe there’s no other option than collaboration, it’s sustainability. That’s an area where you also see that you simply can’t make that change alone, even with the size of the H&M group. You have to collaborate. Of course, there’s another part where we will compete: the more commercial side, the one about truly building a relationship with our customers.  And then at least in my mind, I’m thinking, “Okay, if we are going to be customer-centric, we need to look at every brand. We need to look at every market. And we need to make an assessment about how we meet the customers in the smartest way and the best way going forward.” That’s where we have to identify where we should really go for partnering up, and where we compete going forward. What’s your take on that?

David: Yes, we truly believe in partnerships of different forms, and I also think there’s a way to collaborate a lot more beyond this transactional or commercial relationship. I think that’s important. When it comes to competition versus partnership, of course there are certain areas of competition, we have an overlapping customer group. Of course we somehow compete around retention, around customer loyalty but at the same time, I also think that your propositions are quite different. I think what you do as a brand and the relationship as a brand you have with the customers and the certain target groups is a different one that we are building up with this broad cross-brand platform. And I think on a different level the capabilities are very different, but complementary — really going deep into product and brand story versus focusing on technology, data, how we create online ad experiences for customers. We both aim for not just growth at any price, but rather creating something meaningful and also assuming responsibility in the industry and trying to see how we can influence customer behavior in the right way. I think that’s somewhere where I definitely see that we can collaborate by finding joint definitions,  working more directly on products and creating transparency for customers. I think there are many interesting approaches to it. 

Helena: I think you’re right. I mean, every time I talk to you but also when I see parts of your plans going forward, I do think we share quite similar values and I think that the two companies are big on having a deeper purpose to make changes in the industry. You mentioned one area, product transparency, where I clearly see we have a similar kind of journey ahead of us. I’m so curious to understand a little bit more about your sustainability agenda and what your plans are going forward, and also how you manage the relationships with your partners, since I guess they also have to be on board with that journey.

David: Yes. My first comment to the question would be that we see a lot of traction on the customer side because customers really care more and more about sustainability.  I think the Covid situation even strengthened that and made people question a bit more where things are coming from. Whenever we put different products in front of the customer, where one is more sustainable, the customers opt for the most sustainable one. I think that’s an important foundation because that makes it not some add on topic but that moves it very much to a core position. There’s so much passion around that internally, on all our teams, I think it’s been one of the most exciting debates we’ve had internally because people are really interested in driving it forward and want to have some impact there. And  you’re absolutely right, we know we have to work together with partners because we are a fairly broad platform, we sell many different brands, many different products, we make it super convenient for customers. I think here we have to somehow see how to work on this together with our partners. There are certain elements, I mean, one is how do we become a great platform for a more sustainable product? We have to find the right conditions and see what we actually define as more sustainable. The tricky question is: how do we make all of this transparent to the customer?

Helena: And what effect do you think the pandemic has had on those plans?

David: On the customer side, we’ve seen quite positive traction. According to our own research, 40 percent of customers actually say that sustainability plays an even bigger role post-pandemic. Around 40 percent of our customers in the last half year have purchased at least one more sustainable item. The more traction it has on the customer side, I think the more traction it also has for any brand and anyone participating. How do you see this development?

Helena: We also see that customers seem to be even more aware after the pandemic so we are really excited about that. The value for money in combination with sustainability, that’s the part that we are well-positioned for. But I guess more important is the fact that we simply have to lead the industry towards a more sustainable future much faster in the coming decade than what we did over the past 10 years, simply because it’s much more urgent now. Here I think we really need to join forces. I think customers in most markets are there but we also have the size to influence what customers will want in the future, so I see this as a joint responsibility and a really exciting part of our strategies going forward. 

David: I think it’s also a strong signal, the fact that you’ve been leading sustainability efforts at the company for over 5 years. How does that influence your agenda for the company in your role now?

Helena: Yes, it has quite an influence. I guess those five years of my career really made an impact on me personally, getting my vision clear on what it is that I want to achieve.  That’s really been my guiding star ever since, when I’ve gotten opportunities or when I’m at a crossroads I always look at my position and try to think: Will this help me move closer to my goal? That was really important for me also when getting onto this role, that I could drive sustainability really as an integrated part of our business and use our size to make a change. So I’m really excited about how we can accelerate those plans within the company, but more importantly in partnership with others.The impact that we’re making makes me so proud! I want to accelerate that, I would love to engage with customers more around that and even more importantly, we all have to develop our own business models to make sure that we can keep on growing.

David: If you look at what we could do together, how can we partner up even more and which dimensions could we work on?

Helena: I think the priority topic is more around climate, how can we have an impact on policy making or how can we drive advocacy together? If we’re going to make a system change — because that is at least what I see in front of me — fashion should be something fun, exciting, and a way for people to express themselves. That is a beautiful thing. But the system behind it has to change. I believe that means that we need policies, we need industry initiatives, we need to change ourselves, our purchasing practices, developing our business models, and we need to engage with customers. In several of these aspects I see potential collaboration going forward. 

David: So let’s have a focus on these shared values. I think shared ambition to really drive something meaningful, to have a positive impact. Where would you like to see the industry moving? What would you wish for from it?

Helena: Well, I see an opportunity that we create hope, especially for the young generation, to show that we can offer passion and design. For us it’s also about affordable prices to get the right reach and engage with customers so that they really feel that they can express themselves through fashion. We also have to change the system. What I’m referring to is most of all the use of natural resources and the impact that has today when it comes to climate. I think we need to make changes and that also involves taking bigger and bolder steps towards circularity. The pandemic has highlighted a few areas that are guiding us forward. Those are the necessity of closer collaboration and partnerships, and also accelerating our agendas when it comes to sustainability because I think we seem to have a joint responsibility to do better. I’m excited to see how we, how this partnership can evolve over time to make that type of difference. 

David: Thanks a lot for being here, I think the messages around more collaboration, and on accelerating sustainability, we heard them very clearly. We are very excited to start working on that even more in the future. So, thanks a lot and hopefully see you in person quite soon.

Helena: I would love that. Take care!