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Employee Engagement and Innovation at DHL Express

Clifton Leaf, Editor in Chief, Fortune Magazine and John Pearson, CEO and Regine Buettner, EVP HR Global, DHL Express

DHL Express, the global express logistics provider emerged 50 years ago as a startup with one innovative idea - providing door-to-door, time-sensitive delivery services to the world.

With over 100,000 employees across the globe, diversity is an essential part of the company’s DNA. Heading up the global HR organization, spanning 220 countries and territories, Regine Buettner has helped ensure the principle of acting “As One” has become instilled in the HR approach, ensuring a globally unique culture while making sure employees across the globe have their best day at work every day, no matter in which region and country.

John Pearson joined the company in 1986. He previously served as CEO in Asia Pacific, EEMEA and Europe, and led the global sales, marketing and customer service functions. He assumed the CEO role in January of this year.

Learn how DHL Express has created a strong culture of engagement and recognition, while offering a first-in-class development program for employees. Leadership at DHL Express leverages the positive impact of building a people-centric organization with the aspiration to be the World as its Best.

Join us for a conversation on how diversity and employee experience drive innovation at of one of the world’s largest companies.

Key takeaways:
  • How innovation turned DHL from a local startup to a global upstart.
  • Understand how to build a global culture of engagement in an extremely diversified company impacting the bottom-line.
  • How digital HR transformation contributes to a more seamless and exciting employee experience.
  • Learn how all employees can participate in and drive continuous improvement through DHL’s innovative Performance Dialogs.
  • How DHL is enabling E-commerce all around the world and empowering its people to deliver its vision.
Show Transcript

Interviewer:                     You just had your 50th anniversary. You're moving well. You're growing. You're innovating. You're having fun. I have to say from a personal standpoint, having that after 50 is exciting for me.

Interviewer:                     Regina, I want to start with you because yesterday, I had a conversation with Bernard Tyson at Kaiser Permanente and I've marveled at the size, 200,000 employees by the eight states, the district of Columbia. You're in 220 countries. I think you're the most global company I've ever heard of, actually. 220 countries. How do you create one culture with that?

Regine:                              First of all it is a fantastic experience to work with 220 countries. Have you done it, you will never work for a local company. How did we do it? We really created a focused strategy, which you see behind us. Motivated people create great service, loyal customer, and loyal customer leads to a profitable network. Back to motivated employees. We really developed a program, a cultural change program which is called Certified International Specialist, and we all speak the same language and we all share the same passport. It doesn't which religion, it doesn't matter which country, we share one passport and we have the same values. This is how to create the framework. Based on those values, we have central cognition programs in place.

Interviewer:                     Let me just push a little bit on this because 220 countries is 220 different sets of national holidays, lots of religions, ways of dressing, different benefits programs that different countries require. That really is a lot to manage and when you think about that, what is the secret that you've got for threading the needle through all of these different countries?

Regine:                              Think global and local respect. Respect the local legislation, respect the local holidays, respect the local [inaudible 00:02:25]. This is really the secret. And even more, be proud of it that you are so different. For example, we have in the meantime hired a lot of people from Middle East to Belgium or Germany, and we celebrate Ramadan and Easter as well. We listen to the people, what their need is, and really respect is the secret behind it.

John:                                 Can I also comment a little bit on that? Because you're absolutely right, we're celebrating our 50th anniversary. It was in this fine city that we're incorporated, moving our first ever document from 400 California Street to Hawaii. But I think that the ability to be global is that in 1969, or January 1970, we started to spread organically around the back of the world, in the sense that Fiji and the Pacific Islands and Sydney and Auckland were our first offices in '72 and then Hong Kong '74. And by '76, over 7 years, we've become pretty much a global company. And all the people in those offices were local. There's no one better to observe local customs than local people. This thing about being truly international in every country is when you've been at it so long and you pioneered the express industry, comes quite easily to us.

Interviewer:                     You now are the largest globally, 38% market share for time sensitive international parcels, so you've really grown incredibly. We're in an age here where there's been a lot of pushback on globalization. You come from a nation where they're dealing with Brexit now. Here there's been some pushback as well. How has that changed the model for you?

John:                                 Trade and globalization has been around five thousand B.C. and trade will always win out. It's a very hackneyed phrase, in my view, but globalization is too big to fail. Whilst people get in the way of globalization, people get in the way of trade, and that's happening right now in front of us. The essentials of 'you have, I want,' 'I have, you want' win out. People are very self-resuscitating, businesses are very self-resuscitating, people want to trade, want to sell things, want to buy things.

John:                                 What's so disheartening to me is that of all the origin destination pairs, as we call them, all the trading lanes possible in the world, 25% of them have no recorded commerce whatsoever. And we know that when trade starts flowing, prosperity and education increases. OECD came out with a statistic that said, front line as we would call them, other people would call them blue collar, front line workers get paid between three and nine times higher salary than those countries that are less open and less connected. So there's no argument in my mind for protectionism, and there's everything to say globalization is good for everything and it's the cheapest thing you can get your hands on that makes the world a better place.

Interviewer:                     Definitely. We're going to talk about innovation now. But nothing drives innovation quite like necessity. You have faced this enormous disruption in your business model with e-commerce. Of course, what you've done is you've embraced it. But it's a very different model from the traditional package delivery in the express rate which was business to business. Now you're delivering to millions and millions of homes, remote places around the world.

John:                                 I say to my wife, 'keep shopping and keep shipping,' because-

Interviewer:                     You hear that everybody?

John:                                 So please, carry on. This thing came upon us about five or six years ago, e-commerce really started to move.

John:                                 And if you think years ago, when my father was selling tractors all over the world, if you wanted to do business with China, you waited to get your visa, you flew to China, you ordered the brochures, you radioed back for more brochures when you visited the trade fairs, and it went on and on and on. You extended your trip, you needed another visa. Now, in a small little shed in Slovenia someone's cooking up a great product that they can put on the world stage tomorrow, literally. And orders start flowing to countries they've never even heard of. For us, it wasn't a lifeboat, it was a growth rocket and it was clear to see that if we played in the premium end of transportation, which is where we sit... So the shimano brake for a Cannondale mountain bike, or the part for a Fender guitar, or Kim Kardashian's dog food, whatever it is, there's a premium end, I've learned, to everything in life. There's an expensive end, because the product needs to carry the cost of the transportation.

John:                                 So for DHL to move it, for it then to probably incur customs duties at destination it needs to have its own value. Typically fashion, luxury fashion and high-end fashion is probably the industry that we serve most successfully. But consumer electronics, and so on.

Interviewer:                     I have to correct you on one thing: it's Khloe Kardashian that has the dog food. Regine, the fuel for all that rocket, for all that amazing growth engine, are your people. This is what you guys have really invested in and I think you've shown that for, now decades. Tell us how you've innovated on that e-commerce front. Where's the innovation coming from that really is helping you to get to that last mile a lot faster?

Regine:                              The innovation comes from the country. Innovation comes from our people. Innovation comes from you guys. Maybe you as a partner, we listen, we benchmark each other. This is where innovation comes from. But most important is that we listen to our people and that we share everything that gets developed, alter as the best practice within the group. And if you recognize what people do, how you can make it better. For example, every day we have performance dialogues with our people. Every day, at least 15 minutes, we hae performance dialogues with our people. You get a lot of feedback not only so you that can talk about a target, no, also you get a lot of feedback from the employee what you can do better. And this is where a culture of innovation-

Interviewer:                     The employee drives these performance dialogues, that's really good. Starts out in the morning? The employee comes in and says, 'You know what, Regine, here's what I don't like'? Is that how it starts?

Regine:                              No, it's not what you don't like. It's a question we have a culture of do things better every day. It's a very positive attitude. It's not about criticism it's a positive attitude, how we can serve our customer better, how can we serve our colleagues better.

Regine:                              For example, in HR we developed a buddy program. We lost a lot of people within the first six months when they joined us. Particularly, very big advisors. We developed a buddy program to welcome every single employee personally. And we had a buddy dedicated to this newcomer who really guides them through the first six months. This is where innovation comes from. It was born in a country, we picked it up, and we created a global program. And of course it's a global program with local bits and pieces.

Interviewer:                     And you have a program, an application called Smarter on your phones that connects every employee. What else does it do?

Regine:                              In this age of digitalization, we were thinking 'what does employee experience mean?' You may know that 60% of our employees are front line employees that do not have access to a laptop. So our question is how can we reach out to these people? We want to communicate, we want to make their life easier. This is where Smarter was born. We are still in the development process and implementation process, but this is really where we want to make the lives of our employees, our managers, much easier, and have a kind of communication which goes in minutes to the people in Angola, in Iran, in the Philippines, wherever we are in the world.

Interviewer:                     You've done a lot, John, a lot of experimentation that has bubbled up from these people. I know you tried drones early in 2014 to deliver medicines to a remote island off of Germany. That was pretty early, 2014. You used helicopters to get from JFK down to Wall Street to avoid the traffic in New York City. Recently you're using boats and bicycles now in the Netherlands to deliver packages, because the new imperative is to think green.

John:                                 The longest running helicopter that's been serving our customers is the one from JFK down to the heliport in lower Manhattan. It shortens the transit time for our bank customers in that part of the banking district. But you're right, times have changed. There's the odd drone delivery out there, but anyone that is aware of what happened at Gatwick Airport over Christmas, the drones are so highly regulated that the number of deliveries made by drone will be quite limited for some time to come.

John:                                 With the green movement, we need to be moving around our cities as efficiently and as effectively as we would in fast means of transportation. We've been running a boat in the canals in Amsterdam for many years, but we've now linked that up, for the last mile instead of a van that meets the boat, there's cycle hubs. There's a number of bicycles waiting in parts of Amsterdam when the boat gets there. You can imagine in a country like the Netherlands, city of Amsterdam, how popular that is, how appreciated it is. It's a nation of bicycles anyway. We are literally loved for it.

John:                                 The next concept is now the Boris Johnson built his super highway through London for cyclists. This means the traffic is becoming far more congested in the city of London, which means also we've got an opportunity to put a boat on the Thames and link up with these bicycle or foot couriers at different spaces along the city journey.

John:                                 We're moving with the times, it's very quickly evolving. There's cities in Oslo now that have stated that no diesel vehicles will be allowed in the city center by a certain date, so we have a lot of electric vehicles on our fleet now, bicycles. It's very important.

Interviewer:                     We talk about diverse workforces and this is something that's obviously very important to your company and you've walked the walk, as they say. But it's also the diversity in the fact that you've got one of the largest airline fleets around, In terms of actual planes, you have 250 planes. That's a lot of pilots, folks from all across the board, from local couriers to people who are data analysts and a lot of very sophisticated parts of your logistics program.

Interviewer:                     How do you manage the career trajectories for people who are so very different in terms of their professions?

Regine:                              We always say know your number and know your people, so that's the first thing. Of course we have all the processes in place that every company in the meantime has. But the most important thing is to know your people. It doesn't matter where you go, you need to know your people, you need to know your tenants. We are traveling a lot through the countries. We talk with these employees, we really want to know and understand what their career aspiration is. Therefore, it's so important to know your people. Besides, of course we use our certified international program to develop our people, We have also a lot of opportunities. New projects, new countries coming up. New products coming up. We use our talents to really drive it further. It's really interesting in 220 countries, you have always opportunities also to move within these countries.

Interviewer:                     John, one of the things that's so fascinating is how much international, cross-border trade is rising. It's growing by 25% a year. One in seven international express deliveries is now cross-border. We're seeing the growth in Asian commerce, and I think China accounts for more than half of the global package delivery, is that right?

John:                                 Not quite more than half, but China is an enormous inbound market and it's an even larger outbound market, specifically to the USA.

Interviewer:                     How are you learning from the local countries and customs in terms of how to get those packages faster?

John:                                 In a highly transactional business like ours, where you're moving well over 250 million packages a year, you have to have your big hubs in pipes, which are hubs in [inaudible 00:16:42] and our hubs in Singapore and Cincinnati and Hong Kong, and that's the connectivity by which all these shipments get to where they're meant to be. Very little goes wrong at origin pickup. Very little goes wrong at destination delivery. The opportunity for failure happens in the sky or through the big connecting hubs. Whether it's China or UK or Peru, the same systems and processes literally take place in order to facilitate the movement of that shipment. It really is no different in China. In China we have an extraordinary good partner in Sinotrans, and I think where companies have failed in China is not to partner with someone that knows the local business. This talks to Regine's point about operations in all these different countries. We literally held hands and got married to a local partner within the first two weeks of our setup.

Interviewer:                     Was this in Vegas? Where did you do this?

John:                                 Not in Vegas, in fact, I've never even been to Vegas. And I am currently married.

Interviewer:                     All right.

Regine:                              We've also built a people network, not only an operation that... as you can see in the photos behind us, we have football cups in every region every year. Around two to three thousand people we invite from the different countries to go to one place and compete with each other. We have EOY, Employee of the Year events where we really recognize the best people. Behave the best, go the extra mile, and we invite them three days to a luxury hotel and the get treated like celebrities.

Regine:                              I really would like to mention that we have implemented a program which is called [inaudible 00:18:35] and we really support people who give something back to the society. We always ask for nominations, colleagues nominate colleagues who goes the extra mile to give something back to society. We invite three people from every region to an event, we just came from Africa, where people go over the weekend to educate people who have no access to school, education, and they do it every weekend. We have people who help, the children can die at home because they don't have help in a hospital.

Regine:                              This kind of giving back to society we recognize and we really donate to this community that can even do more for their people in their local community.

Interviewer:                     Well that's all the time we have. There's a big endorsement for a closer, more connected world and for motivating your people. Thank you Regine and John.