Disruption Case Study : Lego

1412 WordsApr 27, 20176 Pages
Disruption Case Study LEGO: Back to Bricks LEGO, as we know, is everywhere today. Not only in their classic, cuboid shapes, but also in video games, on the movie screen, on clothes, and in the formation of theme parks populating the globe. Within a world that is increasingly being surrounded by colorful, snappable bricks, it is hard to describe LEGO as anything other than a major success story. However, the brick road has not always been yellow for the Danish firm. Up against the volatile toy industry, LEGO has had their share of ups and downs, nearing bankruptcy in the early 2000s. One may say that LEGO has always been unique, but it was not until this pivotal low they they became disruptive in the way they operated as a brand. This…show more content…
The company began to make rash initiatives in an attempt to transition their brand from that of a product, to one that embodied a lifestyle. Launching offshoot product lines, television series, and theme parks, LEGO began heavily investing in business model extensions that would quickly crash and burn. (Robertson & Hjulen) As a company, they lacked the expertise and validation to make these ideas work. Enter Jørgen Vig Knudstorp. In 2001, Knudstorp, a design thinker, joined the LEGO company as a consultant and was promoted to CEO after just three years. He understood the complexity of the market and how LEGO was inefficiently addressing those challenges. After meeting with several company stakeholders, Jørgen was able to understand that the LEGO brand and core product were the bread and butter of the company. Creating a messy ecosystem of disparate offerings and products forced LEGO to divide its attention to such a scale that they began to ignore their main customers, a common incumbent faux pas. (Billund) Knudstorp knew what to do. It was time to strip the company down to its core–a ubiquitous brick. (Ringen) Under his lead, the company would execute a multi-phase strategy to create a robust operational foundation that would serve as a platform for resilient innovation. As a response to demand-side disruption, LEGO began to pivot its organization to focusing on the creation of customer value. The company

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