The Lego Group Case Study
Lego case study: from Downfall to Revival
The Lego Group Case Study
Kim In Seok
Strategic Management
Lego bricks still hold special meaning to many young adults who have played with the bricks in their teenage years. I, for one, count among those young adults as I was an avid collector of Lego products myself: whenever there were new Lego products released, I used to nag my parents to buy them for me and promised to be a ‘good boy’. Thus it came quite natural to me that I wanted to investigate the Lego group – the symbol of my childhood nostalgia - as a full case study report for my Strategy for Creative Technology Business class. Established in 1932, the Lego group was the world’s leading toy manufacturer that was embodiment of dream and imagination to children. Parents too, inspired by Lego’s brand image as ‘fostering mental development and creativity for kids’, patronized their products in spite of Lego’s relatively high prices. By the turn of the millennium, however, the changes in the toy industry coupled with expiry on their license, Lego faced huge challenged, reflected in their net loss of 308 million Euros in the early 2000s. Nevertheless, Lego’s exemplarily strategic management practices under its CEO, Knudstorp brought the company back to brilliance and as of 2014, Lego thrives once again as the world’s most competitive toy company. As such as is the case, this essay shall examine Lego groups ‘from riches to rags to riches’ story with a special focus on the strategic management process.
Founded in 1932 by Ole Kirk Christiansen, the LEGO Group made wooden toys in the craftsman shop in Billund, Denmark. LEGO was an abbreviated form of the Danish expression, "leg godt" (play well). Over the following 15 years, Christiansen’s business focused around offering great items that supported innovative play. He composed his toys to enamor the creative ability of the nearby kids; through building, they created
The Lego Group Case Study
Kim In Seok
Strategic Management
Lego bricks still hold special meaning to many young adults who have played with the bricks in their teenage years. I, for one, count among those young adults as I was an avid collector of Lego products myself: whenever there were new Lego products released, I used to nag my parents to buy them for me and promised to be a ‘good boy’. Thus it came quite natural to me that I wanted to investigate the Lego group – the symbol of my childhood nostalgia - as a full case study report for my Strategy for Creative Technology Business class. Established in 1932, the Lego group was the world’s leading toy manufacturer that was embodiment of dream and imagination to children. Parents too, inspired by Lego’s brand image as ‘fostering mental development and creativity for kids’, patronized their products in spite of Lego’s relatively high prices. By the turn of the millennium, however, the changes in the toy industry coupled with expiry on their license, Lego faced huge challenged, reflected in their net loss of 308 million Euros in the early 2000s. Nevertheless, Lego’s exemplarily strategic management practices under its CEO, Knudstorp brought the company back to brilliance and as of 2014, Lego thrives once again as the world’s most competitive toy company. As such as is the case, this essay shall examine Lego groups ‘from riches to rags to riches’ story with a special focus on the strategic management process.
Founded in 1932 by Ole Kirk Christiansen, the LEGO Group made wooden toys in the craftsman shop in Billund, Denmark. LEGO was an abbreviated form of the Danish expression, "leg godt" (play well). Over the following 15 years, Christiansen’s business focused around offering great items that supported innovative play. He composed his toys to enamor the creative ability of the nearby kids; through building, they created
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