Lego Group
Project definition:
LEGO is one of the largest companies in Denmark and a company with a very strong brand. But even so, their economy fell apart in 2003-2004 and we are interested in what they did wrong and what they did to turn their significant loss around to a profit in 2005. So our problem is:
What caused LEGO's financial problems in and what did they do to turn it around? This is very relevant, because it shows how even one of the biggest brands in a market can’t afford to relax in any aspect of the value chain. Even though LEGO is a big brand, their profitability is not to be taken for granted.
To answer the problem we used a history of LEGO, made a Value Chain, a SW-model and organization structure.
There has been some significant limitations when sourcing for LEGO’s inbound logistics. But otherwise we have used LEGO homepage, 2 online weekly newsletters, a homepage for logistics and a book about organizational theory.
LEGO’s history:
LEGO was founded by Ole Kirk Christiansen under the motto “Only the best is good enough”. In 1934 the LEGO name first appears. LEGO is a combination of “leg” and “godt” in Danish, meaning “play well”. In 1935, LEGO manufactured their first wooden construction toy, not looking anything like the LEGO brick we know today. In 1949, the first plastic blocks “Automatic Binding Bricks” were marketed and in 1955, Godtfred Kirk Christiansen developed LEGO Systems of Play while creating a new play platform. The LEGO brick was patented in 1958 with internal tubes as the interblocking component. Later that year, Ole Kirk Christiansen died and Godtfred Kirk Christiansen took over LEGO as CEO. In 1960 there was a fire in a wooden-toy warehouse and they therefore started focusing the production on plastic LEGO bricks instead. In 1968 the LEGOLAND theme park opened in Billund. In 1969 LEGO DUPLO, the large LEGO bricks, was launched and in 1978 they launched the Minifigure as well as the LEGO TECHNIC product lines. Kjeld Kirk Christiansen
LEGO is one of the largest companies in Denmark and a company with a very strong brand. But even so, their economy fell apart in 2003-2004 and we are interested in what they did wrong and what they did to turn their significant loss around to a profit in 2005. So our problem is:
What caused LEGO's financial problems in and what did they do to turn it around? This is very relevant, because it shows how even one of the biggest brands in a market can’t afford to relax in any aspect of the value chain. Even though LEGO is a big brand, their profitability is not to be taken for granted.
To answer the problem we used a history of LEGO, made a Value Chain, a SW-model and organization structure.
There has been some significant limitations when sourcing for LEGO’s inbound logistics. But otherwise we have used LEGO homepage, 2 online weekly newsletters, a homepage for logistics and a book about organizational theory.
LEGO’s history:
LEGO was founded by Ole Kirk Christiansen under the motto “Only the best is good enough”. In 1934 the LEGO name first appears. LEGO is a combination of “leg” and “godt” in Danish, meaning “play well”. In 1935, LEGO manufactured their first wooden construction toy, not looking anything like the LEGO brick we know today. In 1949, the first plastic blocks “Automatic Binding Bricks” were marketed and in 1955, Godtfred Kirk Christiansen developed LEGO Systems of Play while creating a new play platform. The LEGO brick was patented in 1958 with internal tubes as the interblocking component. Later that year, Ole Kirk Christiansen died and Godtfred Kirk Christiansen took over LEGO as CEO. In 1960 there was a fire in a wooden-toy warehouse and they therefore started focusing the production on plastic LEGO bricks instead. In 1968 the LEGOLAND theme park opened in Billund. In 1969 LEGO DUPLO, the large LEGO bricks, was launched and in 1978 they launched the Minifigure as well as the LEGO TECHNIC product lines. Kjeld Kirk Christiansen