July 9, 2016
“I’d surveyed fifty-six companies to understand their innovation management practices and planned to write a book about innovation and leadership, where I’d draw lessons and stories from many organizations and use those cases to illustrate how companies should manage innovation. After visiting LEGO, I wrote a case study that I hoped to use both in the classroom at the Swiss business school IMD and, later, in my book.”
July 9, 2016
“Subsequent interviews uncovered one fascinating aspect of the LEGO story after another. I realized that the LEGO management team had done more than just turn around the company; they had fundamentally rethought what “innovation” meant and how it should be managed and, by doing so, had rescued the company and boosted its performance to new heights”
July 9, 2016
“At every turn, the company’s leaders, employees, partners, and fans were remarkably candid about the mistakes that fueled its downfall, as well as the false starts and dead ends that accompanied its turnaround. Over its eighty-plus years, and particularly during the past decade, the LEGO Group has proven itself to be as resilient as its virtually indestructible bricks and as resourceful as the nine-year-olds who bring them to life.”
July 9, 2016
“BEHOLD THE LEGO BRICK, THAT HARD-EDGED, CANDY-colored bit of plastic that’s bedeviled barefoot parents the world over. By itself, a single discrete, modular brick is inanimate, lifeless—or at least dormant. Only the eight little knobs atop the rectangular block and the three hollow tubes underneath hint at its potential.
Snap two of those inert, inorganic blocks together, however, and suddenly you open up a world of nearly infinite possibilities. Just six bricks yield more than 915 million potential combinations. ”
July 9, 2016
“In the fifty-plus years since it was patented, the little LEGO brick has ignited the imaginations of millions of children and adults—and become a universal building block for catalyzing creativity.”
July 9, 2016
“Über-nerd Jonathan Gay credits the LEGO brick for helping him invent Flash animation and thereby light up the Web. Google cofounder Larry Page once built a fully functioning inkjet printer out of LEGO bricks”
July 9, 2016
“When Fortune decreed LEGO the toy of the century, the magazine half joked that with more than two hundred billion bricks scattered across the globe, “it seems safe to assume that at least ten billion are under sofa cushions [and] three billion are inside vacuum cleaners.” ”
July 9, 2016
“By any measure, LEGO has been relentlessly innovative for much of its eight decades. First and foremost there was the creation of the brick, which found its way into the hands, heads, and hearts of four hundred million people the world over. And then, year after year, the LEGO Group’s idealistic, imaginative approach to play helped it conjure compelling toys that rarely retreated to the back of kids’ closets. The company’s values and creativity put it in an unmatched position within the toy industry: kids loved the brick because it was fun, and parents loved it because it was educational. That combination helped LEGO amass decades of unbroken sales growth.”
July 9, 2016
“LEGO, largely an analog enterprise, found itself fading in a faster-moving, far more competitive digital world.”
July 9, 2016
“In 2003, just three years after both Fortune magazine and the British Toy Retailers Association had crowned the brick the toy of the century, the LEGO Group announced the biggest loss in its history. Its extraordinary collapse led many observers to wonder whether LEGO, one of the world’s most cherished brands, would survive as an independent enterprise.”
July 9, 2016
“In fact, a new leadership team pulled off one of the most successful business transformations in recent memory. One by one, LEGO reinvented those academic prescriptions for innovation, synthesized them into a world-class management system, and reemerged as a powerful, serial innovator. LEGO created the world’s first line of buildable action figures, fueled by a riveting story line that played out over a nine-year span. It launched a line that included an “intelligent brick,” allowing kids (as well as many skilled adults) to build programmable LEGO robots. In another first, LEGO rolled out a series of board games that could be built, broken apart, and rebuilt. LEGO opened up its development process, enabling legions of fans to go online and post their own customized DIY LEGO sets. And it reimagined its core lines of classic LEGO sets, keeping them real while making them modern enough for twenty-first-century kids.”
July 9, 2016
“From 2007 to 2011, all through the worst of the global recession, the LEGO Group’s pretax profits quadrupled, far outstripping the titans of the toy industry, Hasbro and Mattel, which were mired in the single digits over the same period.”
July 9, 2016
“ics.
No doubt these business renegades are inspirational. But their precedent-breaking management systems are not easily transferable. For many companies, building a newfangled innovation model from the ground up—while struggling to nail quarterly performance targets and fend off competitors—is not a viable option.”
July 9, 2016
“The LEGO system for managing innovation also stands in stark contrast to Apple’s (or at least to the way that Apple’s is portrayed in the business press). Where Apple’s innovation management system was built around the brilliant but often difficult Steve Jobs, with Jobs the final arbiter of when a product was good enough to take to market, the LEGO system is far more decentralized. The Apple model, while inspiring, is hard to follow: find a peerless innovator, promote him to the top of the company, and give him the power to make the big decisions. LEGO CEO Jørgen Vig Knudstorp asserts that he could leave his company for three months and its innovation process would continue unabated; although he was intimately involved in many decisions early in its development, he and other executives designed the process to work smoothly without significant input from him.”
July 9, 2016
“Although the pages that follow offer many details and takeaways, we have purposely avoided laying out a blueprint for innovation and goading you to follow it. You won’t achieve similar results by simply grafting the LEGO Group’s innovation system onto your company’s operations. And we absolutely don’t recommend repeating the toy maker’s mistake of waiting until a brush with bankruptcy forces management to embrace deep-seated change.”
July 9, 2016
“Like every LEGO enthusiast, you must bring your own imagination and experience to the game and figure out what’s best for you and your company. After all, it’s up to each of us to make the bricks click.”
July 9, 2016
“NESTLED AMONG THE FARMLANDS OF DENMARK’S FLAT Jutland Peninsula, the tidy community of Billund, home of the LEGO Group’s head offices, is in every sense a town that was built on the brick. ”
July 9, 2016
“Billund itself is a toy town, you might say. The LEGOLAND theme park’s castle and towers are the most striking feature of the town’s horizon. The neat rows of yellow-brick houses, topped with red-tile roofs, have the symmetry and stolidity of a little LEGO streetscape. ”
July 9, 2016
“And yet life was no fun and games in the Billund of the 1930s, when LEGO was just a start-up. Back then, the village was little more than a smattering of farm cottages scattered along a railway line, a place where farmers scraped out a hard living from the surrounding moors.”
July 9, 2016
“How, then, did LEGO defy the odds, ascend from a carpenter’s small workshop on the Jutland plains, and arrive in almost every playroom the world over? How has it managed to consistently deliver products, year after year and decade after decade, that fire kids’ imaginations? How was LEGO “built to last” for most of the twentieth century?”
July 9, 2016
“LEGO owes much of its enduring performance to a core set of founding principles that have guided the company at every critical juncture over its eighty-plus years.”
July 9, 2016
“First Principle: Values Are Priceless"
“Ole Kirk Christiansen, a master carpenter who founded LEGO in Billund in 1932, instilled the company’s quintessential value in its name, a combination of the first two letters from two Danish words: leg godt, or “Play well.”
July 9, 2016
“And he framed the company’s overriding philosophy, which holds that “good play” enriches the creative life of a child as well as that child’s later adult life. This philosophy has sustained LEGO for the better part of a century.”
July 9, 2016
“Over the decades, LEGO has refined and reinterpreted its mission: to infuse children with the “joy of building, pride of creation”; to “stimulate children’s imagination and creativity”; to “nurture the child in each of us.” But on a fundamental level, the company’s goal has stayed remarkably consistent and is probably best expressed in its current iteration: “to inspire and develop the builders of tomorrow.” ”
July 9, 2016
“Looking back on the earliest days of his start-up, he later wrote, “Not until the day when I said to myself, ‘You must make a choice between carpentry and toys’ did I find the real answer.”
July 9, 2016
“The LEGO Group’s early years were shaped by hardship. Ole Kirk’s wife died the year he founded LEGO, leaving him with four young sons to raise and a business in the balance. He remarried two years later and guided his young company through the depredations of the Great Depression and Germany’s occupation of Denmark during World War II. Then, in 1942, a short circuit caused an electrical fire that consumed the LEGO factory, as well as the company’s entire inventory and blueprints for new toys. ”
July 9, 2016
“There, they learn of another bedrock value that the company’s founder bequeathed to his company: the bar-raising principle that “only the best is good enough.”
July 9, 2016
“The deception offended Ole, who instructed the LEGO Group’s future chief executive to go back to the train station, retrieve the carton of ducks, and spend the night rectifying his error. The experience inspired Godtfred to later immortalize his father’s ideal by carving it onto a wooden plaque. Today, a mural-size photograph of the plaque, which bears the motto “Det bedste er ikke for godt”—“Only the best is good enough”—graces the entrance to the cafeteria in the LEGO Group’s Billund headquarters. It’s a signpost that summons LEGO staffers to exceptional performance.”
July 9, 2016
“Second Principle: Relentless Experimentation Begets Breakthrough Innovation”
“The business strategist Gary Hamel underlines this notion in The Future of Management, where he asserts, “Innovation is always a numbers game: the more of it you do, the better your chances of reaping a fat payoff.”4 LEGO gets this.”
July 9, 2016
“In 1946, LEGO became the first toy manufacturer in Denmark to acquire a plastic injection molding machine, which cost more than twice the previous year’s profits. (Family members had to dissuade Ole Kirk, at least temporarily, from buying another.) For a rural Danish carpenter who had spent all of his years working with wood, plastics presented a risky, life-altering challenge. The company’s leaders then displayed an uncommon degree of perseverance by spending the better part of the next decade chipping away at a big idea: how to sculpt the LEGO brick.”
July 9, 2016
“It took years of failed experiments before Godtfred hit on the stud-and-tube coupling system, where the knobs that top one brick fit between the round hollow tubes and side walls underneath another brick. The tight tolerances and flexible properties of the modern brick, which is made from acrylonitrile butadiene styrene (ABS), allowed the studs and tubes to remain connected through friction. That design, patented in Copenhagen on January 28, 1958, delivered what LEGO continues to call “clutch power.” When a child snaps two bricks together, they stick with a satisfying click. And they stay stuck until the child uncouples them with a gratifying tug. And therein lies the LEGO brick’s magic.”
July 9, 2016
“In the years to come, tenacity and experimentation would continue to be prime ingredients in the company’s recipe for innovation, as the company displayed an uncommon willingness to endure setbacks while testing promising ideas.”
July 9, 2016
“On the ferry crossing the North Sea, he met up with a toy buyer from Magasin du Nord, the largest department store in Copenhagen. The buyer lamented that instead of delivering the one-off products that so dominated the market, toy makers should focus on developing a cohesive system where sets of toys were interrelated.”
July 9, 2016
“Fourth Principle: Tighter Focus Leads to More Profitable Innovation”
Notes From: David Robertson. “Brick by Brick.” iBooks.
