Abstract

The case “Lego – Turnaround through Disciplined Innovation” talks about Lego A/S’s (Lego) efforts in coming up with innovative products in the highly competitive global toy market. The case begins with the history of Lego and the evolution of its most innovative and successful products. Later, it discusses the challenges faced by the company in the 1990s and its innovation efforts, under the leadership of Poul Plougmann. The case dwells in detail on the reasons for the market failure of its new products and the resultant financial crisis. The initiatives undertaken by Jorgen Vig Knudstorp to bring in a turnaround, revamp the innovation processes, learn about customer preferences, serve untapped market segments, and use of crowdsourcing in innovation are described in detail. The case concludes by mentioning the future focus markets of Lego and its plans for entering the digital space.

Learning Objectives

The case is structured to achieve the following Learning Objectives:

• To comprehend the innovation strategy of a niche player
• To realize the need for discipline and focus in innovation
• To recognize the importance of understanding customer needs and preferences
• To grasp the need to spot unexplored market segments and develop products catering to them
• To understand new methods of innovation such as crowdsourcing

Keywords

Lego, Lego Brick, Innovation, Crowdsourcing, Innovation Matrix, New Product Development, OpenInnovation, BlueOcean, Toys, Games, MarketResearch, Digital Play, Disruptive Innovation, Mindstorms, Lego Architecture