With seven sets sold every second, LEGO is now the world’s third-largest toys and games company and has produced well over 485 billion bricks so far. Everyone who works at LEGO has the same ambition: ‘We all have one thing in common – the goal is to put a smile on a kid’s face.’ Not many of us can say this. Across the whole organization ‘everyone buys into what the LEGO Group’s purpose is.’ With its track record, most would agree that LEGO and its employees are hitting the mark.
Founded in 1932 and named from the Danish words ‘leg’ and ‘godt’ meaning ‘play well’ LEGO’s first big shift was in 1960 when it switched from making wooden toys to concentrate solely on the now iconic plastic bricks. With the development of DUPLO for younger kids and LEGO Technic for teens as well as a host of kits linked to themes likes cities, pirates and, especially successful, a Star Wars franchise, LEGO became a top 10 global toymaker. Over 36 billion LEGO elements are produced each year and, in theory, everyone on the planet owns 75 bricks. Across LEGO the need to deliver on the company’s ambition ‘to inspire and develop the builders of tomorrow’ is clear to all.
Although nearly bankrupt at the start of 2003, the manufacturer of what Forbes nominated as ‘the toy of the 20th century’ has made a remarkable turnaround and done it largely by itself. In the past five years or so LEGO has launched new products that have taken it into totally new markets. Revenues have more than doubled while profits have risen by over 1700%. But LEGO is not out to be the world’s biggest toy company – just the best.
The change in fortune started with two actions, firstly to stabilize the company and then to build a sustainable platform for growth. And this involved two areas of the business, the supply chain and product development. The extent and success of the change has led to Lego rediscovering its deep self-belief in being the only company in the sector that can truly invent the future of play, and along the way they have developed capabilities around organizational creativity, fan based innovation and product development and the development and management of these communities of fans.