Product Management and Lego
Lego Case Study for
ISM class 5014
How did the information systems and organization diging changes implemented by Knundstorp align with the changes in business strategy.
The Lego Cast Study is about how the toy company has been affected by the rapid and vast change in the way children play with toys and their preference of the same. Historically, Lego’s have been a top rated toy for children and when that quickly changed Lego was not expecting it and furthermore not prepared. The company began to lose money, “by 2004, the company found itself close to extinction, losing $1 million a day.” (Saunders & Pearlson , 2013) A new CEO, Jorgen Vig Knudstorp, was hired in an effort to bring the company back to its feet and the Lego toys back into children’s hands. The new CEO began to strategize and make changes to the company internally, its relationships and the Lego toys. Theses changes were very affective and within five years “sales were strong and profits were up.” (Saunders & Pearlson , 2013)
Several factors contributed to the financial struggles of the Lego Corporation in 2004, which almost led to the demise of the company. The company had issues such as poor overall performance, missing deadlines; product development times were longer than anticipated. Lego’s delivery record was becoming problematic, the popular sets were running out quickly with little to no stock incoming to replenish shelves, which led to frustrated retailers. Another concern Lego faced was mismanaging the production of complicated sets. Lastly, in 2004, the rampant popularity of high-tech iPods and PlayStation gaming systems demonstrated how dated Legos were. The numerous problems Lego Corporation faced led to a loss of $1 million per day, as a result.
Which of the generic strategies does Lego appear to be using based on this case? Provide support for your choice.
Up to this day, Lego remains one of the strongest companies on the global toy market. New CEO Jorgen Vig Knudstorp
ISM class 5014
How did the information systems and organization diging changes implemented by Knundstorp align with the changes in business strategy.
The Lego Cast Study is about how the toy company has been affected by the rapid and vast change in the way children play with toys and their preference of the same. Historically, Lego’s have been a top rated toy for children and when that quickly changed Lego was not expecting it and furthermore not prepared. The company began to lose money, “by 2004, the company found itself close to extinction, losing $1 million a day.” (Saunders & Pearlson , 2013) A new CEO, Jorgen Vig Knudstorp, was hired in an effort to bring the company back to its feet and the Lego toys back into children’s hands. The new CEO began to strategize and make changes to the company internally, its relationships and the Lego toys. Theses changes were very affective and within five years “sales were strong and profits were up.” (Saunders & Pearlson , 2013)
Several factors contributed to the financial struggles of the Lego Corporation in 2004, which almost led to the demise of the company. The company had issues such as poor overall performance, missing deadlines; product development times were longer than anticipated. Lego’s delivery record was becoming problematic, the popular sets were running out quickly with little to no stock incoming to replenish shelves, which led to frustrated retailers. Another concern Lego faced was mismanaging the production of complicated sets. Lastly, in 2004, the rampant popularity of high-tech iPods and PlayStation gaming systems demonstrated how dated Legos were. The numerous problems Lego Corporation faced led to a loss of $1 million per day, as a result.
Which of the generic strategies does Lego appear to be using based on this case? Provide support for your choice.
Up to this day, Lego remains one of the strongest companies on the global toy market. New CEO Jorgen Vig Knudstorp
References: Keri E. Pearlson, Carol. S. Saunders (2013), Managing and Using Information Systems: A Strategic Approach, 5ed, John Wiley & Sons, “Lego”, pp. 39-41. Legoland. (n.d.). Retrieved from www.lego.com http://www.yousigma.com/benchmarking/mattelsglobalmarketingstrategy.htm