Lego Case Study
Rishab Singhvi
LEGO CASE STUDY
Discussion Question:
Q.1: How did the information systems and the organization design changes implemented by knudstorp align with the changes in business strategy?
Advances in the field of information technology and introduction of new hi-tech form of entertainment such as tablets and gaming consoles had left Lego trailing in the entertainment field. Jorgen Vig Knudstorp was appointed as the CEO to revamp the company’s business process, organization structure and information systems. Knudstorp was quick to act and first made changes in the company’s production process. He encouraged designers to use the unused components in development of new products and design, thus reducing the number of unused components and reduced losses as the cost of production of each unit was very expensive. Lego created a new strategy to broaden the product range and target a new customer segment. Earlier Lego used to develop products which primarily targeted boys; with this new strategy they started developing products keeping a larger segment into perspective. They started developing products based on movie themes. Most drastic changes came in the organization structure at Lego, switching the employee pay structure, providing incentive for innovative product designs. Lego also started developing video games thus targeting a new segment of customers. All these changes in the business aspects of the company led to an increased revenue, increased demand and growth in the number of employees. Development of new product based on the internet, addition of new employee and inability to meet the consumer demands led to need for a new advanced and upgraded system which would fulfill all the above mentioned. Lego developed a new modularized and standardized architecture for their information system, which they could easily expand and add functionality and capacity. The latest IT infrastructure in the organization enabled the employees to become more creative
LEGO CASE STUDY
Discussion Question:
Q.1: How did the information systems and the organization design changes implemented by knudstorp align with the changes in business strategy?
Advances in the field of information technology and introduction of new hi-tech form of entertainment such as tablets and gaming consoles had left Lego trailing in the entertainment field. Jorgen Vig Knudstorp was appointed as the CEO to revamp the company’s business process, organization structure and information systems. Knudstorp was quick to act and first made changes in the company’s production process. He encouraged designers to use the unused components in development of new products and design, thus reducing the number of unused components and reduced losses as the cost of production of each unit was very expensive. Lego created a new strategy to broaden the product range and target a new customer segment. Earlier Lego used to develop products which primarily targeted boys; with this new strategy they started developing products keeping a larger segment into perspective. They started developing products based on movie themes. Most drastic changes came in the organization structure at Lego, switching the employee pay structure, providing incentive for innovative product designs. Lego also started developing video games thus targeting a new segment of customers. All these changes in the business aspects of the company led to an increased revenue, increased demand and growth in the number of employees. Development of new product based on the internet, addition of new employee and inability to meet the consumer demands led to need for a new advanced and upgraded system which would fulfill all the above mentioned. Lego developed a new modularized and standardized architecture for their information system, which they could easily expand and add functionality and capacity. The latest IT infrastructure in the organization enabled the employees to become more creative