Learning More About Creativity And Innovation From LEGO

Learning More About Creativity And Innovation From LEGO

• By Rafiq Elmansy


• August 8th, 2014


• BusinessCreativityInspiration


• 0 Comments

Many companies and pattern agencies tend to demeanour during a pattern and creativity theatre from a slight perspective. Usually, a pattern group is sealed inside a ideas room with no hit with a rest of a universe until it delivers a thought that gets authorized by a patron or devise manager.

Once a devise goes into predicament mode and highlight increases, creativity is given an even some-more singular role in a project. This can be a outcome of a high cost of building artistic concepts or a miss of certainty that artistic people are means to hoop vigour and yield assistance during this vicious theatre of a project.

Additionally, ubiquitous models of a expansion routine do not concentration most on creation and creativity, either partially or holistically, heading enterprises such as BT, Microsoft, Starbucks, Xerox, Yahoo and others to yield a explanation that an innovative pattern routine can lead to a rival position in a marketplace — see “Eleven Lessons: Managing Design in Eleven Global Companies¹” (PDF).

Over a final century, many incidents have supposing examples that creation and creativity can play an essential purpose for an classification in a midst of crisis. Creativity and creation in such cases take a broader purpose outward of a ideas room. They can be practical to redesign a company’s structure and digest a some-more innovative routine that leads to products that accommodate both creativity and business needs.

One engaging instance of this is LEGO, a world-famous fondle manufacturer. By study a crisis, durability from 1993 to 2004, we’ll answer dual categorical questions: Can creativity and creation assistance an classification in a time of crisis? And can study cases such as LEGO’s exhibit a indication for a broader purpose of creativity in an classification for other enterprises to follow?

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LEGO bricks (Image: Wikipedia³)

The History: The Rise Of The Toy-Making Giant

LEGO is a heading company⁴ in a toy-making attention and a sixth-largest craving in a field. In box we didn’t know, a word “lego” is an shortening of dual Danish words, “leg godt,” that means “play well.” In Latin, a word means “I put together.” The Danish association was founded in 1932 by Ole Kirk Kristiansen, whose tiny carpentry seminar unsuccessful during providing timber supplies, according to David Robertson and Bill Breen in their book Brick by Brick⁵.

Kristiansen switched from a seminar business to wooden toys, that succeeded in a marketplace during a time. Then, he bought an injection-molding appurtenance and started to emanate toys regulating cosmetic materials, that also did good in a market. After Kristiansen upheld away, tenure of a association went to his son, Kjeld Kirk Kristiansen. Brick-toy prolongation was launched in 1958, giving a association some-more ways to contest and opening a doorway to total building capabilities.

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Pull-along wooden steep by LEGO from around 1955 (Image: Brick Fetish⁷)

By 2006, income reached £717 million, following an 11% boost from a prior year. The association has 5,000 employees around a world, and a categorical comforts are located in LEGOLAND in Denmark. The association has 12,500 warehouses and some-more than 11,000 suppliers. In further to a prolongation plcae in LEGOLAND, prolongation sites are located in Switzerland, Czech Republic, a US and South Korea. The LEGO pattern group consists of 120 people in Denmark and 15 others in Slough, UK.

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LEGOLAND Germany (Image: LEGOLAND⁹)

Since a start of a company, LEGO has confirmed a transparent prophesy of “inventing a destiny of play.” While achieving this prophesy has been a matter of tough work and continual investigate into a business and how to yield innovative products, regularly returning to this prophesy has been a pivotal component that helped to save LEGO’s boat from sinking, as we’ll see after in this article.

The Problem: LEGO’s Hard Times

Before 1993, LEGO had faced some ubiquitous troubles with sales though did not knowledge any tough times, as sales and revenues continued to rise. After a inauspicious duration between 1993 and 2004, sales grew again and reached £163 million in net distinction in 2008, with sales augmenting by 51% in a UK, with an increasing marketplace share of 2.2 to 3.3%.

The doubt is what unequivocally happened between 1993 and 2004 to means sales and, subsequently, income to dump off a cliff? And what did LEGO do to collect a position in a market and, furthermore, to boost sales and income some-more than expected?

Between 1993 and 2004, dual vital problems collided. The initial occurred between 1993 and 1998, when LEGO toys were already on any shelf and a association had reached a healthy expansion cycle. In sequence to keep growing, a association constructed some-more products, though sales did not increase. Subsequently, costs went adult and hindered boost (see “How LEGO Stopped Thinking Outside a Box and Innovated Inside a Brick²¹¹⁰”).

In response to this loss, a association laid off 1,000 employees, and Kjeld Kirk Kristiansen stepped aside, saying, “Maybe I’m not a right chairman to lead this association in a subsequent generation.”

The new boss for a company, Poul Plougmaan, accepted that a association was handling unequivocally differently than before. After examining a marketplace and a consumers, he detected that kids were ceaselessly removing smarter. Added to this, new competitors had entered a market, such as Toys “R” Us and Walmart, with absolute strengths. And many toymakers had changed their prolongation to China in sequence to diminution prolongation costs.

The Analysis: Outside a Box, Outside a Business

As a association built on creation to accommodate patron expectations and marketplace demands, LEGO initial responded to financial predicament by inventing new products, anticipating that they would lead to new opportunities. LEGO collaborated with prolongation companies behind famous cinema and characters such as Star Wars and Harry Potter to emanate new bricks that children would buy formed on their passion for a cinema rather than for LEGO itself.

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LEGO Star Wars and Harry Potter (Image: Lego¹²)

Some of these products, such as Star Wars, did good in a marketplace and seemed to be saving a association from sinking, while other products were a large failure, such as Galidor. While this innovative meditative competence have appealed to LEGO during a time, it had dual categorical pitfalls:

• The new products were not indeed elucidate a company’s problem since they were focusing on consumer passion for other cinema and characters, instead of LEGO products themselves.


• The themed products were a short-term success, since once a film grew old, no one would buy a thesis again.

As a outcome of venturing into these new innovative product areas, LEGO found itself outward a business while perplexing to get behind on track. Furthermore, a new products discontinued a marketplace for consumers seeking strange LEGO bricks.

These new products were one reason for a company’s second tumble in 2003. Once sales for a dual categorical themes, Star Wars and Harry Potter, started to fall, association sales went off another cliff.

The resolution to a initial dump highlighted another conditions that indispensable to be studied. LEGO’s problem was not a innovation, though rather a tie between a creation and a business goals. When creation gets out of control, it disconnects from a company’s strategy, withdrawal a opening between business and creativity, heading to sales losses.

The Solution: Relinking Creativity and Business

The brief answer to how LEGO solved a marketplace problem was simply by meditative inside a box again. It returned to a typical territory themes, such as racing cars, military stations and schools. These products authorised children to reuse a bricks again and again. Buying a new territory set would indeed supplement to a prior one. This is one of LEGO’s pivotal selling strengths and something consumers unequivocally want.

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LEGO overcame a predicament by returning to a strange bricks. (Image: Brick Fetish¹⁴)

Behind this finish were new innovations in a routine itself. Unlike many companies that close creativity inside a meditative room, LEGO strongly believes in expressing creativity not usually in a products though in a prolongation process. To know how creativity and creation helped to solve LEGO’s problem, we need to learn some-more about a purpose of pattern devise in LEGO’s prolongation process.

Design for Business

LEGO is one of a few companies that has had a transparent prophesy of a purpose of creativity within a organization. LEGO grown a pattern routine indication famous as “Design for Business” (D4B) to safeguard a continual linkage between creation and a business plan. D4B also shifts a devise for creation from being product-focused to being company-focused.

D4B focuses on defining creativity and pattern within an organizational strategy. For example, it links a company’s objectives and pattern devise in sequence to grasp these corporate goals. Also, D4B provides for more partnership between teams to urge a creation process. It compulsory a series of processes and collection to safeguard that creation was improved presented and discussed. According to Design Management Europe’s endowment print for LEGO¹⁵ (PDF), these collection and methods are divided into being innovation-related and design-related — distinct given that pattern is a roadmap that turns creativity into innovation.

While a D4B indication supposing a singular government process, permitting for pattern and creation to be some-more holistically integrated in a organization, a opening still existed between a selling devise and artistic team. This opening was one of a causes of LEGO’s thespian tumble by a finish of a 1990s. We can snippet it behind to a artistic group meditative differently from a company’s initial vision.

LEGO’s Shared Vision

D4B was partial of a seven-year devise named “Shared Vision” determined in 2004. The new prophesy was to reconstruct a company’s code temperament as a artistic toy-manufacturing enterprise. In this strategy, a selling dialect was asked to provide a wider prophesy of creation and creativity in a product expansion process. This prophesy ensures that both a artistic side and business side share a same aims and entirely know LEGO’s business devise and how to grasp vital goals regulating a other team’s resources.

As mentioned, LEGO’s problem was not a creativity though in a undo between a creativity and corporate strategy. The business and artistic teams were operative in silos, any carrying management to innovate on whatever it wanted. While LEGO struggled with this problem, many companies do not position pattern and creativity rightly within their business and strategy. Perhaps a problem was strident for LEGO since it is a creativity-based company.

The Shared Vision devise is a couple between business and creativity and puts a routine of creation in a scold place in a organization. It brought a artistic group out of a silo and connected it to a company’s business goals, permitting it to emanate underneath a powerful of a company-wide strategy. The pierce brought LEGO’s devise behind to life, with products that met both creativity and business needs.

The Result: LEGO Goes On

While a Shared Vision devise is a seven-year initiative, it has already influenced a company’s sales and revenue. In 2006, LEGO was named a world’s sixth-largest fondle maker, with income during £717 million, an 11% boost from a prior year. Net distinction for 2006 was £123.5 million, a burst of 6.5% over 2005.

This thespian boost in income is a outcome of a series of procedures, including a focus of a Shared Vision devise with a D4B pattern process, in further to a rebate in costs (the association reduced a bound costs by 33%).

Conclusion

The story of LEGO is an critical and singular doctrine for designers and pattern strategists on a true significance of pattern and creativity in an organization. It also indicates that many stream business models do not put pattern and creativity in their right place in a organizational process. As a result, many of those business models can lead to failure, generally for a association that depends so heavily on creativity and innovation, like LEGO.

In many companies, designers and pattern managers are not invited to assistance detect a corporate strategy, and this is one of a essential problems that led LEGO off a financial precipice and into bankruptcy. Rather, putting pattern and creation in a right place can lead a association to grasp a business goals and altogether strategy.

How does your association or a association we work during understanding with creativity and innovation? Please share your thoughts in a territory criticism next — I’d adore to hear them!

References

• “LEGO History Timeline¹⁶,” LEGO


• Brick by Brick: How LEGO Rewrote a Rules of Innovation and Conquered a Global Toy Industry¹⁷, David Robertson and Bill Breen


• “Design for Business¹⁸” (PDF endowment poster), Design Management Europe


• “Eleven Lessons: Managing Design in Eleven Global Companies¹⁹,” Design Council


• “Case Study: LEGO²⁰,” Financial Times


• “How LEGO Stopped Thinking Outside a Box and Innovated Inside a Brick²¹¹⁰,” Knowledge @ Wharton

(al, il)

Footnotes

1. 1 http://www.designcouncil.org.uk/sites/default/files/asset/document/ElevenLessons_Design_Council%20%282%29.pdf


2. 2 http://www.smashingmagazine.com/wp-content/uploads/2014/07/lego_fig01-large-opt.jpg


3. 3 http://en.wikipedia.org/wiki/Lego


4. 4 http://aboutus.lego.com/en-us/lego-group/the_lego_history


5. 5 http://www.amazon.com/Brick-Rewrote-Innovation-Conquered-Industry/dp/0307951618/ref=sr_1_1?ie=UTF8qid=1404826095sr=8-1keywords=Brick+by+Brick


6. 6 http://www.smashingmagazine.com/wp-content/uploads/2014/07/lego_fig02-large-opt.jpg


7. 7 http://brickfetish.com/toys/duck.html


8. 8 http://www.smashingmagazine.com/wp-content/uploads/2014/07/lego_fig03-large-opt.jpg


9. 9 http://www.legoland.dk/en/About-LEGOLAND/LEGOLAND-Parks/


10. 10 https://knowledge.wharton.upenn.edu/article/how-lego-stopped-thinking-outside-the-box-and-innovated-inside-the-brick/


11. 11 http://www.smashingmagazine.com/wp-content/uploads/2014/07/lego_fig04-large-opt.jpg


12. 12 http://www.lego.com


13. 13 http://www.smashingmagazine.com/wp-content/uploads/2014/07/lego_fig05-large-opt.jpg


14. 14 http://brickfetish.com/sets/700/700_3_1950.html


15. 15 http://www.dmeaward.com/wp-content/uploads/2013/07/LEGO.pdf


16. 16 http://aboutus.lego.com/en-us/lego-group/the_lego_history


17. 17 http://www.amazon.com/Brick-Rewrote-Innovation-Conquered-Industry/dp/0307951618/


18. 18 http://www.dmeaward.com/wp-content/uploads/2013/07/LEGO.pdf


19. 19 http://www.designcouncil.org.uk/sites/default/files/asset/document/ElevenLessons_Design_Council%20(2).pdf


20. 20 http://www.ft.com/intl/cms/s/0/05806aa4-f819-11df-8875-00144feab49a.html


21. 21 https://knowledge.wharton.upenn.edu/article/how-lego-stopped-thinking-outside-the-box-and-innovated-inside-the-brick/

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Learning More About Creativity And Innovation From LEGO