Lego Company’s Successful Innovation Strategy

Why Lego Almost Went Bankrupt in 2003?

Lego has been associated with core family values and constant innovation and development. However, in the early 2000s, the company almost went bankrupt due to its innovation strategy. In 2003, the company lost $300 million and the prognosis for the next year was even more frightening (Time 2012). This was a result of the company’s focus on innovation. Lego introduced new products and diversified the range of its products. Nonetheless, this change was not supported by the change in distribution and logistics. Therefore, the expenditures were rising whereas revenue decreased. The company did not develop new marketing strategies to sell their innovative products. This was the major mistake that led to significant losses.

We will write a
custom essay
specifically for you

for only $16.05 $11/page
308 certified writers online
Learn More

Key Elements Underlying Lego’s Successful Innovation Strategy

At present, the company has a thoughtful innovation strategy. The company’s management has taken into account the faults of the strategy used in 2003. It was acknowledged that new theme products were popular when the original stories and characters used were popular. However, customers soon lose interest in specific theme products. Therefore, now the company produces a quite limited number of products to satisfy the need. The company also outsourced its production to the Check Republic and Mexico and set up a network of its retail stores (Time 2012). Therefore, Lego developed an efficient distribution and logistics which helped the company reduce costs and increase revenue. The company also produced numerous board games and even DVD films. All these strategies support new products and make them popular among customers. Thus, innovation strategy has become more organized and, therefore, more efficient.

Reference List

Time 2012, ‘Innovation almost bankrupted Lego – until it rebuilt with a better blueprint’, Web.

Print Сite this

Cite this paper

Select style

Reference

StudyCorgi. (2021, January 27). Lego Company's Successful Innovation Strategy. Retrieved from https://studycorgi.com/lego-companys-successful-innovation-strategy/

Work Cited

"Lego Company's Successful Innovation Strategy." StudyCorgi, 27 Jan. 2021, studycorgi.com/lego-companys-successful-innovation-strategy/.

1. StudyCorgi. "Lego Company's Successful Innovation Strategy." January 27, 2021. https://studycorgi.com/lego-companys-successful-innovation-strategy/.


Bibliography


StudyCorgi. "Lego Company's Successful Innovation Strategy." January 27, 2021. https://studycorgi.com/lego-companys-successful-innovation-strategy/.

References

StudyCorgi. 2021. "Lego Company's Successful Innovation Strategy." January 27, 2021. https://studycorgi.com/lego-companys-successful-innovation-strategy/.

References

StudyCorgi. (2021) 'Lego Company's Successful Innovation Strategy'. 27 January.

Copy to clipboard

This paper was written and submitted to our database by a student to assist your with your own studies. You are free to use it to write your own assignment, however you must reference it properly.

If you are the original creator of this paper and no longer wish to have it published on StudyCorgi, request the removal.

Psst... Stuck with your
assignment? 😱
Susan
Online
Psst... Stuck with your assignment? 😱
Do you need an essay to be done?
Yes
What type of assignment 📝 do you need?
Yes
How many pages (words) do you need? Let's see if we can help you!
Yes