Essay on Lego Case Study

Words: 962
Pages: 4

Lego Case Study

1. What business goals were set by Knudstorp?

Ans. Jorgen Vig Knudstorp, the CEO of Lego set the following goals for the company which was performing very poorly,

* To remain profitable while maintaining growth, continuous innovation and quality of the products * To reach to broader customer segment * To cut expenses in production and supply chain and making these processes more efficient

2. What business strategies were set by Knudstorp?

Ans. Knudstorp set up the following business strategies to ensure Lego’s profitability and growth:

* Turning the supply chain into an efficient one by contacting top retailers, filling the blank spaces in the supply chain and reducing cost *
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In that customer segment, Lego has separate product lines for both boys and girls. Although, Lego has entered into online virtual games, video games as well as in the online communities where many people feature their Lego creations and thus attracted adults, these all are targeted to the younger population as well. Moreover, they differentiated their products to meet different group’s expectations within the targeted segment. For all these reasons stated above, it can be assumed that Lego is using ‘Focus’ business strategy.

5.Are changes implemented by Knudstorp an indication of hypercompetition? Defend your position.

Ans. In my opinion the changes that were brought to Lego by Knudstorp definitely indicate hypercompetition. Speed and aggressiveness of business actions are the two main components of hypercompetition which can be observed clearly in the Lego case. Under Knudstorp’s tenure, the company was transformed into a profitable and strong one in five years which was once performing miserably. By renewing the business, organizational and IS strategies while keeping up the constant innovation and maintain good product quality, Lego made its return possible in the toy industry. While making various changes within the organization to make production process and supply chain more efficient and less costly, Lego started expanding their target customer segment by product differentiation. Once traditional toy maker, Lego started making