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Lego’s new mantra: Simplify

by on
in Best-Practices Leadership,Leaders & Managers

Innovation is usually a good thing.

In the family-owned Lego toymaker, innovation over time had brought on way too much complexity.

A mere 30 products generated 80% of sales. Two-thirds of Lego’s 1,500 stock keeping units (SKUs) were for products it no longer made. The company dealt with an astonishing 11,000 sup­­pliers—almost twice as many as Boe­­ing uses to build airplanes.

Enough was enough. First, leaders discussed the mess with workers. Then they set up a war room, where they drew up hundreds of lists tracking backlogs and inventory.

And then, still consulting with ­workers and customers, they simplified.

  • They cut in half the roughly 100 colors of resin for plastic building blocks.
  • They narrowed the number of vendors to stabilize pricing.
  • They standardized the production cycle and reduced changes.
  • They set basic rules for creating new colors and shapes, and for ordering new materials. Basically, Lego urged designers to use existing molds and ­colors in new ways.

“The best cooks are not the ones who have all the ingredients in front of them,” wrote one senior manager. “They’re the ones who go into whatever kitchen and work with whatever they have.”

Bottom line: Lego’s profits have soared, due in part to simplification and in part to big bets on digitization and girls’ toys. In 2012, the company took $980 million in profits on revenue of $4 billion.

— Adapted from “Rebuilding Lego, Brick by Brick,” Keith Oliver, Edouard Samakh, Peter Heckmann, strategy + business.

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{ 1 comment… read it below or add one }

michelle brochu westwood February 25, 2014 at 4:23 pm

I have a 5 year old Lego FREAK. he had a birthday right after Christmas and so to say he got lots of lego kits, that is an understatement. we have lost a few pieces, or the pieces did not come with the kit, and I am trying to replace them.
if you could let me know where I could order the replacement parts/people, I would truly appreciate it!!!
the first part of the lego set that has joker in it, it is a 10×4 flat grey piece

superman’s hair

gun to go with the lone ranger

feather to go with bald guy that writes to be bald but not old, the package that you open and it’s a surprise as to what character you get from The Lego Movie

venum, the villain in one of the superman’s kits (our beagle puppy enjoyed that one!!)….spider black looking thing… the puppy got it before I could get a good look at it, sorry I can’t give more of a description!!
my 5 year old is wanting to put these things together everyday and I have looked online, but can’t find then, although I will continue to look. If you could let me know where online I could find the replacement parts, or I live in the Dallas, TX area and could go to the store to get them. thank you,
Michelle Brochu Westwood 214 507 9444

also I am sure we will lose more or the dog will get some as we go on, so I would LOVE to find a place to buy replacement parts so I do not have to get the whole sets again.

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