Lego Case Study

Everything is Awesome for The Lego Group

BUS 2600

Gerrick A Norman

Business Policy – Case # (3)

Everything is Awesome for The Lego Group

The story of the LEGO Group started in Denmark in the late 1930’s by a carpenter named Ole Kirk Kristiansen. The linking plastic blocks have been through many ups and downs over its life but have never been as popular as they are today currently residing as the worlds third largest toy maker. Since the successful release of its LEGO Chima and LEGO Friends line, along with the wildly successful LEGO Movie sales and interest have never been higher for the product. In 2012 the LEGO Group reported revenue increases of 13 percent and global market share increasing from 8.6 to 8.8 (Lego.com, 2013). The construction sets are now sold in 130 countries with themes ranging from medieval knights and dragons, to the Star Wars galaxy. The name is also on clothing, theme parks, television, and movies giving the products exposure to the public with sales and popularity reaching never before seen levels.

Corporate Governance

The LEGO Group is still owned by the Kirk Kristiansen family with the day-to-day business operations overseen by CEO Jorgen Vig Knudstrop. Knudstrop took over the company at a tough spot in its history. From 1998 to 2003 Lego Group had posted losses that totaled $126 million (European CEO, 2010). He pushed for of a focus on traditional lines that had made LEGO an industry treasure for many years. Knudstrop also came out on top when many toy companies images were hurt by the lead paint that was found on toys manufactured in China. Since LEGOs were not outsourced to China they came out looking like a company with an emphasis on customer safety even if the events were totally coincidental (European CEO, 2010).

The board of directors currently consists of seven members two of which are members of the founding Kristiansen family (LEGO.com). The chairman however is not a family member, he...