It’s easy to overlook that LEGO was close to bankruptcy in 2003.
JOrgan Vik Knudstorp, who assumed the CEO role in 2004, took a radical approach to the transformation of the company.
Lessons From LEGO remains one of Pecan‘s Insights most popular insights . They are still relevant for organisations today. We have updated our thoughts to share them with you.
“Execution mechanism”
JVK described the culture as “execution mechanisms” through which he delivers his strategy. It is evident from reading, watching, and listening to the recent stories about LEGO culture that the Board continues to value culture as a strategy and work to define and embed this into their DNA around the world.
Their success story is dominated by four themes. Reconnect with your customers, place purpose and values in the center of all decisions, develop emotional intelligence, and lead by examples.
Reconnecting with customers
JVK knew when he joined the company that the costs were too high and there was a lot of waste. Instead of jumping into a slash-and-burn exercise, as is often the case with such a project, JVK went to BrickFest to listen to his customers’ experiences of LEGO.
It was evident that the simple joy of building something out of their imaginations was overwhelming. He found that Google employees viewed LEGO as a tool to help shape their children’s minds. He found that research supported the belief that children learn best through play.
The quality of the relationships is crucial to culture
LEGO’s culture and brand definition is based on the belief that children are role models.
Customers and products are everywhere. The product is present everywhere. From signs in the canteen, to mini figures that are personalised instead of business cards.
Decisiveness is based on purpose and values
The organisation felt threatened by the rapid growth of video games and had lost its direction. They were too focused on pursuing new avenues, such as clothing lines and theme parks, instead of doing more of what customers wanted.
After re-connecting with customers, JVK, the team, and JVK were able define LEGO’s true purpose for being. This was articulated as their mission, which is to ‘inspire and develop the future builders’.
More recently they have added a vision – ‘to become a global force for Learning-through-Play’ – giving them an ambitious future destination to strive for.
LEGO has expanded the spirit of leadership so that it includes everyone.
JVK’s “philosophical renewal process” included values which defined the culture required to deliver and sustain a new direction.
Six core values still remain today.
- Creativity
- Imagine.
- Enjoy the Fun
- Learn more about the Learning Program
- Quality
- You can also read about how to care for yourself.
The same principles are applied to all international hubs, no matter where you work.
Take for instance Quality. The attention to detail means that if the bricks are 4/1000th of a millimetre off, they will be rejected. They do not want to take a chance on a customer being unable to build.
Designers are assessed not only on their creativity and imagination, but also whether they can work well with a team.
LEGO is an employer of choice for many because it’s a dream career. The culture is not just a great workplace, but it has a purpose that goes beyond money. It is important that employees feel proud of their work and feel a part of something meaningful. This can be achieved in any organization.
Develop emotional intelligence
It is not surprising that a family business places a high value on the quality of the relationships. Caring is also one of the values.
From the moment that a new recruit arrives at the airport, the team is focused on fostering relationships and promoting the health of their family. Social activities such as the Hub Pub Club, in London, and a “no sugar” policy for vending machines are all part of the healthy eating program.
The Rules of Engagement, posted at London’s activity hub, summarize this balance between freedom of expression and social conscience.
“Work in whatever manner makes you most efficient, provided it does not affect the effectiveness of others.”
The same approach is taken to customer relationships. In the lead-up to peak trade, the training in the call center focuses on emotions that customers will feel at Christmas. It also highlights the role LEGO has in putting a big smile on children’s faces at this time.
Empathizing with customers is a key part of the role of a multi-lingual team in a call center. They speak at least 14 languages. They can’t fix the problem but they can demonstrate empathy.
Lead by example
JVK, who led LEGO’s transformation, placed great importance on demonstrating values “from the top” when he was leading the LEGO team. He expected others to follow suit and he encouraged everyone to be responsible for upholding ‘the deal.’
LEGO has extended this spirit of leading to everyone. Their Leader Playground creates an understanding of what leadership is in practice. Be Curious. Focus on the task at hand.
This is the basis of a learning-oriented culture, something that many organizations strive for. The program encourages people to step out of their comfort zones and take on challenging or new tasks.
Everybody is expected to listen, give feedback, and provide guidance on a regular schedule. To embed their values and deliver their mission, it’s important to show that mistakes are OK and to create space for learning and improvement.
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