LEGO has continually evolved its system of bricks and applications for it since its invention. The original system elements have been extended in numerous ways to include, for example, people and special parts to allow the construction of moving vehicles and working train sets.
LEGO has ongoing collaborations with several universities in the UK, the US and Germany. The company has been involved in a joint R&D effort with the prestigious Media Lab at Massachusetts Institute of Technology in the US since 1984. Commercial outcomes of this research have included the company’s Mindstorms system (now in its second generation). This is an advanced kit that includes sensors, actuators and a programmable logic controller. Mindstorms allows users to design, build and programme robotic systems that can sense and react to their environment.
However, recent years have not been easy for LEGO. The company has faced intense competition from the explosive growth in computer-based children’s toys and the rise of low cost production of traditional children’s toys in the Far East and stiff competition between retailers pushing margins and prices down.
After trying a variety of compensatory strategies during the 1990s and early years of the 21st century, the company has more recently made the decision to re-focus on the core and most popular product, namely the “Classic” product lines. An increased emphasis on these in recent years has lead to a warm reception from toy retailers and consumers. Combined with extensive reorganisation and outsourcing, the new approach has transformed the company’s financial performance, putting it on a strong footing from which to go forward.
Given this context, LEGO’s design team saw some challenges ahead: It needed to define a more holistic approach to innovation moving away from a predominantly product focused approach while maintaining an approach to design that would professionalise the department, leading to more efficient use of design resources and increased effect of the offerings in the market.
Design has traditionally been held in high regard at LEGO. The company considers design to be a key element in the development of their products, has used design as a competitive weapon and has given high levels of autonomy and responsibility to its design teams.
In more depth Find out more about how successful business processes require good
leadership and that design is no exception
LEGO has transformed the processes of its design function in the last two years. The design team itself precipitated this process transformation. Existing processes, while they allowed the design team exceptional creative freedom, had resulted in too many commercially unsuccessful products coming to market and had also produced significant additional complexity in the LEGO system, which by the early 2000s had, risen to more than 14,000 different components.
In order to address these issues, the LEGO design team, led by Paal Smith-Meyer and Torsten Bjørn, Creative Directors, Concept & Design, started an initiative called Design For Business (D4B). Couched within LEGO’s overall development process, the objective of D4B is to ensure that all design activities are supported by a real business case, and that proposed solutions can be tested against financial requirements before being adopted. Simultaneously, LEGO wanted to improve its responsiveness by cutting the length of the design cycle down from an average of two years to less than 12 months.
The rigorous process transformation approach adopted by the LEGO design function has helped to maintain and enhance its status within the company. Indeed, the processes developed in the design division are being used as a method for innovation across the entire business.
Design For Business represents a combination of LEGO’s overall corporate strategy and design strategy, and has been instrumental in achieving some of LEGO’s recent business performance successes. Find out more about how LEGO's Innovation model and its Foundation overview fit in to D4B.
In more depth Read about how other companies make sure their designers are able to talk about the commercial implications of their design decisions by
integrating the design process into the business