...! ! ! ! ! ! ! ! ! ! ! ! The LEGO Case Study 2014 ! ! ! ! ! ! ! ! ! ! The A CONTENTS ! ! ! 1! ! 2! ! Introduction! ! ! ! ! 3! ! 4! ! 5! ! 6! ! 7! ! 8! ! Difficult start to the decade 2001.! Signs of Recovery 2002.! Hopes dashed - 2003.! LEGOLAND parks.! LEGO Brand Stores.! The Knudstorp Review.! Financial Focus - the ! Oveson addition. ! Back to basics and the limit to adjacencies. ! ! ! ! 9! ! 10 ! Developing the strategy ! why do we exist? ! 11 ! First the action plan - first ! things first. ! ! 12 ! Summary and Conclusions! ! 13 !Appendices ! ! 13.1 Knudstorp on! ! communication ! ! 13.2 References and slides The A 1 Introduction ! In 2014, LEGO® announced record results. In the financial year 2013, revenues had increased by 10% to 25.4 billion danish krona. Profits before tax were 8.2 billion DKK. The company had once again delivered an impressive operating margin of 33% before tax.! ! In US dollars, the company had achieved $4.5 billion of revenues and profits of $1.5 billion. Revenues had increased from just over $1 billion some seven years earlier. LEGO® had replaced Hasbro to become the largest toy company in the world second only to Mattel. ! ! In just eight years, revenues at the Danish toy manufacturer had tripled. The company had turned around a loss of 2.5 billion krona in the financial years 2003 and 2004 to an operating margin the envy of high tech stocks around the world.! ! ! ! ! The...
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... . . 5 Focus on growth . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Organization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Idea and production . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 LeGO® products for all children . . . . . . . . . . . . . . . . . . . . . . .9 The LeGO history - in short . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 The minifigure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 LeGOLAND® parks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 LeGO community . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Learning through play . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Fun LeGO facts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 using the LeGO brand name . . . . . . . . . . . . . . . . . . . . . . . 24 The LeGO GrOup 2011 3 It all began in 1932 In 1932 Ole Kirk Kristiansen, a Danish joiner and carpenter, began making wooden toys . The business he established...
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...traded companies. They have all had tragedies that closely involve the guests that have used their products. Ford and Toyota are automotive companies that have existed since the early 1900’s. Ford and Toyota are publicly traded companies both internationally and domestically. This leads to the cultural differences with these two companies. They both export into foreign countries; the United States to other countries and Toyota imports to the United States thus being a foreign country to Toyota’s Japan headquarters. SeaWorld Corp. has recently been acquired by The Blackstone Group which is headquartered in the United Kingdom. The entity Merlin Entertainment is a portion of The Blackstone Group and has investments in such companies as Legoland USA and Madame Tussaunds which is located internationally and domestically. All of these companies have a commitment to improving their carbon footprint. SeaWorld has the SeaWorld Conservation Fund which financially supports endangered animals. Ford and Toyota have created hybrid cars which are helping to reduce the pollution into the environment. Nike has a commitment to educating the community through various educational programs. All of the companies have had bad publicity and had a difficult time recovering from the public’s opinion in the companies’ unfortunate experiences. All four companies delayed addressing issues that affected others. When they finally did address there was damage to their image and credibility. The economy...
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...Many consumers have straggling pieces of Lego they no longer use or want. Rather than throwing them away, they can receive something back for the pieces and the company can re-sell the pieces or donate them to a children’s charity. Either way, the company wins as they can make money on the re-sale or tax write-off on the donation. In addition to the monetary aspect, the company helps the environment by recycling the pieces instead of ending up in the landfills and many children will enjoy playing and building with Legos. The way the program works is very similar to how the bottling recycling program works. For every 20 pounds of Legos brought in, the consumer will receive $1.00 credit to redeem at any of the following: Lego stores, Legoland Parks, or online at Lego.com. The cost to implement this program falls in the medium range. The company would have to invest in weight scales and training of employees in order to provide the service. However, the scales will only be available at The Lego Stores. In the future, the program can be expanded to stores such as Toys R Us. The cost of marketing the...
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...! ! ! ! ! ! ! ! ! ! ! ! The LEGO Case Study 2014 ! ! ! ! ! ! ! ! ! ! The A CONTENTS ! ! ! 1! ! 2! ! ! 3! ! 4! ! 5! ! 6! ! 7! ! Introduction! ! ! ! Difficult start to the decade 2001.! Signs of Recovery 2002.! Hopes dashed - 2003.! LEGOLAND parks.! LEGO Brand Stores.! The Knudstorp Review.! 8! ! Financial Focus - the ! Oveson addition. ! 9! ! Back to basics and the limit to adjacencies. ! ! ! 10 ! Developing the strategy ! why do we exist? ! ! 11 ! First the action plan - first ! things first. ! ! 12 ! Summary and Conclusions! ! 13 !Appendices ! ! 13.1 Knudstorp on! ! communication ! ! 13.2 References and slides The A 1 Introduction ! In 2014, LEGO® announced record results. In the financial year 2013, revenues had increased by 10% to 25.4 billion danish krona. Profits before tax were 8.2 billion DKK. The company had once again delivered an impressive operating margin of 33% before tax.! ! In US dollars, the company had achieved $4.5 billion of revenues and profits of $1.5 billion. Revenues had increased from just over $1 billion some seven years earlier. LEGO® had replaced Hasbro to become the largest toy company in the world second only to Mattel. ! ! In just eight years, revenues at the Danish toy manufacturer had tripled. The company had turned around a loss of 2.5 billion krona in the financial years 2003 and 2004 to an...
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...Qn1. Explain how the development of strategy at the LEGO Group reflect the key characteristics of strategic management The LEGO Group has a very rich and proud history that span nearly over 100 years. The LEGO Group’s core success would be their traditional yet innovative toy ‘brick’. This brick is so popular till date mainly due to its unique interlocking principle that offers unlimited building possibilities. It encourages one’s mind to be creative and allow the imagination to keep going. Qn2. Features of the external environment that influenced strategy development at the LEGO Group Qn3. Resources and competences of the LEGO Group that enabled them to regain their successful position in the global toy market Lego has managed to regain successful position in the global toy market through having capable human resources and financial resources as well as having the competency in creativity, innovation and quality control. Capable human resources Lego’s Chief executive recognized and acknowledged the problems LEGO are facing. * Kids were getting older younger and leaving Lego sooner. * The channel has changed. Companies, like Toys 'R Us and Walmart, that sell Lego had become more sophisticated. * Many of Lego's patents had expired leading to increased competition. * Rivals were outsourcing productivity to China and other, cheap economies whereas Lego was based in Denmark. * Lego needs to reduce debt, increase growth and to improve profitability...
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...1.0 Introduction Theme park industry in Malaysia is growing nowadays, other than that companies also are trying to turn Malaysia into an amusement and theme park destination. Recently there are also several new theme parks establishing in Malaysia for example, Leisure Park@ i-City and Legoland, there are also few new theme parks are expected to open in two to three year time. Other than that it is also said by the general manager of long time theme park operator Sunway Lagoon Sdn Bhd, that more competitor doesn’t means that they will meet a higher competition rate, more theme parks around will make an increase in tourist arrival. The objective of studying the market of theme parks in Malaysia is to determine the type of market structure currently in this market. Following on, by determine the type of market structure we are able to illustrate the characteristics of this industry, relevant explanation and concept through economic. Market structure is best defined as the organizational and other characteristics of a market that can best describe as goods and services market. Market structure can be divided into four types which are monopolistic, monopoly, oligopoly and perfect competition market structure. The most important features of market structure include the number of firms, market shares of the firms, nature of costs, the degree to which the industry is vertically integrate, the structure of buyers in the industry and others. (Riley, 2015) 2.0 Body Theme park industry...
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...Group Strategy 1.Strategy development According to Johnson et al (2011), in order for a strategy to be successfully measured, the organization should apply three horizon framework. It could be argued that the crisis of LEGO Group in 2003 was a result of a lack of realistic action plan. The objectives set by the Company were too ambitious considering the highly competitive environment. Also, major changes in the management structure have caused disagreement which resulted in many employees leaving the company. Significant revenue loss from 2003 and 2004 has forced LEGO Group to re-think its strategy and start from the beginning. Using the three horizon framework, it could be explained that the core business was defended by selling the LEGOLAND parks and focusing on LEGO brick concept (a ‘core’ product). Building emerging businesses could be recognized as developing a new digital strategy – launching online multiplayer game as well as entering mobile app industry. Regarding the viable options where nothing can be predicted, I think LEGO Group is doing well by inviting consumers to participate in product development as that way the risk related to new concepts is minimized. 2. External environment. There were numerous aspects of external environment that affected Company’s strategy. The oil crisis from 70’s and 80’s had a serious impact on the world economy therefore organisations had to implement new strategies in order to continue the growth. Lego then introduced innovative...
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...This article was about LEGO Group and a deal gone wrong with DHL. LEGO Group was founded in 1932 by Ole Kirk Kristiansen in Billund, Denmark. They had around 70 years of exceptional business, before an abrupt stop in 1998. It was not specified why the craze had such an immediate break, but I believe the progression or advancement of technology, computers, and just cell phones alone were the demise of the toy blocks. For the first time in the 70 years; staff reductions were made and LEGO began to lose money. It was time for a new plan, after four years of innovative and creative designing with new products to release in 2002. With high hopes for the Christmas season, it looked to be a positive year. But with the inventory and receivables up, bad news was to come and the LEGO Group braced for another bad year. Sales dropped an astonishing 26% in 2003 and a whopping 20% the following year 2004. Needless to say heads were spinning. The leadership at LEGO Group knew the supply chain needed immediate and extreme improvement. The supply chain needed to be flexible and able to adapt to the seasonal marketplace the toy could sell in. The first method implemented was the just-in-time delivery. This method failed by less than 67% of total sales being partial cartons and only 62% being delivered on time, or “just -in-time”! The company worked out of four main Regional DCs. Two were in France and were operated by third party companies. They mainly served the UK and S. Europe. There...
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...S |Subject Name |Relationship Marketing | |Week |2 (Tutorial Questions) | |Topic |The Nature and Characteristics of Relationship Marketing | Part A: Short Answers 1. Explain the factors that may influence the organisation in adopting RM. 2. Suggest for a company with which you are familiar. Where would you place the company on the hypothetical RM/TM continuum? What factors led to your decision to place them at this point on the continuum? 3. What are the differences between Relationship Marketing and Transactional Marketing? 4. What effect do switching costs have on a relationship? 5. Explain the association between risk, salience and emotion. Part B: Case Study Lego is one of the world’s largest toy manufacturers. It is estimated that more than 400 million children and adults play with Lego each year. However, despite being voted the nation’s favourite toy for a number of successive years and a YouGov pool into the top ten favourite toys of the past century showing Lego as the clear winner (ahead of computer games, teddy bears, Meccano and train sets!) Lego is in serious financial difficulty! With an annual revenue of over £1 billion and employing around 8000 people...
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...* What were LEGO’s fundamental problems? Consider both external and internal factors. Fad toys rising, product life cycles declining; less unscheduled time to play, demand shift towards technology, give up traditional toys for videogame & online activities 2 “the impact of new product introductions was muted by rapid imitation and limited protection of intellectual property” 2 “retailers focused on profit per square foot and consequently considered margin, turn, and product space requirements” 2 “Kjeld felt that the company’s sustained growth required new bricks” 3 Before had a trip on the market and unmet demand so graduatlly added new products and could control sales growth 3 Birth rates in core markets declined, household spending on toyus declined, retail channels consolidated, mass discounters featured toys more aggressively, less unstructured play, shorter attention spans, want instant gratification 4 Potential seemed to be everywhere; felt had huge untapped potential; tailred products to different untapped markets ilke southern Europe 4 Branched out to family leisure park, videogame software, children’s ware, watches, robotic bricks “There seemed to be potential everywhere” “our brand must have huge untapped potential” 4 Ploughman: moved managers around, “’Fitness Program’ included measures to steamline production, reduce organizational layers, and increase responsibility and customer focus, all to build a simpler, more responsive, global business system”...
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...Case questions preparations and Hand-In Cases (LEGO) Christian GP A. LEGO 1. What were the biggest challenges facing Lego? Fundamentally, at this point (2004, per start of the case study), the challenges were myriad for LEGO; competition was on the increase, the toy industry was evolving in ways that did not favour the LEGO group and the company was on the verge of bankruptcy (limited cash, price pressures, high fixed costs, powerful retailers and new play platforms). Those two issues by themselves would have been cause enough for concern. However, the CEO also felt that the company had lost its way and had no clear idea of what it stood for (c.f. “who it was”) and what products it should offer. It was further clear to him, and to everyone, that changes were needed. In early 2004, they had formulated a new strategy (and presumably this was far from being tested and proven as a means to “turn the ship around”. That plan dealt with: (i) the financial situation (improving cash flow and eliminating debt etc) by selling off non-core assets, reducing operational complexity and outsourcing some manufacturing elements; (ii) Increasing profit margins, by revitalizing product lines, made harder by the need to cut costs. (iii) Grow organically; invent new ways of creating value. The first phase was accomplished by end 2005 but the second and third had yet to show fruit (or commence in some ways). The main challenge at that point was HOW to reinvent...
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...The year is 1945, when the toy company Mattel is born. Along with truly great toys, this company gives a lot to the community and environment as well as being the world's leading toy company. Mattel is the worldwide leader in the design, manufacture, and marketing of toy products. The company's major brands include Barbie, Hot Wheels, Matchbox, Fisher-Price, and American Girl. With headquarters in El Segundo, California, Mattel has offices and facilities in 36 countries and sells its products in more than 150 nations throughout the world. In 1945, Ruth and Elliot Handler and Harold "Matt Matson develop this new company out of their garage workshop located in Southern California. Although the first products they create are simply picture frames, Elliot takes the left over pieces of these frames and put them to use to make dollhouse furniture. These dollhouse furniture pieces were just a side business for Elliot though. Harold Matson soon sells out his partner, and, being confident from the success of the dollhouse furniture, the Handler's decide to turn the companies' emphasis on toys. In the year 1947, the "Uke-A-Doodle is the first, in a line if musical toys. In 1948, Mattel is incorporated in Hawthorne, California. During the year 1955, Mattel becomes involved with "Mickey Mouse Club . This very popular show soon become the major spot of advertising for Mattel, which revolutionized they way the toys were marketed. It also introduced they another great product, the "Burp...
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...Introduction & Company Overview Lego is the definition of the household name. The little brick has made itself an essential part of childhood around the world. The Lego Company, a multinational corporation was founded in 1932 in Jutland, Denmark. By 2009, it became the fifth largest manufacturer of toys by sales volume. The company had a workforce of over 7000, and was selling its products in over 130 countries. The core idea behind LEGO is to develop a line of marketing toys and accessories in the form of interlocking plastic bricks. Because plastic became readily available following the Second World War, Lego purchased its first plastic injection-molding machine in 1947. The plastic version of the Lego brick was born and patented in 1958. Modern bricks we still see today are comparable with ones made in the 1950s. During the 1970’s the foundation of the company’s manufacturing facilities and research and development department were established to keep the manufacturing methods up to date. A LEGO production plant was opened in Enfield, Connecticut in the United States. This growth enabled The LEGO Group to continue expanding their product and by 2007 divide their product line into six product segments including pre-school products, creative building, play themes, licensed products, Lego NXT, and LEGO Education. Fortune Magazine and the British Association of Toy Retailers named the Lego Group Company’s iconic brick the “Toy of the Century.” It was clear that the brand...
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...NEW MEDIA PAPER NEW MEDIA PAPER COMSTOR | COMSTOR | Brandgagement michiel hutten 2054625 Brandgagement michiel hutten 2054625 2014 2014 Table of Contents Introduction 2 Chapter 1: Business description 3 Chapter 2: Brandgagement 4 Examples of succesfull brandgagement 5 Chapter 3: Applicability Comstor 7 Roadway for brandgagement 7 Recommendation 8 Bibliography 9 Introduction In this report the possible applicability of brandgagement by Comstor is further clarified. The first part of this report contains a business description of Comstor. In the second chapter brandgagement will be explained. What is brandgagement? Which companies are using brandgagement at the moment? What are the benefits of brandgagement? What are the costs to introduce brandgagement by Comstor? When brandgagement is explained, the applicability for Comstor will be outlined. Finally there will be some recommendations. Chapter 1: Business description This chapter provides a description of Comstor. There is a description of the core business, the Westcon group and the turnover. We will also take a look at the competitors and the global activities of Comstor. Comstor is the leading Distributor of Cisco's advanced networking products. Comstor also sell a number of other brands, but the main brand they sell is Cisco. Comstor provides expertise and experience at each stage of the sales process, including consultancy, design, implementation and support for single...
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