It’s all approximately a modular machine. It’s all approximately distinguishing the ones simple constructing blocks of your company idea that may be assembled and re-assembled into several various services. Think approximately the LEGO brick and the countless opportunities for innovative buildings that it offers. This is what we communicate approximately at THNK; growing a modular machine of services. Creating the opportunity to split and ad infinitum recombine the factors of your company idea’s essence. If we have been to select one inspirational instance of an agency that masters the artwork of modularity, LEGO might be it.
OW IT ALL STARTED
It is 1932 while Danish grasp chippie Ole Kirk Christiansen founds LEGO in Billon, Denmark. The agency is to start with the targeted production of wooden toys for children but quickly switches to plastic fabrication. During the 1950s, Christiansen and his son, Gottfried Kirk, placed a brand new concept for a plastic production brick into the test. Then, in 1958, they introduce the “stub-and-tube coupling machine” that defines the mythical LEGO brick-toys.com.
Their brick patent resulted in the advent of a modular machine, which permits LEGO to take a step far from the conventional manufacturing of standalone toys. This modular machine is a hard and fast of simple constructing blocks that may be mixed in special approaches to construct several various creations. Moreover, leveraging modularity right here the way that the bricks in any toy set may be mixed with the bricks of another toy set, growing the opportunities for creativity. By continuously introducing new units that encompass equal bricks, LEGO leverages large economies of scale in product development, brick manufacturing, and retail.
CHALLENGES AND DECLINE
At the top of the 20 the century, after 8 many years of increasing increase, the agency faces the mission of incremental competition. Children at that point commenced embracing digital and virtual entertainment – video games, computers, VCRs – and LEGO’s longstanding portfolio of plastic production bricks misplaced its oomph.
To compete with virtual and digital toys, LEGO prompt on an adventure of incessant, untamed innovation. From 1994 to 1998, its services tripled and new markets have been approached. Nevertheless, the proper increase turned into now no longer achieved. Sales grew handiest 5%, even as manufacturing prices swiftly rose. In 1998, the agency stated a loss of $ forty-eight million.
After duration of great loss, it has become time for radical motion and LEGO initiated a three-section rebound strategy. The first section, in 2003, protected rigorous restructuring for survival through enforcing constraints. Practices protected last places of work in addition to casting off the workforce, unprofitable factories, and merchandise.
In 2006, LEGO initiated the second and maximum critical section of its rebound strategy. This turned into essentially a “return-to-the-brick” initiative with the primary aim to regain profitability. They emphasized constructing a center set of merchandise that might permit limitless growth and innovation. Following the crowdsourcing trend, the agency grew to become an enthusiast for thoughts by introducing the Digital Designer, wherein customers ought to layout and add their very own units of LEGO.
Finally, the 1/3 section concerned drawing the increased path. LEGO pursued new markets by constructing its center and capitalizing on the variety and skillfulness of its group of workers and enthusiasts. A well-known instance turned into to introduce of the “smart brick”, as a part of updating the Mindstorms’ robotics set, which permits customers to apply their robots.