How Lego Made a Comeback From Bankruptcy

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The Lego group is a family owned Danish company founded in 1932 by the Kirk Kristiansen family. It is majorly involved in the manufacturing of kids’ toys and video games. The company had been one of the leading toys manufactures in the world until 2004 when it almost went bankrupt. It took the intervention of Jorgen Vig Knudstorp, who came in as the CEO in 2004, to change the fortunes of the struggling company. How Lego made a comeback from bankruptcy The major decisions that Jorgen Vig Knudstorp made were bringing fiscal responsibility to the company and giving creative directions to the main fans of the company’s products.

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He made sure that the number of parts is reduced to 6000 and that the company analyzed and restructured all costs. The design was linked to the manufacturing cost and re-focused on the core business of making construction sets (Robertson, Breen, 2013). The company also shut down the computer games business because it was not profitable. Finally, Knudstorp made efforts to give creative control to the hardcore fans of the brand.

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Why Legos are still popular Legos are still popular today because of the following reasons;

They engage the senses of creativity and logic in children at the same time. Children are tasked with producing a pre-designed model from a disorganized package of bricks and pieces (Rothrock, 2015). The children are also able to play with a completed model or build something totally different.
The company created strategic partnerships with well-known brands such as star wars and used deals with movie franchises to maintain relevancy.
The Lego Company produced new video games and television shows like the Bionicle series for children’s entertainment.

Are Legos just for kids? The Lego toys are not just for kids because of their ability to engage a person’s mind.

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They are able to engage the logic and creativity senses at the same time, making them suitable for adults who want to sharpen their logic and creativity senses. It is surprising how the Lego Company made such an impressive turnaround from near bankruptcy in 2004 to the successes it is enjoying today. The arrival of Jorgen Vig Knudstorp to the company proved beneficial as he implemented a number of measures that helped the company. Such steps included bringing fiscal responsibility to the company and giving creative directions to the main fans of the company’s products. Up to today, the company’s products are still relevant due to reasons such as strategic partnerships, their ability to engage the mind, and the production of new entertainment for children.