Author Archives: David Robertson

The most interesting retail experiment that no one is talking about

legoland-discovery-center-map

The LEGO Dead Ocean Strategy Near my home in Philadelphia, LEGO just opened its tenth North American LEGOLand Discovery Center.  It’s located in the Plymouth Meeting Mall, a mall opened in 1966 outside Philadelphia and once one of the premier malls in the country.  Plymouth Meeting Mall, like many others, had fallen on hard times as flagship retailers such as Macy’s have closed stores.  With customers choosing alternatives like Amazon, Wal*Mart, and the nearby King of Prussia Mall, the mall was slowly dying. If you were the owners of the mall, what would you do?  How would you fill tens of thousands of square feet of empty space?  JC Penny’s and Sears are unlikely to be interested in expanding, no matter what price you offer.  If you can’t fill the anchor store spaces, the smaller stores that depend on the larger stores to draw in business will also close down. read more

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What we can learn from LEGO

LEGO sale Graphic

LEGO announced its annual results for 2014 on February 25, and it was another stellar year for the Danish toymaker. Sales grew 13%, and profits grew 15%. As great as that is, that’s actually a decline from their seven-year average. Since 2007, the company’s sales have been growing at an average rate of 20% and profits at 37% per year. The company has now tripled its sales since 2008, and increased its profits by over 7100% in the same period. And they’re not cutting prices to boost growth – the company is stunningly profitable. As any parent can tell you, LEGO bricks are expensive – LEGO pays less than a dollar per pound for its raw material, ABS plastic, and sells its finished bricks for over fifty dollars per pound. Yet even with this price premium, the sets fly off the shelves. What’s even more striking about LEGO’s performance is that they compete in a very read more

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The LEGO Movie as an example of creative leadership

Tim Brown recently posted his thoughts on how The LEGO Movie is an example of creative leadership.  I agree, but not only for the reasons that he lays out in his post. The LEGO Movie is the result of a long, painful but very successful restructuring of the company, one that began during the company’s crisis in 2003.  Convinced that the brick was passé and would soon be replaced by video games and other digital play experiences, LEGO experimented with all kinds of out-of-the-box play experiences between 1999 and 2002. The result was a crisis and near bankruptcy in 2003. To recover, LEGO went back to the brick, but also went back to their customers to understand how they used the company’s products. With the help of outside consulting firms such as ReD Associates, LEGO applied many of the disciplines of Design Thinking to understand who played with their products and how they read more

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What Apple and LEGO have in common

Geoff Colvin from Fortune had a short post on how Apple and LEGO are similar:  “In one word, integration.”  Specifically: “Apple has conquered the world in large part because it’s the best company anywhere at integrating all the parts of the business into a knockout customer experience. Hardware, software, product aesthetics, online experience, even packaging — at Apple they’re all created simultaneously in ways that reinforce one another.” LEGO has done the same.  As Colvin says:  “Characters and products that show up in the movie may also play roles in programs that Lego creates with Cartoon Network, in video games, at six Legoland theme parks around the world, and at 11 smaller Legoland Discovery Centers.”  He doesn’t mention the other tie-ins:  online games, McDonald’s Happy Meal toys, product merchandise (like this alarm clock), and the Build With Chrome app from Google that uses the character Vitruvius from The LEGO Movie to read more

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Three thoughts on The LEGO Movie

The LEGO Movie was released last night.  It’s about an unassuming young man who has to organize a group of fractious but talented people to save the world from the evil Lord Business.  He teaches them to cooperate and together they pull the world back from disaster.  In other words, it’s a metaphor for the LEGO Group’s story over the past decade.  I want a writing credit!  I wonder if there’s a little bit of the relationship between Jorgen Vig Knudstorp (the current CEO) and Poul Plougmann (the previous CEO, who was much older than JVK) in the movie, in the way that Emmet has to fight back against the evil Lord Business. I love the animation.  LEGO did a full computer-generated imitation of stop motion LEGO animations.  Even the smoke that comes out of the train has little studs with LEGO logos on them.  It must have taken forever read more

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Is 3D Printing a Production Technology? Part 1: Making Consumer Products at Home

Some of my colleagues believe that additive manufacturing (of which 3D printing is one type) is only a prototyping technology now.  It’s an interesting debate that I’ve been looking into all summer.  I believe they’re wrong; that there is a significant set of products that are better produced using additive manufacturing techniques right now, both for consumer and industrial applications.  I’ll be continuing to research this over the Fall, but thought it was worth a post now. A team of researchers at Michigan Tech did a nice article on whether it was worth buying a home 3D printer to make simple manufactured products.  They found 20 common household items ranging from a set of 12 shower curtain rings to custom shoe orthotics and computed how much it would cost to make each on a low-end open source 3D printer, the RepRap.  In every case, the part produced is more than strong enough read more

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Defending LEGO Friends

LEGO friends is the latest attempt by LEGO to attract young girls to the brand.  Business Week covered the launch extensively and well in a cover story at the end of 2011. The line was an immediate hit with “astonishing” sales, selling twice as many sets as expected and leading to a 35% jump in profits in the first half of 2012 (according to this article). But the product brought a swift, negative reaction from some.  A petition on change.org by psychologist Dr. Lyn Mikel Brown charged that: “Narrow stereotypes associated with pink and blue simply box kids in from an early age….  This is why LEGO’s latest marketing campaign has parents so angry. The rainbow of colors and a range of options for young children to create the scenes they are most interested in is much better for them than feeding them a narrow set of stereotypes.” On NPR’s Tell read more

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Which industries could additive manufacturing disrupt?

There’s a lot of debate about if and where additive manufacturing technologies (such as 3D printing) will disrupt current manufacturing industries.  Some argue that it’s a low-quality prototyping technology that is unlikely to cause any major change to mass production industries.  For example, a recent Deloitte report (http://bit.ly/YELqOH) concluded: “While the technology has several unique applications and is expected to experience considerable growth in the long run, for the foreseeable future it will likely remain a specialized application that for the most part will complement, not replace, traditional forms of production.” This analysis misses a crucial point that Clayton Christensen didn’t acknowledge until his later books – it’s not enough to focus on the technology; you have to understand the effect on the business model.  I’m working this summer with some very bright students to understand if and where additive manufacturing (AM) will disrupt traditional industries. Where will AM read more

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Why much of the reporting on additive manufacturing is misguided

An interesting post by Scott Locklin on why much of the reporting on additive manufacturing is silly and misguided. http://scottlocklin.wordpress.com/2012/08/11/bad-engineering-journalism-reporting-on-3-d-printing-of-guns/ I agree with everything he says, but not where some of my colleagues go with similar arguments.  Locklin doesn’t fall in the trap of saying that because home 3D printers can’t make many useful parts now, they’ll never make useful parts and they’ll never disrupt industries.  But his article could lead some to think that. 3D printers can’t make the same quality plastic parts as traditional injection molding machines can.  They can only make much lower strength parts, with worse dimensional accuracy.  But take that statement, replace “3D printers”, “plastic”, and “injection molding” with “Electric arc furnaces”, “steel”, and “blast furnaces” and you’ve got a typical statement from 1980.  But, like many new technologies, the capability of electric arc furnaces increased quickly and cost dropped very fast, eventually driving read more

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  • david robertson innovationAbout |David Robertson

    David Robertson is a Professor of Practice at the Wharton School where he teaches Innovation and Product Development in Wharton’s undergraduate, MBA, and executive education programs. From 2002 through 2010, Robertson was the LEGO Professor of Innovation and Technology Management at Switzerland’s Institute for Management Development (IMD), which received the #1 worldwide ranking by the Financial Times for its executive education programs. Robertson is the author of Brick by Brick: How LEGO Reinvented its Innovation System and Conquered the Toy Industry, and co-author of Enterprise Architecture as Strategy.
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    innovation navigationIn his latest quest to understand innovation, David is also host of Innovation Navigation, a Wharton Business School Business radio program offering live, unscripted access to world-renowned thought leaders, executives, and faculty. As a Professor of Practice at the Wharton School, Robertson brings brilliant minds worldwide to share their innovation knowledge and experience to the... read more

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