Corporate Strategy Process And The Management Strategy Essay

799 Words Sep 19th, 2015 4 Pages
This case is designed to understand the corporate strategy process and the management strategy in a dynamic environment. The LEGO case offers insight into turnaround management and development strategy in a difficult situation. Action before Strategy was needed at an early stage.
Understanding key factors for success and introducing KPIs for product innovation catalyzed sales while decreasing costs. Based on the analysis, following below are the key factors that have been identified for the turn- around success.
Rationalize the product offer – return to basics: For years, company has invested in expanding the product portfolio increasing the commitment and cost producing undesired results. The revised business strategy focused on developing and marketing the company’s more timeless core products that are in general demand from the existing customers
Cost base changes: Lego has increased into focus on cutting costs by reducing the design components, increasing the reusable components resulted in 50% of development time along with product innovation. Drastic organization structure resulting in reduction of redundant functional areas such as moving manufacturing and distribution functions to less expensive location also contributed to increase in profitability.
Logistics and IS: Introduced continuous improvement on information systems that accelerated the efficiency of operational activities. Products that are in demand can be pulled out from any geographical location for…

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