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Question: Discuss and Analyse the Case Study of Lego. Answer: Introduction The report is based on the analysis of the case study of Lego and the problems that was faced by the company from the year 2003. Lego had recorded huge losses in the year 2003 and the debts of the company became as high as $800 million. The revenue of the company had decreased by 5% and there was more than 1400 job cuts in the organization. The company had never experienced losses from the year 1932 to 1998 and the losses were faced for the first time in 2003. The consultants of the company had suggested diversification so that Lego can improve its status (Behrens and Patzelt 2016). The major business areas that were advised to Lego by the consultants were, Barbie, Fisher-Price, Hot Wheels and Lego clothes. Lego had built a video games company and the largest installation of the organization was related to Silicon Graphics supercomputers in Europe. In the year 2015, Lego Group was able to overtake Ferrari and they became the most powerful company in the world. The profits of the organization had increased from the year 2008 to 2010 and they were able to beat Apple as well. The turnaround of Lego was one of the greatest incident in the history (Theguardian.com 2018). Opportunity of Lego Lego had hired consultants for the increase in their profits from the year 2003 and they started increasing their business opportunities. The new business areas where Lego started investing were toys, jewellery, clothes. The company also opened theme parks and started their own video games company as well. The profits of the organization started increasing from the year 2008 and they were able to overtake many other large organizations. The case of Lego had gained a lot of attention and a movie was also made based on this subject which was named as The Lego Movie which came out in the year 2014 (Bierwerth et al. 2015). The revival of the company was a big incident in the industry and the ways that were taken by the consultants of the company had proven to be profitable. The saviour of Lego was Vig Knudstorp who was hired as a consultant in the year 2001 and was then promoted to the position of the boss after three years. Lego was strategically rebuilt by Vig Knudstorp and this was the way of rescuing the company from the major breakdown that is was going through. The major strategies that were undertaken by him in this phase was the slashing down of inventory, interaction with the customers and using the internet related facilities to increase the fan following of Lego. The organization had the capability of to engage with the customers and further make the company successful. Lego had started improving its operations in the year 2011 so that they can be able to increase their customer base which only consisted of boys at that time (Bloodgood et al. 2015). They were successful in their venture with the help of the various different types of products that were manufacturing. Issues and challenges faced by the company Lego had to face its worst performance in financial terms in the years 2003 and 2004. The job cuts of the company had also grown during this phase which was an effect of the financial collapse in the company. The decline of Lego was mainly due to the challenges that were faced by the company in the process of staying relevant in the market. The situation in the market had changed from what it was many years ago. The companies were able to manufacture products that were appropriate for the market according to them. However, in the current scenario the products required to be relevant for the market and customers as the customers had an upper hand in this case (Chen et al. 2014). The relevance of the company in the market can only be maintained in this manner. The major changes that have occurred in the global business environment has led to the increase in the importance of prompt communication of the company with the customers. The simplification in the business operations of the company will lead in the increase in communication with the customers which will further increase the profitability of the company (Dentchev et al. 2016). One of the major issues that have been faced by Lego is the complex structure of the organization which has led to many layers in the management. This is the major reason behind the delay in the decision-making process of the organization. The lack of experience of the managers who were working at the executive levels had led to the major problems in the organization. The costs related to the employment of the managers of different levels were also high which had added to the losses of the company (Garca-Morales, Bolvar-Ramos and Martn-Rojas 2014). Another major issue in the company is the distance between the management and the customers or the end users of the products. The development process of the products of the company was also poor and relevance of the products in the market was also lacking. The company was lacking the communication with the customers and this led to the lack of knowledge of the company related to the needs of the customers. Market analysis and intervention Corporate entrepreneurship is generally related to the development of the new opportunities and the ideas within established and large businesses. This development has led to improvement of the profitability of the organization and enhancing the competitive position of the business in the industry. Innovation is a major part of corporate entrepreneurship and they bound together in a tight way. The main reason behind the consideration of corporate entrepreneurship for the large organizations is to enable the them to take risks, innovate their operations and the drive the leaders (Hsu et al. 2014). This process can be considered as a way of organizational renewal in the industry. The main task of the modern business organization is to create an environment which can facilitate the entrepreneurial thinking and the process can take place readily. The leaders of the company need to be motivated so that innovation can take place in the company and the business processes can be improved (Za hra 2015). The organizational structure of the Lego Group was complex in nature and this had a major impact on the profitability of the company. The system of management had excessive number of managers which had led to the decrease in the revenues of the organization. The distance between the management and the customers has become a major issue for the company as they were not able to properly judge the needs and desires of the customers (Kuratko, Hornsby and Covin 2014). The first step that was taken by Lego to improve their sales was to diversify their operations. The organization had made its achievement in the year 2010 by beating Apple and gaining the name of the Apple of toys. The company had become much more successful in the year 2015 and they had overtaken Ferrari. The profits of 660 million Euros had made the organization one of the most powerful brand in the world. Lego had taken an innovative marketing step in the year 2014 by releasing a movie named The Lego Movie and the follow-up of the same movie was The Lego Batman Movie. These two movies were a part of the promotional activity of Lego related to its toys division (Kuratko, Hornsby and Hayton 2015). Vig Knudstorp, the saviour of Lego had taken steps to establish a connection between the management and the customers or fans of the company. He promoted various events and functions like, Brickworld and other fan conventions of Lego. The internet had played a major role in this aspect and they were able to connect positively with the fans of the company. Lego was able to engage with its customers with the help of TV shows, movies and other promotional activities by partnering with many successful people. Lego has designed many different types of toys based on the likes of the different age groups. The increased communication with customers has helped Lego in delivering the appropriate products for them (McKelvie et al. 2014). Lego had also started many different initiatives involving the customers like, Lego Friends, Lego Life. Lego Life was designed as social network platform for the kids who are not eligible to use other social platforms for the purpose of sharing their views. Lego Life was able to bridge the gap between the physical and virtual world by involving the young kids in the process of the organization. The games that have been designed by the company are also interactive in nature and this enables the coordination of the customers and the management. The profitability of Lego had increased a lot after the new strategies had been implemented in the company (Nason, McKelvie and Lumpkin 2015). Recommendation of the business plan The major issues that have been identified in the discussion above are related to the complex organizational structure of Lego. The multiple layers in the structure of the organization will mainly have a negative effect on the profitability of the organization. The costs related to the maintenance of multiple managers in the company are one of the major reasons behind the losses that have been suffered by the company. The decision-making process of the company also becomes slower due to the multiple levels of management (Ogunsiji and Ladanu 2017). Recommendation The complexity of the management system can be reduced by decreasing the levels of managers of the company. The decrease in the number of levels will speed up the decision-making process and the delivery of products to the customers will also be more prompt. The system of communication within the organization is also a major problem that affects the profitability of Lego. The problems in communication is also related to the hierarchy of managers in the company. The various levels of managers in the company and the slow process of communication acts as a problem and it also has to face the threat of message distortion. Message distortion can further lead to miscommunication among the employees which can further cause a lot serious issues in the organization (Turr, Urbano and Peris-Ortiz 2014). Recommendation Lego is a large organization which has its operations in many fields and therefore they need to pay attention towards improving the process of internal communication. The company can make use of the internet to enhance communication within the organization. Lego has used the internet for many purposes including communication, hence, they can also use the power of this medium to improve their internal processes. The relationship of customers with the management of the organization is an important factor related to its success. Lego had faced problems in the various markets due to the poor development of products. This situation had occurred due to the lack of communication with the customers and lack of research as well. Although Lego had taken many initiatives to solve this issue, they still need to go a long way in building fruitful relations with the customers (Wadhwa, Phelps and Kotha 2016). Recommendation The relationship of the company with the customers can be improved by decreasing the levels in the management system. This will speed up the process by decreasing the distance of the customers from the management. The identification of the needs of the customers is another important step in this process. This will help the company in manufacturing products that suit the needs of the customers. The marketing habits and preferences of the customers are also important for the company so that they can build a suitable strategy. Conclusion The report can be concluded with the learning that Lego had gone through huge losses in the years 2003 to 2004. However, the company was brought back to its profitable position by Vig Knudstorp who was the consultant appointed by Lego. He later became the CEO of the company and continued the growth of Lego in the industry. The organization is however still facing many internal issues related to management and communication. 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