“One of the things people often overlook is the massive system integration and to what degree the LEGO group is actually an IT-driven company as much as a brand driven company.”
Jørgen Vig Knudstorp, CEO
“Radical is the new normal. Lifecycles are getting shorter and shorter. There’s no time to catch up. All companies need to experiment and understand these things.”
David Gram, LEGO
LEGO blocks are more than just a tool beloved by agile scrum masters – they are the product of a company that has embraced a scaled agile framework. Back in 2014, the LEGO Group kickstarted the transition towards a SAFe working model within its Digital Solutions department with the goal of building what the company termed the ‘Land of Awesome’. By transitioning to this collaborative way of working, LEGO has kept pace with children’s demands for digital products including video games and online communities. Adopting a fresh approach to delivery allowed the company to adapt where other toy manufacturers fell behind.
A deep dive into the LEGO story reveals how the company successfully scaled an agile framework. Exploring this journey highlights that the key to an agile transformation lies in the mindsets, beliefs, and actions of the people at the heart of an organisation. In short, LEGO’s journey provides a blueprint of adaptive delivery for companies by highlighting the importance of culture in scaling agility. It showcases how the key to embedding an agile framework is teaching people firstly what an agile mindset truly is, and secondly how it can be embedded into their day-to-day operations.
Below I explore the step-by-step approach LEGO used to shift their working model in order to clarify crucial lessons for consultant looking to navigate digital projects in the financial services space. Like their counterparts in other industries, many financial services firm are facing the challenge of adapting or potentially becoming extinct. Taking note of how other industries have successful scaled agile therefore offers invaluable lessons for the modern financial services consultant.
The LEGO Group’s Problem Statements
Before diving into LEGO’s agile journey, it is useful to consider why the company had to alter its ways of working:
- It had to diversify into the digital toy market, matching the pace of competitors such as Minecraft creator Mojang Studios, or face being left behind as a physical only product company
- Embed a truly customer-centric focus into LEGO’s working model or risk losing its customers, whose expectations were evolving in an ever-shifting toy market
- Improve the efficiency of agile methods or risk cost-to-innovate becoming high, undermining profitability.
Short-term: How Did They Do It?
- LEGO gathered together 20 managers from LEGO’s Digital Solutions department
- It held a two-day class on the fundamental principles of SAFe
- This was followed by a PI Planning event covering insights and lessons from the SAFe training
- As a result of this training, the Digital Solutions department expanded from five large teams to 20 small, self-organising, and cross-functional teams
- The company implemented programme and portfolio levels of planning that synced the work of different teams
- Iterative development was maintained through Design Sprints that streamlined different teams’ journeys
- Employees used an agile hub and Yammer site to share knowledge on agile and the broader transformation at LEGO.
Benefits to the organisation:
- Faster innovation of products and an accelerated time to market. A study on LEGO agile transformation reports that for a product estimated to require 8,000 hours of development, that development time was reduced to 800 hours across two four-week sprints
- The working culture of employees was transformed, with redundant tasks reduced and a greater focus on creativity and collaboration
- Due to the success of agile within the Digital Solutions department, more than 500 employees at LEGO moved towards an agile framework by 2017.
Benefits to the Customer
- Customers collaborated on new LEGO products through frequent feedback. This fed into the development of titles such as LEGO Super Mario in 2020, one of its most successful releases ever
- LEGO gave their customers a direct role in the production process by promising them a share in revenues from products they proposed that successfully made it to market.
Following the success of the Digital Solutions team’s transition,CEO Jørgen Vig Knudstorp announced an end to digital strategies, proposing a unified agile approach across LEGO as a vehicle to innovate in the digital world. Scaling agile, he argued, would result in three key benefits: streamlining decision-making; forging a direction for future development; and producing a global collaborative culture.
In the years since the LEGO Group’s commitment to scaling agility, the company has blossomed into a truly agile business and become a blueprint for success. LEGO continue to champion continuous learning to inject an agile philosophy into their company culture by employing a team of agile specialists worldwide, who ensure the company stays committed to genuine agility. LEGO’s blueprint can be summarised by three key lessons learnt:
My Lessons Learnt
By being adaptable, thorough, and direct in their approach to agility, LEGO evolved and secured their ongoing success as a digital toy manufacturer.
- Be Bold and Flexible: “To change course, sometimes you have to pull the emergency brake”.
Being bold is crucial to delivering real change. A key part of this is experimentation, whether in relation to team size or the disruption of roles. LEGO’s journey towards an agile working model demonstrates why it is important to think big and be flexible. SAFe is a good framework, but it needs adapting in line with the specific needs of the company; again, experimentation is essential.
- Embed an Agile Mindset
The key to scaling an agile framework is embedding an agile culture. To do so, open conversation is required. LEGO’s journey showcases why conversations should be guided by experts with insight into the ways that agile can benefit a workforce. It is clear to me that those responsible for transforming an organisation must believe in the power of agility. Embedding such a mindset in the financial services space requires intelligent and adaptable consultants who can overcome pushback and doubt.
- Define and Pursue a Clear Vision
Scaled agile can shine when a company pursues a clear vision that aligns with its working culture. At LEGO, 20 managers remained consistently committed to scaling agile whilst championing flexibility and innovation. Keeping the vision consistent ensured that their mission and approach were in sync. Within financial services, such alignment is key to navigating a vast and ever-changing industry.
Like LEGO, Capco seeks to disrupt the fabric of organisations. Learning from companies like LEGO provides a blueprint for embedding agile from the ground-up. Lessons learnt from LEGO include adopting a flexible and bold working model, embedding an agile culture, and pursuing a clear vision. These tips offer perspective to those of us within financial services who must wrestle with the challenges faced by the increasing digitisation of products and companies. In response, we must choose to adapt.