Michael Au-YeungDiscussion Questions The changes Knudstorp achieved is toadvance the information systems capabilities and the organizations internalchanges. The business strategy, according to Jay Barnum, is the actionsimplemented to meet the business goals (Strategic Factor Markets: Expectations,Luck, and Business Strategy). The changes align within the strategy in that theinformation system was improved to support product management, data operationalsupport, and other types of management in the organization. The improvement oftechnology from vendors are SAP, a software company and IBM, a computermanufacturing company. The changes within the organizational chain of employeesaffects the incentives ideas innovation and creativity that many individuals willdisplay to stay with the company when Knudstorp informed all employees thatthere would be employment cut(Lego.com).
Other business strategies that is achievedis the targeting of more than one customer base from both boys and girls andinto the virtual world of video games and film. I think the changes knudstorpimplemented are a form of hypercompetition. The textbook states thathypercompetition is the aggressiveness and speed of all the moves andcountermoves that a company uses in a highly competitive environment or market.
Knudstorp’s changes include changing the company’s organizational structure,the ideas of new products, and the overall costs and efficiency. The changeswere needed as Legos was losing a lot of money daily. The first move was tocreate a well-established working environment and culture, it being that thecreation and innovation of products must not over take the organization’sprofit. According to Jena McGregor, Knudstorp made tough decisions to cut thestaff, but he was honest with his decisions that by being innovative, you wouldn’tbe cut (The Washington Post). The next move was to innovate a new set ofproducts that targeted more than one sector of customers. It targeted anyoneusing movies, websites, and popular trends at the time. Not only did it targetboys, but it also targeted girls too with a specific line of toy creations.
Legos needed to continue to renew its product and ideas to consistently succeedyear after year. Lastly the move to cut down costs and time drasticallyimproved the efficiency of the company. Legos before Knudstorp’s transition tothe CEO of Legos, was failing in supply and demand. To improve the productiontime of parts, he decided to reuse parts and molds that saved time and money.
Thesereasons of aggressive yet successful strategic decisions, helped shape thecompany. According to Peter Keen from the MIS Quarterly Journal, Knudstorp’sdecision was supported by himself and even though his strategies were notsupported by others, he eventually made the company successful (Value Analysis:Justifying Decision Support Systems).