Innovation Doesn’t Have to Be Disruptive — Just Look at Lego

 

David Robertson talks Legos at Congress on Monday.

By Cyndee Miller

Confession time: I am bored with disruption. A few years ago the business press and management consultant gurus started issuing decrees about “disruptive innovation.” Stern warnings ensued: Disrupt yourself lest you be disrupted!

Oh, and this was all wrapped up in the cult of personality around Steve Jobs and Apple. Now I’ve got nothing against Jobs and the company he built — I’m typing this on a MacBook while compulsively checking messages on my iPhone. I just don’t think he owns innovation, whether it’s disruptive or not.

And as keynoter David Robertson pointed out, Mr. Job’s early path was more about slow and steady innovation. Organizations can’t all be disruptive all the time — and they don’t need to be. Every innovation doesn’t have to be revolutionary, leading to a patent or creating a new product category. Innovations don’t even have to be incremental advances, he said.

“Most of us can’t spend most of our time focusing on those two ways of innovation,” said Robertson, author of Brick by Brick: How LEGO Rewrote the Rules of Innovation and Conquered the Global Toy Industry. “Our customers count on us doing better versions of our current products. Business models depend on revenue from those.”

Which brings us to the Lego Group, a veritable case study in how sustainable success can mean simply getting back to basics.

The Danish toy company flirted with bankruptcy in 2003 after spending the previous five years trying to aggressively reinvent itself. Lots of new products moved away from the traditional Lego look and feel. The company lost sight of its core identity and customers, many of whom were left confused.

After making huge lay-offs, taking out emergency loans and selling its headquarters, the company goes “through a deep reconsideration of who they are as a company. They learn something from that brush with bankruptcy,” Robertson said.

Lego’s “disruptive revolutionary phase” had resulted in “variety without value.” Looking for supply chain sanity and consistency, the company simplified its products and centralized approval of any new Lego elements.

Its innovation was to focus on the classic product lines we’ve known for generations — Lego and Duplo bricks — while boosting the storytelling around them. Voilà: a whole universe of tie-in accessories around the bricks is born. Lego-themed books, video games, even bed sheets. And yup, I’ve purchased the Harry Potter and the Batman Legos.

Then there’s the massively successful The Lego Movie from 2014, which brought kids and adults together to revel in what Lego bricks are ultimately all about: imaginative play. It was a stroke of marketing genius. And it helped power Lego to become the second-biggest toy company in the world. Revenue and profits have soared through the roof for years.

“Innovation flourishes when the space for it is limited,” Robertson said. “When you constrain, sometimes you get not just great innovation, but more profitable innovation.”

He left congress attendees with a fitting metaphor: If disruptive innovation is “fighting” existing customers, he said, then Lego’s way is more like dating them.

“Think of innovation as dating your customer. Understand who they are and what they care about. See beyond your products to understand what will make their lives better.”

And then, everything is indeed awesome.