How to Scale Your Business with Agile Project Management: The Story of LEGO

How to Scale Your Business with Agile Project Management: The Story of LEGO | Project Management | Emeritus

For businesses that value efficiency and flexibility, Agile project management has emerged as a guiding light. Many firms are making the change to Agile techniques because of the established track record of success. A recent survey by Radixweb showed that Agile methodologies had an 80% success rate, which is significantly higher than other models. In addition, 60% of businesses that have implemented Agile have seen an uptick in revenue and profit, proving that it has a positive effect on overall business performance. This blog takes a look at the remarkable success of the LEGO Group, a well-known toy manufacturer, and how they were able to use Agile approaches that completely transformed their operations. Exploring LEGO’s Agile journey, looking at the obstacles they encountered, the tactics they used, and the remarkable results that came from using Agile, this blog takes LEGO as a case study of how adoption of Agile project management principles can help scale a business.

What is Agile Project Management?



Agile project management is a methodology that emphasizes flexibility, collaboration, and customer satisfaction. Originating from software development, Agile approaches focus on iterative progress through small, manageable increments called Sprints. Agile methodologies allow teams to adapt to changing requirements quickly, ensuring that the final product effectively meets customer needs.

1. A Brief History of Agile

The roots of Agile project management trace back to the early 1990s. At the time, industries such as software, manufacturing, aerospace, and defence were frequently employing the Waterfall methodology. This was a sequential method and entailed inflexible planning and implementation stages. This, in turn, resulted in lengthy development cycles and obsolete solutions.

As a response to these issues, other novel methodologies surfaced, including Scrum, Rapid Application Development, Extreme Programming, among other approaches. These strategies had a single objective: to enhance the adaptability and efficiency in project management.

In 2000, a significant meeting occurred in Utah, where 17 software engineers, including notable individuals such as Martin Fowler, Jim Highsmith, Jon Kern, Jeff Sutherland, Ken Schwaber, and Bob Martin, convened to deliberate on strategies to enhance the efficiency of development processes. Their concepts established the foundation for the Agile principles that we currently use.

ALSO READWhat is Agile Project Management and How to Use it Effectively

In 2001, these developers once again gathered in Snowbird, Utah, and created the Agile Manifesto. The manifesto clearly expressed the fundamental values and concepts of Agile, representing a notable achievement in the history of project management. The Agile Manifesto delineated four fundamental principles:

  • Prioritizing individuals and interactions over processes and tools
  • Working software over comprehensive documentation
  • Customer collaboration over contract negotiation
  • Responding to change by following a plan

It’s important to note that while Agile started in software development, it has since spread to various other industries, including marketing, business operations, and more, demonstrating its versatility and broad applicability

2. The 12 Key Agile Principles

Agile project management principles, which were distilled from the processes that emerged from a need to change traditional software development methods, are characterized by 12 key principles:

  • Customer Satisfaction: Deliver valuable software continuously to satisfy customers
  • Welcome Change: Embrace changes, even late in development, to maintain a competitive advantage
  • Frequent Delivery: Deliver working software frequently, from a couple of weeks to a couple of months
  • Collaboration: Business people and developers must work together daily throughout the project
  • Motivated Individuals: Build projects around motivated individuals and give them the environment and support they need
  • Face-to-Face Conversation: The most efficient and effective method of conveying information is face-to-face conversation
  • Working Software: Working software is the primary measure of progress
  • Sustainable Development: Agile processes promote sustainable development with a constant pace
  • Technical Excellence: Continuous attention to technical excellence and good design enhances agility
  • Simplicity: Simplicity—the art of maximizing the amount of work not done—is essential
  • Self-Organizing Teams: The best architectures, requirements, and designs emerge from self-organizing teams
  • Regular Reflection: At regular intervals, the team reflects on how to become more effective and adjusts accordingly

ALSO READWhat is Kanban? How Does It Help Organizations Become Agile?

Agile Project Management at LEGO

1. The Pre-Agile Era: LEGO’s Building Blocks of Trouble

Before embracing Agile project management, LEGO found itself in a bit of a bind with its old-school ways. The company clung to the Waterfall method, a project management style as rigid as a LEGO brick stuck in the carpet. This led to some serious headaches:

  • Long Development Cycles: Projects took years to complete, delaying product releases
  • Inflexibility: Fixed project requirements prevented adaptations to changing market demands
  • High Costs: Prolonged development led to increased costs and resource wastage
  • Outdated Products: By the time products hit the market, consumer demands had often shifted
  • Low Team Morale: The rigid structure stifled creativity and innovation among team members

So clearly, it was time for LEGO to try a different approach, one that was more adaptable and responsive. And here enters Agile project management. As discussed, this method is all about working in smaller chunks, being flexible, and getting everyone on the team to work together. Here’s a breakdown of how LEGO made it happen.

2. How LEGO Deployed Agile

A. Agile Pilot Projects

First, LEGO didn’t jump into Agile methodologies headfirst. They started by testing the method out on smaller projects within the organization. This gave them a chance to see how it worked for them and make any tweaks they needed. They also created teams with people from different departments to encourage collaboration and ensure everyone was on the same page.

B. Embracing the Agile Mindset

LEGO knew that for Agile to really work, they needed to change the way everyone at the company thought about projects. This was a big deal, and the company’s leaders played a huge role by actively participating in the change. Thus, the new LEGO culture was all about being able to adapt to change, putting customers first, and always trying to improve. And this included their “LEGO Ideas” initiative, which allowed fans to submit ideas for new products, shortening the product development time and effectively pre-testing concepts for market acceptance.

C. Building With the Customer in Mind

LEGO started paying a lot more attention to what customers wanted. For instance, they regularly chatted with LEGO fans, both inside and outside the company, to make sure their products were hitting the mark. This customer-centric approach was a major turning point for LEGO, leading to happier customers who couldn’t wait to get their hands on the latest LEGO sets.

D. Focusing on Continuous Improvement

Continuous improvement is a core value of Agile project management, and LEGO took it to heart. Thus, they regularly held meetings where teams could look back on what worked well and what could be done better. And this helped LEGO fine-tune their processes and products, making them even more awesome.

ALSO READ: Kanban vs Scrum: A Guide on These 2 Different Agile Methodologies

E. Agile Finances

LEGO also changed how they handled their money. For instance, instead of sticking to a rigid budget, they started using a more flexible approach that aligned with the iterative nature of Agile project management style. This gave them more wiggle room to adjust their spending as projects evolved.

F. Focus on Teamwork and Shift to Agile KPIs

Aligned with Agile project management principles, LEGO ditched individual performance goals and started focusing on how well the entire team was doing. Consequently, this encouraged collaboration and made sure everyone was working toward the same goals. For instance, program and product managers defined high-level outcomes and timelines. This created a “project backlog” that aligned with the company’s overall strategic goals. Later, cross-functional teams, equipped with all the necessary skills, tackled tasks from the backlog in two-week Sprints with the goal to have a testable result within this timeframe.

G. Reorganizing for Agile

Lastly, LEGO even changed how the company was organized. For instance, they created teams that focused on specific products, which made everyone more accountable and helped things run more smoothly. And these cross-functional teams were designed to break down the traditional silos that often hindered progress in larger organizations. For instance, every 8 to 12 weeks, the outputs of all the teams were coordinated into an “Agile release train” to implement larger changes or features that required cross-team collaboration.

3. LEGO’s Success With Agile

LEGO’s foray into Agile project management was a transformative experience, yielding remarkable outcomes. First and foremost, the iterative nature of these methodologies allowed LEGO to accelerate product development and launch new products significantly faster than before. Furthermore, they achieved continuous delivery of functionality, reducing turnaround times from months or years to days or weeks. Additionally, the emphasis on continuous improvement inherent in Agile helped LEGO streamline its processes, eliminating unnecessary steps and resources, ultimately saving both time and money. By actively listening to customer feedback and incorporating it into product development, LEGO was able to create products that resonated with their target audience, thus leading to increased customer satisfaction. Moreover, the collaborative nature of Agile fostered better communication and teamwork among employees, resulting in higher morale and a more motivated workforce. Finally, the feedback loop and commitment to improvement inherent in Agile methodologies ensured that LEGO consistently delivered quality products.

4. Real-World Agile Wins: LEGO’s Success Stories

The benefits of Agile project management at LEGO are crystal clear when you look at their success stories.

A. Pop-up LEGO Shops

When traditional toy stores were struggling, LEGO quickly created pop-up shops to connect with shoppers who still wanted that in-person experience. In essence, Agile helped them act fast and create fun shopping experiences that boosted sales.

B. Speedy Finance Product

A finance product that was initially estimated to take a whopping 8,000 hours to develop was completed in just two four-week Sprints—thanks to Agile. This functioned as a major time-saver!

C. Smart Machines 

LEGO even used Agile to connect their production machines to the Internet of Things (IoT) to improve quality control. This involved close collaboration between different teams and a willingness to learn and adapt along the way.

D. Supply Chain Transformation

LEGO’s supply chain got an Agile upgrade too. They created new tools that made planning simpler and more efficient, and they continuously improved them based on user feedback.

However, it is crucial to remember that LEGO’s journey of adopting an Agile project management style was not without its difficulties. Rather, it faced a number of obstacles. Some of them were:

A. Team Challenges

Some teams struggled to organize themselves effectively or felt limited by Agile methods. LEGO addressed this by letting employees naturally reorganize and move between teams as needed.

B. The Problem of Rigid Agile

Some teams got too focused on following the Agile rulebook without truly understanding the core principles. However, LEGO tackled this by educating everyone about Agile values and encouraging continuous improvement.

C. Managers Embracing a New Role

Agile requires a different kind of leadership, and some managers struggle to let go of control and empower their teams. To achieve this, LEGO invested in leadership training to help managers understand their new role in an Agile environment. For instance, the company went as far as to host a two-day onboarding session at their headquarters to get global leaders on board with the shift.

LEGO’s strategic adoption of Agile project management was not just a shift in operations; it was a transformation that redefined success. By embracing Agile principles, LEGO accelerated its product development and enhanced team collaboration, leading to increased customer satisfaction and profitability. Thus, this case study serves as a powerful testament to the capabilities of Agile methodologies in fostering innovation and driving business growth.

We hope that this blog has convinced you of the importance of proper methodologies for growing your business and adapting to changing scenarios. So, if you are curious to learn more about Agile project management principles along with many other organizational/operational methodologies. Consider joining Emeritus’ online project management programmes and lead your organization to success.

Write to us at content@emeritus.org

About the Author


Content Writer, Emeritus Blog
Niladri Pal, a seasoned content contributor to the Emeritus Blog, brings over four years of experience in writing and editing. His background in literature equips him with a profound understanding of narrative and critical analysis, enhancing his ability to craft compelling SEO and marketing content. Specializing in the stock market and blockchain, Niladri navigates complex topics with clarity and insight. His passion for photography and gaming adds a unique, creative touch to his work, blending technical expertise with artistic flair.
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