HYPE members on Monday, February 27th had the pleasure of meeting with Søren Torp Laursen, President of LEGO
® Systems, Inc. in the latest in our series of CEO Luncheons. The group came into the meeting to find that Laursen had brought a LEGO toy set for everyone in attendance. He joked that he wanted to bring something tangible, so “at least you got something out of this” and in case people mistook LEGO brand for “leggo my eggo” or other popular taglines. He added that he seriously intended to spotlight the LEGO Friends
line, which has recently come under controversy.
Laursen began by giving an overview of his professional history at LEGO Systems. In 1986 he started as an International Marketing Trainee, which led to his first actual position in the procurement department, estimating the amount of fuel that jets were using. Through this position he learned the basics of business like product development and using marketing campaigns, but he was still a far cry from the President he is today. He continued his work with the company, moving his family to New Zealand, Ukraine, London, and eventually replacing the former company President in Connecticut.
While both Laursen and the LEGO company have enjoyed a lot of success over the years, he explained there was a “dark ages of LEGO” Systems. In 2000, the company saw its first ever decline in sales. This was followed by three years of losing money, capped by record-breaking losses in 2003. The company shed assets, downsized, and Laursen was forced to lay employees off for the first and only time in his career, something he refuses to ever do again. To ensure this, Laursen has completely changed his hiring practices to only hire a number of employees he can retain for years to come.
LEGO Systems, Inc. took the “dark ages” seriously. Laursen told the group that “one simple headline” to take away about the company’s plan for the future is “continuing to develop the best toys [they] can, but also beginning to look over [their] shoulder.” He explained that they had become complacent through high demand and minimal competition and he is not going to allow that to happen again. Throughout the luncheon Laursen made sure to stay humble in regard to the company’s successes. He mentioned that they are paying attention to what Mattell and Hasbro are doing, as well as looking to reach new markets themselves.
One such market is young girls, who only currently make up about 5 – 10% of their sales. LEGO Systems has attempted to reach this market before; 6 times in fact, each time the product was a failure. As they researched the problem they decided to change their tactic. In all their previous attempts they simply modified existing LEGO brand products in an attempt to make them appeal to girls. This time around the company really researched how girls play and attempted to understand what they wanted. They found that young girls didn’t want to spend the time building that boys did, they were more interested in the role play aspect of the toy. LEGO Systems responded by developing the LEGO Friends line, which features small, easier to build kits that focus on role playing. Another change they made to this line was to alter the classic “mini figure.” Research showed that girls were having a hard time identifying with the toy because it did not have a neck!
When a HYPE member asked Laursen what drives him in his career, he talked about the importance of being authentic as a leader. He is able to do this because he found his “sweet spot.” Laursen is in a career that he is passionate about which allows him to do his job well. He even threw “modesty out the window” and declared that the LEGO Corporation has an “impact on children around the world.” He cited how the founders of Google claim they got inspiration from playing with LEGO bricks.