LEGO ensures all its global factories are exact operational and physical copies. This extreme standardization means an employee from any factory can transfer to another continent and be fully productive the next day. This "rigidity," as the CEO calls it, provides enormous executional power and flexibility.
To foster innovation, LEGO co-locates all its designers in Billund, Denmark. This creates a highly concentrated creative hub, supplemented by giving them total creative freedom on dedicated "free-play" days every two weeks to explore new ideas outside of their assigned projects.
LEGO maintains its market leadership by replacing half of its product portfolio—around 450 products—every single year. This aggressive renewal cycle forces the company to stay deeply connected to current trends and continuously innovate, ensuring they are "no better than the creativity we are coming out with right now."
Instead of stigmatizing failure, LEGO embeds a formal "After Action Review" (AAR) process into its culture, with reviews happening daily at some level. This structured debrief forces teams to analyze why a project failed and apply those specific learnings across the organization to prevent repeat mistakes.
LEGO's CEO notes that absorbing new hires into the culture at its established HQ is easy due to the high density of tenured "culture carriers." The real challenge is scaling culture in new, specialized hubs, which requires a much more deliberate effort because that organic cultural osmosis is absent.
Despite high demand, LEGO's CEO views ~15% annual growth as the sustainable maximum. Because LEGO manufactures its own products, faster growth would strain its ability to build new factories and distribution centers, introducing unacceptable complexity and delivery risks into the operating model.
To avoid bureaucratic slowdown, LEGO's CEO broke his leadership team into smaller, empowered subgroups like a "commercial triangle" (CCO, COO, CMO). These groups handle operational decisions, only escalating disagreements. This has cut full executive meetings to just one hour a month plus quarterly strategy sessions.
LEGO's CEO has settled on a four-year strategic planning cycle as the ideal cadence. He finds three-year plans create a constant sense of urgency, while five-year plans feel too abstract. A four-year horizon is long enough to execute major initiatives but short enough to remain tangible and relevant.