Quality & Safety Measures at LEGO

Prepared by:

• Akash N Parikh• Ankit Shah• Anshu Sharma• Bhavika Dodia• Manali Hanmante• Mit Shah• M.S.Srivamsee• Nikita Kale• Tarit Registrar• Venkatesh Iyengar

11BSP006111BSP130211BSP013711BSP137711BSP179911BSP162611BSP054011BSP150111BSP106611BSP1114

Case Overview:

• LEGO Group – A toy making company

• LEGO Stands for “leg” (play) “godt” (well)

• Founded in 1932 in a small carpenter’s workshop by Ole Kirk Christiansen

• Headquarters reside in Billund, Jutland in Denmark

Overview - Continued

• World’s 6th largest manufacturer of toys

• Products are sold in more than 130 countries

• Brick based toy company• Even though popular among

adults, the main target customer are children

5 Targets set by LEGO

• Zero Product Recalls• Top ten on employee safety• Support learning to 101

million children• Explore the opportunity of

becoming fully reliant on renewable energy

• Work towards elimination of waste

Health and Safety Policy

• Objective: The Occupational Health & Safety policy shall ensure that all activities of the LEGO Group are planned and executed in accordance with a healthy and safe working environment. Compliance with national and international legislation and other standards which the LEGO Group has adopted is considered a minimum requirement.

• LEGO Group Way: Safety Health Work Planning Improvements

Product Quality Measures• Quality Policy• To be the best in all the areas of business in which they participated• Durability and versatility• Highest quality of ABS (Acrylonitrile Butadiene Styrene) Plastic• 20 other types of plastics are used• LEGO Toys are passed through generations• Manufactured under controlled conditions• Moulds were precisely engineered• Worn out moulds were buried• Emphasis on packaging & Raw Materials (EU CE Symbol & ASTM

Standards

Environmental Issues

• ISO 14001 standards• Recycle of plastic materials• Sorting of Plastics• Use of Eco friendly raw materials

Safety Standards

• Strict Safety Standards• Division = Preventive activities

Monitoring Activities• Preventive Activities –

Foreseeable misuse• Tests Conducted by LEGO Mechanical and physical tests Chemical Tests Ignitability and Flammability Electrical Properties

Safety Assessment Stage

• Safety any stage of development process• Integrated part of product development

process• Better if early stage• the safety assessment must relate to the toy

that will finally be placed on the market• Risk assessments & Safety assessment

Quality Control

• Regular checks on the SCM• LEGO’s introduced Corporate Quality Control

Department• Internal Team for monitoring toy recalling

activity around the world• Safety measures for all its products (Quadro &

Duplo)

Internal Production Control• Continuously adapt to type of production and experience• Where and during which phase could a “quality dip” haveserious effects (in warehouse, in production, afterproduction, etc)• Statistical sampling depending on experience, total numbersproduced, sensitivity of production• Example: Small parts is critical in assembled toys for childrenunder three. Therefore LEGO applies 100 % tension test checkon heads of DUPLO-figures and wheels of DUPLO-wagons

Internal Production Control

Promises made by LEGO

• Play Promise Consumer Satisfaction Consumer Information Product Safety

• People Promise Employee Survey Health & Safety

• The Partner Promise Customer Pulse Code of Conduct Product Quality

• The Planet Promise We Care and Share Care for children in need Care for Education

Promises made by LEGO - Continued

Corporate Policies in LEGO Group

• Communication Policy• Environmental Policy• Finance Policy• Health & Safety Policy• IT Policy• Legal Policy• People & Culture Policy• Product Safety Policy• Quality Policy• Responsibility Policy• Risk Management Policy

Future Prospects / Challenges

• Increase competition from company like Mega blocks, Tianjin coko toy company

• Price strategies of competitors• LEGO outsources a large part of its production to

Flextronics

Future Prospects / Challenges (Contd)

• LEGO future proofing – “We are beginning to see the first outlines of a new business model – moving from a tradition, integrated model towards a partnership model. In future we will focus our own efforts on the key processes relating to our brand such as innovation & marketing and source expertise in other areas from strategic partners. In doing so, we will derive important financial benefits in the very difficult market in which we operate.”

• In Flextronics LEGO has found a satisfactory partner