Business Model and Lego Toys

Running head: BUSINESS MODEL AND LEGO TOYS
BUSINESS MODEL AND LEGO TOYS
Name of student:
Name of university:
Author note:

1
BUSINESS MODEL AND LEGO TOYS
Introduction:
The aim of this paper is to discuss the notions of business model and disruption. The
term business model refers to the blueprint of the business plan whereas disruption refers to
the innovation in the business model through smart-connected devices. This paper discusses
about the disruptive business model of Lego toys and further analyses through Osterwalder
and Pigeneur’s business model. The paper also discusses about the two specific perspectives
on business.
Business model:
Business model underscore on the conceptual tool that is used in defining and
explaining the underlying principle of the business. It has been described as model that
elaborates on the rationale of business in terms of its organization, creation, capturing the
values of the customers as well as disseminating its values among the customers, and delivery
of the of the products (Chesbrough, 2010). It further provides an insight into how different
companies aim to generate money and in what ways a idea turns into a full-fledged business.
Studies have shown that different companies may have similar settings but have divergence
on the business models (Forbes Welcome, 2018). Therefore, the business model is the
provides a blueprint of the organization and renders directions about the operation of strategy
of the company. A business model consists of three elements that are namely value
proposition, profit formula and key resources and processes (Zhu & Furr, 2016).

2
BUSINESS MODEL AND LEGO TOYS
Disruption:
The term disruption in business model underscore on the notion of interruption of the
traditional principles of business by fostering alteration in the business model (Zott, Amit,
& Massa, 2011). Disruption in business is concerned with seeking risks and
experimentation with the given business model (De Jong & van Dijk, 2015). Some of the
important examples of disruption in business can be understood through the following
examples. Amazon has revolutionized the scene of disruption in business through the
introduction of Amazon Prime and streaming of blockbusters (Clinton & Whisnant, 2018).
It has further enabled the distributed of DVDs therefore, bringing a change in culture of
business. Another example of disruption in business is that of Domino’s pizza that have
changed the game of delivery through the incorporation of smart-connected devices. These
devices have enabled in tracking the order, monitoring the preparation of pizza and finally
keeping a tab on the delivery person. It also has a safety censoring system that is believed
to be effective in preventing accidents (Caro, F., & Martínez-de-Albéniz, V. (2015). The
company has big plans to incorporate artificial intelligence in the delivery of its products.
Another important example of disruption in business is that of Commonwelath bank,
Australia. The company is planning to take the experience of customer care to the next
level through the introduction of machine-to-machine transaction. This is believed to be
effective in reducing the burden on the customers during physical transactions. Therefore,
it can be seen that the strategies adopted by the companies are in dissonance with the
conventional business model and is a challenge to the cherished ideals of the organization
of business (Kavadias, Ladas & Loch, 2016).

3
BUSINESS MODEL AND LEGO TOYS
Lego Toys, Denmark and digital leadership:
According to El Sawy, Kræmmergaard, Amsinck & Vinther, (2016), companies are
veering towards digital leaderships. This refers to the idea that companies are becoming
digital. The present focus of the companies is to concentrate on technology and reach out to
the customers through digital customer engagement. This digitalization of business needs to
be understood beyond its traditional meaning of tapping the advantages of the digital
platforms. It is widely understood as veering towards the digital business and the
incorporation of digital technologies to restructure the business models and creation of value
opportunities. This digitization can be witnessed in the form of wide-scale incorporation of
smart-connected devices that has made business innovation more integrated. The
digitalization strategy can be illustrated through the example of Lego toys (Rodriguez, 2018).
The company was founded by Kirk Kristiansen, a carpenter ho was known for making
wooden toys in Denmark (Pine II & Gilmore, 2016). The organizational structure of Lego has
been described as a wheel. The structure focuses on the communication and sharing of
knowledge. The organizational culture of Lego is premised on trust, openness, principles of
imagination and creativity. The company has engaged in three lenses in the enhancement of
digitalization-product lens that was woven around the ecosystem and innovation of the
product, marketing lens important for digital marketing and the enterprise lens that was
woven around enterprise platforms and the fusion of the external world with that of the
internal world.