INNOVATION MANAGEMENT

ASSIGNMENT-1

By early 2008, the Lego Group had managed to turn around its
decreasing sales and return to profitability. The company's turnaround
was aided by the revitalization of brands such as Lego City, Bionicle,
and the relaunch of Lego Mindstorms. Lego was able to focus on
fulfilling goals faster by restructuring the organization and setting clear
and unambiguous goals. Setting profitability as a fundamental aim and
including designers in the goal by giving them with targets gave value
creation structure.

At the Lego Group, we use the following metrics to measure

Innovation:
The Lego group has produced an innovation matrix that may be used to
determine the KPIs for innovation. The innovation matrix aided the
teams in better coordinating their efforts. They separated eight forms of
innovation into four groups. They also identified three distinct levels of
innovation (Redefined, Reconfigured and Adjusted). They created the
Lego Innovation Matrix by combining both of these approaches. This
became an important part of their new development approach.

Innovation Matrix:
For a development programme, Lego designed a four-gate procedure,
which was initially a lengthy bureaucratic process. Each gate has three
stages.

We may establish programme level metrics for each gate in the gate
procedure as follows:
1. P0: Idea generation gate (internal and external): (Ideas for 2
years down the line)
➢ Here we can see how well a concept aligns with Lego's
business goals; the better the connection, the more viable
the idea is for Lego to pursue.
 2. P1: Three degrees of creativity are used to create a gate for
concept presentation:
➢ We can assess the ease with which the proposal can be
implemented as well as the time necessary to do so. We
may use the three-horizon model to categorize the ideas and
choose which should be pursued immediately, which should
be developed further, and which should be monitored.

3. P2: Proof-of-concept and prototype gates:

➢ From here, we can assess the feasibility of the company
strategy and verify the accuracy of the projections. These
can be used to complete tasks that need to be moved ahead.
4. P3: Gate for final project selection:
➢ In this case, key performance indicators for manufacturing,
distribution, and so on can be used as metrics to assess
performance.

We may give activity-based metrics to each gate's three stages.

1. Exploring: This is where we may calculate the proportion of customer

feedback that is included into the phase's output.
2. Developing: This is when we compare the design stage that was
attained to the design stage that was intended. We can also assess the
prototypes' suitability for use.
3. Validation: This is where we compare predicted and actual testing
outcomes.

Overall, the performance metrics of the innovation matrix can be

measured as the percentage of ideas implemented out of ideas
received, change in development time, change in development costs,
revenues generated from new projects, profits generated from new
projects, employee satisfaction achieved, efficiency improvement, and
customer satisfaction due to new projects.