After a long period with the two self-taught enthusiasts, Ole Kirk Kristiansen and his son Godtfred Kirk Christiansen, at the head of the company, a new era calls for professional corporate management. The new team of managers is drawn from both external executives and from the Kirk family itself – in the person of Kjeld Kirk Kristiansen, grandson of the founder.
The next generation
New times require new and professional managers, and the third generation of the owning family, Kjeld Kirk Kristiansen, grandson of the founder, is ready to do his bit for the company. Kjeld Kirk Kristiansen is appointed Chief Executive Officer in 1979, succeeding CEO Vagn Holck Andersen who since 1973 has acted as link between Kjeld Kirk and his father Godtfred Kirk Christiansen.
In the early 1970s, Kjeld Kirk Kristiansen is studying at IMD, the international institute for management development in Lausanne, Switzerland, where he takes an MBA. He follows this with a period in the management group at LEGO Switzerland before returning to Denmark in 1977 to join the LEGO Group management. During his time in Switzerland, Kjeld Kirk Kristiansen also spends a part of his time in the USA being active in the build-up of a new US sales organization. When returning to Denmark Kjeld Kirk brings many new ideas with him from his time at IMD and one of his first steps is to introduce a brand-new product-development model to be known as “System within a system”.
Vagn Holck Andersen is the first CEO of the LEGO Group who is not a member of the Kirk Kristiansen family. At the same time, he is the first professionally trained corporate leader of the company, which has hitherto been managed by Ole Kirk and Godtfred Kirk, who do not have a managerial training. When Kjeld Kirk is appointed CEO, Vagn Holck Andersen leaves the company for another appointment in Copenhagen. He returns to the LEGO Group in 1984, heading up its activities in the US. In 1993, Vagn Holck Andersen succeeds Godtfred Kirk Christiansen as board chairman, a post he holds until 1996.
New corporate manager
In 1998, Kjeld Kirk Kristiansen appoints Poul Plougmann as chief financial officer. A year later Kjeld Kirk Kristiansen hands over day-to-day management of the company to Poul Plougmann, who is promoted to chief operating officer (COO). Poul Plougmann has made a name for himself as an able manager whose successes include turnaround of Bang & Olufsen. A good match for the LEGO Group in view of the deficit it reports for 1998. Poul Plougmann is appointed to turn the LEGO Group around and return it to profitability. He does this by trimming the organization through something called the Fitness Plan.
Poul Plougmann’s style of management is straight to the point. After settling in, he starts a shake-up of the LEGO Group portraying the style of leadership he is brought in to pursue. In the short term, he succeeds in cutting the company’s costs but at the same time, he is unable in the long term to bring continuity to the company.
Poor results require changes in senior management of the LEGO Group. After a period of alternating between deficit and profit, the 2003 fiscal year ends with another deficit – this time billions of kroner. Following the massive deficit, Kjeld Kirk Kristiansen once more resumes the reins of day-to-day management. Kjeld Kirk spends the next 10 months charting a new course for the company. An action plan is set in motion by Kjeld Kirk and the top management and in October 2004, Kjeld Kirk is comfortable handing over the reins to a new CEO. In his own words:
“My job since January (2004, red.) has been to change the course of the company and produce a blueprint for leading the LEGO Group back to profitability. We’ve charted our course – and we’re well on our way. This is therefore the right moment to hand over control to the future managers of the company. I have worked closely both with them and with the other members of the management team on the implementation and future development of the action plan. So I have full confidence in the management team that is now taking over. As owner, I shall naturally continue to stay close to the company – as vice chairman of the board of LEGO Group and in my current capacity of chairman of the LEGO Foundation and for several of the Danish companies.”
New chief executive officer
Kjeld Kirk Kristiansen and the LEGO Group board choose an internal appointee as the right man to steer the company out of the crisis. Jørgen Vig Knudstorp, hitherto senior vice president of the company, is appointed new chief executive officer. He joined the LEGO Group in 2001 from a position with McKinsey & Co, management consultants. Jørgen Vig immediately launches a new strategy for the company entitled Shared Vision, building upon the action plan launched in early 2004.
Jørgen Vig is in his mid-30s and has limited management experience when he takes over as CEO, but in the view of company owner Kjeld Kirk Kristiansen, he has something more important than experience. He understands the LEGO idea and the thinking and attitudes behind it.
In an interview in the LEGO Group house magazine, “LEGO Life”, the new CEO talks of his new role: “It’s a natural continuation of my present role and the tasks I’ve tackled. I’m delighted to be working for the LEGO Group, and it’s a great challenge helping to turn the ship around and getting the LEGO Group back into its natural position as market leader.”
Jørgen Vig is CEO of the LEGO Group from October 21, 2004 until January 1, 2017. In this period, the company regains focus on its core competencies and thus manages an impressive turnaround followed by more than a decade of continuous growth.
LEGO Brand Group
To prepare for a new tomorrow and further explore the LEGO idea, including new strategic ventures, the Kirk Kristiansen family consolidate governance of all brand related activities in LEGO Brand Group, effective May 1, 2017. LEGO Brand Group is founded in a collaboration between fourth generation owner Thomas Kirk Kristiansen and Jørgen Vig. Consequently, Jørgen Vig steps down as CEO and takes on the role of working chairman of the board of directors and LEGO Brand Group.
A Natural Step
As a result of the plans to establish the LEGO Brand Group, and the new role in store for Jørgen Vig, Bali Padda becomes CEO of the LEGO Group on January 1, 2017. After joining the company at the peak of its crisis in 2002, he assumes global responsibility for the supply chain four years later as the company’s COO, playing a key role in the turnaround and subsequently growth of the company. With more than 14 years at the company, he brings continuity, experience and highly detailed strategic knowledge. In October 2017, Bali Padda steps down to hand over daily management to new CEO Niels B. Christiansen.
Niels B. Christiansen
With vast experience in digitalization, globalization, and creation of an agile and effective organization Niels Bjørn Christiansen enters the LEGO Group as CEO, October 1, 2017. He brings with him a deep understanding of leadership in a family owned, value-based and purpose-driven company.
“As I look at the challenges facing this generation of children, the LEGO Group’s mission, to inspire and develop the builders of tomorrow, is more important and urgent than ever. I look forward to working with the Board, the owner family and LEGO Group employees as we embark on the next phase of global growth.”
Niels B. Christiansen
The LEGO Group is, and will continue to be, a family-owned company. In 2007 Kjeld Kirk Kristiansen’s son, Thomas Kirk Kristiansen, joins the board of the LEGO A/S, bringing the fourth generation of the owning family into the company. In April 2016, the Kirk Kristiansen family takes an important step towards a smooth handover to the next generation as Thomas Kirk becomes the more active owner. He replaces his father as deputy chairman on the board of directors of LEGO A/S. On the board of the LEGO Foundation he becomes chairman with Kjeld Kirk as deputy chairman. In Spring 2020, Thomas Kirk cements his role as the most active family owner by becoming chairman of the board of directors of LEGO A/S. Kjeld Kirk continues as chairman of the board of directors in KIRKBI A/S. Kjeld Kirk´s two daughters Sofie Kirk Kristiansen and Agnete Kirk Thinggaard, are both active in various associated foundations.