Lego Assignment Example | Topics and Well Written Essays - 500 words

Lego - Assignment Example However, this decision turned sour and LEGO withdrew their production from Flextronics in 2009. There are two major reasons behind LEGO’s decision to have 80 percent of their products produced in Flextronics. The first one was the introduction of new toys in the market by its competitors. This influenced the company’s decision to partner because it was during the same period the company had lost confidence in its key product, LEGO brick (Larsen et al, 3). The second reason that triggered partnership was the changes in the global market, as well as, the currency exchange rates in the major importing countries. Through partnership, the company had aimed at increasing its market shares and producing new products. The partnership did not last long without challenges which with time led to the end of the relationship between the two companies. The fist challenge was ensuring that enough stock is constantly maintained. This was mostly contributed by the errors in forecasting and fluctuation of seasonal demand. In addition, the need to meet consumers’ expectations of large stock within a short period led to over production (Larsen et al, 5). The second challenge was the need for change in its retailers. This was a challenge, especially in supply chain management, considering the level of flexibility towards all retailers and smallest outlets. Although the partnership between the two companies did not turn as expected, LEGO can use this failure as its strike back in handling supply chain complexity as well as knowledge sharing, flexibility and coordination (Larsen et al, 10). However, the company has to consider several aspects to achieve these. The first aspect is being open and putting into consideration consumer views. This can be achieved by working closely with the retail shops which in turn reaches the consumer. The