It was 2003, exactly 56 years after Ole Kirk Christiansen bought the first plastic injection molding machine in Denmark to start manufacturing plastic bricks for building-block toys. On the surface, or so it seemed, the LEGO Group had done everything right over that time period.

The company was an iconic name in the toy business. Plastic building-block toys were “LEGOs” in customers’ minds, just like all tissues were Kleenex and all flavored ice pops were Popsicles. LEGO was also rare among big companies in that the firm was still run by the founding family, with Christiansen’s grandson, Kirk, serving as CEO. While LEGO had always looked for new products, after a sales slump in 1993, the firm tripled its offerings, and in 2000 went on a binge of innovation, adding on LEGO-branded electronics, amusement parks, interactive video games, jewelry, education centers, and alliances with the Harry Potter franchise and the Star Wars movies.

 …