Strategic Risk Management at the LEGO Group: Integrating Strategy and Risk Management
MARK L. FRIGO
Director, Strategic Risk Management Lab, and Ledger & Quill Distinguished Professor of Strategy and Leadership, DePaul University
HANS LÆSSØE
Senior Director of Strategic Risk Management, LEGO Group
How can organizations manage strategic risks in a volatile and fast-paced business environment? Many have started focusing their enterprise risk management (ERM) programs on the critical strategic risks that can make or break a company. This effort is being driven by requests from boards and other stakeholders and by the realization that a systematic approach is needed and that it's highly valuable to include strategic risk management in ERM and to integrate risk management within the fabric of an organization.
In this case[1] we describe strategic risk management at the LEGO Group, which is based on an initiative started in late 2006 and led by Hans Læssøe, senior director of strategic risk management at LEGO System A/S. It's also part of the continuing work of the Strategic Risk Management Lab at DePaul University, which is identifying and developing leading practices in integrating risk management with strategy development and strategy execution. This descriptive case provides a great example of integrating risk management into the strategy development and strategy execution.
- [1] This chapter was adapted from Mark L. Frigo and Hans Laessoe, "Strategic Risk Management at the LEGO Group," Strategic Finance (February 2012) with the permission of Strategic Finance and the Institute of Management Accountants. An earlier version of this case was presented at the Risk and Insurance Management Society (RIMS) Conference, where Mark and Hans serve as members of the RIMS Strategic Risk Management Development Council.
