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11. June 2014

Co-design

LEGO - a business case for service co-design

Do you remember playing with Lego as a child or with your children? Let me give you a good reason to use LEGO at work to trigger your imagination and redesign your services the way LEGO did a couple of years ago.

Governance International has shown me that it is worth exploring new scenarios in which public service providers enable and skill up service users to help themselves and empower local communities to harness their knowledge and expertise to solve ‘wicked problems’.

The 50+ case studies in their Good Practice Hub show the wide range of co-production approaches all over the world. They demonstrate that co-production can either achieve improved outcomes or better value for money. Often it does both.  The Co-Production Explorer developed by Governance International highlights innovative co-production models so that you can design a new vision for your service. At the same time, it helps you to build on existing pockets of co-production in your service to link the present with the future.

Ignoring the imagination unleashed by co-production is almost like accepting the inevitability of future failure. Once again, don’t read on if that really is what you think is acceptable - but I certainly don’t.

Be honest - you probably need to save budget? Guess what, co-production can help with that, too. Co-production champions are refreshingly unwilling to accept that offering ‘less’ is the only path. Even with financial constraints, it is possible to do better.

Perhaps you might not expect a well known company to use co-production approaches? Well, read this Toy Story about Lego’s transformation.

Lego is now so popular that there are 62 little coloured blocks for every person on the planet but few people are aware that the family-run business nearly went bankrupt in 2004. From being an amazing start-up in the economic depression in the 1930s and experiencing a fast expansion in the 1960s Lego started to suffer losses in a fast changing toy market in the late 1990s. Kids simply preferred to play video games and playing with Lego was not cool any more. As a portrait of the Lego company in the Guardian states, in January 2004 the company reported a record deficit of £144m.

According to the brilliant analysis in Tim Kastelle’s blog on the Innovation Lessons from the Rise, Fall, and the Rise of Lego, its economic downturn was due to three factors:

 

  1. Poor overall management.  As LEGO reached its crisis point in 2003, everything was going wrong.  Its financial control was very poor, and it had lost touch with what customers wanted.  Furthermore, even when people who loved LEGO reached out to try to contribute ideas, the firm was fairly arrogant in ignoring this input, believing instead that they knew best.
  2. Lack of strategic focus.  In all of the pre-2003 innovation efforts, LEGO was obsessed with novelty – with doing new stuff.  But they were so far removed from understanding what their customers wanted (or even who they were), that these new ideas failed to create value.  They thought that the power was in the brand – so they launched things like LEGO TV series.  But really, the power was in the bricks – it was refocusing on this that started to turn the firm around.
  3. Disconnection from customers.  Many of the misfires prior to 2003 were the result of not understanding what kids wanted – most of the new products were based on assumptions about this, not on feedback from the customer base.

Does this sound familiar to you? Do you think that your commissioners know their clients – or what they need?

If not, continue to read the Lego story. Of course, as Lego is a private sector business not everything may be transferable to a public service context but in my view the LEGO transformation shows the potential of co-designing services with people using services.

Tim Kastelle describes in his blog how LEGO discovered co-design as a method to drive product and service innovations:

Shortly after LEGO released Mindstorm, the enthusiastic community of adults that love LEGO, hacked the software.  After a great deal of thought, instead of shutting down the hackers, LEGO embraced them.  This then led to further collaboration with the community. It was this community that drove the overwhelming success of the product:

Instead of taking a year to find two potentially big growth opportunities and then invest significant resources to develop them, the front-end team would align with entrepreneurs who were already working on nascent but promising projects. Within a matter of months or even weeks, the team would use the LEGO Group’s know-how to help these entrepreneurs test the market, make necessary revisions, and test again. The idea was to avoid making bet-the-firm mistakes by launching a series of low-cost, low-risk experiments, which would increase the odds that one might grow into a runaway success.

LEGO also discovered that the key to its success was harnessing the ideas of its end customers – children!  Lugnet, a Lego user community, works with users to co-design models, even using open source design software to create shared visions from different cities. This virtual community even tackled problem solving and design - for fun! Children are enabled to create their own designs making them co-designers of their own dreams. Lego now incorporates public feedback into its heart, soul and philosophy, contributing to its choices, designs and decision-making on new products.

In the end, it was its new strategic focus and this new collaboration with customers which turned the company completely around. As a result, five years after reporting its biggest ever loss, Lego was reborn and reported a net profit soaring to 32% to DKr1.35bn and sales up a healthy 18.7% for 2008 (source: http://www.theguardian.com/lifeandstyle/2009/mar/26/lego-billund-denmark).

Are there any bells ringing yet or light-bulbs flashing inside your head? There should be…!

The transformation of Lego is the starting point for imagining how co-design can not only create ’improvements’ but can transform a whole organisation and its relationship to its clients and local communities.   

The many forms of co-design that Lego adopted illustrate the tremendous potential of harnessing the ideas and skills of people using services. And, as I’ve experienced in my career in public services, one ‘co’ leads to another ‘co’, involving clients and communities as part of the process, starting from co-commissioning, all the way to co-design, co-delivery and co-assessment.

Scotland has an amazing wealth of case studies to learn from – just look into the publication 

Co-Production of Health and Social Care in Scotland. But there is also an increasing number of local authorities in England and Wales such as LB of Lambeth, Stockport MBC, Surrey County Council and Swansea Council which have embarked on a co-production journey. What a difference it would all make, if even more service providers and commissioners adopted these ideas.

So we do some good things in the UK already – but don’t we now have a golden chance to harness fully the opportunities offered by co-production?

USA basketball legend Michael Jordan famously gave what I consider to be one of the best motivational quotes of all time:

“I can accept failure, everyone fails at something. But what I cannot accept is not trying”.

Now ask yourself honestly, why don’t you get in some Lego for the next senior management or team meeting and ask your colleagues to design an alternative service delivery model based on co-production? It’s obvious – what LEGO could achieve, you can do too!

Personal blog by Andy Tipper, a co-production practitioner in Birmingham.

Email: andy.tipper@hotmail.co.uk

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