As Lego Group’s chief digital and technology officer, some may say that Atul Bhardwaj has built the toy manufacturer’s digital presence brick-by-brick.
Externally, the digital transformation of the near century-old toymaker is clear. No longer is the brand just associated with plastic bricks, cupped hands, and yellow cylindrical heads. Instead, 2024’s children see Lego products across film—most recently in the form of Piece by Piece, a biopic about American musician Pharrell Williams—TV, and video and mobile gaming.
But as the world’s most popular toy manufacturer, with over 1000 stores worldwide and revenue results as large as almost kr.66 billion ($9 billion) in 2023—up 2% in a declining toy market—Lego also has a physical challenge to confront: sustainability and operational efficiency on a large scale.
According to the University of Plymouth, Lego bricks will take anywhere between 100 and 1,300 years to break down in the ocean, for example—However, a Lego study suggests that 96% of families in the UK, France, and Germany pass on their bricks, whether to their friends, family, or charity.
Plus, the brickmaker also tried to move to an oil-free, recyclable material last year but made the move to ditch it as it says it would have led to higher carbon emissions.
In 2023, the firm increased spending on environmental initiatives by 60%, with plans to double by 2025, it says, and a move to increase the use of sustainable materials—aiming to make all bricks sustainable by 2032.
In this context, how can digital technologies help Lego achieve its sustainability goals while streamlining operations to meet demand and engage children, whether on their screens or living room floors?
Since joining four years ago, Atul Bhardwaj has led the digital transformation at Lego. He has scaled the IT team from 600 to 1,800, pushing tech talent behind its digital transformation – which he claims is the single largest investment Lego has made in its 93-year-old history
“The journey involved examining everything from how we worked, to what we did, to the capabilities we had, and transforming it,” Bhardwaj says, as he sits down with TI at Web Summit in Lisbon.
“We also built a digital product organisation, which we didn’t have before. We built it in a federated manner inside the business, so it doesn’t report to me, but I was involved in setting it up,” says Bhardwaj.
Ultimately, nurturing technology and uplifting talent, was the goal. In fact, for the first time, this year Lego held four internal developer conferences called ‘DevCon’, which saw 500 members of its IT team in Billund, Copenhagen, London and Shanghai come together to get an understanding of what each team was working on.
“DevCon was all about developers sharing the great things they’re building and learning from each other,” says Bhardwaj.
“We aimed to explore what each team was doing, particularly regarding GenAI, and how we could work together. It was about nurturing curiosity and continuous learning as part of our culture.”
With five factories across three continents—Asia, Europe, and South America—and plans to open two more in Vietnam and the US in the coming years, Lego’s expansive supply chain network requires efficient technology.
“Whether it’s a partner, a store, or a person who’s ordered online, we’ve automated it,” says Bhardwaj. “We’ve also automated systems so that our retail team can place the right stock in the right location at the right time, replacing old spreadsheet methods.”
Additionally, to better serve its customers, Lego has created a unified ID system across its website and other platforms, enabling more personalised interactions.
To support high-traffic events like Black Friday, the company is also leveraging cloud technology to ensure scalability. “We work with cloud vendors but also build a lot of the technology ourselves since we have the capability,” Bhardwaj adds.
With a long history of plastic bricks, and a large footprint over the earth, Lego claims to be making a conscious effort to clean up its path and Bhardwaj explains how technology plays a pivotal role in this.
“From a technology perspective, we support our strong sustainability initiatives in three areas: carbon data management, circular business through brick recognition and sortation, and operational sustainability,” he says.
By moving away from single-use plastics in packaging, enhancing energy efficiency in their offices and factories, and collecting energy data to minimise consumption, Lego is laying down the foundations for a more sustainable future. “These are the kinds of steps we’re taking to support our sustainability goals.”
But sustainability at Lego isn’t just about what’s in the box; it’s also about what’s outside.
Bhardwaj underscores how Lego is integrating circular business models through brick recognition technology, allowing for better sorting and reusing of materials. These measures are designed to reduce waste while promoting a circular economy, he says, where every Lego piece has a second life.
With this, the firm hopes to work with suppliers on cutting emissions down and help it achieve its sustainability targets of cutting emissions by 37% by 2036, and achieving net-zero by 2050.
At the same time, Lego is carefully balancing its focus on physical play with emerging digital experiences. As Bhardwaj notes, “Firstly, we will always be a physical toy company. Our digital games are a part of our physical experience, but the physical experience will always dominate for us.”
He adds that this emphasis on physical play is at the heart of Lego’s mission to inspire learning and creativity. Yet, Lego recognises the growing role of digital spaces in children’s lives.
“We know that children, particularly boys and girls aged 9-12, engage in platforms like Fortnite. We believed we were uniquely positioned to offer a safe and secure digital experience for children, so we partnered with Epic to make this possible,” Bhardwaj adds.
Through this partnership, Lego is not only providing engaging digital experiences but ensuring that these platforms are safe, enriching spaces for children.
As a brand whose name literally translates from the Danish word “play well” Bhardwaj reflects on Lego’s central ideals: “Our core mission is inspiring and developing children to learn through play, making sure all children can do that.”
Whether through physical bricks or innovative digital experiences, he says Lego remains committed to fostering a space where learning and creativity go hand in hand.
“Physical play is crucial and we also know that we can augment this with a digital play experience, where physical and digital converge.”
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