Friday, December 23, 2011

Lego tells Europe how to rebuild, brick by brick

Lego boss Jorgen Vig Knudstorp, who pulled the iconic toy brand back into profit, says Europe needs to face up to its harsh economic reality.

Knudstorp believes Europeans think they are wealthier than they are, despite three years of a global financial crisis.

With the crisis continuing to roil markets and destabilize the banking sector, "it's about all of us recognizing that we have lost a bit of our wealth," he says.

Lego lost its way in the late 90s and went deeply into debt before rebounding to double digit growth under Knudstorp's leadership.

Knudstorp suggests European finance ministers could learn from Danish manufacturer's experience. "My piece of advice would be: face the truth -- that is what I learned the hard way in our company."

Knudstorp says Lego went too deeply into debt, as Europe has also done. According to Knudstorp, stemming the crisis will begin by saying: "Yes we are over-indebted, we are sorry, we screwed up."

He believes Europe needs to write-off some of its debt to avoid a stagnant economy for the next decade. Read More