In the early 1990s Lego was bordering bankruptcy. The plastic bricks that defined a generation were being tossed aside for “Game Boys” and video games. Through an unexpected Internet hacking, Lego embraced an “outside in” business model, welcoming external brainpower and creating a collaborative relationship with its consumers.
In an effort to save the company, they introduced LEGO Mindstorms—a concept that took years to develop—and released programmable Legos equipped with sensors that allowed customers to create moveable robots and designs.
Within three weeks of its release, over 1,000 users hacked—through a campaign created on Lego’s website—into the software that came with the toy and created unauthorized changes that modified it’s functions and design.
Instead of pressing charges, Lego realized how beneficial these unforeseen modifications were to the original product. The hackers became Lego’s unconventional Research and Development lab. Lego eventually opened their software to see what the rest of the community could create.
The hackers’ improvements immensely improved the product and vastly increased the amount of units being sold, particularly to customers over the age of 18, an audience Lego had never been able to target before.
The Lego fiasco was an early example of crowd-sourcing. After embracing external input, the next generation of Lego products was developed with user-designed parts. By taping into the innovation and creativity of others they extended their network and showed consumers that Lego valued their relationship. All while saving themselves from a brightly colored downward spiral.