If you have not read about it already, LEGO recently found that its efforts to make its blocks with recycled plastics are worsening its environmental footprint. The reason behind that is that the new material is softer than ABS and requires significant manufacturing changes to ensure long-term durability of the blocks. You can read about it in this Financial Times report.

As I read this news piece, two aspects emerged from an analytics point of view.

One is that our “BI Mindset” of analytics is challenging to eliminate and keeps returning to haunt companies despite significant investments in tools and technologies. BI tools were all about reporting. And their usage for decades meant that we developed a reporting mindset regarding analytics. This is one classic example. LEGO, like many other companies, became so obsessed with specific KPIs (carbon footprint in this case), that they tend to miss leveraging the true power of analytics. I covered this aspect in one of the episodes of “Think About It” as well.

Analytics, the word in itself, beyond any technology tools, is about generating insights. If this initiative of replacing the existing manufacturing process had gone through the analytics process, it would not have been difficult to gauge, even before it went to senior leadership, that significant process changes may be needed.

LEGO, being a leader in a category it created, probably has an army of chemical and process engineers. Bet they never got a chance to review these plans. Why? Because the expected changes in a KPI is what is generally perceived as a data-driven decision. The reality is that many KPIs we use are misleading. The analytics process, keeping technology aside, was never leveraged in the process.

The second aspect is the difference analytics tools could have made. A team of chemical, process, and industrial engineers could have easily simulated the impact of the process change in simulation tools that have been used for decades. But the reporting mindset blinds us all.

This is an example of why I insist that every critical analysis should go through the three essential filters of people, processes, and technologies. You may have the best-in-class tools and technologies. But as I have insisted, they are useless if you do not know how to leverage them for critical projects like this.