Lenovo Dell

7/28/2019 Lenovo Dell

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LenovoLenovo: Countering the Dell Challenge: Countering the Dell Challenge

The battle is on between the WESTERN and EASTERN

VS


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Developed By:

Md. Forhad HossainMehdad Mamur MannanHimadri Sheakar HoreMd. Mahfuzur Rahman


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Presentation Proposition

Case at a Glance The Global PC Market Scenario

Focusing Chinese PC Realm

The Fate of Lenovos Business Model???

Business Model: Lenovo Business Model: Dell

Lenovos March in Local Market

Lenovos Emerge in Global Arena

Recommendation Implementations of Recommendation

Index


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Case at a Glance


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Case at a Glance

Case at a glance

Global PC market

scenario

Focusing Chinese

PC Realm

Business Model:

Lenovo

Lenovos Emergein Global Arena

Recommendation

ImplementingRecommendation

Index

Lenovos March in

Local market

Challenge

DELL

Lenovo

PC Market

Since the 90s, the global PC market isflourishing in a tremendous pace. Mainlythis boom is taking place in US, Europe

and of course in Asia.

Lenovo, an expert player especially in Chinese

PC Market and also looking for global

expansionDell, another US based giant is doing

exceedingly well in the same line. Afterwinning the global share of PC market now

they are staring at Chinese domain.

Since Lenovo excels in Chinese market witha vision to be a global player, they now

have the challenge to outperform their UScounterpart.

Business Model:

Dell


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Global PC Market Scenario


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Case at a glance

Global PC market

scenario

Focusing ChinesePC Realm

Business Model:

Lenovo


Recommendation


Index

Lenovos March in

Local market

PC Market

Desktop Notebook PC Server

Growth Driving Factors

Lower price

Replacing ageing system

Recovery of European economics

Business Model:

Dell


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Case at a glance

Global PC market

scenario


Business Model:

Lenovo


Recommendation


Index

Lenovos March in

Local market

Fast Market

Growth

Chinese

Indian

CEMA

European

USThai

Japanese

Sluggish

Market Growth

Business Model:

Dell


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Case at a glance

Global PC market

scenario


Business Model:

Lenovo


Recommendation


Index

Lenovos March in

Local market

16.50%

14.30%

5.90%

3.50%

3%

56.70%

Dell

HP

IBM

Fujitsu

Acer

Others

Position of top Global Brands in 2004:

Business Model:

Dell


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Case at a glance

Global PC market

scenario


Business Model:

Lenovo


Recommendation


Index

Lenovos March in

Local market

A Massive Boom in PC Market

0

100000

200000

300000

400000

500000

600000

700000

1999 2000

Year

Sales

In 2010 the Chinese PC market Is about to exceedthe US PC market

Business Model:

Dell


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Case at a glance

Global PC market

scenario


Business Model:

Lenovo


Recommendation


Index

Lenovos March in

Local market

A Massive Boom in PC Market

Units (000)

0

5000

10000

15000

20000

25000

30000

2002 2003 2004 2005 2006 2007

year

Major contributors towards

the growth:

Domestic PC makersForeign multinationals

Contract manufacturers

Business Model:

Dell


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Case at a glance

Global PC market

scenario


Business Model:

Lenovo


Recommendation


Index

Lenovos March in

Local market

Chinese Govt.s Policies

Towards PC Market

Encouraging domestic computer production and use

Intention to achieve technological independence Use of R & D as a tool of computers market expansion Imposing high tariffs and taxes for the foreign companies Providing technology & know how to the local companies

Business Model:

Dell


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Case at a glance

Global PC market

scenario


Business Model:

Lenovo


Recommendation


Index

Lenovos March in

Local market

Distribution channel of

Chinese PC market

Conventional distribution channel

Dealer Distributor Retailer

Direct model

Producer Customers

Business Model:

Dell


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Fate of Lenovos Business Model ???


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Business Model: LenovoSWOT Analysis

Case at a glance

Global PC market

scenario


Business Model:

Lenovo

Business Model:Dell

Lenovos March in

Local market


Recommendation


Index

Integration capabilities Inexpensive Easy to useTechnical sophistication Strategic allianceAcquisition & Merger Strong brand equity Customization Innovative marketing strategy Product DiversificationA Meaningful Brand Name

Too much dependence on

middle men

Too much focus on end users

Doesnt excel in inventorymanagement

Outperformed by the

challenger in advertisement

Yet to expand the Laptopunit

Internet fever among theChinese Dells shift to corporate

segment Ever expending Chinese

and Global market

Extensive Govt. support

Rapid growth of smallerfirms

Tong Fangs low cost PCs Low priced PCs by

Cloners Random access of foreign Companies in china Invaded corporate and

consumer market High advertisement by

foreign Competitors Being non responsive for

quite a long time


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Business Model: Lenovo

Case at a glance

Global PC market

scenario


Business Model:Dell


Recommendation


Index

Lenovos March in

Local market

Financial Performance

Turnover ratio :Total sales

Value of assets

In case of Lenovo it is 77%

which is quite goodBusiness Model:Lenovo

Breakdown of Turnover

House hold

Device

11%

Consumer IT

35%

Corporate IT

51%

Other

3%


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Case at a glance

Global PC market

scenario


Business Model:

Lenovo


Recommendation


Index

Lenovos March in

Local market


0% 50% 100% 150% 200% 250%

Home PC

Cmmercial PC

Notebook

computer

Unit shipment in percentage

Business Model:Dell


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Case at a glance

Global PC market

scenario


Business Model:

Lenovo


Recommendation


Index

Lenovos March in

Local market


Business Model:Dell

4.20% 4.40% 4.60% 4.80% 5.00%

Margin in Ratio

2004

2005

2006

Year

Net Profit Margin

0.00% 5.00% 10.00% 15.00%

Margin in Ratio

2004

2005

2006

Year

Gross Profit Margin


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Lenovos March in Local MarketCase at a glance

Global PC market

scenario


Business Model:

Lenovo


Recommendation


Index

Lenovos March in

Local market

Legend permitted manufacturing in mainland china1990

Developed pc on Intel 80826 microprocessors1989

Hong Kong legend established

Distributing foreign brand computer

Distributing peripherals for beginning legend

Designing and manufacturing motherboard

System integration products and services

1988

Awarded and honored1988

Manufacturing of legend Chinese insertion cardInexpensive & easy to use

1985

Distribution of imported pc such as IBM & HP printer1984

ActivitiesYear

Business Model:

Dell


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Lenovos March in Local MarketCase at a glance

Global PC market

scenario


Business Model:

Lenovo


Recommendation


Index

Lenovos March in

Local market

Developing and offering customized products

Strategic alliances

MOU with IBM

System integration capabilities

1998

Three dimensions

1. Distribution of imported computers

2. Manufacturing and sale of legend brand PC

3. Provision of system integration

1997

Legend brand equity reached RMB 3.574 billion

Entitled one of the top ten most Chinese brand

1996

TV coverage for imaging nationalism1995

Legend ranked third in the china pc market

Top selling domestic pc brand

Second generation of legend pc brand

1994

Setting R & D sector1993

MOU between china and US

Stropping producing and creating ventures

1992

Business Model:Dell


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Lenovos Emerge in Global Arena

Case at a glance

Global PC market

scenario


Business Model:

Lenovo


Recommendation


Index

Lenovos March in

Local market

First introducer of dual - core ThinkPad network PC

Acquisition of IBMs PC division2006

Introducing Research Triangle Park

Introduces first wide screen Thinkpad

Introduces industrys thinest and lightest, most secure tablet PC

2005

Lenovo becomes Olympic worldwide partner

Lenovo and IBM announce an agreement, Lenovo will acquire IBMsPersonal Computing Division

2004

Birth of its new Lenovo logo

Data protection in case of system drop

2003

Introduces its visionary concepts

First automatic data recovery technology

2002

First introduces Digital Home concepts2001

Legend ranked in top 10 of worlds best managed PC vendors2000

Business Model:Dell


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Case at a glance

Global PC market

scenario


Business Model:

Lenovo


Recommendation


Index

Lenovos March in

Local market

Lenovos Future Plan

Inventory

Management

Alternative

Promotional

Schemes

Intensive

Target Market

Corporate

Selling

Direct Selling

Via Internet

Future

Plan

Business Model:Dell


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Business Model of DELL


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Business Model: Dell

Case at a glance

Global PC market

scenario



Recommendation

Implementing

Recommendation

Index

Lenovos March in

Local market

Dells Business Method

Operation Efficiency Through Internet

Direct Sales

JIT Inventory Management

Extensive Customer Care

Different paying options for Customers Pricing Lower (Smart PC)

Customization

If Lenovo can not take adequate measures against its challenger,

it might be Dell to reap the competitive market of China.

Business Model:Dell

Business Model:

Lenovo


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Case at a glance

Global PC market

scenario


Business Model:

Lenovo


Recommendation

Implementing

Recommendation

Index

Lenovos March in

Local market

Survival of Lenovos Business model

Lenovos business model might survive.

BUT???

Business Model:Dell


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Recommendation


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Case at a glance

Global PC market

scenario


Business Model:Dell


Recommendation

Implementing

Recommendation

Index

Lenovos March in

Local market

Recommendation Pyramid

Recommendation

For Local Market

For International Market

Business Model:

Lenovo


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Case at a glance

Global PC market

scenario


Business Model:

Lenovo


Recommendation

Implementing

Recommendation

Index

Lenovos March in

Local market

Local Market

Outperforming Smaller Firms

Being More Cheap

Monitoring the Cloners

Restricting Foreign CompaniesAdding Values

Intensive Distribution

Paying Attention to Laptop Unit Utilizing the Chinese Internet Fever

Closely Monitoring the Challenger

Being expert both in Corporate & Consumer Marke

Recommendation

Business Model:Dell


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RecommendationCase at a glance

Global PC market

scenario


Business Model:

Lenovo


Recommendation

Implementing

Recommendation

Index

Lenovos March in

Local market

International Market

In this case Lenovo has to take decision in TWO aspects :

Its Product Types

Its Distribution Network

Business Model:Dell


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Index

Case at a glance

Global PC market

scenario

Focusing Chinese

PC Realm

Business Model:

Lenovo

Business Model:

Dell

Lenovos March inLocal market

Lenovos Emerge

in Global Arena

Recommendation

Q & A

???


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Thank You All

Lenovo Dell

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