2013 LENOVO. ALLE RECHTE VORBEHALTEN. 1 ACCIDENTAL DAMAGE PROTECTION Lenovo EMEA Services.
Lenovo Final2007
Transcript of Lenovo Final2007
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Jeffrey
Brinkhus
Kenneth Keaney
Kathleen McLaughlin
Benjamin Smith
Ziheng Zhu
New World. New Thinking.New World. New Thinking.
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Lenovo was founded in 1984 by a group of 11 engineers from the Chinese Academy of Science as the Legend
Group Limited.
Now,
23
years
later,
it
is
the
third
largest PC manufacturer in the world……
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History1984 Liu Chuanzhi and 10 engineers founded Legend.
1994 Legend
is
listed
on
the
Hong
Kong
Stock
Exchange.
1996 Legend obtained largest market share in China.
2002 Legend
created
Deep
Comp
1800,
43rd fastest
super computer in the world.
2003 Legend went international under name Lenovo
2004
Lenovo
became
Olympic
Games
sponsor2005 Lenovo purchased IBM’s PC division and started to use the Think‐series brand name
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OverviewSenior management: Chairman:
Yang
Yuanqing
CEO: William Amelio
Shareholders:
Legend
Holdings
Limited
42.4%Public shareholders 39.6%
TPG Capital, General Atlantic LLC &
Newbridge Capital LLC 10.1%
IBM 7.9%
Largest shareholder: Legend Holdings Limited Note: The Chinese Academy of Sciences and Employees' Shareholding Society of Legend Holdings Limited hold 65%
and 35%
of
Legend
Holdings
Limited,
respectively.
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Overview (Continued)3rd largest PC maker
Behind Dell
and
Hewlett
‐Packard
7.1% market share
Largest in China
35% market
share
Gross Profit (year 2007): 2,037 million USD
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WorkforceRoughly 25,100 employees worldwide
Over
2,500
sales
representatives
worldwideThe Lenovo technical support team of China has approximately 6,000 support engineers
Train Employees at Global Engineering College
Workforce
much
more
internationalizedSpeak better English
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What makes Lenovo tick……
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Firm AnalysisStrengthsFocus
on
quality
of
service
Rigorous testing
Low‐cost labor
WeaknessesNew to the global market
Opportunity
2008
Beijing
OlympicsThreatIncreasing labor costs
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Impact of the IBM Acquisition Purchased IBM’s PC Division for approximately $1.25
billion for
the
right
to
produce
ThinkPad
and
ThinkCentre computers.
The Think‐series have already established
themselves as
reliable,
quality
computers
that
the
consumer base can trust and depend on. This will help break down one barrier to entry into the western market—brand loyalty.
Cultural differences caused Lenovo to lose some customers.
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Lenovo in China Approximately 34% market share
Pride of
Chinese
as
the
first
true
international Chinese company
Positive image
Brand loyalty
Developing basic computers for every Chinese citizen
Targeting poor
rural
inland
Chinese
to spread technology
$199‐$399
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Lenovo in the World7.1% market shareIntense
battle
with
Acer
both
in
Asia and now globally
Had a rough year in developed
marketLost high profile clients in Europe, the US, and Japan
Lost contracts in the US as
security measure
Much more well recognizedSponsorships
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Striving to create the world’s best engineered PC…….
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Operation LocationExecutive
headquarters: Raleigh, North
Carolina and Beijing, China, Singapore.
Research centers:
Raleigh, Beijing, Shenzhen, Shanghai, Xiamen, Chengdu,
and Japan.
Sales headquarters: New York, Paris, Beijing, and Sydney.
Manufacturing
centers: Xiamen,
Beijing, Shanghai, Huiyang, Pondicherry, India.
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Quality/Efficiency ManagementPreload Lab
Failure Analysis
Lab
Joint Failure Analysis Lab
Customer Simulation Lab
Humidity test
A single design platform of an integrated production line and simplified
operation
Migration to an IT platform of information sharing and supply
chain management
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Product Line China World
Notebook
TianYi
XuRi
ZhaoYang
Desktop
TianJiao
FengXing
JiaRui Accessories
Notebook Thinkpad
3000 Family Notebook
Desktop
ThinkCentre
3000 Family Desktop
Accessories
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The PC industry is a very profitable one, thus competition among rivals is extremely intense……
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Competitive StrengthsUsing the Think‐series brand name to penetrate
foreign market
Low cost manufacturing in operations in China and India
Advanced production
line
Patriotic feeling plays important role in Chinese market
Massive advertising
campaign
to
create
awareness
Sponsorships
Celebrity Effect
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Competitive WeaknessesBrand name is still not very well‐
known despite
efforts
Difficulty in penetrating developed market due to influence of Dell and
HPLess effective supply chain compared to Dell and HP
Distrust by
high
‐end
customers
and
government sectors
Made‐in‐China effect
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Business ModelLenovo has a two‐part business strategy
Relationship Model
making and sustaining relationships with other national and international companies to help further its interests
Transaction Model
making its products easily accessible to the everyday consumer and small businesses
Allows Lenovo
to
cover
a wider
market
Allows maximization of both profit and global consciousness of the company
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Competitive StrategyLenovo believes the future growth of demand lies in:
Computers Small and Medium‐sized Businesses (SMB)
Consumers
Emerging markets
Rolling out
Transaction
model
in
US,
Japan,
Eastern
Europe, and certain countries in Africa
Improving relationships with large clients
Improving service
by
decreasing
delivery
time
Seeking advice to achieve manufacturing optimization, better material management, and supplier relations
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Lenovo still has a long way to go. Here are some things it should do……
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GeneralOvercome cultural barriers
Realize cultural
understanding
is
very important in striking deals
Sacrifice some control over
employees to
foster
creativity
Overcome global competition from
the world’s largest computer companies
Keep old clients and gain new ones
Continue creating innovative technology
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SpecificMaintaining its stance as a Chinese corporate
leader
Lead a sense of better integration to fit within the global consumer environment.
Use the
image
of
Olympic
sponsor
to
its
fullest
Lower operational cost, penetrate new markets with low prices
Create special
computers
for
niches
Gamer
High speed computer