While the majority of us receive email, surf the web and text message on our Apple Iphone’s, Samsung smart phones or even blackberry’s we rarely think about or identify with the number 1 maker of computers in the world. After a very successful acquisition of IBM’s money losing PC business in 2005 Lenovo a Chinese company has asserted themselves as the leaders of the PC business. While more traditional PC powerhouses like HP and Dell are faltering Lenovo is beefing up their supply chain, making acquisitions and setting the stage to dominate the mobile phone and tablet business as well.
Lenovo is perhaps one of the most unique Chinese firms and possibly the world. Lenovo has made itself a truly global organization. They have dual headquarters in Beijing and North Carolina along with top executives stationed in 7 different countries. In addition Lenovo still handles all manufacturing and R&D in house versus outsourcing. Lenovo’s CEO Yuanqing Yang believes that Lenovo’s strategy of production and R&D has allowed them to move quicker than the competition and as a result they are gaining market share far faster than any of their competitors. Just last year Lenovo picked up 13% of the PC market share in the US, a number that by far outpaced HP and Dell.
Every year Yuanqing Yang, known around Lenovo as YY hosts a dinner at his estate with all of his top lieutenants to discuss the upcoming year and growth strategies. What started as a simple toast years back has turned into a tradition where each business head holds a glass of wine in their hand and sets a goal for their own business unit. This year many of the toasts centered around a rise in Smartphone’s or retail growth. Lenovo is focused on overtaking Apple and Samsung in many categories. Lenovo is slowly creeping into the retail and Smartphone sector like Apple did years ago. Lenovo is currently offering Smartphone in Asian countries where they have more brand recognition and expanding their retail stores into new countries. Instead of making a big splash and entering every market Lenovo is slowly building up their reputation and dominating the markets where their presence is already known.
What struck me as extremely interesting and well thought out is Lenovo’s current growth strategy. Instead of just trying to jump into the Smartphone market in North America they are starting slowly where Lenovo currently has the brand awareness of an Apple or Samsung in the US. In addition Lenovo has a very good feel for the retail industry and what type of stores/outlets to have in what areas. For example Lenovo has a very high end Apple type store in Beijing but just a few miles away they have a smaller less flashy store in the local electronics market. After reading this article I do not think it will take that long for Lenovo to transform itself from the PC you get at work to a household name on a number of devices for everyone.
Do you think Lenovo has what it takes to dominate these competitive sectors in the US and do they have the right strategy to build their global brand?