Lenovo: Building a Global Brand Harvard Case Solution & Analysis

Lenovo: Building a Global Brand Case Solution

Facts of the case:

Lenovo is the PC manufacturer and a well-known brand in China. Moreover, 90% of its revenues come from China,however Lenovo aims to explore other markets of the world to become a global technology colossal. Lenovo was a small distributor of imported computers in China,but now it has become China’s leading computer manufacturer. Lenovo is China’s first multinational company which has surpassed Hewlett-Packard and Dell to become the largest PC manufacturer in the world. (William J. Holstein, 2014)

Lenovo introduced its first product which was the legend Chinese character card whichtranslatedfromEnglish to Chinese. At that time, Lenovo was operating under the name of New Technology Developer. The legend Chinese card has boosted the PC distribution business of the firm, which also contributed in winning several contracts. Moreover, the legend Chinese cardintroduced its own desktop PC in China and became the founder of the home computer concept in China. In the year 1996, Legend introduced first laptop PC in China, which allowed thecompany to generate more revenue. By 1999, the legend became China’smarket leader. It is expectedthat Lenovo gained 30% share of its home market, which is expected to become the world’s largest company in the world. (Jeffrey Hays, 2008)

It was not easy to maintain the market share of Legend’s PCs astheCEO, Yang, had to face many challenges. China joined the World Trade Organization, which created hindrances for Legend such as the implementation of quotas, tariffs on imports, access to the distribution channel, and ownership rights. Legend also had to deal with other major players in the market like Haier. The increased domestic competition enabledLegend to expand beyond China. The company began its international expansion with new name and logo which was Lenovo. The company adoptedLenovo Group Limited as the company’s official name and keeping the original name for the home market, which was China. In 2004, Lenovo joined the International Olympic Committee and became the exclusive computer equipment and service provider for Olympic. This allowedthecompany to use Olympic logo for its marketing and promotional activities and have access to the world’s market.

 In 2004, Lenovo acquired IBM’s personal system divisions and got the right to use IBM on its products together with two major offerings; the IBM ThinkPad laptop and ThinkCentre desktop PC brands. However, Lenovo assured IBM not to become a competitor for its consulting services and gained access to IBM’s sales teams and management programs. The ThinkPad product line was highly popular and recognized worldwide for its advanced features and continuing advancements. By acquiring IBM PC business, Lenovo was able to enter the international market quickly. According to sources, Lenovo expanded assertively outside China and becamea global brand through theacquisition of IBM. (Jeffrey Hays, 2008)

Lenovo’s small headquarter was located in New York near IBM’s headquarters, whereas the research centers were located in Beijing, Shanghai, Shenzhen and Yamato (Japan) and Raleigh, North Carolina. To reflect the international composition, Lenovo restructured the management and top positions were assigned to Americans, Europeans, and Indians. English became the working language of the company,however working via conferences calls led to severe problems. Lenovo had to arrange the meetings to solve various issues, but due to the 12 hours difference in the timings of Beijing and US, it became difficult to communicate. Many meetings were scheduled early in the morning or late at night, causing stressful working conditions for executives to work around the clock.

SWOT:

Strengths:

Lenovo’s main strength is to have innovation in every aspect. It has the ability to combine innovation and efficiency together. Lenovo has great brand presence in Asia which could help in becoming global giant. With the acquisition of IBM, Lenovo has access to the international market as well as it has deep insights on the practices from western companies.................

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