Business

Lenovo(联想集团) Up Close: Expanding as the World Gets Smaller

Published: 2007-4-27

By Rachel Sussman

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Turning our gaze to the period prior to 2004, we see the seedling that was Lenovo(联想集团): a small but innovative PC manufacturer with large aspirations. Coming from humble beginnings – eleven employees and US$25,000 in start-up capital – Lenovo has since pounced onto the world stage with its acquisition of IBM's Personal Computing Division, now with 27,000 employees and capital in the tens of billions.

Thinking hard but don't quite recall this Chinese PC superbrand? For our international viewers, the name Lenovo may not be on the tip of your tongue. However, ThinkPad – a line of internationally successful notebook computers – will likely seem more familiar. ThinkPad combines Lenovo technology with IBM's marketability and user-friendliness to create a Lenovo product line that has outshone a number of other well-known PC brands, including Dell (as Lenovo representatives are quick to point out). Today, along with Beijing University's International Student Association, I had the opportunity to see Lenovo's Beijing headquarters firsthand, observe where they have been, and gauge the path to come.

Our experience began in a small conference room on the first floor of the Lenovo headquarters in northern Beijing. We were shown a presentation on the history of the Lenovo Company and the business plan that would dictate its growth potential. The presenter was spry and excitable, his energy both amusing and infectious. I get the sense that the presentation was negatively impacted by our language barrier; I am sure that a Chinese-language presentation, as opposed to the English-language seminar we were given, would have been more complete and insightful. However, the English speaking ability of the presenter was laudable and his lecture informative, though general. It certainly served as supplement enough to understand what we would soon be viewing firsthand: the Lenovo manufacturing plant and product showroom.

We made our way up several flights of stairs to another conference room, at which point we were instructed to put light blue slip-on covers over our shoes and given portable headphones linked to our tour guide's microphone. One of the first departments we saw was the testing department in which employees are paid to "try out" new Lenovo computer models, doing activities similar to the "everyday tendencies" of Lenovo's customer base. In plain English, they played games, surfed the Net, listened to music, and played some more. Not so bad for a day job, eh? I suppose it's comparable to being the taste-tester at the Häagen-Dazs plant. Except less fattening.

The tour guide then led our group through the failure testing area (where computers are rehabilitated when they don't behave – so let's call it PC prison), the main assembly lines for both standard products and customized models, and the component warehouses. The latter was particularly cool for being completely automated. Cranes, conveyor belts, and robotic apparatuses operated by a handful of operators in a separate control center efficiently distributed materials from a space the size of a small basketball arena.

With a wave goodbye to the assembly line workers, we handed back the headsets, removed our shoe covers, and returned to the first floor to visit the Lenovo product exhibition room. After an introduction to their two product lines – "ThinkCenter/ThinkPad" and "Lenovo" – I can sum up each line in a slogan. The "Think" line? Security, Portability, and Aesthetic Appeal. And the "Lenovo" line? Big and Ostentatious – but you still really want it. How much do we love our consumer culture? Quite a lot. Presented were models with face recognition and fingerprint security features, large-screen monitors for movie viewing, and extremely small-screen monitors for lightweight mobility. There were even notebooks sponsored by Coca-Cola and Disney, including Coca-Cola logos and pictures of Winnie the Pooh and Mickey Mouse.

But, by far, Lenovo's most touted achievement is their relationship with their country and their clients. Lenovo is a state owned enterprise (SOE). The Chinese government even today still holds the largest stake in the company. Lenovo is also China's top PC manufacturer, making it the easy choice for representing China as an Olympic sponsor. It has been China's delegate for the games in Torino as well as the upcoming event in Beijing in summer 2008. Boasting a client list that includes Chinese government offices, top Chinese companies, and American organizations NBC and the NFL, among others, Lenovo seems intent to maintain and build business through its ability to supply mass quantities of high-quality customized product with relatively quick turnaround time. With retail locations on every continent (excluding Antarctica, of course!) and research, manufacturing, and sales headquarters worldwide, Lenovo is poised to make a grand entrance onto the world stage.

"But where has it been all this time?" you may ask. Before coming to China, I also did not recognize the name "Lenovo." Up until recently, Lenovo was strictly a Chinese brand, only expanding upon landing a hefty investment by American private equity firms Texas Pacific Group, General Atlantic LLC, and Newbridge Capital LLC. Even since their foray into the international PC market, Lenovo still retains a strong presence in China, but remains a relative outsider in other international markets. In an attempt to alter the perception of Lenovo as a "Chinese" company – as opposed to an international one – the Lenovo management team is attempting to increase the penetration of the recognizable "Think" product line into foreign markets and increasing the visibility of Lenovo and IBM as partners. Slowly, over time, they hope to decrease the visibility of the Lenovo-IBM link. Literally. Over time, they will actually make the IBM logo on the ThinkPads smaller and lighter until it has vanished. It is quite a plan to transition the "Lenovo" name into everyday vernacular as an independent, viable corporate entity. More importantly, it will give Lenovo the opportunity to shine solo on foreign soil. If it really is true what they say, "status quo is a no go in the new Lenovo," they will have much shining to look forward to.

Lenovo: 联想集团 / lián xiǎng jí tuán /  Lenovo group (PRC computer firm)

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