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Lecture 5

ECO244Y5 Lecture 5: Yq1d7k

2 Pages
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Department
Economics
Course Code
ECO244Y5
Professor
Frank Reid

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Global Strategy at Lenovo
Questions
1. What strategies does Lenovo employ to maximize company efficiency and flexibility? How does
Lenovo use these strategies to succeed in the global marketplace?
Ensure organizational learning and optimize firm’s value-chain activities continuously
Use M&As to acquire needed knowledge and assets and to expand into markets faster and
less risky than greenfield investment
Protect-and-attack strategy
o Protects core business (esp. in China)
o Aggressively grows market share in emerging markets and advanced economies
o Rapidly growing in new product categories tablets and smartphones
Standardizes component parts so same parts can be used to make up different computers
Standardized products with different language or marketing customization
Concentrates manufacturing in China, Argentina, India, Mexico, Poland
Production in low-cost countries generates cost efficiencies and economies of scale
2. What does Lenovo management do to foster organizational learning?
Uses M&A deals to acquire knowledge
Hire managers with a global mindset and technology background
Create career maps for people and work with them to get the training needed to achieve goals
3. What are the characteristics of Lenovo’s culture? How does the culture help Lenovo achieve its
international goals?
Senior management emphasizes global innovation, global products and branding, global HR,
corporate culture conducive to global success
Firm’s official language is English
Executive team meetings rotate among Beijing, Hong Kong, Singapore, Paris, North Carolina to
foster a global spirit
Senior management has a process to socialize young managers to Lenovo organizational culture
Managers become well acquainted with firm’s culture and goals
Feel strong connection to firm wherever they operate
4. Examine Lenovo in terms of the integration-responsiveness framework. What is the nature of
Lenovo’s international strategy? Is the firm’s strategy primarily multi-domestic or global? Justify your
answer. What advantages does Lenovo derive from the particular international strategy that it
pursues?
Case Notes
Lenovo is the top worldwide PC vendor
Based in China
PC market share
o 33% in China
o 15% in North America
o 20% in other countries
Company Strategy
PC industry has reached maturity
Profit margins on computers are thin
Key to Lenovo’s success:
o Ensure organizational learning and optimize firm’s value-chain activities continuously
o Use M&As to acquire needed knowledge and assets and to expand into markets
Follows a protect-and-attack strategy
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find more resources at oneclass.com Global Strategy at Lenovo Questions 1. What strategies does Lenovo employ to maximize company efficiency and flexibility? How does Lenovo use these strategies to succeed in the global marketplace? Ensure organizational learning and optimize firms valuechain activities continuously Use MAs to acquire needed knowledge and assets and to expand into markets faster and less risky than greenfield investment Protectandattack strategy o Protects core business (esp. in China) o Aggressively grows market share in emerging markets and advanced economies o Rapidly growing in new product categories tablets and smartphones Standardizes component parts so same parts can be used to make up different computers Standardized products with different language or marketing customization Concentrates manufacturing in China, Argentina, India, Mexico, Poland Production in lowcost countries generates cost efficiencies and economies of scale 2. What does Lenovo management do to foster organizational learning? Uses MA deals to acquire knowledge Hire managers with a global mindset and technology background Create career maps for people and work with them to get the training needed to achieve goals 3. What are the characteristics of Lenovos culture? How does the culture help Lenovo achieve its international goals? Senior management emphasizes global innovation, global products and branding, global HR, corporate culture conducive to global success Firms official language is English Executive team meetings rotate among Beijing, Hong Kong, Singapore, Paris, North Carolina to foster a global spirit Senior management has a process to socialize young managers to Lenovo organizational culture Managers become well acquainted with firms culture and goals Feel strong connection to firm wherever they operate 4. Examine Lenovo in terms of the integrationresponsiveness framework. What is the nature of Lenovos international strategy? Is the firms strategy primarily multidomestic or global? Justify your answer. What advantages does Lenovo derive from the particular international strategy that it pursues? Case Notes Lenovo is the top worldwide PC vendor Based in China PC market share o 33 in China o 15 in North America o 20 in other countries Company Strategy PC industry has reached maturity Profit margins on computers are thin Key to Lenovos success: o Ensure organizational learning and optimize firms valuechain activities continuously o Use MAs to acquire needed knowledge and assets and to expand into markets Follows a protectandattack strategy find more resources at oneclass.com
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