2. Company Overview
• Lenovo operates is computer technology.
• Founded in 1984 in Beijing, Lenovo grew to become China's leading
PC company, and then acquired IBM's Personal Computing Division,
the creators of the first personal computer.
3. Lenovo’s Prescription for Supply Chain Success
• Qualitative and Quantitative
1. supply chain data analytics
▪ tools like Excel spreadsheet, to drive productivity by
improving reporting and dashboards.
▪ Lenovo’s global supply chain group was using its growing
analytics capability to support the Perfect Order Fulfillment
(POF) metric.
2. Convert the voice of the customer into things
▪ like accurate invoicing and reported defects in packaging
and delivery process
▪ Problems:
Supplier partners were occasionally missing their delivery dates
into the manufacturing plants
Parts failed quality tests and couldn’t be used
Required days of inventory were miscalculated by
Lenovo’s procurement managers
▪ Basic solution: Reduce inventory, improve cash flow and
improve brand loyalty.
4. Lenovo goes global
• China is the largest market
1. China
32 % of the total revenue.
continued growth PC market
refine its Lenovo brand smartphone strategy
2. Americas (AG)
26 % of the total revenue.
PC unit shipments grew by 4 % both consumer and
commercial businesses
3. Asia Pacific (AP)
14 % of the total revenue.
strong shipments growth in ASEAN and ANZ regions
4. Europe-Middle East-Africa (EME)
28% of the total revenue
continued to expand its smartphone business
Source: Annual report 2015
5. Environmental friendly in Global supply chain
Member of
Electronics Industry Citizenship Coalition (EICC)
EPA SmartWay program (transportation)
Suppliers meet ISO 9001/14001 ,Occupational Health & Safety (OHS 18001)
and Social Accountability (SA8000) standards requirements.
6. Lessons from the case
• The innovation and strategic acquisition
- With the potential for integrating two disparate east and west markets, Lenovo
created a unified global PC leader with growing market position by acquiring the IBM
and Motorola.
- Due to the acquisition, the company significantly expanded its market share.
• Synchronize the strategies among all the stages
- From facilities, transportation, sourcing, inventory to pricing and information, all the
strategies that are performed in each stage are affected by each other.
- We have to develop the strategy carefully to assure each strategy can create
maximized effects.
• Utilize the strategy defensively and offensively
- The company uses the strategy “Protect and attack” not only to dedicate to
protecting its core legacy but also to attack new market opportunities in regions with
high growth potential
7. Lessons from the case
• All member in the network should participate
- The strategies need to be performed by all the members in the network to make sure that
each step is being done effectively and efficiently.
- Especially the leader of the team should all involve in the protect and attack strategy to
optimize the objective since strategy across all geographies, customer segments and product
lines as the organization continues to build its business worldwide.
• Product diversification
- From the strategy “PC+”, we can tell that the company won’t be satisfied with only
one successful product line. Therefore, the team develop multiple product availability
under the production constraints.
• Keep improving and maximize the supply chain surplus
- The successful company knows that they not only need to sustain the position but
also must keep improving so as to maximize the supply chain surplus.
