Lenovo, like other large laptop and desktop suppliers, does not manufacture its own raw materials and relies on a small number of powerful chip and board suppliers. While buyer bargaining power is relatively low in the PC market, Lenovo differentiates itself through quality, customer satisfaction, and innovation. However, its design and audio capabilities remain below average. To adapt, Lenovo has expanded into mobile devices like phones and tablets. Maintaining talent and preventing major changes to suppliers are keys for Lenovo, HP, and Dell to retain their dominant positions in the corporate market.

1. Name: Wu Diyi
Matrix No: P68508

2.  Lenovo like others big laptop and desktop
supplier who did not manufactures its own
materials.
 The raw materials like boards and chips
supplier is fewer and powerful, they are not
easy to drive up prices.

3.  Buyer bargaining power in this market is
relatively low in this market, since the store
sales mode.
 improving product and service quality,
offering extra features and maintaining
strong customer relationship is still key to
success.

4.  Currently, there are three major players in the
PC corporate market, Dell, HP and
Lenovo, which take up around 43% of the
market share, second in the world market
share 15.7% in 2012.(showing on next page).

5. Vendor
4Q12
Shipments
4Q12 Market
Share
4Q11
Shipments
4Q11 Market
Share
4Q12/4Q11
Growth
HP 15,023 16.7% 15,113 15.8% -0.6%
Lenovo 14,105 15.7% 13,040 13.6% 8.2%
Dell 9,482 10.6% 11,967 12.5% -20.8%
Acer Group 6,959 7.8% 9,692 10.1% -28.2%
ASUS 6,467 7.2% 6,126 6.4% 5.6%
Others 37,753 42.0% 39,974 41.7% -5.6%
All Vendors 89,789 100.0% 95,913 100.0% -6.4%
Source: IDC Worldwide Quarterly PC Tracker, January 10, 2013

6.  According to the customer satisfaction
survey, there are relatively few
differentiations among these top five
players in terms of product features and
product quality.
 Lenovo has the best customer satisfaction
and innovation and overall score among
them. But design and displays and audio
below average level.

8.  The most probable substitute products are
tablet (like ipad and sumsung note) and
smartphones. Despite the rapid development
of mobile devices, enterprises don’t see them
as useful to their organization.
 The consumer market can not be replace by
next few years.

9.  “With the growth of the PC corporate market, there are
foreseeable potential entrances in this market. However,
the entry barrier is relatively high – enterprises generally
seem to be satisfied with their current notebook providers,
with little incentive to look beyond their current suppliers.
However, in technology markets, it is generally considered
a constant possibility for a new company to leapfrog the
competition with a new invention. “
 “As a result, existing companies are rigorous about
attracting new engineering talent and attempt to use
complementing to make major changes in IT providers
unprofitable. This is a significant reason that Dell, HP and
Lenovo maintain their dominant positions in the corporate
market.” (Source: Lenovo: Competitive Strategies for
Dominance In the Corporate Market )

10. Force Key Determinants Strength of the force
Rivalry competitors Concentration (number) and
size of competitors
Medium to high
Brand identity
New entry Economies of scale high
Brand identity
Capital requirements
Threat of substitutes Price/Performance of substitutes Low to medium
Switching costs
Buyer Power Buyer concentration Medium to high
Buyer size (volume)
Switching costs
Supplier Power Supplier concentration Low
Supplier size (volume)
Switching costs
Table 1

11.  Like others big laptop and desktop supplier
raw material receiving from other supplier.

12. Lenovo's OEM partners are mainly Wistron, Quanta and
Compal three, including the IdeaPad, Thinkpad, and Tin
Yat other original series models are apportioned to three
foundry.

14. To adapt the new environment, Lenovo mobile device new
products cellphone and tablet came out.

15. Lenovo delivers the quality, reliability and peace of
mind to get you and keep you up and running, no
matter where you are, no matter when you need us.

16.  Procurement
 Technology Development
 Human Resource Management
 Firm Infrastructure

17.  Drive Quality Improvements from our
suppliers of goods and services
 Deliver lowest overall cost and greatest
competitive advantage
 Improve client perception of our values
through increased influence and exemplary
customer service and support

18.  Lenovo must learn to innovate to become the
true high-tech leader

19.  This is the technique of employment
management that can create positive
improvement and add value by the
combination of employment policies,
programs and practices.

20.  Lenovo has consistently outgrown the
worldwide PC market in unit shipments and
gained market share across all
geographies, products and customer
segments, making it the fastest growing
major PC company in the world for three
years running.