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The new Lenovo way: We do what we say
January 21, 2011, Friday
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EDITOR'S note:
This is the second of two parts of a Wharton Business School article on the legendary Chinese IT giant Lenovo, the first Chinese company to take over an American firm. It's an edited version of Wharton's interview with Liu Chuanzhi, founder and chairman of Lenovo.
Q: Tell us about the corporate culture you're trying to cultivate - what you call "the Lenovo way."
A: We pay a lot of attention to corporate culture here.
The culture refers to the core values; "the Lenovo way" means we do what we say, and we own what we do. The Lenovo way now is an alternative to the status of Lenovo right after the acquisition.
The new culture - we do what we say - is not just a matter of attitude. When we propose a target, we think it through, and we have a clear idea of how we'll execute steps to meet it.
Q: How does "the Lenovo way" translate into the way you treat employees?
A: The key or essential part of our core values is to put people first.
We need to make sure our employees love this company. And when we are successful, we need to give back to our employees with incentives and rewards. We need to take care of our employees to make sure they have a good life.
Q: What about the company's new strategy?
A: In the old status, the company focused on mature markets with little emphasis on emerging markets. But the new management is thinking differently, and we're spending on emerging markets.
In the past, the client base was commercial, with little in the consumer space. But today consumer growth of PCs outpaces commercial clients. The previous top leadership didn't address that. They did not have the strategy to grow our PC business. Because of the correct strategy, our business is much more ballast.
Q: Give us some examples of how you're focusing more on consumers.
A: We have introduced ThinkPad Edge, a light, powerful notebook for the small-business market; we have launched the Skylight smartbook, a combination of mini-PC and smartphone, and we will also bring out the IdeaPad U1 hybrid, a notebook with a detachable screen.
In addition, we have launched LePhone, a 3G smartphone, in China, which is our answer to Apple's iPhone, and we will roll out more products in the new area of mobile Internet.
We've moved from a 7.6 percent market share just before the crisis to a 10.4 percent market share today. We are ranked No. 4 in global market share in the PC business.
Q: China has just developed the fastest supercomputer in the world. How big an edge does this give the Chinese? And do you think this latest news is emblematic of the state of American and Chinese technology?
A: I think for computers being used by people around the world, 70 to 80 percent are made in China physically. For some of the components, like storage and display, only 20 percent, or 30 percent or 40 percent are made in China.
But for those software components like operating systems, the technology is not in the hands of the Chinese. I don't have a comment about what China's new supercomputer means on a symbolic level.
Q: As Chinese domestic consumption increases, do you think global tech companies will set their development road maps to follow Chinese consumer tastes rather than American tastes?
A: The Chinese will certainly have more influence on the direction of IT companies. The total volume of cars and PCs is starting to match the US, and China has 800 million mobile phone users. The sheer size speaks for itself.
We've already seen examples of Chinese influence on how certain technologies evolve and become popular. Ten years ago in Western countries, text messaging was not that popular. But in China, it was already taking off.
In China, at the New Year or during the Spring Festival, it's a customary tradition to send greetings to family and friends. Calling people takes a lot of time so when this technology became available many people chose to send texts. Texting became very popular in China, and in the West, too, eventually.
Q: What advice would you give a US company interested in expanding into the Chinese market?
A: If I happen to acquire one, I will tell you.
(Reproduced with permission from China Knowledge@Wharton, http://www.knowledgeatwharton.com.cn. Trustees of the University of Pennsylvania. All rights reserved.)
This is the second of two parts of a Wharton Business School article on the legendary Chinese IT giant Lenovo, the first Chinese company to take over an American firm. It's an edited version of Wharton's interview with Liu Chuanzhi, founder and chairman of Lenovo.
Q: Tell us about the corporate culture you're trying to cultivate - what you call "the Lenovo way."
A: We pay a lot of attention to corporate culture here.
The culture refers to the core values; "the Lenovo way" means we do what we say, and we own what we do. The Lenovo way now is an alternative to the status of Lenovo right after the acquisition.
The new culture - we do what we say - is not just a matter of attitude. When we propose a target, we think it through, and we have a clear idea of how we'll execute steps to meet it.
Q: How does "the Lenovo way" translate into the way you treat employees?
A: The key or essential part of our core values is to put people first.
We need to make sure our employees love this company. And when we are successful, we need to give back to our employees with incentives and rewards. We need to take care of our employees to make sure they have a good life.
Q: What about the company's new strategy?
A: In the old status, the company focused on mature markets with little emphasis on emerging markets. But the new management is thinking differently, and we're spending on emerging markets.
In the past, the client base was commercial, with little in the consumer space. But today consumer growth of PCs outpaces commercial clients. The previous top leadership didn't address that. They did not have the strategy to grow our PC business. Because of the correct strategy, our business is much more ballast.
Q: Give us some examples of how you're focusing more on consumers.
A: We have introduced ThinkPad Edge, a light, powerful notebook for the small-business market; we have launched the Skylight smartbook, a combination of mini-PC and smartphone, and we will also bring out the IdeaPad U1 hybrid, a notebook with a detachable screen.
In addition, we have launched LePhone, a 3G smartphone, in China, which is our answer to Apple's iPhone, and we will roll out more products in the new area of mobile Internet.
We've moved from a 7.6 percent market share just before the crisis to a 10.4 percent market share today. We are ranked No. 4 in global market share in the PC business.
Q: China has just developed the fastest supercomputer in the world. How big an edge does this give the Chinese? And do you think this latest news is emblematic of the state of American and Chinese technology?
A: I think for computers being used by people around the world, 70 to 80 percent are made in China physically. For some of the components, like storage and display, only 20 percent, or 30 percent or 40 percent are made in China.
But for those software components like operating systems, the technology is not in the hands of the Chinese. I don't have a comment about what China's new supercomputer means on a symbolic level.
Q: As Chinese domestic consumption increases, do you think global tech companies will set their development road maps to follow Chinese consumer tastes rather than American tastes?
A: The Chinese will certainly have more influence on the direction of IT companies. The total volume of cars and PCs is starting to match the US, and China has 800 million mobile phone users. The sheer size speaks for itself.
We've already seen examples of Chinese influence on how certain technologies evolve and become popular. Ten years ago in Western countries, text messaging was not that popular. But in China, it was already taking off.
In China, at the New Year or during the Spring Festival, it's a customary tradition to send greetings to family and friends. Calling people takes a lot of time so when this technology became available many people chose to send texts. Texting became very popular in China, and in the West, too, eventually.
Q: What advice would you give a US company interested in expanding into the Chinese market?
A: If I happen to acquire one, I will tell you.
(Reproduced with permission from China Knowledge@Wharton, http://www.knowledgeatwharton.com.cn. Trustees of the University of Pennsylvania. All rights reserved.)
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