strategic analysis for Lenovo 1

Topics: Personal computer, Revenue, Customer service Pages: 9 (1315 words) Published: December 2, 2014
ISE520 Manufacturing Strategy

Proposal for a mini-project
-Strategic Analysis and Proposal for Lenovo

Group member:JIN Yu


QI Jia




HUANG Shanhui



ISE520 Manufacturing Strategy

1 Study Objectives
Through collecting and collating information
to analysis Lenovoorganization's internal and external environment to understand the environmentchanges in business, status, resources and strategic capability of Lenovo. By using the Balanced Scorecard to change the organization's mission and strategy into tangibleobjectives and metrics.Through this study we will establish a basiclong-term business growth and improve proposal and identify the key factors of current and future success.Then we will implement the findings to improve the performance of Lenovo.

2 Introduction of Lenovo
Lenovo is a highly innovative international science and technology based company, the association and the original of the personal computer department of IBM and Motorola Mobile.In 2014, the global enterprise 286 strong, as the global PC market leadership enterprise, Lenovo is engaged in developing and manufacturing the most reliable and safest technology products .They also provides high quality professional service, helping the global customers and partners succeed. Lenovo mainly produces desktop computers, servers, notebook computer, printer, motherboard, cell phone etc.

3 Analysis of the Environment
3.1External Environment-PEST Analysis
Lenovo has strong political background, national support. Lenovo is the Chinese Academy of Sciences Institute of Computing Technology founder. 2)economic
National macro-control, rising prices and otherobjective factorsdoes have certain influence the computer industry growth. But the short-term shocks of macroeconomic environment does not fundamentallyaffect the computer market, the fundamentals of computer market overall growth trend does not change. In addition, Lenovo has become the third largest mobile phone manufacture after merging Motorola Mobile. 2

ISE520 Manufacturing Strategy

The social demand for products, China and even the world still have greatpurchasing power. Moreover, the society is transforming from PC generation to Mobile generation, which is beneficial to the development of Lenovo. 4)technical

Institute of Computing has more than 42,000 employees and 7 international R&D centers all over the world, making Lenovo’s products the highest level. Lenovo has got a large number of patent reserve by developing, merging and cross-licensing, which can both reduce the risk of patent litigation in the international market and enhance the competitive power.

3.2Internal Environment – Porter’s Five Forces
1)New Entrants
From the market perspective, the current PC production capacity has been oversupply, overcapacity in the industry and market share is stable, Lenovo, HP and Dell's leadership is difficult to change.Investment in production lines and the establishment of management, sales, service, research and development institutions need a lot of money.From this analysis, the possibility of potential competitors to enter the market is small

PC is a sophisticated instrument, the main supplier of only two CPU, AMD & INTEL, PC hard drive manufacturers are Samsung, Patriot and other major PC manufacturers, will weaken the bargaining power of PC manufacturers.Overall, the majority of PC hardware are provided by the vendor, rather than produced by the manufacturer. PC manufacturers bargaining power is high.

For the low-priced products, customer bargaining power is stronge, as the Chinese-made computers, price as a competitive advantage. For high value itemscustomers’ bargaining power is weak, mostly pricetakers, but they may need improvements in otheraspects of performance satisfaction.


ISE520 Manufacturing Strategy

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