Book contents
- Frontmatter
- Contents
- List of figures
- List of tables
- Preface
- Acknowledgments
- Introduction: the global challenge
- 1 The global mosaic
- 2 Global strategic analysis
- 3 Global competitive advantage
- 4 Global competitive strategy
- 5 Global investment strategy: choosing the best mix of transactions and investment
- 6 The global business organization
- 7 Lenovo: entering global competition
- 8 Cemex: making global markets
- 9 Dairy Farm: regional retail strategy
- 10 Danone: organizing for global competition
- Conclusion
- Glossary
- Notes and references
- Index
7 - Lenovo: entering global competition
Published online by Cambridge University Press: 05 June 2012
- Frontmatter
- Contents
- List of figures
- List of tables
- Preface
- Acknowledgments
- Introduction: the global challenge
- 1 The global mosaic
- 2 Global strategic analysis
- 3 Global competitive advantage
- 4 Global competitive strategy
- 5 Global investment strategy: choosing the best mix of transactions and investment
- 6 The global business organization
- 7 Lenovo: entering global competition
- 8 Cemex: making global markets
- 9 Dairy Farm: regional retail strategy
- 10 Danone: organizing for global competition
- Conclusion
- Glossary
- Notes and references
- Index
Summary
The shock in international business circles was palpable. The New York Times asked “Lenovo. Who?” under a headline that read “An Unknown Giant Flexes Its Muscles.” China's Lenovo Group had purchased IBM's personal computer (PC) business for US$1.75 billion in cash, stock, and debt. The acquisition created shock waves in part because the purchaser was a Chinese company, and perceptions in developed economies had not fully adjusted to the growth of Chinese businesses or to the technological progress taking place in China. Some were startled by IBM's exit from the PC business, despite having pioneered its development in the early 1980s. Known as “Big Blue,” IBM had played a key role in establishing PC industry standards through its alliances with Intel in microprocessors and with Microsoft in operating system software.
Lenovo vaulted from being the eighth-largest PC maker in the world to the third-largest, after Dell and Hewlett-Packard (HP). At a stroke, Lenovo gained an internationally recognized brand name, access to customers, skilled managers, advanced technology, and a powerful partner. Buying IBM's PC division transformed Lenovo from a leading domestic player in China to a major global company:
How did Lenovo make such a great change so quickly?
How did the acquisition fit into Lenovo's overall strategy?
How would Lenovo adapt its strategy and organization to become an effective global competitor?
- Type
- Chapter
- Information
- Global Competitive Strategy , pp. 169 - 195Publisher: Cambridge University PressPrint publication year: 2007