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27
Lenovo Group Limited • Annual Report 2007/08
In the 2008/09 fiscal year, Lenovo will strengthen its newly
launched global consumer business by establishing
strategic partnerships, extending its consumer notebook
portfolio and exploring more routes to market. The Group
will also accelerate the growth by rolling out the business to
additional countries.
Workstations & Servers: In addition to offering
standard notebook and desktop products, Lenovo is
expanding into the higher margin workstation and server
markets globally to better fulfill market demand and pursue
growth by leveraging its core PC strengths.
Lenovo launched the ThinkStation line in November 2007
to deliver high performance workstation products for
professional users who work in graphically and
computationally-intensive environments. The Group will
focus on the market opportunities in higher volume mature
markets by leveraging its existing large enterprise customer
relationships. ThinkStation has already won business from
major global enterprises and received numerous positive
industry reviews in the first few months since its launch.
Lenovo will also leverage its transaction business model to
target SMB opportunities in mature and emerging markets.
Lenovo already has a significant mid-size server business in
China and will expand the business on a global basis. In the
worldwide server hardware market, x86 servers have been
the fastest growing segment and made up more than 50
percent of the spending in that area. Lenovo made its initial
foray into the worldwide server market by extending its
strategic alliance with IBM in early 2008 to license the rights
to design, manufacture and sell a select set of one-and
two-socket rack and tower x86 servers. Lenovo will target
SMB server opportunities as it continues to expand its
overall product portfolio for its customers and business
partners.
Emerging Markets: Emerging markets are major
growth drivers in the worldwide PC market and are
expected to account for over 50 percent of the incremental
growth over the next coming few years. Lenovo is uniquely
positioned to capitalize on these new market opportunities
with its tremendous success in China and rapid expansion
in India. Lenovo’s proven business model will enable it to
capture the opportunities in the emerging countries in all
geographies. The roll-out of the transaction business model
outside China has laid important groundwork for Lenovo to
further expand in India, Russia, Middle East, Turkey, Brazil,
and Mexico.
Gain Scale Profitably
It is critical for Lenovo to drive growth in its core business
to gain scale and better manage profitability. Lenovo
delivered solid growth in the 2007/08 fiscal year and will
strive to continue success by extending its product
leadership, strengthening its China market position and
large enterprises business, expanding its dual business
model and accelerating the growth of higher margin
adjacent businesses.
Extend Product Leadership: Lenovo’s ability to grow,
capture share, and gain scale is all based on its competitive
advantage through product innovation and its commitment
to providing the best-engineered PCs. In the 2008/09 fiscal
year, Lenovo will continue to extend its leadership with
innovative design by focusing on the key product
technology trends in PC market. At the same time, it will
drive products that satisfy customers’ desires, such as
smaller form factor desktop computers, and thin and light
notebook computers.
Leverage Our Base in China and Large
Enterprise Business: Lenovo’s China PC business and
worldwide large enterprise business still represent a large
portion of its business and will continue to be critical in its
future success, even as the Group moves ahead with new
market opportunities. In the 2008/09 fiscal year, Lenovo
plans to strengthen its position by focusing on the fast-
growing notebook market in China and drive market
demand by leveraging its unique marketing opportunity at
the Olympic Games in Beijing. Following smooth transitions
of global sales support and product brand name, Lenovo
has taken full responsibility of its large enterprise business.
It will build on its strengths in various segments such as the
public sector, mid-market for growth and at the same time
accelerate customer acquisition.