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2009/10 Annual Report Lenovo Group Limited
8
A year ago, Lenovo faced tremendous challenges
brought on by the global economic downturn. Our
leadership team focused on the task of first stabilizing
our performance and then quickly setting about
returning Lenovo to strong, sustained growth. I am
pleased to report that we have made tremendous
progress, returning Lenovo to profitability and
positioning ourselves for a strong future.
Five key factors were critical in driving our strong
performance year-to-year:
• Our clarified strategy focused our operational
execution on protecting our base in China and
commercial and global accounts while expanding
aggressively in emerging markets and consumer
sales to make these new areas of strength.
• Our global senior leadership team developed an
effective working approach defined by frequent
consultation and rapid decision making on the
Group’s strategic direction.
• A new organizational structure – our Emerging
and Mature market groups and Think and Idea
product groups – enabled clear end-to-end,
integrated focus.
• Lenovo’s culture of delivering on our commitments
continued to strengthen, enabling us to act with
greater speed and efficiency.
• The new products Lenovo launched enhanced
our competitiveness and profitability while our
innovation leadership differentiated us and enabled
us to create new product categories.
For the first time since the landmark acquisition of the
IBM PC, Lenovo became the fastest growing major PC
company in the second half of the fiscal year. As the
global economic climate continues to improve, Lenovo
is stronger and better-positioned to capture market
growth and new opportunities that emerge.
ACHIEVEMENTS IN FISCAL YEAR 2009/10
Our strategic focus and strong execution led to some
notable achievements in fiscal year 2009/10:
• Lenovo’s worldwide market share reached an all-
time high.
• We continue to build on our market-leading position in
China, growing our market share to an all-time high.
• In key Emerging Markets, Lenovo grew faster than
the markets and gained significant share.
• Our position in Mature Markets stabilized, with
areas such as Japan and Australia/New Zealand
gaining significant share.
• We demonstrated that our transactional model can
flourish worldwide, making strong gains in both
emerging and mature markets.
• Through a strong focus on controlling expenses,
we effectively scaled our growth and achieved our
lowest expense/revenue ratio since acquiring the
IBM PC.
• At the Consumer Electronics Show, we
demonstrated our innovation leadership and won
more awards than any company in the industry.
• Our Mobile Internet strategy was launched,
wherein we are helping define an entirely new and
fast growing product category. The reacquisition
of Lenovo Mobile is a critical part of our plan for
capturing the rapid growth in this space.
These successes demonstrate that Lenovo is well
positioned to drive strong, sustainable growth in
the future.
STRATEGIC PRIORITIES
Looking forward to the new fiscal year, Lenovo will
focus on the following priorities:
• Strategy: Our strategy is working and we will
continue to extend our leadership position in China.
We also will refine our strategy by simplifying our
business model for global commercial accounts. At
the same time we will increase our efforts to capture
growth in key emerging markets and in worldwide
transactional sales, while also pursuing new
opportunities such as the Mobile Internet through
new products and our Lenovo Mobile unit.
• Business Model: We have a strong foundation in
place having established our transactional model
worldwide. Now we need to build on that with
strong growth, unleashing the power of our unique
business model.
• Execution: Clear goals and a strengthening of
our culture of commitment enabled us to make
tremendous progress in our execution. We will
build on that success and operate with even
greater speed and efficiency in the year ahead.
By continuing to focus on controlling costs and
effectively scaling our growth, we will make Lenovo
even more competitive.
CEO’S REPORT