Lenovo 2011 Annual Report Download - page 25

2010/11 Annual Report Lenovo Group Limited 27
Meanwhile, Lenovo will continue to benefit from the
sustained strong growth momentum in Emerging Markets
(excluding China) under its attack strategy to outperform
its major peers and capture market share. The Group
already captured double-digit market share in India for the
fiscal quarters three and four, and will continue attacking this
geography, seeking to achieve double-digit market shares in
key countries and improve profitability. Lenovo will accelerate
consumer business momentum by focusing on retail
development, achieving a breakthrough in SMB business, and
driving the relationship business model.
Looking forward, the corporate PC refresh cycle will continue
to drive PC industry growth in Mature Markets, and Lenovo
believes that the corporate PC replacement trend will remain
on track. Lenovo is well positioned to leverage this market
environment given its unique position in the commercial PC
segment. The Group will continue to protect its relationship
business with the aims of delivering steady profits in all regions
and driving across-the-board market share gains. The Group
will address the growth opportunity in both consumer and
SMB PC segments with innovative products, while continuing
to expand its channel partner network and deploying tools to
simplify its business models in Mature Markets. Furthermore,
the Group will increase its investments in marketing activity
in key countries to improve brand consideration. Finally, the
Group will leverage the joint venture with NEC in Japan to grow
market share in the world’s third largest PC market, becoming
the number one in the market upon anticipated completion of
the transaction on or about June 30, 2011.
Lenovo has delivered consistent strong performance in the past
two years under its successful “Protect and Attack” strategy
despite challenges in the market environment, and established
a solid foundation for the next phase of corporate development.
Lenovo will remain firmly committed to this successful strategy,
confident that the Group will continue to outperform the
worldwide PC market through balanced growth. Lenovo also
will attack MIDH business to develop global presence and drive
the convergence of its products.
The PC market is changing into multi-products and multi-
platform, therefore innovation in products remains a key factor
for success. The Group will continue to differentiate through
strong design and Lenovo has a sound track record for product
innovation in the global PC industry. The Group had two very
successful CES, in which the Group’s technology and products
earned great industry recognition. In addition, Lenovo has
been ranked in surveys by Bloomberg Business as one of the
world’s most innovative companies for two straight years. The
Group will remain committed to product innovation in order
to differentiate itself from the competitors and to enhance
corporate profitability. Through its major research centers in
Raleigh, Yamato, Beijing, Shanghai and Shenzhen, the Group
created attractive products that are competitive in the market,
and well-received by customers.
Lenovo has benefited from its strong brand reputation in China,
and it is the Group’s strategy to build its brand reputation
globally to drive future price stability and margin enhancement
over time. The Group launched an aggressive corporate
marketing campaign with an objective to further strengthen its
brand globally.
Although the Group’s strategy mandates investments in product
innovation, brand building in global markets, and mobile
internet products to drive future growth, Lenovo will continue
its stringent control on expense and enhance end-to-end
operating efficiency. With increasing unit shipments in PC
and mobile products, the Group will likely to continue to enjoy
the increased benefits of larger scale. Therefore, Lenovo is
confident that its expense-to-revenue ratio will remain at low
levels in the new fiscal year even as the company invests to
drive future growth.
Given its strong balance sheet, the Group will continue to
actively look for inorganic growth opportunities within the PC
industry, which would supplement its organic growth strategy to
accelerate future expansion.
With the global market environment showing signs of continued
growth in areas where Lenovo is well positioned, management
is confident that the Group will consistently deliver solid
performance and create more values for the shareholders
through the successful execution of strategic priorities and
balanced growth.
Lenovo’s Joint Venture with NEC in Japan