Competitive Advantage Case Study

Lenovo Group Limited: Loosing the Competitive Edge?

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Abstract:
In early 2007, Lenovo, the largest PC maker in China faced an increasing threat from foreign competitors both domestically and internationally. The other emerging Chinese technology companies faced similar challenges. Critics felt that some of the policies of the Chinese government were slowing down the growth of Lenovo. They also opined that Lenovo, in order to gain prominence in the global market had neglected the Chinese market. This was despite the enormous potential that China still had. To regain its lost ground in China and to establish itself globally, Lenovo adopted strategies like modifying its selling approaches, strengthening its distribution networks, launching innovative products and brand promotions. Industry observers, however, remained speculative on whether the measures taken by Lenovo would enable it to retain its competitive edge.

Pedagogical Objectives:

• To discuss the factors that made Lenovo the largest PC maker in China.
• To discuss the factors that prompted Lenovo to seek global recognition.
• To analyse the various challenges faced by Lenovo and other Chinese technology companies in China and globally.
• To discuss the measures that were adopted by Lenovo thereafter to strengthen its position in both the domestic and international markets.

Keywords : Lenovo; China; Computer industry; Acquisitions and mergers; IBM; Business strategy; Competitive edge; Globalisation; Challenges; Growth strategy; Country of origin (COO); R&D (research and development); Liu Chuanzhi; Dell; Hewlett Packard; Steve Ward