Lenovo: Aiming to be #1 PC Brand Globally - Essay Sample

Introduction

Lenovo is a re-known personal computer producer in the global market. Currently, the brand is striving to become the leading shareowner in the market. The year 2005 saw Lenovo acquire through purchase 'ThinkPad' which was brand and personal computer business globally. This move has taken Lenovo at a very crucial stage of the international strategy in the computer business. In the year 2011, Lenovo formed a merger with NEC hence taking its internationalization strategy to a whole level (Cavusgil, Rammal & Freeman, 2011). Lenovo has used a multi-domestic strategy supported by mergers and acquisitions that have ensured the growth of the company and maintaining its competitive advantage.

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The Nature of Lenovo's International Strategy

The nature of Lenovo's international strategy is built on cementing its position as the dominant computer company in the Chinese market as well as in other countries. To expand into markets globally, Lenovo makes use of mergers and acquisitions to gain knowledge, information, and assets from partnering companies (Cavusgil et al., 2011).

The company primarily places its strategy in multi-domestic. This strategy is attributed to the fact that Lenovo produces universal standardized products. However, other components, such as the keyboard and internal software, are customized to respond to local language requirements. Thereby, the company needs to capitalize on upcoming consumer patterns and common needs by making products that can be used globally (Cavusgil et al., 2011). The provision of services to multinational buyers and customers should be consistent with being able to maintain a competitive angle globally. Lenovo should also outsource its workforce and expertise in production globally to be able to produce gadgets that will be accepted universally.

The marketing of its products is also designed to suit local situations. IBM acquisition by Lenovo gives the latter access to the formers worldwide sales and distribution in one hundred and sixty nations and economic regions (Cavusgil et al., 2011). The merger has helped increase economies of scale in manufacturing as well as in marketing.

Advantages of the Multi-Domestic Strategy to Lenovo

Lenovo has been able to reap a lot from the multi-domestic strategy it has assumed. The acquisition of IBM has brought about increased global network distribution. IBM is known to have a sales and distribution network that traverses across one hundred and sixty countries and regions. With this acquisition, Lenovo gets access to these trading areas, thus increasing its sales and subsequent profits.

Secondly, Lenovo has attained higher economies of scale in manufacturing and distribution (Cavusgil et al., 2011). Mergers and acquisitions have helped the company increase its output, thus increasing sales globally. This, in return, has given Lenovo a cost advantage. Lenovo has also acquired a lot of technical knowledge and advanced technology (Cavusgil et al., 2011). With the advanced technology, the company has been able to provide the market with all sorts of gadgets ranging from smartphones to laptops and software. Lenovo has been able to attain global recognition by becoming the largest PC market shareholder hence strengthening its brand in the market. The company also prides itself on employee retainment having the best qualified and sought after experts as part of its personnel. This has guaranteed continued production of quality gadgets to suit the different market needs. Gaining and retaining foreign expertise has helped Lenovo graduate from copying what other brands are doing to innovating competing brands such as the ThinkPad and the Yoga Ultrabook.

Conclusion

In conclusion, Lenovo has taken over the PC market by storm. The move has been aided greatly by its international strategy to dominate the Chinese market and other countries as well. The benefits of this move are improved higher economies of scale, a strongly recognized brand, and increased innovation.

Reference

Cavusgil S.T, Rammal H. & Freeman S. (2011) International business: The new realities. Pearson Higher Education AU.