Lenovo Competitive Advantage

So for such move they should follow an international strategy where it applicable to all markets. Firms can gain various benefits from international strategies such as increased market size, greater returns on

In recent decades, internationalization has been more and more common in over the world. This is a great opportunity and challenge that many businesses can earn a lots new experiences and practice themselves when they work in a new environment. Also, internationalization is a good way for companies expand their power and reputation. So these companies or organizations might improve themselves with new knowledge which they learn from foreign countries in order to gain more profits and benefits.

The main objectives of this report is to identify and critically evaluate the strategies used by a chosen Multinational Company (MNC) to internationalize. Firstly, this report will clearly analyzed the current internalization strategies that being used by the chosen Multinational Company (MNC) which is Lenovo Group Limited and its relationship with the theory of internalization.

Firms internationalize for couple of reasons. Philips expands their overseas market because home market is limited and Matsushita expanded as efficient operation did not guarantee growth anymore. Basic strategies adopted by these two companies evolved during their process of internationalization. As competitions become brutal, firms need to change strategies to cope with T high pressure for cost reduction and strong pressure of local responsiveness. Transnational strategy is now a feasible approach. Companies reduce cost to be competitive and the same time modify products to satisfy local customer preferences. However, firms’ structures are very different. Philips has a decentralized structure as Matsushita’s operations are highly centralized. Strategic human resources are also vital so both companies send expatriate experts to offshore subsidiaries. Philips and Matsushita also form strategic alliance relationship with each other. Companies’ strategy is highly correlated to their basic strategy and the fit between strategies is vital to company’s

| Globalisation can enlarge the market share of Intel chipsets and build strong brand image.

Innovation, localization and customization, and an efficient and environment-friendly global supply chain are the pillars of growth for Lenovo. Cost-innovation, efficient execution of strategy and a strong presence in China support its global endeavours. In-house manufacturing reduces costs and strategically located manufacturing facilities in China, Mexico and India enhance the efficiency global supply chain. It spends adequately on R&D to move ahead with the times. The R&D centres are located in North America, Japan, and China. Joint ventures and local-level innovation supports its customer oriented focus. Over the years, it has leveraged its strong presence in China, pursued incremental innovation and used inorganic growth strategies to its advantage (Ahrens & Zhou 2013). Further, geographical diversity helps it avoid overdependence on a particular market or product. Cultural diversity, supported by an inclusive organisational culture, facilitates Lenovo’s efforts to build a sustainable competitive advantage (Lenovo

As Lenovo has been successfully internationalizing into other country by using joint venture as their strategy, the new relevant proposed strategy that the company can use is direct exporting. Direct exporting is considered relevant to be used as the new strategy for Lenovo because it is the least risky strategy of all. In fact, Lenovo can maximizes their profit and minimizing their risk in direct exporting

Concepts Cost leadership is measured by the ability of firms in the industry to operate at lower cost than competitors. A competitive advantage firms endeavor to accomplish to lessen cost and increase profits. Cost leadership can be achieved by maintaining economies of scale, efficient production, lower input costs, and simpler product designs. Differentiation is achieved when a firm creates individuality within an industry. It can be measured by product quality and variety, brand image, flexible delivery, customer service, and research and development. They must be able to produce a product that is unique and valuable that consumers are willing to buy an attainable

Strong position as a technology leader – Even if Lenovo is ranked as the world’s No. 1 PC maker it would not be able to achieve success without being a mobile tech leader. The smart-phone business will prove to be a key for success for Lenovo

As Lenovo has been successfully internationalizing into other country by using joint venture as their strategy, the new relevant proposed strategy that the company can use is direct exporting. Direct exporting is considered relevant to be used as the new strategy for Lenovo because it is the least risky strategy of all. In fact, Lenovo can maximizes their

Analysis: Legend focused on designing desktops for the average Chinese people while the competitors were focusing on providing new technologies for the market. Legend always aimed to became a global fortune 500 company. Overtime, Pc became the important aspect of the daily life. Competitors like Apple and Sony focused on the innovation, to differentiate Lenovo from the competitors’ efficiency was the best option. Since we have a very efficient base in China, unlike the competitors

Nowadays, competition in anywhere is about the international affairs. In order to keep country’s own competitive advantage, it’s necessary to make national strategies to sustain this advantage and be an attractive market for international competing.

But this company hasn't adopted the measure of cutting down the price to keep the regular customer and attract more new customers. It accomplished establishing more than 100 customer service centers all over the world. (quote lenovo.com,2004) As well as being responsible for repair, their centers try to get an appointment and contracting for service. In the communication with customers, they collect the data about their products from users and

Companies can decide to go global or to enter international markets for various reasons, and these different objectives at the time of entry that enable the business to produce different strategies and the performance goals, and even forms of market participation.

The consumer market, facing the threat of the Hewlett-Packard, Dell is a strong competitor. A large number of new brand computer manufacturers produce cause confusion of market.The financial crisis is still not completely eliminate and global individual market is falling which affect the Lenovo shipments greatly since commercial personal market.