Lenovo is a vast and highly successful manufacturer and vendor of Personal Computers. The desktops and laptops sold by the company are distributed in the millions and are known for being high quality and relatively affordable. This article takes a look at the Strengths, Weaknesses, Opportunities and Threats associated with the Chinese technology giant. You can also check out our PESTLE analysis of Lenovo.
Lenovo is the fastest growing manufacturer of Personal Computers in the world. This is an obvious strength for the Chinese giant.
Lenovo has found a very lucrative global market. It currently vends laptops and desktops to customers in 160 countries. Lenovo strategic management is divided into four geographic regions that include China, Asia Pacific, the Americas, and Europe, Middle East and Africa.
Research and Development
Lenovo invested 1.2 billion dollars into research and development in 2018. Strong investment in research and development is crucial in order to stay ahead in the technology industry.
Lenovo currently has a very high bar for quality despite offering its products for a very reasonable price. This focus on quality improves the brand equity associated with the company and makes for a robust relationship with customers.
Uncertainty in the PC Market
One of the key areas in which Lenovo has focused its resources is the Personal Computer market. Unfortunately for Lenovo, the PC market is experiencing a decline thanks to the immense popularity of mobile computing. Mobile devices now account for over 50 percent of internet use around the globe. How Lenovo reacts to this will be crucial to its success.
Late Entry into the Mobile Market
Lenovo has failed to adequately capitalize on the rise of smartphones around the world. Compared to its investment in PC research and development, its investment into mobile technology has been paltry.
Lenovo’s huge financial clout means that it has been able to purchase influential companies and add to its brand. The recent purchase of Motorola Mobile by Lenovo is a good example of this.
Lenovo has the opportunity to be ahead of the game in the integration of cloud technology in computing – something that is growing and due to become ubiquitous in the next few years.
Lenovo is a company headquartered in the People’s Republic of China. As such, it may well be in danger of falling prey to the ongoing trade wars between the PRC and the USA. The United States is a lucrative market for Lenovo, and any disruption of this could spell trouble. If the United States ever decides to sanction Chinese companies, Lenovo would be one of their first targets as a key Chinese tech firm.
As the PC industry develops, new regulations are being enforced on producers around the world. This is an ultimately good thing: companies need to acquire and produce their products ethically. Lenovo needs to ensure that it complies with increasing regulation as it moves forward, or it will face market blackouts.
Photo by Javier Peñas