From strength to strength

Red Hat, Nutanix, SAP, Juniper, Cloudian. These are just some of the organisations that Lenovo works with to support its evolution from being a PC maker to now being a relevant enterprise solutions provider with the full breadth of computing solutions from servers to mobile, a consultancy services arm and a growing ecosystem of partners.

Just a little over three decades ago, Lenovo was just a USD25,000 business[1], and they have made a gargantuan leap to be a US$45 billion company[2], commanding an ecosystem of established partners who recognise that Lenovo adds more value and innovative products and offerings to their own portfolios.

How did Lenovo do it?

Meteoric rise

It all began in 2005 when it acquired IBM’s Personal Computing Division and its global desktop and notebook computer business. Having only sold to a China market before, Lenovo became a new international IT competitor with this move, and also the third largest PC company in the world.

The Mobile Internet Digital Home (MIDH) business unit Lenovo formed in 2011, enabled it to address the growing opportunity in consumer devices like smartphones, tablets and smart televisions. During that same year in one fell swoop, it created the largest PC company in Japan together with NEC and substantially increased presence in Western Europe by acquiring German-based consumer electronics company, Medion.

In 2012 there were more acquisitions, of a Brazil-based CE company and more notably of Stoneware, a cloud computing company. A partnership with EMC saw the beginning of Lenovo’s steady growth of presence in industry standard servers and networked storage solutions. This also helped extend EMC’s reach into China and other key, high-growth markets.

But 2014 was the year of Lenovo’s acquisitions of international iconic brands – first relieving IBM of their x86-based System X servers and then taking over Motorola’s portfolio of innovative smartphones. But, besides rocketing Lenovo to position as third largest maker of smartphones, the Motorola acquisition gave Lenovo strong presence in mature markets, a strong IP portfolio and long-standing relationships with global carriers, three important advantages that will surely come to bear in the near future.

The company builds upon its expertise in hardware infrastructure, continually innovating to deliver reliable hardware, and strengthening their best-of-breed partnerships to offer leading edge solutions and easily approach markets where the biggest growth opportunities lie.

Lenovo Malaysia and Singapore’s Country General Manager, Khoo Hung Chuan said, “Today, Lenovo’s leading edge approach has made the company the fastest growing major PC company each quarter since 2011, culminating in the pinnacle achievement of being the world’s number one PC provider.

Software aspirations and addressing current trends for HC

According to Khoo, business and IT leaders in Asia Pacific prioritise investments in enterprise solutions, specifically those related to cloud, networking, storage and data centres. Gartner echoes the same sentiments as Khoo with their prediction of worldwide IT Spending to reach a total of $3.5 trillion in 2017 and an increase in investments in  big data, Internet of Things, sensor networks, enterprise mobility and storage solutions.[3]

Recognising this, Lenovo is executing their plan to be indispensable in the enterprise and their data centres.

This is via strategic alliances and joint go-to-market programs with leading tech vendors like SAP to combine hardware and software for digital enterprises to create value, as well as co-development on cloud solutions and next-generation SAP HANA appliances.

Lenovo also integrates its technology with Red Hat’s technology to help the telco industry develop next-generation data centres based on open source.

IDC has found that  vendor revenue from sales of infrastructure products (server, storage, and Ethernet switch) for cloud IT, including public and private cloud, grew by 9.2% year over year to $32.6 billion in 2016, with vendor revenue for the fourth quarter (4Q16) growing at 7.3% to $9.2 billion[4]

Despite this, Lenovo anticipates demand for hyperconverged solutions in the future and partners with Juniper and Nutanix to bring simpler, more manageable and more scalable solutions to handle mission-critical workloads in data centres.

IDC finds that hyperconverged systems would be a USD4billion opportunity by 2019, and to fully reach this total addressable market (TAM), Lenovo also has OEM (original equipment manufacturer) deals with hardware and software vendors to develop hyperconverged appliances.

Closer to home

Lenovo is the only technology company that can offer enterprises an end-to-end solutions portfolio, from PCs to mobile to servers and storage. It is also the only one with leadership in three categories – PCs, mobiles and enterprise.

Now, they are in the midst of transforming into a customer-centric provider of smart connected devices and virtual reality. Being as single-source supplier of everything from desktop PCs to laptops to tablets, smartphones and servers, Lenovo is well-positioned to offer this capability to its customers.

Khoo said, “As part of our formula for success, we are adopting a new multi-business operating system to unleash the productivity and creativity of each of our three growth engines – PC, Mobile, and Data Centre.

“At the same time, we are integrating our traditional strength in end-user devices with our new capabilities in cloud and enterprise systems to attack the balanced Device + Cloud opportunities.

Khoo explained, “As DCG, we are singularly focused on being a credible trustworthy data centre partner to our customers with breakthrough next-generation data centre solutions that are unconstrained by legacy thinking or traditional technologies.”

Conclusion

Lenovo’s ability to extend and finetune their market reach is thanks to their best-of-breed technology partnerships, ecosystem of trusted advisor partners and strategic acquisitions.

With a global-scale supply chain to rival that of some of the biggest technology vendors today, the organisation knows the importance of remaining responsive, efficient and agile, and now also leveraging their alliances with key software and hyperconverged players to deliver cost-efficient and impactful solutions for Lenovo’s customers.

Khoo concluded, “Lenovo has a clear strategy, great global scale, and proven operational excellence.”

[1] Lenovo Company History – 1984

[2] Lenovo announces fourth quarter and full year 2015/16 results (May, 2016)

[3] Gartner Says Worldwide IT Spending Forecast to Grow 1.4 Percent in 2017 (April, 2017)

^[4] Worldwide Cloud IT Infrastructure Spend Grew 9.2% to $32.6 Billion in 2016, According to IDC (April, 2017)