Post on 25-Dec-2015
| © 2006 LenovoLenovo Confidential
Lenovo: Building The New PC Company
Steven BandrowczakSenior Vice President and CIO
| © 2006 LenovoLenovo Confidential Page 2 of 19
Lenovo: Building the New PC Company June, 2006
• Revenue: FY 06 ~$13.4B (USD)
• Number of Employees: 19,000
• Sales Representation in Countries: 138
• Manufacturing and Distribution Facilities:
– US, China, Japan, Mexico, UK, Hungary, Malaysia & Brazil
Who Is Lenovo?
| © 2006 LenovoLenovo Confidential Page 3 of 19
Lenovo: Building the New PC Company June, 2006
Lenovo and China
China• Population: 1.3 B• 4th largest economy--- $1.79 Trillion (2005)
– A more than tenfold increase in GDP since 1978 – Expected GDP Growth 2006 – 2010: 8%– Export: $752 B, Import: $631 B (2005 est.)
• Internet Account: 111 M (2005)• Cell Phone Users: 444 M (2005)• PC shipment: 19.3 M, a 29% increase annually
(2005)
in China• The Largest PC Maker: 33% Market Share• Profit Margin: 4.9% (before the merger)
| © 2006 LenovoLenovo Confidential Page 4 of 19
Lenovo: Building the New PC Company June, 2006
1000 PC Patents filed in last 4 1000 PC Patents filed in last 4 yearsyears
900 Lenovo engineers and scientists 800 former IBM research & development staff in Raleigh and the renowned ThinkPad Japan
Design Center
IBM – ThinkPad, ThinkCentre, IBM – ThinkPad, ThinkCentre, ThinkVantage Technologies win ThinkVantage Technologies win more awards than any other PC more awards than any other PC
company company
Lenovo: Intel Most Innovative Lenovo: Intel Most Innovative PC Award from Intel 5 years PC Award from Intel 5 years
runningrunning
Powerful R&D Powerful R&D Capability on both Capability on both
Computing and Computing and CommunicationsCommunications
Founder of Founder of Personal ComputerPersonal Computer
Leading Innovation Leading Innovation in PC Industryin PC Industry
Deeply UnderstandingDeeply Understandingon both Consumer and on both Consumer and Commercial customerCommercial customer
Lenovo Innovation for Customer Value and Benefits
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Lenovo: Building the New PC Company June, 2006
Six Lenovo Attributes
4. International & Industry Leadership
6. Efficient and Easy to Do Business with
5. Trustworthy
2. High Quality & Reliable Products*
3. ServiceExcellence*
1. Innovation*
* Core Attributes
| © 2006 LenovoLenovo Confidential Page 6 of 19
Lenovo: Building the New PC Company June, 2006
Lenovo IT Vision and Mission
VISION Integrated business partner that is acknowledged as a world-class leader
in innovation that continuously enhances shareholder value
MISSION Ensure the IS strategy is an integral part of the business strategy.
Manage the IT portfolio to maximize the business value of investments.
Develop and manage IT services partnerships.
Provide solutions that maximize value for the business.
Manage our organization to be a world-class solution provider.
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Lenovo: Building the New PC Company June, 2006
Business Transformation – IT is the Key Enabler
Lenovo China
Lenovo International
One Lenovo
Global Business Processes Central/Integrated IT Systems Central Planning and Control Dual Model Centralized Inventory Mgmt Real-time Data Visibility Flexibility to Adapt to Change
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Lenovo: Building the New PC Company June, 2006
China PC Revenue
Dell, 10%
Others, 33%
HP, 9%
Founder, 10%
Lenovo, 38%
Leveraging the Very Best of Lenovo China
Global PC Leadership
Building on the Model of Success
GOING GLOBAL World-class Practice Estimated $250M company-wide savings Build an industry leading supply chain
- Reduce end-to-end Supply Chain Cost by 15%- Compress Order Fulfillment lead time from 14 to 10 days- Maintain low DOA level
Targeted 1.1% corporate E/R Pursuing new market opportunities
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Lenovo: Building the New PC Company June, 2006
Base Building Block For The New Design (MCS)
– Start with China Business Processes and IT
– Standardize Data Model
– Globalize Operating Model
Implementation Strategy
‘Adopt and Go’ Initiative
– China IT System Upgrade from R3 to MySAP ERP Oct. ’06
– Rollout India using China MySAP ERP (Process Change) Oct. ’06
– Migration of China EC to MySAP CRM Dec. ‘06
– Upgrade China i2 and key local applications Feb. ’07
– Complete value chain driven by business model Oct. ’07
– Complete country Rollout by May ‘08
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Lenovo: Building the New PC Company June, 2006
– Keep current IT spend (2% of revenue) flat during transformation and SAP implementation period
– Drive out I/T cost short-term and long-term targeting a 1.1% E/R
– Leverage SAP as the core enabling application in the Lenovo Transformation
‘Adopt and Go’ Initiative
I/T Objectives
| © 2006 LenovoLenovo Confidential Page 11 of 19
Lenovo: Building the New PC Company June, 2006
IT Application Architecture
• NPI/EOL• BOM/Routing• Resource• Planning Data• Business Rules
Meta-data/
Workflows/
Business
Rules
Business
Application
Layer
Enterprise Integration Bus
Transaction
Data
PDM
EAI/ETL Layer
Master
Data
Plan
Data
Parameter
Data
CRM FI/CO Legacy
Data
Management
Layer
Cu
sto
me
r Fa
cin
gC
us
tom
er F
ac
ing
SR
M / S
up
plie
r Co
llab
ora
tion
SR
M / S
up
plie
r Co
llab
ora
tion
Channel Inv.Management
(VMI)
Channel Inv.Management
(VMI)
Network StrategyNetwork Strategy
InventoryOptimization
InventoryOptimization
StrategicSourcingStrategicSourcing
FactoryPlan / Schedule
FactoryPlan / Schedule
MasterPlanningMaster
PlanningDemand
ManagementDemand
Management
SupplyCollaboration
SupplyCollaboration
DemandFulfillment / ATP
DemandFulfillment / ATP
TransportationPlanning
TransportationPlanning
Procurement Order Management Procurement Order Management
Transportation , Warehouse and Trade Management Transportation , Warehouse and Trade Management
Customer Order ManagementCustomer Order Management
StorefrontStorefront
Demand Collaboration
Demand Collaboration
SupplyVMI
SupplyVMI
SRMSRM
Manufacturing ExecutionManufacturing Execution
End to End Visibility, Cross Functional Workflow Engine, Business Performance Management End to End Visibility, Cross Functional Workflow Engine, Business Performance Management
| © 2006 LenovoLenovo Confidential Page 12 of 19
Lenovo: Building the New PC Company June, 2006
Global Network: Foundation for Strategic Platform
China Regional Net
Sites
RTP
Americas Regional Net
Global Data CenterCommand Center
SitesSites
Sites
TBD
EMEA RegionalNet SitesSites
Sites
AP Regional Net SitesSites
Sites
SZN/HK
China Regional Net SitesSites
PEK
Global Backbone
Sites
| © 2006 LenovoLenovo Confidential Page 13 of 19
Lenovo: Building the New PC Company June, 2006
ThinkVantage Technologies: Managing TCO From Purchase to Disposal
Pu
rch
ase
Access
Connecti
ons
System M
igratio
n Ass
istant
System U
pdate
Client S
ecurity
Solutio
n
LANDesk M
anagement Suite
Producti
vity C
enter
Rescue &
Reco
very
Secure
Data D
isposa
l
ImageUltra
Build
er
Active
Pro
tection S
ystem
———————————— 1-3 years ————————————
Deploy DisposeProtect SupportConnect
Policy Decisions Email Solution (April 15 Decision) Limit standard images Limit hardware upgrades (1 per 3yr) Etc.
TVTs: Reduced labor costs Reduced risk Improve productivity
Result
Minimize RunExpense
| © 2006 LenovoLenovo Confidential Page 14 of 19
Lenovo: Building the New PC Company June, 2006
Th
ink
Van
tag
e™
Tec
hn
olo
gie
s
Access Connections
Rescue and Recovery
Antidote Delivery Manager
ImageUltra Builder
System Migration Assistant
Secure Data Disposal
Productivity CenterServer
Management
Remote Control
OS Deployment & Profile Migration
IT Asset Inventory
Software Distribution
Handheld Management
Software License Monitoring
Security and Patch Management ThinkVantage Technologies
installed on the client
Enterprise Desktop Management - LanDesk
Corporate standardization, security, and cost-effective distribution
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Lenovo: Building the New PC Company June, 2006
Internal MfgGlobal Manufacturing – Current Desktop Locations
SSCIRaleigh
Beijing
Shanghai
Huiyang
Shenzhen
Pondicherry
SSCIHungary
SSCIMexico
SolectronBrazil
FoxconnCzech
FoxconnMexico
Contract Mfg
Contract Config
| © 2006 LenovoLenovo Confidential Page 16 of 19
Lenovo: Building the New PC Company June, 2006
Internal Mfg
Global Manufacturing – Current Notebook Mfg Locations
SSCIRaleigh
Shanghai
Shenzhen
Pondicherry
SSCIMexico
SolectronBrazil
Contract Mfg
Contract Config
Quanta Shanghai
Wistron Kunshan
| © 2006 LenovoLenovo Confidential Page 17 of 19
Lenovo: Building the New PC Company June, 2006
Lessons Learned
• China has tremendous Intellectual Property• Extremely well skilled• Incredible CAN DO mentality• Retention / Recruiting needs focus• Cost Mode is extremely different• Sometimes manual is ok!
| © 2006 LenovoLenovo Confidential Page 18 of 19
Lenovo: Building the New PC Company June, 2006
Global I/T in China---- Challenge / Issues
• Lack of Global Experience• Employee / Customer Privacy• Emotion• Respect face
| © 2006 LenovoLenovo Confidential Page 19 of 19
Lenovo: Building the New PC Company June, 2006