Answer the 3 questions which are on the third picture

Figure 1 Lonovo Group's soock price, 2001-2005, compared whh NASDAQ index 'In the five years I have been in Asia, one thing I have it was fve years earJer, and that it cantinued ta trail the learned... is to have a Ist more patience. 1 howe ts hi-tech American Nasioal index. to be more eflective.' Amelio started by addressing costs, removing 1.080 posirions, or 10 per cent, from Lenovs's nan-Chins warkforce. He integrabed the IIM business and the ald Lenared business into a single sinucture. The compary 1. What fational scaarces of competithe launched a now range of Lenswe-branded PCs fer small advantage might Lenoro draw from its and medium-siesd American businesses, a market Chinese base? tradtionally iensred by IBM. To improve its reach in 2. What are yaur oonclusions on this segment, Leforo enpanded sales to big American Lenowo's antry into the American fetalers such as OHilice Depot. US market share began marker? Perform an analysis. to recover. pushing beyond 4 per cent again. Lensw 3. Now that Lenovo is intemational, what. bepon la csnsider enty ints the lndan market. type of generic interrational strategy Amelo's actions seemed to pay eff. After a preshauld in purgue - simple export, multicipitsus slidn during the firnt half af 2005 , the atock. dentikstic, complex enport er global? price turned up. Bul there a nas no disguising that the stock price in the autumn at 2006 mas still below where culture. The three words I use ts desaribe this ars whipped us a seare campaigh aboot Chinese com"trust. respect, compromise". " puters entering sensitive damaing. In Germany, labour He conti-ued: Lwwa allawed a voluntary tranaitien of IBM emplayees to Lenoro, and mary German warkers chese not to As a glabal campany maye we have to aacrifice transier, leaving the campany shert-ataffed. There was same speed, especialy turing tur lirst phese. We some discomiart amsngst former IBM employees in need mare cemmurication, We need to take time ts Japan absut Chinese ownerahip. Betwenn the bwa understand each sther. But speed was in the genes daminan culfures, American and Chinese, there were af the old Lenswe. I hape it will be in the genes of the considerable differences. Qaa Jan, Vice Preaident far new Leteve." Human Ressurces, commented: IEM was nat leanieg its old buninass to sirk ar awin 'Americans like to talk; Chinese people like to listen. entirely an its own. Lenewo had the right to use the At firat we wondered why they kept talking when they IEV brand far PCs for five yearn, including the waluable had nothing to nay. Dut we have learnt is be more Thinkpud name. 18M 's saleslorte wauld be sllered direct when we have a problam, end the Americana incentives ta sull Lenowo PCa, juat as they had had wich are leaming to lisien.' lBV's own-brand machines. 18M Giobal Services was Cuhural ditferences were not just national. Lenoro cantracted to pravide maintenance and support. IM was a new and relatively aimpla campary - basically weuld have two nen-voting observers on the Lenow ote coutry, ant product. Malinational gant. IEV boord. Moreover, Stephen Ward, the 51-yeariald farmer Corporation, founded in 1F94, was far more comples. head of IDM's PC division, was to beceme Lenses' . The Lenave management team, meally in their thirties, Chiel Enecubive Dllicer. were much younger than IBM's, and the average age of the campary as a whale was just 28. IBM =as Managing the nev giant fampus fer its management processes and routines. Qiao Jan cammented: THM pecole set a time for a Havisg an IEM CED was not entirely a surprise. After conference call and stick to it every week. But why all, the \$13bn buniness was nearly 80 per cent en-lBM hanet the call if there ia nothing to repart?' On the and custemers and emplayees had to be resssured of other hand, IEN people had a tendency for being late cantincity. But there were name aignificant challenges for meetings, nomething that wan atrictly dincouraged lar the fiow compary to manage fare the less. within Lenore. Things had not alarted well. When the Chinese team first flew to New York to meet the IBM team, they Some results had nat been met at the airport as they had eapected and was formal polate practice in China. Tang and At firat, the respanse to the new Lenova was positiee. Ward had diagreed abcut the location of the new IBM customers atayed logal and the atock arice began headquartern, Yang wishing it to be ahared between to climb (see Figare 1). Remaining IBM execution Beijng and near New Ysek. Ward had areeailed, and recogrised that at least they were part ol a business Yang meved his family is the USA. The new organisation committed te PCs, rather than the Cinderella in a much atructure Kept the old IBM buniness and the ariginal. larger IBM ampire. The fact that a Lenewo PC manulacLenovo buniness an aeparate divinisns. Dut atill the tured in China had a labsur cost of just $3.00 affered a new company needed corsiderable lasson mith China, lot of opporturity. a 14hour flight away, across 12 time zones. Tele- However, market leader Dell responded to the new carferencing beiween the East Coant and China became compary with heavy price cuts, offering 5100 aaving a way af lile, akh the Amencass caling typically at on the average machine. Winh market share is the either 6.00 in the maming or 11.00 at right ta catch crucial. Americat market bepinning ta slig, ex-BM their Chinese cellesgues. Calls were always in English. CE0 Stephen Ward was replaced in December a0s5 by with many Chinese leas than fleent and bedy language Wiliam Amelia. This was a coup for Lanses, as Amelia imposs ble te abserve. had been rufining Dell's Asia-Pacific regian. As well as The Chi-ese naburs of the campary was an asue for knowing Lenova's compet tor from the inaide, Amelia, same constinuencies. IBM had had a lat of gowernment based for seeeral years in Singapore, had a good under. bunineax, and populiat membera of the US Cangreas atanding of Alaian busi-eas: Lenovo computers: East meets West lintroductisn In May 2605, the warld's thirteenth largest personal computer campany, Lenova, teok sver the warld's third larpesl persenal camputer business, IBM's PC Eivision. Lanaves, at that time based wholly in China, mas paying 51.75bn[61.23tn to cuntrol a business that operaled all ower the world and had alfectively invented the peraonal compuser induatry back in 1981. Micheel Dell, the creatar of the world' a largent PC campany, cammented simply: it wonit work. Lenovo had been founded back in 1744 by Liu Chuarahi, a 40-year-eld researcher working for the Camputer Inctitule of the Chinese Acadery of Sciences His early career had included disassembling captured American radar a piema during the Vistinam War and plenting rice during the Chinese Culiual Revilution. Lia Chuarahi had atarted with $25,000 capital from the Camputer The deal Invitule and promised his boss that he would buld a business with revenues of 5250,000 . Working is the Wark on the IEM PC deal had begun in 2004, with Computer lhstitute's old guardhoupe, and borrowing its Lenses asaiated by manugement canaulatancy Mekinacy colour televisions. But real success started to cone to dapsse of is PC business, which had anly 4 per cent in 1987. When Lenovo was one of the first w package. market share in the USA and suffered low margins in Chineas-character asthware with imported PCl. a compestiet market dominated by Dell and HewletlLenova tegan ta take aft, whth Lu uaing the auppart Packard. Hiaher-margin services and maintrame comof his tather, well placed in the Chinese gevernment, paters wsuld be IEN's future. As well an Lenova, IBM to help impart FCs cheaply throuph Hing Keng. During had prisate equity firm lesas Pacfic Group in the bidding. 1048. Lenovs placed its first jab advertisement, and Lensve aflered the better price, but Texas Pacific wan recrulted 58 youns people ta jain the compary. Whilat. persueded enough 6 take a stake in the new groug, the founding generation of Lenove etatt were in their while IfM isok 13 per cent ownerahip. The groernmentforties, the new recnuits aere all in their uwevties, as owned Chinese Acadomy of Sciences still owned 27 per. the Cultural Revolution had preve-ted any eniveraily cent of the stack, the lerpest angle shareholder. greduatios for a peried of 10 years in China. Amengat. The new Chairman, Yang Ywaneing. had a clearvisian the new menuitsaas Yang Yuanging, who would be run- of what the campary was to achieve, while recogriaing ning Lanare's PC business belare he was 30 , and later aome of the challengen: becsme Chairman of the now Lenowo-13M senture at In five yeara, I watt this lLanavel to be avery faman the age of 41. It was this new team which heiped launch FC brand. with maybe double the growith of the the groductian of the fint Lenovo PC in 1990 , and indatry. I want to have a wry halthy proft margin, drove the compary to a 30 per cent narket sharewithin and maybe name ather baxinenses beyand PCn, China by 2005. The compary had partidly Moated an =arldwilde. We are at the beginnings of this new com- Figure 1 Lonovo Group's soock price, 2001-2005, compared whh NASDAQ index 'In the five years I have been in Asia, one thing I have it was fve years earJer, and that it cantinued ta trail the learned... is to have a Ist more patience. 1 howe ts hi-tech American Nasioal index. to be more eflective.' Amelio started by addressing costs, removing 1.080 posirions, or 10 per cent, from Lenovs's nan-Chins warkforce. He integrabed the IIM business and the ald Lenared business into a single sinucture. The compary 1. What fational scaarces of competithe launched a now range of Lenswe-branded PCs fer small advantage might Lenoro draw from its and medium-siesd American businesses, a market Chinese base? tradtionally iensred by IBM. To improve its reach in 2. What are yaur oonclusions on this segment, Leforo enpanded sales to big American Lenowo's antry into the American fetalers such as OHilice Depot. US market share began marker? Perform an analysis. to recover. pushing beyond 4 per cent again. Lensw 3. Now that Lenovo is intemational, what. bepon la csnsider enty ints the lndan market. type of generic interrational strategy Amelo's actions seemed to pay eff. After a preshauld in purgue - simple export, multicipitsus slidn during the firnt half af 2005 , the atock. dentikstic, complex enport er global? price turned up. Bul there a nas no disguising that the stock price in the autumn at 2006 mas still below where culture. The three words I use ts desaribe this ars whipped us a seare campaigh aboot Chinese com"trust. respect, compromise". " puters entering sensitive damaing. In Germany, labour He conti-ued: Lwwa allawed a voluntary tranaitien of IBM emplayees to Lenoro, and mary German warkers chese not to As a glabal campany maye we have to aacrifice transier, leaving the campany shert-ataffed. There was same speed, especialy turing tur lirst phese. We some discomiart amsngst former IBM employees in need mare cemmurication, We need to take time ts Japan absut Chinese ownerahip. Betwenn the bwa understand each sther. But speed was in the genes daminan culfures, American and Chinese, there were af the old Lenswe. I hape it will be in the genes of the considerable differences. Qaa Jan, Vice Preaident far new Leteve." Human Ressurces, commented: IEM was nat leanieg its old buninass to sirk ar awin 'Americans like to talk; Chinese people like to listen. entirely an its own. Lenewo had the right to use the At firat we wondered why they kept talking when they IEV brand far PCs for five yearn, including the waluable had nothing to nay. Dut we have learnt is be more Thinkpud name. 18M 's saleslorte wauld be sllered direct when we have a problam, end the Americana incentives ta sull Lenowo PCa, juat as they had had wich are leaming to lisien.' lBV's own-brand machines. 18M Giobal Services was Cuhural ditferences were not just national. Lenoro cantracted to pravide maintenance and support. IM was a new and relatively aimpla campary - basically weuld have two nen-voting observers on the Lenow ote coutry, ant product. Malinational gant. IEV boord. Moreover, Stephen Ward, the 51-yeariald farmer Corporation, founded in 1F94, was far more comples. head of IDM's PC division, was to beceme Lenses' . The Lenave management team, meally in their thirties, Chiel Enecubive Dllicer. were much younger than IBM's, and the average age of the campary as a whale was just 28. IBM =as Managing the nev giant fampus fer its management processes and routines. Qiao Jan cammented: THM pecole set a time for a Havisg an IEM CED was not entirely a surprise. After conference call and stick to it every week. But why all, the \$13bn buniness was nearly 80 per cent en-lBM hanet the call if there ia nothing to repart?' On the and custemers and emplayees had to be resssured of other hand, IEN people had a tendency for being late cantincity. But there were name aignificant challenges for meetings, nomething that wan atrictly dincouraged lar the fiow compary to manage fare the less. within Lenore. Things had not alarted well. When the Chinese team first flew to New York to meet the IBM team, they Some results had nat been met at the airport as they had eapected and was formal polate practice in China. Tang and At firat, the respanse to the new Lenova was positiee. Ward had diagreed abcut the location of the new IBM customers atayed logal and the atock arice began headquartern, Yang wishing it to be ahared between to climb (see Figare 1). Remaining IBM execution Beijng and near New Ysek. Ward had areeailed, and recogrised that at least they were part ol a business Yang meved his family is the USA. The new organisation committed te PCs, rather than the Cinderella in a much atructure Kept the old IBM buniness and the ariginal. larger IBM ampire. The fact that a Lenewo PC manulacLenovo buniness an aeparate divinisns. Dut atill the tured in China had a labsur cost of just $3.00 affered a new company needed corsiderable lasson mith China, lot of opporturity. a 14hour flight away, across 12 time zones. Tele- However, market leader Dell responded to the new carferencing beiween the East Coant and China became compary with heavy price cuts, offering 5100 aaving a way af lile, akh the Amencass caling typically at on the average machine. Winh market share is the either 6.00 in the maming or 11.00 at right ta catch crucial. Americat market bepinning ta slig, ex-BM their Chinese cellesgues. Calls were always in English. CE0 Stephen Ward was replaced in December a0s5 by with many Chinese leas than fleent and bedy language Wiliam Amelia. This was a coup for Lanses, as Amelia imposs ble te abserve. had been rufining Dell's Asia-Pacific regian. As well as The Chi-ese naburs of the campary was an asue for knowing Lenova's compet tor from the inaide, Amelia, same constinuencies. IBM had had a lat of gowernment based for seeeral years in Singapore, had a good under. bunineax, and populiat membera of the US Cangreas atanding of Alaian busi-eas: Lenovo computers: East meets West lintroductisn In May 2605, the warld's thirteenth largest personal computer campany, Lenova, teok sver the warld's third larpesl persenal camputer business, IBM's PC Eivision. Lanaves, at that time based wholly in China, mas paying 51.75bn[61.23tn to cuntrol a business that operaled all ower the world and had alfectively invented the peraonal compuser induatry back in 1981. Micheel Dell, the creatar of the world' a largent PC campany, cammented simply: it wonit work. Lenovo had been founded back in 1744 by Liu Chuarahi, a 40-year-eld researcher working for the Camputer Inctitule of the Chinese Acadery of Sciences His early career had included disassembling captured American radar a piema during the Vistinam War and plenting rice during the Chinese Culiual Revilution. Lia Chuarahi had atarted with $25,000 capital from the Camputer The deal Invitule and promised his boss that he would buld a business with revenues of 5250,000 . Working is the Wark on the IEM PC deal had begun in 2004, with Computer lhstitute's old guardhoupe, and borrowing its Lenses asaiated by manugement canaulatancy Mekinacy colour televisions. But real success started to cone to dapsse of is PC business, which had anly 4 per cent in 1987. When Lenovo was one of the first w package. market share in the USA and suffered low margins in Chineas-character asthware with imported PCl. a compestiet market dominated by Dell and HewletlLenova tegan ta take aft, whth Lu uaing the auppart Packard. Hiaher-margin services and maintrame comof his tather, well placed in the Chinese gevernment, paters wsuld be IEN's future. As well an Lenova, IBM to help impart FCs cheaply throuph Hing Keng. During had prisate equity firm lesas Pacfic Group in the bidding. 1048. Lenovs placed its first jab advertisement, and Lensve aflered the better price, but Texas Pacific wan recrulted 58 youns people ta jain the compary. Whilat. persueded enough 6 take a stake in the new groug, the founding generation of Lenove etatt were in their while IfM isok 13 per cent ownerahip. The groernmentforties, the new recnuits aere all in their uwevties, as owned Chinese Acadomy of Sciences still owned 27 per. the Cultural Revolution had preve-ted any eniveraily cent of the stack, the lerpest angle shareholder. greduatios for a peried of 10 years in China. Amengat. The new Chairman, Yang Ywaneing. had a clearvisian the new menuitsaas Yang Yuanging, who would be run- of what the campary was to achieve, while recogriaing ning Lanare's PC business belare he was 30 , and later aome of the challengen: becsme Chairman of the now Lenowo-13M senture at In five yeara, I watt this lLanavel to be avery faman the age of 41. It was this new team which heiped launch FC brand. with maybe double the growith of the the groductian of the fint Lenovo PC in 1990 , and indatry. I want to have a wry halthy proft margin, drove the compary to a 30 per cent narket sharewithin and maybe name ather baxinenses beyand PCn, China by 2005. The compary had partidly Moated an =arldwilde. We are at the beginnings of this new com