Original URL: http://www.theregister.co.uk/2013/01/07/lenovo_reorg/

Lenovo proclaims PC victory, re-orgs to take on Apple

CEO says 'Think' brand is so strong it needs a high-end division of its own

By Simon Sharwood

Posted in Business, 7th January 2013 00:49 GMT

Lenovo will alter its structure in 2013 to create a “Lenovo Business Group” that will sell commodity products and a “Think Business Group” to push premium kit and take on Apple.

News of the restructure emerged at Sina Tech, which quotes an email sent to staff by Lenovo chairman and CEO Yang Yuanqing in which he proclaims (after being forced through the wringer that is Google Translate) that “Lenovo today is no longer blindly fight for market share in the PC manufacturers. Lenovo today is the leader of the global PC industry” but “rapid rise in the field of competitors should not be underestimated.”

To head off those competitors, Yang feels Lenovo needs to recognise that the company's brand plans well in mainstream and low-end products, but that the “Think” brand “is the best brand assets, and only compete in the high-end market with Apple brand.”

The company will therefore “need to give full play to the potential of these two brands in their respective market segments, each value to the maximum extent possible. We want to clarify and simplify our brand strategy, let the market positioning of each of the two brands Lenovo and Think more clearly understood, and thus better serve the business expansion.”

That strategy will see the creation, as of April 1st, of a new Lenovo Business Group offering “mainstream consumer and commercial desktop computers, laptop and tablet computer business.” This group is also charged with “global expansion” for the company's burgeoning smartphone business, and other connected devices like Smart TVs.

The Think Business Group will be “committed to advancing the high-end commercial and consumer business, while continuing to consolidate the core of the global commercial business leadership (especially relational business), another aspects in the field of desktop and notebook computers, to create a high-end consumer brands, let Think respected brand image in the consumer area and in commercial areas.”

The Think group will also enjoy “new additional input of enterprise-class business and workstation team,” an addition sure to be noted at HP given the ailing giant last year proclaimed it was still the planet's top PC seller if one counts workstations as part of the PC market.

A Think-branded business unit's chance of taking on Apple seem slim. Neither the Lenovo or Think brands made it into Interbrand's list of 2012's top 100 brands. Yang's letter reportedly says Lenovo plans a “'defence + attack' double fist strategy” that will see it “maintaining gains and continue to achieve new breakthroughs” but doesn't mention if a marketing offensive to make Think as cool as iThink is planned.

With smartphones and smart TVs the responsibility of the new Lenovo Business unit, perhaps tablet devices – such as the well-received Yoga – and high-end laptops are the vehicles Lenovo hopes will carry it into the homes and offices of the well-heeled. Even that plan, however, seems optimistic given tablet prices are falling and the sweet spot for ultrabooks is falling well below four figures in all western currencies.

Lenovo can point to the scoreboard and its $US16bn revenue climb – from $14bn to $30bn in the last year – as evidence it's doing plenty right. Building a brand to rival Apple will need efforts that don't just translate its current success. ®