‘Strategy is all about taking tough decisions’ – The Lenovo India Story

‘Strategy is all about taking tough decisions’

This and many more such one-liners, punctuated the 3 hour session of Mr. Amar Babu (MD, Lenovo India) with the combined class of PGP-PGPX at CR1.

During the the Q&A session, he delved in great details on the topic of Strategy.

“A good strategy is one, that can fit in one page.  Else, it is meaningless”.

He described in great detail, Lenovo’s global strategy and regional strategy.  Globally Lenovo is investing heavily in bringing out new innovative products.
For India they are clear.  It is not about making profits; but generate enough cash from one segment, which can then be ploughed back to develop the other segment.
Lenovo is already a market leader in Enterprise segment.  The focus is now to capture the consumer segment.

He also talked about ‘Brand’ building.  Brand is the value – the premium that you get over your competitor.  At Lenovo, the plan is to make ‘Lenovo’ the mother master brand (e.g. Nike/Apple).

“It is important that you identify what your brand message is (e.g. Lenovo – tough, strong) and then go all out to convey the message at all forums.”

He illustrated it with an example of a ‘press conference’ where he dropped Lenovo laptop from great height.  And the the same act was repeated by the celebrity brand ambassador.

The next day the press was all over, praising the ‘brand’. It is a different matter that the model in question was X1, a premium model.  But still the message was delivered!

He also explained how your expansion strategy dictates your choice of channel.  e.g Lenovo has various channels: LES light – Lenovo Exclusive Stores VS mom & pop stores in Tier 4/5/6 cities VS multi brand store e.g. Croma VS large format retail.  They have chosen to focus on opening their own exclusive stores.  In Sep’10, they were 130 such stores.  Today they are 400+.  Target is to have 1000 stores by Dec’11.This requires huge investments.  But then the ‘Middle of the line’ strategy does not work.  If ‘exclusive stores’ is your priority, go for it.

Earlier the two sections of PGPs (MC course), made their respective presentations on the case study titled: ““Doing” the Act: Lenovo and Corporate Reputation”.The case has been researched and written by Prof. Asha Kaul.

Both the teams were given the following brief:  ” Based on the case facts, identify the growth strategy of Lenovo and align it to the image building strategy followed by Lenovo. What can they do in the future?”   The teams brought about some excellent points and made valiant effort to convince Amar on the choice of their strategic options.  At the end, Amar congratulated both the teams for their good grasp on the case and the ability to identify key elements of Lenovo’s strategy.  He also highlighted few holes in the presentation and his take on how they can be taken care of.

It was indeed a pleasure to see how the concepts of “Marketing, Strategy & Finance” were married together and used to illustrate the ‘Lenovo India’ story!

 

(Story Credit : Abhishek Gupta , PGPX6)

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