Convenience

198
Part 3:
Organizing
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LEADING THE WAY
Charting a “New” Old Course
Lenovo was started in Beijing by Liu Chuanzhi in
1984. Initially, Lenovo made computers for other
companies. In 1990, the firm launched its own
brand of PC and by 1997 Lenovo was the top-
selling PC in its home country. Unfortunately, how-
ever, the company was not successful in gaining
market share outside China. One reason for this
was the lack of brand recognition. Another was that
Lenovo simply did not have many top managers with
global experience. But that changed in 2005. When
IBM decided to sell its PC operation that year,
Lenovo was quick to jump on the opportunity and
bought IBM’s entire PC business for $1.75 billion.
Lenovo was allowed to continue using the IBM
name through 2007 but then started to brand all of
its PCs with the Lenovo name. Along with the PC
business itself, Lenovo also got a team of skilled
top managers well-versed in global PC markets.
Senior IBM executives were quickly integrated
throughout the top management structure, and one
of them, Stephen Ward, was appointed chief execu-
tive officer (CEO) of Lenovo. Liu Chuanzhi, mean-
while, moved into the background but remained a
director—he felt that Lenovo’s best opportunity for
the firm to gain international market share would be
under the leadership of a seasoned global manager
like Ward.
But almost from the start, problems began to sur-
face. Ward was extremely autocratic and believed
that Lenovo should function in a highly centralized,
command-and-control fashion. This alienated his
new Chinese colleagues who assumed that their
roles were being diminished because they spent
less time with the CEO. Chuanzhi, for instance, had
relied on a senior leadership team that worked
together to make decisions, whereas Ward made
Doug
K
anter/B
loom
berg/Getty
Im
ages
Lenovo is a leading Chinese technology products company best known for the
line of ThinkPad personal computers it purchased from IBM. For years, the
company has struggled with balancing traditional Chinese approaches to
management with contemporary management practices more widely practiced in
global businesses. Lenovo’s founder, Liu Chuanzhi, recently took back control of
the firm in an effort to improve its competitiveness.
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