Sample Business Studies Paper on The Rise of Lenovo

The Rise of Lenovo

Having been founded in 1984, Lenovo Group Limited, as a technology company dealing in the designing, manufacture, and sale of electronic items like tablets, and smart television among other electronic gadgets among its products, has since undergone growth prodigiously. In 2019 for instance, the brand, Lenovo, had claimed up to 24.7% in terms of the share of the world market (Singh). This achievement saw Lenovo ranked as the largest vendor of personal computers during the third quarter of the year. Nevertheless, Lenovo owes its growth and impressive competitiveness over its competitors to several factors, among them, large network distribution and the capacity to expand and rate awareness on its presence in the markets that are emerging. In accessing the markets, Lenovo has applied strategic acquisition in a bid to create and maintain an upward trend in the volumes of its sales, besides, the company has also had to exploit partnerships as a means of gaining entry into some markets. As a strategic acquisition move, Lenovo’s acquisition of the International Business Machines Corporation (I.B.M) was a major step into accessing the world stage.

Following the acquisition of IBM in 2005, Lenovo, after Dell and Hewlett Packard, would become the third-largest maker of personal computers in the world (Rui and Yip). Since merger processes, inevitably, have impacts on the stakeholders in any given company or brand, Lenovo made considerations of the interests of its stakeholders a priority. Key among the considerations during at the time of the merger that would make Lenovo one of the most selling brands and improve its influence in the technological-based was the identification of these stakeholders and formulating mechanisms that would caution the company from any threats that they pose. This too was a strategy of ensuring that the stakeholders are engaged. To ensure a healthy relationship while engaging the stakeholders, Lenovo is keen on the various principles of communication and management of stakeholders.

Theoretically, the widespread acceptance of the stake holder’s perspectives and their contribution to the market (Maignan, Ferrell and Ferrell), at Lenovo, these aspects have positive contributions to the growth and rise of Lenovo as a brand was anchored on the understanding of social-economic theory. An important suggestion of the theory is who counts. This extends beyond those who are viewed to be very important in the existence of the brand. For example, during the acquisition of IBM, the economic nature of the employees, customers, and the main competitors in the market was of interest. This was in response to the needs of the company to deliver based on shareholders and the market value. As a result, Lenovo was able to avert any possibility of the emergence of dangerous stakeholders. In perspective, these are stakeholders whose actions can lead to coercion. Consequently, the brand has experienced a great rise from the merger due to its contribution to the deal.

According to researchers conducted on the influence of stakeholders in the acquisitions process, the anticipation of loses or gains that would possibly accrue from such a business move influences the reaction by shareholders. Had there been any fears by the stakeholders that they would be losing during the acquisition of the IBM, probably, the stakeholders would have reacted in a manner that would be detrimental to what was proven to be a milestone in the existence and completion of Lenovo. The employees’ expectations of gains and benefits in the acquisition of IBM, consequently, generated satisfactory concurrence which made it easier for their persuasion by the company to be in support of the transaction effectively lowering the cost of acquisition and making the deal a success.

Since strategic communication highly affects the relationship between an organization stakeholder, Lenovo, during the merger process benefited from the establishment of a healthy, reliable, and effective exchange of information between the company and both the employees and the customers. Through a multidimensional approach to strategic communication between the company and its customers, Lenovo experienced an improvement in public relations and marketing. Some of the aspects of communication that were of important considerations included the use of digital communication. This enabled the stakeholders to access the company directly, enhancing the hearing of their views and facilitation of information access through the collection of data on the merger, stakeholder information reporting, and analysis of the relationships with the customers. Also, the company carried out constant reviews of the methods of engagement with the customers during the period of acquiring IBM. This resulted in improved engagement and strengthened the support for the move, hence, is one of the key factors that have largely contributed to the rise of Lenovo. In tracking the impacts of the acquisition, the company reaped from ensuring that its communication is in alignment with the interest of the customers and employees and that partly explains the growth of the brand. Moreover, Lenovo guaranteed maximum transparency and good accountability on its side while commenting on it as a brand.

Therefore, in the development of strategies that engage the stakeholders, the company derives part of its successes from the mapping of stakeholders, factoring in influence, identifying triggers, seeking opportunities, and proactive mitigation. Consequent to the understanding by stakeholders is a plan of mitigation, this entails the aversion of any risks as a mechanism of reducing its impacts. In building a good reputation for the company and strengthening the goodwill, there is an effect of communication that has created lasting long-term relationships between Lenovo and these stakeholders. These engagements involve dialogue via asymmetric models and consultations that are both mutual and reciprocal (Dhanesh). Besides, to ensure that there is no interference to the internal activities of the organization, where necessary, a buffering approach for the claims by the stakeholders is applied. This is achieved by influencing their opinions and thoughts to the company from any threats that would arise following the stakeholders’ reactions. Similarly, in emphasizing value addition, there is the exploitation of the bidirectional link of values both socially and commercially and the interdependence between the wellbeing of the society and that of Lenovo. All these strategic policies and principles applied together have seen Lenovo have control of the electronic market, acquiring IBM to result in the growth of the technological giant into one of the biggest suppliers of personal computers globally.

In conclusion, therefore, Lenovo owes a lot of its recent success to the successful acquisition of IBM which effectively boosted its supply of personal computers. In essence, it solidified its customer base. Besides, factoring in the stakes that tare in the electronics market, the company strategically, through effective and customer targeted commutations, built the reputation of Lenovo as a brand, and has put in a prime position to offer competition for other brands like Dell that possess a good brand reputation and awareness in the market. Hence, well-coordinated processes of stakeholders’ management and engagement have greatly influenced the rise of Lenovo.

 

 

References

Dhanesh, Ganga S. “Putting engagement in its PRoper place: State of the field, definition, and model of engagement in public relations.” Public Relations Review 43.5 (2017): 925-933.

Maignan, Isabelle, O. C. Ferrell, and Linda Ferrell. “A stakeholder model for implementing social responsibility in marketing.” European journal of marketing 39.9-10 (2005): 956-977.

Rui, Huaichuan, and George S. Yip. “Foreign acquisitions by Chinese firms: A strategic intent perspective.” Journal of World Business 43.2 (2008): 213-226.

Singh, Netra Pal. “Lenovo acquired Motorola Mobility in a bipolar world of mobile phone makers.” Industrija (2017): 149-180.