Anyway Ive got an Email from one of my close friends.I am sure this is true story
Dear Colleague,
Lenovo is facing a critically important period in our company's history.
Several months ago, we talked about the "perfect storm"Lenovo" is facing — slowdown in commercial business where we have 75 percent of our volume; a weakening economy in China which has been a traditional growth engine for us; and a dramatic move across the industry to lower-priced, lower margin PCs, a space that has not historically been a sweet spot for us. Today, this storm continues, and conditions have continued to deteriorate.
Now, we are seeing consumer growth, which had accelerated through the last two calendar quarters of 2008, is slowing as global economic confidence declines. Companies navigating an uncertain economic climate continue to cut costs. Analysts have cut forecasts for the PC market. IDC reduced its expectations for growth by 10 percent (from 14 percent growth to under 4 percent), and it expects the total value of shipments to decline next year by almost 5 percent. All expectations are that these challenges will continue to impact our entire industry and our customers for the coming year.
In light of these expectations, it is crucial that we focus on driving efficiency and positioning ourselves for growth. We must make the tough decisions that will lay the foundation for our long-term performance. As the market has slowed and revenue has fallen, we have to dramatically change how we go to market, and we must cut expenses now. We also must maintain the fundamental optimism that comes from our belief that Lenovo can and will emerge from these difficult times. We have the right products, a sound strategy and a willingness to act when necessary to ensure the health of our business.
Today we are announcing a series of actions that will help us substantially reduce costs, refocus resources, eliminate duplication across our organization and improve efficiency by more closely aligning our structure and our strategy. We are reducing our overall workforce worldwide by 11 percent -- approximately 2,500 people. Along with operational changes and other efficiency actions, this is expected to save Lenovo up to $300 million over the next year. These actions include:
Reductions in nearly every business unit and geography where necessary, at all levels of the organization as well as the relocation and consolidation of some staff, support and customer care functions.
Significant reductions in management and executive staff and expenses. We are eliminating approximately 20 percent of our senior leadership positions (band 10 and above). Additionally, we'll be reducing actual pay for senior managers by between 30-50% this year. Together, these actions significantly reduce our expenses and better align our structure to current market conditions.
Consolidating our China and Asia Pacific geography organizations into a single new geography, Asia Pacific and Russia (APR). This will drive substantially greater speed, efficiency and performance in these vital markets. The outcome of this consolidation includes the streamlining of support and staff organizations to eliminate duplicative costs and focus our resources across the region on selling and serving customers. Today's actions do not include any job eliminations in China. We will continue to explore opportunities to drive greater efficiency and performance within China, as performance there is central to our worldwide success. Chen Shaopeng will lead the new Geo as SVP and President, APR. David Miller will remain with Lenovo for a transitional period to help support the integration. Japan and ANZ will report to Rory Read, senior vice president, Operations.
As we consolidate organizations and reduce costs at all levels, today we are also announcing the departure of two of our senior leaders who have served Lenovowith dedication, passion and commitment:
Scott DiValerio, who has led the America's Group (AG) through a very challenging period, will be leaving Lenovo. His leadership in establishing an organization that is ready to compete and win in both mature and emerging markets across the geo will be key to our success in the long term. We thank him for his service. Rory Read will lead AG through a transitional period.
Steve Petracca, SVP, Mergers and Acquisitions, is also leaving Lenovo. Steve has served Lenovo well in numerous roles, and has established a strategy and process to help us evaluate unique new growth opportunities. His organization will report to Rob Cones, SVP and Controller.
Employees are being informed of the personal impacts of these actions during the next two days. These are all difficult decisions. Around the company many of us will be having tough conversations with colleagues and friends. We must ensure we act with compassion for those who are leaving us.
At the same time, we must maintain our commitment to our five fundamental strategic pillars — efficiency, growth, customer intimacy, scale and building the brand. We will be flexible in how we execute and manage market conditions, competitive challenges and new opportunities … but we will be committed, strong, and bold in our pursuit of these core strategies. This includes introducing innovative new ways to bring lower priced PCs to market more quickly so that we can aggressively pursue share, grow in the segments of the market where there is immediate opportunity and establish a leading position in key emerging markets.
We are confident that these actions represent a significant and strong step in the right direction for Lenovo, its customers, its employees and its shareholders. But they also represent only one step. To be successful today, and in the long run, we must execute.
Right now, we are being tested — as a company and as individuals. We can't allow ourselves to be derailed by the difficulty of the moment. We must find the strength in our business and in ourselves to meet, head-on, the challenges before us. It is not easy to see friends and colleagues leave, or to navigate organizational uncertainty and operate in an industry under this kind of pressure. But we can and will succeed if we demonstrate the focus, resolve and entrepreneurial spirit that helped build Lenovo.
Thank you,
Bill Amelio
President & CEO
Lenovo
Ive Summarise it for some people who think its too long to Read : Lenovo is facing a pretty dificult time at this moment.Retrenchments and layoffs by the bulks soon to follow.
( I will not give the name of the person who told me this) But I assure you its true.
I am the Bringer of Light
