Discord and note

In an interview with China Entrepreneur magazine, Liu said Amelio paid more attention to the markets that he was confident of handling, and entrusted important jobs to those who also knew those markets well. This approach had alienated many Chinese executives who were passed over for important positions sometimes for no other reason than their lack of proficiency in the English language. Unsurprisingly, many talented Chinese employees in sales and marketing left the company to join competitors.

Liu Jun, the president of Lenovo's Consumer Business Group was one such person. Liu joined Lenovo in 1993, and won a special mention for having made "outstanding achievements in designing the PC supply chain" in the domestic market. But he failed to see eye to eye with the then senior vice president in charge of global supply chain and in August 2006 Liu was suspended from his post and sent for a one-year management training program.

At one point in time, nearly 70 percent of the management positions in Lenovo were held by expatriates.

A senior executive in the sales department said the confusion at the top hurt innovation as product designers were not sure of their target customers. In the past several years, the company was selling products of mainly the IBM design.

Vendors said Lenovo's latest models, including the Thinkpad X300, despite being the thinnest and lightest notebook computer produced by the company, had failed to make an impact in the highly competitive marketplace dominated by innovative designs and colorful rendition from the likes of Sony and Samsung.

"Lenovo was not consistent in innovation. It is lagging behind Acer in this respect," said Chen from Interband.

It is now Liu's job to put the house he founded back together again. "The current situation is much easier to deal with compared with the situation in 1996 when we survived and went on to become China's No 1 PC producer after having lost HKUS$190 million," he said recently in an interview, reminding his audience that the company still has US$1.3 billion of cash in hand.

"Liu himself is a convincing example of success, he could lead Lenovo onto the right and healthy track," said Tian Suning, non-executive director of Lenovo and chairman of CBC Partners.

Under Liu, China has once again become Lenovo's most important market. The company will also focus more on emerging markets such as Russia, Brazil and India, which witnessed over 100 percent growth, and try to contain the losses in the US market.

"We will see a positive change in the next three years," said Liu.

(China Daily February 25, 2009)