Lenovo presents new business structure to tap services

Lenovo announced a new organizational structure designed to capitalize on the Group’s service-led transformation growth opportunities.
Lenovo event in 2016Lenovo said it will bring together services and solutions teams and capabilities from across the company to form a dedicated organization – the new Solutions & Services Group (SSG).

Lenovo said SSG will drive the company’s transformation by delivering incremental business across smart verticals, attached services, managed services and our ‘as a service offerings’ including DaaS and Truscale.

Lenovo’s business will be structured into three business groups aligned to the company’s 3S strategy of Smart IoT, Smart Infrastructure and Smart Verticals, namely IDG (Intelligent Devices Group) – focused on Smart IoT; ISG (Infrastructure Solutions Group, renamed from DCG, Data Center Group) – focused on Smart Infrastructure; and SSG – focused on Smart Verticals & Services.

IDG will be led globally by Luca Rossi (currently SVP & President of PCSD in EMEA and Latin America).

ISG will continue to be led globally by Kirk Skaugen.

The newly formed global Lenovo Solutions & Services Group (SSG) will be led by Ken Wong (currently SVP & President of PCSD in Asia Pacific).

Lenovo’s sales organizations will split into a China GEO and an International Sales Organization, led respectively by Liu Jun (currently EVP & President of IDG in China) and Matt Zielinski (currently SVP & President of PCSD in North America).

All above five leaders will report directly to Yuanqing Yang and sit on the Lenovo Executive Committee (LEC).

Lenovo Group said its revenue in the third quarter grew 22 percent to $17.2 billion. This was the second consecutive record-breaking quarter, driven by strong growth across all core business groups as well as the company’s transformation businesses.

Business Overview

Lenovo’s Intelligent Devices Group (IDG) continues to lead the Group’s growth with the PC and Smart Devices Group (PCSD) delivering another historic quarter. Revenues of US$14 billion, up 27 percent, were accompanied by PTI up 35 percent to US$925 million and a record profit margin of 6.6 percent.

IDG’s second business unit, the Mobile Business Group (MBG), delivered double-digit revenue growth year-on-year, and recovered from the impact of COVID-19 by not only resuming profitability, but also achieving its highest profitability since the Motorola business was acquired.

Solid performance in Latin and North America underpinned rapid expansion in Europe and Asia, where there was strong double- and triple-digit growth thanks to expanded carrier relationships and a stronger product mix. The business will continue to leverage its strong product portfolio and 5G innovation to drive future profitable growth.

The Data Center Group (DCG) achieved record revenue of US$1.63 billion thanks to across-the-board growth. The Cloud Service Providers and Enterprise/SMB segments delivered  growth at a premium to the market. Enterprise/SMB reached US$1 billion in revenue, the highest amount in over three years, while Storage had record revenue and outgrew the market by 11 points.

Revenue in Software Defined Infrastructure and Services reached a new record. Lenovo’s TruScale Private Cloud Infrastructure-as-a-Service combined with SAP’s HANA Enterprise Cloud has been well received and is generating a strong pipeline of demand, while the business extended its #1 position in TOP500 supercomputers.

Lenovo aims to capture growing Hybrid Cloud and IT Infrastructure demand and continue to grow at a premium to the market.

Lenovo’s Intelligent Transformation businesses continued to make strong progress as total Software and Services revenue grew almost 36 percent to a new record of almost US$1.4 billion – over 8 percent of total group revenue.

Revenue of Attached Services, Managed Services and Solution Services achieved growth of nearly 26 percent, 73 percent and 49 percent respectively, while Device-as-a-Service delivered high double-digit growth (74 percent).

In addition, E-commerce revenue grew almost 45 percent and set new records. These outstanding results demonstrate the significance of Intelligent Transformation as a long-term growth catalyst for the Group.

Lenovo said it sees opportunities to leverage its experience and capabilities to build smart manufacturing, smart education, and smart healthcare solutions.