Lenovo&s Response

The following are Lenovo&s responses to e-mail questions posed by Senior Editor Edward F. Moltzen.

CRN: What is the biggest change that you have made in terms of how you work with the channel since you completed the acquisition?

Mark Enzweiler, vice president, worldwide channel strategy and sales: Lenovo is even more focused on becoming faster and easier for business partners and our customers to do business with. We want to be different, which is why we are combining the best elements from both IBM and Lenovo to provide Lenovo channel partners an entirely new approach to the PC marketplace.

The most immediate change has been Lenovo's enhanced customer segmentation. We now have access to more great products in more countries, so it is important to clearly delineate our customer segments to ensure that our business partners and our direct-sales organization work synergistically. We think this will generate greater advantages for our customers because they now have the option to purchase and maintain Lenovo products how they want and with greater ease. We will continue to segment our business with increased focus on functionality and costs in the transactional model.

CRN: What kinds of changes are you working on with regard to U.S. reseller terms and conditions now that you are 120 days into the new Lenovo?

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David Bankemper, director, U.S. solution provider sales: We're making strategic investments in and enhancements to our programs designed to bring our resellers more opportunities, stronger relationships and greater profit. Channel margins continue to be under pressure and we&re seeing many of our business partners shifting to a services model. We need to increase ThinkVantage technology value adoption because this is an area that will help our business partners build new revenue streams. Some PC manufacturers are following the trend of “stripping down” to bare bones. Lenovo, however, is leading the way towards adding valuable software and system capabilities that truly benefit customers.

With Lenovo's ThinkVantage technologies, customers will experience total-cost-of-ownership savings, wireless flexibility, enhanced security and reliable backup capabilities. When VARs wrap their services around ThinkVantage technologies and ensure that their customers employ their full capabilities, they will create new opportunities and increase customer loyalty because the value of what was purchased will be apparent in the increase in savings and productivity. Lenovo will help VARs become experts in these tools with training courses offered through the Lenovo PC Institute. Working with Lenovo ThinkVantage technology experts, technicians from VARs can become ThinkVantage technology qualified to better help their customers leverage the outstanding benefits of these tools. Through these programs, Lenovo will unleash reseller power to deliver Lenovo innovation to more customers than ever before.

CRN: What is the Lenovo reseller strategy to take down Dell?

Enzweiler: One of the ways Lenovo will compete with Dell is through the Think Express program targeted at small and medium-sized businesses. The Express program offers standardized pricing for a simple purchase experience and good availability to meet customers' quick delivery requirements. By carefully monitoring the market and listening to what our customers and partners are saying, we're in a better position to determine the next new technologies to bring to market. Based on recent feedback, more and more small-business customers want standard offerings that are simple and easy to use so that they can focus on growing business and not figuring out complex technologies. As a result, Lenovo collaborated internationally to develop a new standard desktop PC line that combines ease of use, low cost and style, all in one. You will see this strategy grow as we introduce new products targeted at the transactional customer.

CRN: What kinds of changes are you looking for to gain more synergies between the IBM.com direct effort and the Lenovo reseller effort?

Stephen Mungall, vice president, inside and solution provider sales: All the benefits Lenovo brings to the market are available to customers through Lenovo business partners and Lenovo.com. Every Lenovo program is designed to excite and assist our customers regardless of where or how they want to buy Lenovo products. To further please customers and help sustain our invaluable partners, Lenovo has developed a program which incents partners even if its customers choose to change their purchase from the channel to direct. We want to work together to do business in an open and honest way.

CRN: Does Lenovo plan to add, cut or simply maintain the number of partners it goes to market with in the U.S.?

Bankemper: Lenovo has over 40,000 partners worldwide, but we're not playing a numbers game. Lenovo is looking to add partners who want to add value in the marketplace and who want to partner and grow with Lenovo to provide customers innovation that matters and creates a competitive advantage.

CRN: What are you doing to promote higher attach rates in terms of service agreements and add-ons among your U.S. resellers?

Bankemper: The reseller programs in place now do just that. We have programs for higher attach rates or add-ons on the horizon, but our plan is to communicate any changes at one time to ensure we are communicating clearly and consistently.

CRN: What is your biggest surprise with regard to how the IBM PC division operates now that it is part of Lenovo?

Enzweiler: With the amount of planning and preparation we devoted to this transition, there were very few surprises. One thing I am proud of is the fact that we didn't have any customer or partner defections despite our competitors& efforts to lure them away. We stayed visible and very aggressive in the market during the transition and answered any claims that our competitors made. In the end, our commitment to the channel, service and support, high-quality products and industry-leading innovation paid off.

CRN: Where are you looking to make improvements in terms of the PC division now that it is part of Lenovo?

Enzweiler: Moving forward our focus is on becoming faster and more efficient. Our mandate is to build the best, most innovative products in the world and we will work hand in hand with our partners and customers to achieve that goal.

CRN: How are you gaining synergies by bringing the U.S. and China Lenovo teams together?

Enzweiler: One area of synergy is the SMB expertise that Lenovo's heritage brings. In China, Lenovo predominantly sells to SMBs, whereas IBM's PC company was predominantly a large enterprise business. As we expand our channel sales into the SMB market, we will leverage the company's international SMB experience to penetrate more of these accounts. Another area is Lenovo's ThinkPad mobile offerings and our latest innovations, the new ThinkPad X41 Tablet and ThinkPad Z60 wide-screen notebook, which provide cutting-edge ThinkVantage technology features including the easiest wired and wireless connectivity with Access Connections and new integrated WWAN on the ThinkPad Z60 for the fastest wireless broadband technology available.