Yang Yuanqing responds to the question of "unqualified CEO" for the first time: Lenovo has not been marginalized by BAT

"After the New Year, I made the headlines and became an Internet celebrity." On the evening of February 20, Lenovo CEO Yang Yuanqing, who has recently received much attention, publicly responded to the question of "unqualified CEO" for the first time at the 2016 Yabuli Forum. He joked that being an Internet celebrity this time also shows that "Lenovo has not been completely marginalized by BAT." Facing many questions from the outside world, Yang Yuanqing also responded one by one. Yang Yuanqing emphasized his confidence in Lenovo's smartphone business, saying that "Lenovo's PC glory will be restored."

In the year when Lenovo's smartphone market lagged behind, Huawei has become the world's third largest smartphone manufacturer, with a market share of 9.7%. Its revenue last year reached US$20 billion, of which the proportion of mid- to high-end models increased significantly.

Therefore, the industry believes that at a time when innovation and growth in the smartphone industry are sluggish, the winter of the mobile phone industry is approaching, and the remaining competition is a comprehensive physical competition that relies on the accumulation of technology, the strength of the company, and the brand premium ability in the subsequent market.

Yang Yuanqing unexpectedly became an "Internet celebrity"

At the beginning of the new year, a self-media person published an article titled "Is Yang Yuanqing a qualified CEO of Lenovo?", which caused the young leader who has been in charge of Lenovo for 15 years to fall into heated public debate. Facing the controversy, Yang Yuanqing said that the controversy made him realize that Lenovo needs to learn from Jack Ma in the future. "It is good for our performance to explain the company's strategic vision, the risks and setbacks in the process of realizing the vision to all walks of life and let them understand."

Yang Yuanqing reviewed the three important milestones and achievements in his 27-year career at Lenovo, but the outside world is more concerned about Lenovo's future.

Although Lenovo has entered the mobile Internet smartphone and enterprise markets through the acquisition of Motorola Mobility and IBM's x86 server business to diversify and transform its business, and ranks fourth and third in the above-mentioned global markets respectively, Lenovo still leaves the impression of being a PC manufacturer to the outside world.

This can be seen from its latest financial report that PC is still the bulk of its revenue and profit. For Lenovo and Yang Yuanqing, regaining its position in the Chinese smartphone market is the most powerful proof of its successful transformation in the mobile Internet era.

As for the future, Yang Yuanqing defines Lenovo as a "provider of smart devices and cloud service infrastructure", and firmly believes that Lenovo's smartphone business will reproduce the glory of Lenovo PC. He believes that Lenovo will reach new heights by continuously focusing on the front-end and back-end. However, he did not explain the specific path of its strategic implementation.

Mobile phone turnaround hopes lie in next year

With the rapid growth of the domestic smartphone market, the industry chain has been attracted to concentrate in China, which has led to a lower threshold for manufacturing and greatly intensified the competition. On the one hand, the overall sales volume of the mobile phone market has declined, but the competition has become increasingly fierce. On the other hand, the seemingly prosperous industry is facing a crisis of extremely low profit margins. Therefore, starting from 2016, China's smartphone industry has entered a real competition stage.

In this context, how will Yang Yuanqing restore the glory of the PC business to the smartphone business? Sun Yongjie, a senior IT commentator, told the reporter of the Daily Economic News, "In the future, the competition of mobile phones will be about the innovation of core components. Mobile phone manufacturers that rely on business models and marketing methods will no longer have an advantage. The chips of Apple and Huawei in the industrial chain, such as differentiated core technologies such as chips, are the advantages of these brands. These can improve the competitiveness of brands in the high-end market and are also the key to pulling away from competitors."

Data from market research institutions show that from September 2014 to March 2015, Apple still has an absolute advantage in the market for flagship models above 4,000 yuan, and its market share in the mid-to-high-end models between 3,000 and 4,000 yuan has risen from 16% to 22%, while Samsung's share has dropped from 50% to 25%. What Samsung has lost is being quickly filled by domestic brands.

At Lenovo's third-quarter earnings conference, Yang Yuanqing also refuted the market's accusation that Lenovo's R&D investment was too low. "Before I took over as CEO in 2009, Lenovo's R&D spending was indeed not very high. But after I took over as CEO, Lenovo's annual R&D spending has increased significantly, reaching 3.2% in the 15/16 quarter." Yang Yuanqing was a little excited at the earnings conference, and he also said, "Comparing us with Huawei (R&D spending) is not comparable. We are all in different industries. We should compare with the mobile phone and PC industries."

Yang Yuanqing has expressed his confidence in the smartphone business more than once. At the CES in January this year, Yang Yuanqing revealed that Lenovo is currently accelerating the development of new products, and Lenovo has sorted out and clarified the future strategic direction of its mobile business. "From the perspective of sales growth, Lenovo will first focus on emerging markets outside of China, which have brought rapid growth to Lenovo's mobile phone business in recent quarters. At the same time, we will also strive to make breakthroughs in mature markets this year and make a comeback in China."

Lenovo has taken many detours in its mobile phone business, such as having too many product lines, taking too many low-end routes, and relying too much on operators. After Chen Xudong, president of Lenovo Mobile Business Group, took office, he made many adjustments to the product strategy. He said that mobile phones are long-term products, and the overall situation in 2016 has been determined. Currently, he and his team are studying the product line for 2017. By then, Lenovo will have major innovations in mobile phones.

It is reported that Lenovo Lemon 3 International Edition will first enter the Indian market and then be launched in other regions, taking advantage of the MWC 2016 being held in Barcelona. Industry insiders believe that this low-priced and cost-effective mobile phone is expected to consolidate Lenovo's current market share.

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.