Lenovo announces restructuring in wake of IBM server deal

dranii@newsobserver.comJanuary 30, 2014 

PC maker Lenovo is restructuring its organizational structure in the wake of its pending $2.3 billion acquisition of IBM’s low-end server business.

The moves announced Tuesday by the world’s largest PC maker include naming Gerry Smith, who leads Lenovo’s Americas group and is based at the company’s Morrisville headquarters, to head a new Enterprise group that will include IBM’s x86 server business as well as data storage devices. Smith, who will continue to lead the company’s sales operations in North and South America, also is being promoted to executive vice president.

Lenovo, which is based in China, has been outpacing its PC competitors for 18 quarters – which enabled it to become the No. 1 PC company worldwide last year – but is nonetheless diversifying into other devices given slack demand for personal computers. Sales of smartphones, smart televisions and tablets accounted for 15 percent of revenue in the latest quarter, up from 8 percent a year ago.

Lenovo, which has 2,200 employees in Morrisville and 300 at a manufacturing facility in Guilford County, will nearly double its presence in North Carolina when it completes its purchase of IBM’s low-end server business. That deal, which was unveiled last week and is expected to close in six to nine months, would catapult Lenovo’s worldwide market share in servers from 2 percent to 14  percent.

Beyond naming Smith to head the new business group that will include IBM’s server business, Lenovo hasn’t announced who will directly lead the business it is acquiring from the technology giant.

“Further functional alignment is still to be determined,” spokeswoman Milanka Muecke wrote in an email message.

Given the company’s sales momentum, “now is the perfect time to prepare for our growth,” CEO Yang Yuanqing said in a statement. “This new structure will help us be even faster, more focused and more efficient in providing innovative products and services to an incredibly diverse global market with a wide range of technology needs.”

The new structure replaces the company’s two existing business groups with four: PC, Mobile, Enterprise, and Ecosystem and Cloud Services.

The PC business group, which includes the Think brand, will be led by Gianfranco Lanci, the former CEO of PC maker Acer who currently heads Lenovo’s sales operations in Europe, the Middle East and Africa. Gianfranco also is being promoted to executive vice president and chief operating officer, and will be responsible for alliances and managing regular business reviews and processes, among other duties.

The Mobile group that includes smartphones, tablets and smart TVs will be headed by Liu Jun, who now heads the Lenovo business group that includes consumer and mobile products.

The Ecosystem and Cloud Services group will be led by George He, who currently is chief technology officer.

Peter Hortensius, the RTP-based executive who heads the company’s Think business group that focuses on business customers, will succeed He as head of research and technology and chief technology officer.

A year ago Lenovo realigned its sales structure, geography-wise, to improve efficiencies.

Smith’s latest promotion continues his rapid ascension up the corporate ladder. He was named president of the company’s North American operations in November 2012 and the following February his role was expanded to include heading the then-new Americas group, which includes Latin America.

Ranii: 919-829-4877

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