Summary
Spending several recent years in Lenovo's sales channel, this latest restructure will not speed revenue due to: * Antiquated IBM policies * Slow distribution channels
Analysis
Lenovo's latest restructure is an effort to improve sales efficiency, distribution as the number 4 global PC manufacturer (behind HP, Dell and Acer/Gateway). However the layoffs are not all due to poor revenues and depreciating margins but rather a continued effort to streamline operations originating from the days of the Lenovo Think buyout. However, hurdles continue to exist.
Obstacle number one is still IBM itself. Though IBM has proclaimed a "hands-off" approach, which can be seen in the new Lenovo sales facilities in Morrisville and new management hired away from Dell, processes, procedures, backend systems, accounting and more are still outdated and will not change very soon. From orders to shipping will these antiquated processes will continue to be an anchor for another 12-18 months.
As a result of these processes, obstacle number 2 is Lenovo distribution channels. Though several large fulfillment distributors like CDW, Insight, EDS, Compucom and others produce millions in sales for Lenovo, dealer channels won't improve until Lenovo figures out exactly how to run them. Since the buyout, my experience has been that there are far too many situations between traditional IBM partners, new Lenovo partners and the Lenovo direct sales teams not knowing who is adding the value. This continues to slow down the efficiency of the sale and leaves the door open for HP and Dell to close business.
Lenovo's re-structure will provide the layout for a very efficient organization down the road, however, rather than give it a fresh start, this latest reboot will more than likely hang.
