Lenovo Restructures as Emerging Market Focus Grows

Lenovo will create developed and emerging market units in the place of its regional business divisions as it moves its focus back to emerging economies, the company said Thursday.

The restructuring comes two months after Lenovo said it would reduce its efforts in Europe and the U.S. due to plummeting demand. It also follows company founder Liu Chuanzhi's return to the CEO post last month as William Amelio resigned.

Lenovo's new mature markets division will focus on Western Europe, North America and Japan. Its emerging markets unit will include Africa, the Middle East and most of Asia, including China.

China, Lenovo's most important market, accounted for 45 percent of the company's sales in the last quarter.

Lenovo will also restructure its product groups around high- and low-end customers. The new Think Product Group will mainly work on enterprise products, while the Idea Product Group will focus on products for small firms and consumers, including in emerging markets.

The changes build on the separation of developed and emerging markets Lenovo began with its earlier restructuring, said Bryan Ma, an analyst at IDC.

Building a presence in emerging markets could boost Lenovo in the long term, but focusing on them will not be an immediate cure-all, Ma said.

"Obviously, the whole world, including the emerging markets, are still going to be impacted by this recession," Ma said. "China is a case and point."

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