Lenovo clarifies Singapore - Beijing shift

Lenovo has clarified recent reports saying that many HQ functions will remain in Singapore.

Computer maker Lenovo has clarified reports that it is shifting its Asia Pacific (AP) headquarters from Singapore to Beijing, saying that many HQ functions, including some Asia Pacific ones, would still remain in Singapore.

"It's important to note that many other functions: Singapore, ASEAN, as well as some AP and worldwide functions, will still be based out of the Singapore office," a Lenovo Singapore spokesperson said.

"Many functions will still remain in Singapore — they include the Lenovo Singapore roles, which run the gamut from marketing to finance to sales and product management, plus the ASEAN HQ functions, Worldwide Treasury, and Services.

The spokesperson said that Lenovo's worldwide CIO David Schmook, plus services senior vice presidents and the vice president of the Global Supply Chain, Gerry P. Smith would still be based in the Lion City.

The clarification came after Lenovo announced this week that it expects to reduce the number of its employees worldwide by 2,500 during this first quarter of 2009, about 11 percent of its total workforce. This includes management and executive positions. The company is also reducing expenses in support and staff functions, such as finance, human resources, and marketing.

Consolidating China and AP

As part of the restructuring, Lenovo said it was consolidating its China and Asia Pacific organizations, which are currently run as separate business units, into a single business unit — Asia Pacific and Russia (APR). The new organization will help the company reduce its operating expense and eliminate duplicative support and staff functions.

APR will be headed by Chen Shaopeng, currently senior vice president, and president, Greater China. David Miller, senior vice president and president, Asia Pacific, will remain with Lenovo for a transition period.

From these restructuring actions, the company expects to realize savings of approximately US$300 million in the 2009/2010 fiscal year (ending March 31, 2010). The company anticipates taking a pre-tax restructuring charge of approximately $150 million, most of which will be taken in the fourth fiscal quarter (ending March 31, 2009).

"The actions we are taking are not easy, and we will act with compassion and respect for the individuals in our company who are most affected," said William J. Amelio, Lenovo's president and chief executive officer. "As hard as this news is for all of our Lenovo employees, we believe the steps we are taking today are necessary for Lenovo to compete in today's economy, and in the long run, will help us to continue to deliver exceptionally engineered PCs to our customers worldwide."

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Ross O. Storey

CIO Asia
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