Job cuts won't affect Lenovo Philippines

PHILIPPINES--It will be business as usual for Lenovo in the Philippines amid a massive restructuring the Chinese PC maker is pushing through in some key markets.

According to Lenovo Philippines' country manager, Vicky Agorilla, the local office "is not affected" by the company's recent announcement to cut 2,500 jobs worldwide.

In an e-mail interview with ZDNet Asia, Agorilla added that Lenovo plans to counteract the expected downturn in sales and growth by sticking to the basics.

"We believe the best course for business during challenging times is to stay focused on fundamentals. Stay as close as you can to your customers; understand their needs and their pain points," she said.

The executive added that Lenovo Philippines plans to "drive all the efficiencies" it can without sacrificing quality or brand promise, and to continue to invest in innovation as a competitive differentiator.

"And finally, we will focus on high-growth markets," Agorilla said, adding that the company also plans to unveil more products and services to offset the downturn.

"Our strategy is to keep innovating so that we keep delivering products valued by our clients for features that improve their total cost of ownership, such as rollcages in our ThinkPads, which contribute to durability and reliability," she said.

"As a consequence, we believe that when we emerge from the current downturn, Lenovo will be ready to lead and outperform the market."

Global cutbacks necessary
Agorilla explained that Lenovo's corporate restructuring was inevitable amid an "unprecedented global uncertainty" that has impacted businesses and industries worldwide. "These actions are essential to strengthen Lenovo's competitiveness in light of the unprecedented economic challenges affecting all of us."

Businesses, consumers and governments are reducing their spending, and analysts have predicted a continued slowdown in the global PC market, she said.

She noted that much of Lenovo's sales volume comes from its commercial business and the higher end of the market, but this segment has slowed.

In addition, China historically has been a fast-growing market and generates more revenue for Lenovo than other geographies. "But, China growth has slowed with the emergence of lower-priced netbooks, which have moved the market dramatically to lower-priced products--and hence, lower-priced margins," Agorilla said.

The result is that Lenovo, like every vendor in the industry, faces significant challenges to revenue and growth, she said.

"These difficult decisions are in no way a reflection on the talent and dedication of our workforce," she noted. "Rather, they are a reflection of the realities of the global economy today and our fiercely competitive industry."

According to reports, Lenovo said the job cuts will affect management and executive positions, as well as support and administrative staff. Under the restructuring, the company said it will be consolidating its Greater China and Asia-Pacific operations--previously run as separate business units--and Russia into one unit.

Joel D. Pinaroc is a freelance IT writer based in the Philippines.