Lenovo sees remarkable growth in its Service business

Lenovo has witnessed a strong growth in its service support business in Asia Pacific. The revenue from this segment of the business is becoming a bigger percentage of Lenovo’s revenue and profit margin. Service support is a major contributor to Lenovo’s revenue. 

“In India we have seen very big growth in the business, a strong double digit growth and the overall the services business in Asia Pacific has doubled in about three years. It is becoming a bigger percentage of Lenovo revenue and profit number. So if you compare the share of revenue coming from services, it is growing and we call itPen rate. In India we have seen the share of services as a percent of the total revenue grew by 150%,” says Daniel Fields.

Lenovo has not limited itself to offer service support for its own products but also supports other vendors. It offers annual maintenance contracts to customers with multi-vendor devices. In the country the company has grown 900% year-on-year “We provide services to other brands as well. So, our managed services business in India has grown 900% year on year and a lot of what we are providing is multi-vendor services. So we are providing annual maintenance contracts to customers that have mixed fleet, they might have Dell and HP devices, they may have other types of technology, and we are supporting that,” he adds.  

Premier Support
The Premier Support is Lenovo’s highest level of support where it has elite technicians, a technical account manager that does end to end case management. It covers both software and hardware issues.It establishes best first time resolution 24/7.It is a new service level that has come to India in about the past two years which is providing good customer experience, so that service structure is keeping the customers with minimal downtime.
“One of the things that initially you think of Lenovo is warranty support. But I mentioned that we have grown the services business with a pen rate by 150% in India. One of the ways that we have done that is that traditionally, we relied on warranty support with all the service centers. Now an increasing amount of our business is not coming from warranty, it is coming from an extra level of support service called Premier Support, configuration services and managed services for customers. What is more important now is that we can deliver field based services across the country. We use subcontractors for the hands and feet. Now, if it is a large customer, what we will do is rather than subcontracting and we will hire Lenovo Associates. So, they are the contractors that would wear Lenovo shirt and we would engage them for a large opportunity. There is a variety of partners that we work with depending on what the location is and we also work with our own channel partner community. If the channel partner is able to provide services we work collaboratively with them,” discusses Daniel.  
“Lenovo strategy focuses on smart technology for all and the three S strategy - Smart devices, Smart infrastructure, and Smart verticals. The Smart verticals, has a lot of solutions and services supports. So I guess what is exciting about Lenovo right now is that, increasingly as part of corporate strategy and also in terms of investments that we have made, we vastly increased our footprint of services that we offer. The other thing that happened is thatwe created a specific organization for services business as opposed to services operations only to support value added services and solutions for our customers. We have a separate organization which we call the services business that focuses on delivering value added services to our customers,”he reveals. 
 
AI improves Lenovo’s Supply chain
Lenovo has curved out its supply chain well with the apt use of AI. The company has implemented AI in its supply chain to make sure that it delivers the best result.
“Lenovo has a lot of Artificial Intelligence (AI) IP and we actually used our own AI capabilities to optimize our supply chain. We actually applied AI to improve the forecasting of our parts network and parts supply. Basically, we have got some capabilities which have made the supply chain smoother and when comparedto the AI forecasts with the actual demand curves that are coming in, we are very accurate. The fact is that AI is not just a buzzword for Lenovo, we actually use it in our own supply chain to make sure that we deliver the best result,” explains Daniel.  

Further he adds, “We have a Universal Command Center or UCC, people monitor every single services incident and they will look at things like whether there is a disruption with protests or anything which might stop logistics and they will proactively chase service incidents to overcome any kind of issue that they might have in the logistics chain. There is a team of people that work around the clock to make sure that services, incidents and services dispatches go through without any issue with parts and logistics. They are constantly managing a sort of command center format to make sure that the services as efficient as possible.”