Lenovo'S "Warm Spring" Laid The Foundation For Winning The "Red Start" In The Year Of The Ox

February 10, the 29th lunar month. Lenovo PC industrial base, located in Hefei, Anhui Province, completed the last day of the year of gengzi.

This year, though, the base is different. Lianbao technology, which started on the fourth day of the new year's day in the past, has returned to work early in the face of strong market demand. "In the Spring Festival of the year of the ox, due to the needs of epidemic prevention and control and production, we have nearly 6000 workers staying fat for the Spring Festival." On February 24, in an interview with the 21st century economic reporter, Qu Songtao, senior director of Lianbao technology intelligent manufacturing center, said that the company began to resume production on the second day of the new year, laying the foundation for winning the "red start" in the year of the ox.

Lianbao technology is the core of Lenovo's Hefei industrial base and the largest PC R & D base of Lenovo Group in the world. One out of every two computers Lenovo sells around the world comes from this factory. Since its landing in Hefei in September 2011, Lianbao technology's output and sales have continued to grow at a high speed. In 2020, it will realize a revenue of 101.6 billion yuan, a year-on-year increase of 41%, becoming the first 100 billion yuan enterprise in Anhui Province.

It stopped work on the 29th of December and resumed work on the second day of the new year. In terms of the time span, employees just spent a "weekend.". For the management of the industrial base, these two days are not idle. "Our management didn't go home to celebrate the new year's day. On New Year's Eve, we visited the left behind employees." "This year, we have done a lot in retaining, employing and recruiting people," Qu recalled

Lenovo's efforts to speed up the construction of Hefei Industrial Base originated from the upsurge of global PC market after the epidemic in 2020. And its booming production scene is also the epitome of the "red start" of China's economic year of the ox. According to the Ministry of Commerce, the consumption of communication equipment and household appliances increased by 39.0% and 29.9% year on year. The strong demand for electrical and electronic products has promoted relevant manufacturers to become the "vanguard" of returning to work during the Spring Festival.

"The accelerated growth of China's export since August 2020 is mainly the result of the resonant recovery of the global economy," said Zhong Zhengsheng, chief economist of Ping An Securities. "With the accelerated recovery of the European and American economies, the demand source of China's export in the first half of 2021 is still tough, and there is no risk of rapid weakening in the short term."

Benefited from the strong demand for economic recovery, Lenovo Group's performance and share price have soared in recent six months. According to the results of the third quarter of fiscal year 20 / 21 released a few days ago, Lenovo Group's turnover reached 114.2 billion yuan, a record high of 22.3% year-on-year growth. The pre tax profit reached 3.9 billion yuan, up 51.6% year on year. Net profit reached 2.6 billion yuan, up 53.1% year on year.

In the secondary market, Lenovo Group's share price rose to HK $11.12/share on February 18 this year, doubling in two months from HK $5.5 in early December 2020. As of February 26, Lenovo shares closed at HK $9.81 per share, with the latest market value of HK $118.129 billion.

Benefited from the strong demand for economic recovery, Lenovo Group's performance and share price have soared in recent six months. Visual China

PC "warm spring"

"This Spring Festival is a warm spring for Lianbao technology, just like the weather in Hefei." Qu Songtao said with emotion.

This is related to strong growth in the global PC market. "At present, our order demand is very strong, so far we have basically all the orders we need for the whole quarter." At the presentation meeting of Lenovo Q3 financial report in early February this year, Yang Yuanqing, chairman and CEO of Lenovo Group, was full of confidence. In his view, Lenovo's strong growth momentum will not change.

Therefore, on the eve of the Spring Festival, Lianbao technology began to adopt a series of incentive policies to encourage employees from other provinces to stay fat for the new year. According to reports, as early as mid January, a group of R & D personnel of Lianbao technology in Taipei experienced 14 + 7 days of isolation, giving up the opportunity to reunite with their families during the Spring Festival, and began to work in a tense manner on February 5. On the second day of the lunar new year, 5800 front-line employees went to the production line to start a new round of production capacity war in the Spring Festival, accounting for 60% of the month.

This is also the largest number of employees to celebrate Chinese new year on the spot since Lianbao technology was founded.

"The focus of Lianbao last year was basically on epidemic prevention. Based on last year's experience, in order to ensure the health and safety of production staff, the company strictly implemented various epidemic prevention and control and safety management measures." Qu Songtao said that as early as three weeks before the festival, Lianbao technology had fully planned to purchase medical materials according to the amount of masks used for more than a quarter.

At the same time, in order to let the left behind employees feel the festival atmosphere, Lianbao technology also takes great pains. According to reports, during the two-day holiday of the Spring Festival, the company has planned many activities, including badminton competition, billiards match, whipped egg, King's glory, etc., as well as rich new year's Eve dinner, Spring Festival meal and lucky draw.

"We watched the Spring Festival Gala and spent the Spring Festival together. We also distributed many snacks and organized free meals. As long as the employees participated in the competition activities during the Spring Festival, the employees would have 100 yuan," Qu told the 21st century economic report. "This year, our enterprise has put forward a large amount of funds to encourage the left behind employees."

Thanks to all kinds of efforts, about 16500 people of Lianbao technology before the festival and 11000 people after the festival, of which nearly 6000 employees return to work during the festival. This is a rare number for the manufacturing industry, where a large number of workers are lost during the Spring Festival.

He Weiping, director of Lianbao human resources center, pointed out to the 21st century economic reporter that this is closely related to Lenovo Group's brand strength, workers' confidence in Lianbao's scientific and technological strength, local government's policy support, enterprise's return incentive policy and multi-dimensional care and communication between the upper and lower levels of the factory.

According to he Weiping's calculation, if employees stay for the Spring Festival and go to work according to their schedule, plus the subsidy for staying in the countryside under the Hefei government's policy of retaining work and stabilizing production, a single person can get up to 6100 yuan. The company spent more than 30 million yuan to encourage employees to stay behind for the new year.

At the same time, Lianbao technology continues to expand recruitment. "We have recruited more than 9500 people so far." He Weiping told the 21st century economic reporter.

This is also the largest recruitment scale of the factory after the festival. It is understood that the newly recruited employees will mainly serve the SMT production line of PC related products motherboard and the box production line of notebook machine production. "This is actually the capacity needed to maintain our planned expansion of capacity layout." He Weiping pointed out.

In order to improve the speed of recruitment, he Weiping's human resource center also made every effort. "In previous years, it took 128 minutes on average for our new employees to get on the job. Now we can enter the employee information on the way to Hefei base. It only takes 28 minutes to complete the entry. In these days, we can employ more than 2000 people a day."

And in the ultra-high intensity of recruitment speed, Lianbao technology has also created a small miracle. It is understood that the return rate of factories in the past years was about 92%, and this year it has reached 98.6%. It is expected that by the end of February, the plant will be able to complete the ramp up of production capacity and realize full capacity operation.

Race Against Time

Lenovo's Hefei industrial base has started the rush work mode, which is linked with the global PC market environment.

In January, preliminary results from IDC's global quarterly personal computing device tracking report showed that global PC shipments in the fourth quarter of 2020 increased by 26.1% year-on-year to 91.6 million units. In 2020, the global PC market shipment increased by 13.1% year-on-year.

According to IDC's forecast, China's PC market will grow by 10.7% in 2021, with K12, smart office and government industry as the main drivers of growth. Extrapolated from the Chinese market, the overall PC industry is also expected to maintain a high momentum in the global recovery period.

"This shows that home work, study, and entertainment are becoming a new normal, becoming everyone's new consumption habit, and this consumption habit will drive consumption upgrading," Yang Yuanqing pointed out. "In the past, people only used mobile phones for information consumption, but now it is upgraded to a mobile phone plus a computer or tablet, which will certainly drive the continuous growth of the computer and tablet market."

Affected by the high demand, as the core PC production base of Lenovo, Lenovo Hefei industrial base holds a large number of orders. According to the data, Lenovo Hefei industrial base will achieve a revenue of 101.6 billion yuan in 2020, with a year-on-year increase of 41%. The annual export volume will reach 8.6 billion US dollars, with a year-on-year growth of 21%. It has been the largest import and export enterprise in Anhui Province for seven consecutive years.

"During this period, I have to hold a war room operation meeting every day, focusing on the specific problems of the production line." Qu Songtao revealed. According to incomplete statistics, more than ten million PC orders are queuing up in Hefei industrial base of Lenovo. At present, the orders have been arranged to the third quarter of this year.

Even not only the factory itself, in response to the soaring global orders, suppliers of raw materials and other materials around the factory also resumed production on the second and third day of the new year. "We all attach great importance to the sustainability of production capacity during the Spring Festival, and have formulated relevant security plans." Qu Songtao said.

This is also the return of Lenovo Hefei Industrial Base's long-term investment in supply chain coordination. It is understood that Lenovo has been encouraging its supplier partners to set up factories and expand investment in the vicinity of Lenovo's manufacturing base, forming a "four hour industrial circle", that is, the supporting services of suppliers are located within four hours' drive from the production base, and Lenovo's products can reach the main markets within four hours.

With the digital and intelligent management of all links of the supply chain, Lenovo (Hefei) industrial base can transfer more than 2000 kinds of materials from the raw material warehouse within 4 hours after receiving the global order, and carry out automatic sorting and transportation to the computer motherboard production workshop.

In particular, as early as 2020, Lenovo has started a race against time and competitors.

Among the top five computer manufacturers in 2020, Lenovo leads with 24% market share, according to IDC. Especially in the fourth quarter of 2020, Lenovo's share rose to 25.2%, ranking first in the world, and HP's market share ranked second was 20.9%. The gap between Lenovo and Hewlett Packard has widened from about 1% in the past to 4.3%. In the EMEA market, Lenovo PC sales increased by 17.4% year-on-year, surpassing HP as the champion for the first time.

The backbone

For the employees of Lianbao technology factory, the theme word of the past year is "rush". However, Lianbao technology and time race, not only this.

It is understood that in September last year, with the over expected blowout demand, Lianbao technology quickly expanded its plant area and completed the construction of 70000 square meters of "Yunhai" new plant area in 51 days. According to the data, the newly built 11 production lines will contribute 1.6 million units in 2020, which also creates a new record in the industry.

In fact, this is the epitome of Lenovo's unique advantages. In the PC market, Lenovo, with its hybrid manufacturing strategy, has found its own competitiveness in the context of supply chain shortage to a certain extent. Yang Yuanqing told the 21st century economic report that Lenovo's production model is composed of independent production, OEM and ODM. When global production capacity is tight, Lenovo's own factories become the backbone.

"When I went to Lianbao factory in Hefei in 2020, I was very moved by them. They need to fight not only the epidemic, but also the flood season. " Yang Yuanqing sighed, "what's more, Lianbao factory found the problem of insufficient capacity in September, so it built a new factory in a short time on the basis of the original production line, and started operation in early November."

This is also an important reason for Lenovo to hand over more than 23 million PC "report cards" in the fourth quarter of 2020. Under the background of tight global supply and shortage of raw materials, "Lianbao speed" shows Lenovo's strength and determination.

"The current shortage of supply is due to strong demand, but Lenovo will also make full use of its operational excellence and good strategic partnership with global suppliers to maximize customer demand." "In any case, Lenovo's strong growth momentum will not change," Yang said

The research team of Everbright Securities pointed out that, in view of the long-term driving effect of the popularization of remote economy on consumer PC demand, combined with the launch of domestic commercial replacement service in the second half of 2021, and a new round of overseas commercial replacement demand factors, it is expected that Lenovo's PC shipment in fiscal year 2022 is expected to achieve a year-on-year high single digit growth. In terms of profitability, the pre tax profit margin is expected to maintain a high level of above 6% in view of the high-end consumption PC driven overall unit price increase and the binding of high-value-added software services.

Lianbao technology is just a microcosm of China's economy. As a matter of fact, the booming scene of factories operating at full capacity fully demonstrates the vigorous vitality of China's manufacturing industry, and also sets off the "first gun" for China's economic growth in 2021.

According to the "international situation report of the Chinese Academy of Social Sciences (2021)" released by the Chinese Academy of social sciences on February 24, the world economy will restart its growth in 2021 on the basis of the previous low base after the economic downturn caused by the impact of the new crown pneumonia epidemic. The International Monetary Fund (IMF) predicts that the real GDP growth rate of the world economy will reach 5.5% in 2021, 9% higher than that of the previous year.

Among them, China's economic performance is relatively better. According to the IMF, China's real GDP growth rate will reach or exceed 5% in 2021; China's average growth rate in two years will be the highest in the world, which is expected to reach 5%.

The "good start" of China's economic year of the ox is related to many efforts, such as the left behind workers in Lenovo's Hefei industrial base, and enterprises' less or even no production stoppage during the Spring Festival.

According to Baidu's migration map data, the overall migration scale index of the whole country during the return period of spring transportation this year has dropped significantly, 50% compared with last year. According to a report released by a recruitment platform, one week after the resumption of work in the Spring Festival, the market demand for recruitment has increased rapidly, 124% compared with the same period in 2020, which is shrouded by the epidemic situation.

"There are many orders and customers are in a hurry this year. Our global supply chain started on the second day of the new year." During the Spring Festival, Yang Yuanqing sighed in the circle of friends, "pay tribute to those who work hard and stick to their posts!"