Lenovo announces new resource redeployment and 11 per cent job cut

08 January 2009

The world's fourth-largest personal computer maker, Beijing-based Lenovo, announced a restructuring plan for its Asian operations with about 11 per cent job cuts on fears of a prolonged global economic downturn, that would enable it to save $300 million.

The restructuring plan aims at increasing the company's efficiency and become more competitive in the face of a long and painful economic recession, a statement from the Chinese hardware maker said.

A part of the "resource redeployment plan,'' includes the layoff of 2,500 employees or 11 per cent of its total workforce, including management and executive positions, in the first quarter of 2009. Lenovo expects this to reduce expenses in support and staff functions, such as finance, human resources, and marketing.

Executive compensation will be reduced by between 30 per cent and 50 per cent, including bonuses and other incentive payments, in the coming year.

The statement did not mention whether the layoffs would be spread evenly across all of the regions where the company operates or confined to specific areas.

''These actions in total will help take advantage of Lenovo's strengths as a global organization to better align its resources with shifting customer demands in the current marketplace,'' the statement said.