Magazine article Newsweek

Blue in a China Shop; Steve Ward Is Still Mr. ThinkPad-Just Not with IBM

Magazine article Newsweek

Blue in a China Shop; Steve Ward Is Still Mr. ThinkPad-Just Not with IBM

Article excerpt

Late last year came the shocking news that IBM will be selling its PC business (including the acclaimed ThinkPad notebook franchise) to Lenovo, the leading IT company in China. Though IBM will retain only a 13.4 percent stake in the new enterprise, the first leader for the Chinese-owned company will be an American: Stephen Ward, 50, who headed IBM's personal computing division. Just before taking the helm (the merger could become official as soon as this month), Ward, who will run the company from the United States, spoke to NEWSWEEK about his challenge.

NEWSWEEK: What was your first thought on being asked to head the Chinese company taking on IBM's computer business?

WARD: I never thought of it that way. This is really a company using a merger to become very international. It's a combination of excitement and trepidation.

At one time IBM seemed to own the PC business. Is the Lenovo sale an admission of defeat?

I would take this more as an admission that the industry has changed, and that this new company can be stronger.

From Lenovo's point of view, why jump into the U.S. market, where everyone but Dell seems to have trouble making money?

We have to look at this on a worldwide basis. Lenovo does have very good returns in a business that many of our competitors have exited because they can't compete. Roughly 30 percent of our revenues will come from the United States. [Dell] has roughly 70 percent of their revenue in the United States. So Lenovo is a much more international, much more balanced company, and there's a lot of strength having our plants where the supply chain is for PCs these days, which is China. …

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