Key Features of Information Technology

A key trade associate of Information Technology industry says that IT is the application of computing via hardware, services, software, and infrastructure to generate, store, interchange, and control information in its numerous ways to achieve various purposes (World Economic Forum, 2018). Furthermore, the term includes the workforces that cultivate, implement, uphold, and apply IT openly or indirectly. Key features of Information Technology include:

Hardware: Servers, mobile phones, network equipment, computers, storage, tablets, and printers.

Software: Efficiency, network and security applications, business application, video games and mobile apps.

Services: Placement, addition, custom development, managed services, repair/upgrade (Singh & Kaur, 2017).

Infrastructure: Telecommunications networks, internet backbone, centers of cloud data.

Information: Voice, images, data, video, documents.

Objectives of Business: Communication, commerce, collaboration, production (Shaqiri, 2015).

At the position of non-technical and technical around 5.73 million people are hired in the firms of IT, government agencies, non-profit agencies and companies who have a separate department of IT in their premises. Around 85 % of the total workers are involved in the technical department.

Jobs in Information technology industry are majorly found in the United States. According to the reports of CompTIA, the top and four famous states for the employment of IT worker are Virginia, Texas, Florida and California. In some states there are clusters of employment like in California and Seattle, Washington there is Silicon Valley (CompTIA, 2015). Opportunities for IT jobs differ from the other segment of the industry. In the branches of computer industry software and hardware, many positions overlay and every company does not employ people to cover post in every primary industrial segment. These segments are consists of sales, programming, service, design, and administration (Vault, 2018). 

Mobility has become the next big thing. As much as Google has restored its procedures once again in order to highlight websites that create unified mobile web browsing simpler.  Due to this every single feature of the business can be controlled from distant places if the tablet or smart device is updated with the right software. Total sales enablement, customer relations and content marketing of back-end procedures such as invoicing and shipping can be handled at just one click of a button (Vijayasri, 2013).  However mobile is not only for business clients it is also for the general public. With the progress of the Millennials (Y Generation) other people are also using these mobile devices for various purposes. These purposes are selling, searching, shopping, buying, and to share their retail understandings with friends, associates, prospects, and strangers on Facebook every single day.  This new pattern has accurately redrafted the marketing to prospects book (Olson, 2018).

Jobs in Information Technology Industry

Cloud computing is a technology that permits small and large businesses to transfer several of their processes to the server (third-party) which is reachable via Internet connectivity.  It is not only allowed for flexible packages of data but it is also allowed for quick (on-demand) expansion and mobility of the anxiety of idle time, crashes, or perpetually data lost. This has offered small business the access to use the resources. These resources would have remained expensive for them earlier but now cloud computing has made the functioning area more convenient for the businesses. The small business can give strong competition to the competitors with extra resources or funds with the help of cloud computing.

Technology has also increased the comfort with which every person can stay in touch or linked. The connectivity has solved the problem of many businesses by providing them support to get connected with their employees or co-workers with the help of text or video chat. The businesses can reach to their customers in a minute with the help of internet connectivity. The growth of mobile technology has mixed flawlessly with software communication in order to make a hyper-real web of actual time data.  

Civilization has demanded technological production since last few decades. As the development of computers, information technology industries have tried to reply to these demands competently by offering customers the products of technology. A good instance is the sector of mobile devices — after the entrance of the initial mobile phones, the community has called for additional advanced devices. This derived the discovery of color displays and combined cameras along with the application of business in the mobile devices (Daven, 2017). 

Competition is the driving force of every single creation for the reason that by competing, companies can arrive with additional products of innovative technology. This is obvious in the information technology’s success. According to the report of IBM, a leading technology expert stated that the competition among western corporations and Japanese electronics companies has increased the striking products with the combination of more innovative technologies (Tan, 2018). The competition among, Microsoft and Sony have resulted in the scattering of two games which are very successful – Xbox and PlayStation.

The information technology industry provides number of striking opportunities for employment in the matter of labour and environment. According to the EHS Today Magazine by offering easy social circumstances and specifically by raising the rates for technology experts in advanced countries, information technology industries have converted in a desirable employer for refined individuals. This provides the companies of technology the opportunity to handle talented individuals in their business and to enjoy advanced work by the experts (Arias, Vilches, Banchoff & Harari, 2012).

Mobility and Its Impact on Information Technology Industry

Conclusion

The Information Technology industry is growing rapidly by offering creative and innovative products to the public across the world. IT industry helps business to achieve its objectives effectively and along with this if involve hardware, software, services, and infrastructure. The industry is changing with time and gaining success in the global market.   

From the latest gadgets for the consumer to the eruption in the capabilities of communications that is offering the growth of global economy. Enhancements in lives are because of the technology innovation and it also offers a new instrument to carry out daily responsibilities. The Federal Trade Commission encourages competition in the industry of information technology such as communications, computers, biotechnology, and software as the finest method to decrease costs, promote innovation, and enlarge varieties for customers. Since the risks are more in these fast-changing markets and the profits to customers and to the economy significant, the FTC’s operates in these zones (Federal Trade Commission, 2018).

The market of information technology can reflect several exclusive problems and challenges for the makers of policy, distributors, customers, and manufacturers. Innovation is an essential feature of competition between the firms of technology, and the changing market: fresh concepts collapse previously leading technologies and customers stand in a queue to purchase products that are better, faster and smaller. However, the important principles of economics and antitrust law are equally relevant to the most recent industries.

A condition in which business operate trading in the complementary product in order to compete with each other is known as Vertical competition. Occasionally termed as co-opetition, vertical competition is pervasive to ICT. More accurately, business with a planned existence in IT, or business with opportunities to receive rents in IT, is probable to be included in the vertical competition. The Microsoft capability to influence its supremacy in the operating system of PC into internet software and applications software is presently the well-broadcast instance of these dynamics.

The analysis is consisting of an assessment of risk on the competitive advantage of the company from its business and position in the market. The analysis also includes the brand, size and market share of the company (especially when a company gets involved in the consumer sector). A company which has increased market share must have better economies of scale. The product, technological innovation and leadership are also focused to confirm the capacity of the company to grow. The presence of entry barriers like acceptance of patented platforms and technology, the total number of applications inscribed for the platform etc. can also defend the position of the company over its competitors (PEFINDO, 2017).

Cloud Computing and Its Impact on Small Business

Sustainable profitability margins of the company are considered as an effort in order to run business in the well-organized way. Operating and Cost efficiency is vital for becoming competitive especially in the matter of selling prices. The analysis of the key success factors also includes the assessment of the ability of the information technology company to offer reliable service quality. The service or product development act as a vital aspect in order to have justifiable growth in demand with the product cycles. Various vital factors, which define the success of product of information technology, are budget of R&D facilities and human resources. As the company of IT has to be inventive in offering its services or products to maintain the pace of change in technology.

Management of working capital, including receivables collection, payables management, and inventory management, are also examined to define the level of company’s productivity and its abilities to operate the business. The operating margins analysis is also measured by the characteristic, which is significant in examining the competitiveness of the company. The analysis is obliging to measure operating competence and the flexibility of company in regulating selling price.             

Lenovo Group is not only the leader in the PC market of the world, ahead of #3 Dell and #2 HP, but it also functions in server businesses and competitive phone. Over an acquisition series, the company based in Hong Kong has accumulated a product which is a device-driven lineup that participates in many technology markets all over the world (Lin, Monalis, Srinivasan, Sun & Yang, 2008). Lenovo has revived the brand i.e. Motorola in smartphones and released the low-end server of IBM’s former body into a rapidly rising business. Moreover commercial PCs ThinkPad-branded, accessories, Lenovo’s turns out tablets, software, and ultra-books. Its sales are evenly obtained mainly from the world markets of Europe, North America and China (D&B Hoovers, 2018).

Lenovo Group Limited’s Top Competitors are:

• Dell Technologies
• HP Inc. (Spider Book, 2015)

Dell is the well-known brand in the information technology market and considered as one of the world’s major technological corporations which cultivate, produce, vend and do maintenance of laptops, personal computer, and various other computer peripherals (Bhasin. 2018). In 2010 on the Fortune 500 Dell was positioned at 38 ranks. Along with this, it was also ranked by the Fortune on number 5 as the well-regarded company in the industry of computer. Dell has involved in big mergers and acquisitions. For instance, acquisition of Perot Systems was held in 2009 and Alien ware in 2006. 

Technology and Connectivity

The major weaknesses of Dell are that it fails to attract or invite the segment of college student market. Sales revenue of Dell from institutes of education like colleges covers only 5% of the total population of college students. Because of focusing majorly on the business customers, the ability of the company is affected to make good relations with the educational institutions (MBA Skool. 2017). 

The strength of HP is that it has a good position in the market. After the announcement of the merger between Compaq and HP on September 3, 2001, HP achieved a position in the world as a large peripheral and computer hardware company across the world (Bhasin, 2018). There are various benefits to HP for being a big company like market’s leading positions of services in IT, printers, management software, storage, and PCs. Specifically, the market for the printer, HP’s market share of 40% proofed that it is on the commanding position in the global market of the printer (Haseeb, 2015).

The major weakness of HP is a high level of debt. In this time duration, HP has a debt level’s high risk as compared to its competitors such as Dell (MBA Skool, 2017). From the HP debt to the equity ratio data revealed that HP touched the uppermost value of 0.9292 in 2012. Debt to equity ratio is considered as a leverage ratio to specify the relative amount of debt and equity of shareholders used in order to finance a property of the company. It displays the finance of the company’s property.

The development of Dell Technologies is an indication of a key market change. Instead of operating with one main IT or business change companies deal with a mass of immediate technology and organizational changes. Similarly, companies which are recognized or well established deals with extreme competition from new participants that have inexpensive entree to robust technologies like cloud services. Organizations, irrespective of the size, should hold the cloud computing, IOT, mobility, and new analytics solutions. Recognized companies should know how, and where, these key technology movements will interconnect. Positive IT efforts will emphasis on combined policies, not islands with remote technology. For instance, cloud influences strategies of mobile with access to accessible platform and infrastructure as a service (PaaS) solutions. Businesses can also buy the apps SaaS or can use cloud-based advance instruments to update present applications (Lopez, 2017).

The standard equipment in 1985 for individual computer owners was dot-matrix printers. HP was facing market share loss in cheap Japanese products, and the revenue was also suffering.  HP had designed a technology inkjet and set out to make a paradigm of the new market — the printers of inkjet, which made the dot-matrix printers exit from the market. This variation in the strategy of product made HP the frontrunner in the market for personal computer printer for some years, which was ahead of any substantial competition (Duff, 2018).

Competition and Innovation in Information Technology Industry

HP Company took the step of extending its leadership into the key movements of driving investment of IT—data security, information optimization, and cloud computing. In 2013, HP introduced a multiyear restructuring design. In order to readjust its structure of cost and make investment capacity to determine innovation in contradiction of its strategic significances, reinforce market leadership and reconstruct its balance sheet along with repaying capital to shareholders. In spite of the challenging surroundings, the company has kept research and development (R&D) expenditure, along with a stable focus on conserving the business’s long-term health (HP, 2012).

Rivalry or Competition largely is reasonable in this particular industry, because various big retailers are operating in it. Customers have various selection choices in the market to choose and switch to other product. For the vendors, costs of storage are more therefore quick product turnaround is important as new technology, features and updates, are continuously striking in the market. Every retailer who has trouble making sales converts in an open target for procurement. To conclude, current financial downturns have tautened margins of profit for every retailer, which have strengthened competition. The development slowly decreases the competition the industry.

Conclusion

In the conclusion, it can be said that the rapid changes in the technology are offering a growth to the world economy and this is the reason for the improvements in the lives of the people. There is high competition in this industry which offers customers a variety of choices to select from. But this industry involves huge risk and due to that Federal Trade Commission operates in this sector. There are various competitors of Lenovo but major are Dell and HP. Both of them have a good market position and brand image.     

In terms of the sustainable competitive advantage of Lenovo, it has been operating positively in Hybrid, Price, Focus strategies, Difference respectively. After owning the trademark of IBM’s PC and its current market share, the company has swapped for extra efforts in constructing its own brand (Bhasin, 2017).

For example, Lenovo Company pays high cost for its promotion and advertisement so that they can announce its products of a new laptop – IDEAPAD series and Essential series. These series deprived of any characters of IBM’s THINKPAD and has a lesser cost yet advanced performance.

Value chain analyses are industrialized by key organizations in emerging low-cost along with strategies of differentiation. These strategies are well-organized in evolving the competitive advantage by making stakeholders’ worth, giving strong competition to the competitors and lead to the success of the organisation. Merging both Lenovo’s and IBM’s structures and strengths in the development of technology, Lenovo has recognized them well in their efficiency and increased its worth as compared to company’s industry competitors.

Employment Opportunities in Information Technology Industry

The operating margin ratio of the company in 2016 was negative. However, 2017, the company has achieved an operating ratio of 1.56% which shows sound profitability performance of the company.

Return on assets was also negative in the year 2016 but in 2017 the company has improved its profitability by producing higher returns through better utilization of its total assets and therefore it has achieved 2.04% as ROA.

Return on equity of the company in the year 2017 is positive and also it is considerably better than the last year which was negative. ROE of 12.95% shows that the company is efficiently utilizing the funds of shareholders to produce returns.

The ideal current ratio that a company must achieve to maintain its liquidity position is 2:1. However, Lenovo has achieved only 0.81:1 as its current ratio which indicates that company’s liquidity position is adverse and it is not able to manage its current assets to settle its current liabilities.

Debt ratio: The debt ratio of the company is 85% which is not showing the sound solvency position of the company as debt ratio indicates the percentage of total assets required to square-off company’s total debt.

Higher performance throughout the product lines: Lenovo showed progress in its revenue in its complete product lines in the financial year 2015. Lenovo enhanced its revenue and market share in PC, a business group of mobile and data center group. This shows augmented receiving of the product of the company and enhanced brand image.

High growth in China and other developing markets:  High development of Lenovo in the extremely rising market of China and existence in other developing markets all over the world has assisted the company to observe high progress in the coming years. It also promises high progress in the upcoming time period (Cheng, Chien, Chang and Kuo, 2018).  

Slow growth of market share: The market share growth of Lenovo is slow because of the entry of other companies and product’s duplicity, Lenovo is not capable to enlarge its PC and smartphone’s market share.

Brand Image is affected by Product recall: Many products are recalled by the Lenovo in the recent years. For example, in 2015 Lenovo recalled lithium-ion batteries globally. Such batteries are used for Lenovo to create ThinkPad computers. These recalls disturb the trust and brand image on the product (Jurevicius, 2013).

Growing Market for Smartphones: The market for Smartphone is globally rising and is anticipated to rise at a fast speed in the medium term particularly in the developing markets. This offers Lenovo an opportunity to enlarge its revenues (Faizul, 2017).

FTC’s Role in Information Technology Industry

Cloud Computing: The global market for cloud computing has revealed high potential and is anticipated to rise during the period of 2014-2019 at a CAGR of 19.4%. Lenovo Company has also being aiming at the rising opportunity in the market for cloud computing and is fixed to be profited by the development of cloud computing in the upcoming years (Bhasin, 2018).

Market share can be affected by Competition: Lenovo deals with penetrating competition from several global companies like Apple, Acer, Samsung, Dell and HP etc. in the market for smartphones and PC. The pressure of competition can affect the market share of Lenovo and also encounters Lenovo to continuously update.

Conclusion

In the conclusion, it can be said that Lenovo is a strong competitor in the information technology market and have its good brand image in the market. The above analysis has identified the strategies of Lenovo, SWOT analysis and along with this financial analysis has been done to identify the financial position of the company in the market.  

ThinkPad is performing well in the market and Lenovo is an enterprise of $30 billion — the world’s second-largest company of PC offering customers in 160 countries and hiring closely 30,000 people (Makovsky, 2012). In spite of all these positive things, this strategy of Lenovo has faced many issues of perception of competitors such as according to the perception the procurement will not perform well. The effort to expand the company involves cultural, strategy and leadership issues. Another challenge is that not a single Chinese company has constructed a worldwide brand and they also faced a challenge with a fact that a company which is not a U.S. based company has to lead in the industry which is dominated by U.S. Company.

Lenovo moved forward along with the purpose of reflecting that Chinese Company can do globalization. The solution of all the challenges faced by the company was suggested by Shafer, that the company can represent themselves as an enterprise of next generation. He also explained that the Lenovo Company is comprised with a global leadership team, and whereas several topmost positions are Chinese. There is a variety of ethnic group; there is no effort to force single culture on everybody. It has also been said that China has the best support from the media because everyone is excited to know more about the things that China is offering.

However Lenovo now has nearby sensitive media and public programs all over the world. Shafer who is a Vice President of Global Communications directed, said that the objective is to display the positive actions of the company globally. By doing this the company planned to tackle the issues.

• For maintaining a positive brand image in the market Lenovo should not only focus on the products quality but it should also try to adopt split and diversify strategy.
• The concentration of the company should be to diversify and invite the corporate market in order to solve all the problems faced by the company by upgrading the software.
• If Lenovo Company wants to give strong competition to Dell Company, then the company should promote its products with the help of appropriate techniques. For instance, Lenovo should promote ThinkPad by using a spin off strategy which will support company in making up all the losses faced at the time of IBM.
• In spite of using the logo of IBM, Lenovo should make use of its own logo.

Vertical Competition in Information Technology Industry

Conclusion

In the conclusion, it can be said that Information technology industry is one of the fast-growing industry and is counted in one of the industry who are the reason behind the growth of the economy in every country.  The above report has provided the detail explanation in information technology industry, details of the Lenovo’s competitors and analysis of the Lenovo Company and strategies followed by the company.   

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