Lenovo CEO breaks with old rhetoric of ambition for big donation
It's refreshing to see Lenovo's (HKEx: 992) chatty CEO Yang Yuanqing finally doing something besides boasting about his big plans for the company, with word that he is donating a big chunk of his annual bonus to ordinary employees. I'm a bit too jaded to believe that Yang's donation of US$3 million is a purely selfless act, since he was quite willing to give the media a detailed account of his decision. Still, the latest news comes as a nice break from the usual chatter about new M&A targets and other global aspirations from one of China's most successful tech firms.
The latest reports say the US$3 million from Yang's bonus check will go to some 10,000 Lenovo workers, ranging from receptionists to production line workers spread across the globe. When all the money is distributed, the average recipient will get the equivalent of a about US$300 each -- not a huge sum but perhaps equating to up to an extra half month's pay for a typical China-based employee.
It's worth noting that Yang won't exactly suffer too much as a result of his generosity, since his last annual bonus was reportedly worth US$5.2 million, and his net personal income for the year totaled US$14 million. Still, I'm willing to give him credit for making what looks like a sincere effort to thank the many people who have helped to make Lenovo China's first truly world-class tech firm.
For me personally, the news of Yang's generosity also comes as a nice shift from his usual bluster about his ambitious plans for Lenovo, along with the non-stop rumours about the company's latest acquisition targets. After taking over as Lenovo's CEO in 2009, it was hard to ever go more than a month or two without reading news reports citing Yang discussing his ambition to overtake Hewlett-Packard (NYSE: HPQ) to become the world's biggest PC seller.
After finally achieving that goal briefly last year, Yang suddenly changed his tune as sales of traditional PCs started to decline in the face of the rapid rise of smaller, more portable devices including smartphones and tablet PCs. Over the past year, he has shifted his message to say Lenovo's chief rivals are now smartphone and tablet PC giants Apple (Nasdaq: AAPL) and Samsung (Seoul: 005930), which he happily repeats time and again whenever he conducts interviews.
When Yang isn't talking up his HP- or Apple-chasing dreams, Lenovo is also frequently in the headlines for its voracious appetite for overseas acquisitions. This year alone the company has been in the headlines for a number of potential deals, including a smartphone joint venture with Japan's NEC (Tokyo: 6701) and the potential multibillion-dollar purchase of IBM's (NYSE: IBM) low-end server businesses. Many industry observers have also speculated that Lenovo is likely to make a bid for sputtering smartphone pioneer BlackBerry (Toronto: BB), which put itself up for sale last month.
All of this returns me to my original point, namely that perhaps Yang is finally turning over a new leaf and preparing to tone down his ambitious talk and let his actions speak for him instead. But that's probably wishful thinking, and I suspect this act of generosity is probably more of a one-time thing. Then we'll soon see Yang return to his previous talk of grandiose plans to become one of the world's top smartphone makers. But at least this one time we're getting to briefly see another side of this outgoing executive who is arguably one of China's most visible global CEOs.
Bottom line: Lenovo CEO Yang Yuanqing's US$3 million donation to his employees is likely a one-time act that will be followed by a return to his usual talk of grand plans to overtake Apple and Samsung in smartphones.