Lenovo announced on Thursday that it will be reducing its global workforce by five percent, cutting or repositioning approximately 1,400 jobs in the U.S. and Asia as part of a continuing effort to increase the company's profitability.

According to William Amelio, Lenovo's president and chief executive officer, over the next 12 months, the company will be redoubling its efforts to grow faster and more profitably than the rest of the industry. In order to do that, Amelio says that the company will need to make its organization more efficient and reducing expenses.

To that effect, Lenovo said it will be streamlining its global supply chain organization by aligning more work closer to supply bases; integrating its software testing into the company's China operations; streamlining its sales and marketing organizations; and centralizing teams and resources.

Approximately 750 of the 1,400 positions—which will also include contractors—will be transitioned into emerging markets closer to Lenovo's suppliers and manufacturing facilities, according to the company. Lenovo claims the net effect will be a global workforce reduction of about 650 positions, with most of those changes to be completed within one to twelve months.

Amelio also said that the company expects to see savings of close to $100 million in the 2007/2008 fiscal year as a result of these measures, which Lenovo will subsequently reinvest back into the business to support the company's strategic initiatives.

"There is no doubt we have made strong progress in the past year, but it's clear we need to further accelerate that progress to be as profitable and cost efficient as the rest of the industry," Amelio said in a statement Thursday.

"While these actions are difficult, we believe the 'tipping point' is within reach," he added. "If we can combine optimal cost competitiveness and efficient delivery capabilities with innovative, best-engineered products, we can generate more profitable growth, gain market share, and make further reinvestments into the business, fueling more growth. We are confident that we are doing the right things to make Lenovo an even stronger, more competitive player in the global PC market."