Hi, linuxawe. It would help a great deal if you included in your post which distro you are using. It would also help to tell us why you chose to install from source code if your distro has another package system, such as .rpm, .deb, etc.
You have chosen to install LZO into /usr/local/lib. Is that the default install location, or your prefered choice? Did "./configure --help" offer alternatives, such as "--libdir=" as a choice to inform the configure routine of the lication of lzo?