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Case Study

Xiaomi 2015: A homegrown Apple in China?

18 pages

December 2015

Reference: IMD-7-1739

The Xiaomi case explores how this Chinese startup leveraged ubiquitous connectivity and open innovation to revolutionize the mobile phone industry in the global market. In less than five years it became the world’s third largest mobile phone maker and second most valuable startup. This progress is even more dazzling considering the organization’s business model, which differs considerably from traditional Chinese firms. Investors saw Xiaomi as social media giant capable of mobilizing an enormous fan base in its product development, like many Silicon Valley startups. Some even saw Xiaomi as marking a new wave of Chinese companies focused on developing new capabilities rather than manufacturing. Perhaps the strongest endorsement came from a former Android executive, Hugo Barra, who left Google to join Xiaomi in October 2013 to manage the company’s international expansion. Xiaomi –which means “little rice or millet in Chinese, may not be that small after all.

Learning Objective

The case allows students to explore how ubiquitous connectivity and open innovation may take hold in the Chinese market, and how it might impact the global market place.
The material in the case offers a multitude of options for deep dives into a variety of topics, eg: understanding how industries evolve and how profits can shift from one end of the value chain to another; demonstrating the importance of open innovation; illustrating the need to be adaptable to changing market conditions; etc..

Keywords

Open Innovation

Settings

Asia, China
Xiaomi, Manufacturing, Electric and Electronic Equipment, Consumer Goods
2011-2015

Type

Published Sources

Available Languages

English

Related material

Teaching note

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2015 EFMD AWARD WINNER (Emerging Chinese Global Competitors)

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