China’s high-tech companies like Alibaba, Tencent, Xiaomi and Baidu are pushing the country to become a global leader by developing new business models, says Zhejiang University professor Mark Greeven, author of Business Ecosystems in China: Alibaba and Competing Baidu, Tencent, Xiaomi and LeEco to the South China Morning Post.
The South China Morning Post:
Greeven, who co-wrote Business Ecosystem in China: Alibaba and Competing Baidu, Tencent, Xiaomi and LeEco with Wei Wei, said Chinese companies have found a new method of organisation that will help it become a global innovation leader.
The business ecosystems of Chinese companies differ sharply from those of US juggernauts such as Google, Amazon, Facebook and Apple, according to Greeven, whose book came out in September.
In the US, one company usually creates a platform which outside companies either plug into or use. In China, an outside company does not plug in, but becomes part of the business as one of hundreds of players in an ecosystem, Greeven argues.
A distinct trait of a Chinese innovation ecosystem is the “glue” that exists between all the participants. For example, in the case of Alibaba – the owner of the South China Morning Post – the payment function is shared in its ecosystem.
The five companies in the book’s title are all digital driven, but they mix hardware and software, online and offline and old and new industries. They include relatively old companies such as Tencent, which was set up in the 1990s, and younger companies.
What they have in common is an aversion to adopting the standard metrics structures used by most multinationals. Greeven found. Their unique ecosystem, under which suppliers, distributors or customers become partners, helps them achieve early success in a highly uncertain business environment.
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