You are on page 1of 4

INTERNATIONAL BUSINESS ( 2 MBI A

)

COMPANY OBSERVATION 3

Group Members :

1. Affan Naufal Syafida (01)
2. Aji Setiyoko (04)
3. Atika Rahmadhiyati (07)

1.
A. International Business Strategy of Xiami Company is multinational strategy which
focuses on local responsiveness. Subsidiaries operate autonomously or in a loose
federation. This strategy reduces the need for communications because local
subsidiaries can make many decisions. There are heavy reporting requirements though,
as the results from the subsidiaries have to be monitored at a headquarter location.

B. The two core competitive strategies, followed by Xiaomi, are – production at a lower
price and production with superior features and quality. Besides these, the added
applications, present in Xiaomi smartphones, attracts the customers towards them. The
competitive strategy is the market survey of Xiaomi before the launch of its 1st Android
based smartphone. Xiaomi has discovered that two giant smartphone manufacturing
companies of the world, Apple Inc. and Samsung Electronics Co. has their customer
bases because of their separate features and OS platform bases. For this reason, Xiaomi
has chosen the Android OS platform and developed MIUI to deliver smartphones at a
cheaper rate. The company has developed all the common apps like cloud services, the
security app, music player (both online and offline), video player, browser, and many
more. As a result, the substitutes of most of the marketable apps, available in online
marketplaces like Google Play Store, are present in MIUI Express . Now, Xiaomi is a
successful smartphone manufacturing company with both of his hardware and software
manufacturing sections. The competitive price of Xiaomi smartphones and their own
online app market, as well as distribution market, is a deadly combination of
competitive strategies used by Xiaomi.

The following analysis is going to depict the growth path of Xiaomi. Xiaomi, the Apple of
China, is playing the leading role in the smartphone market of China with the sales
record of 90 percent its smartphones. According to Walker (2014), Xiaomi has also

explored its business in the international market such as Taiwan. Xiaomi’s patent portfolio was thin compared to those of large competitors.. Xiaomi has shipped over 22 million smartphones by the end of 2013. The creation of powerful hardware as well as cost price selling of the smartphones and the easy to use app services of their devices has given a revenue over $5 billion within 2013 only. India. In 2010. 35 million users (approx. Europe. the software company has become a hardware company announcing their 1st Android smartphone Mi-One in 2011. and it ran the risk of lawsuits from companies that held patent rights in the countries it wanted to enter. and this case lays out the company’s globalization strategies and challenges moving forward. the core competitive strategies which help Xiaomi to stay ahead in this competition with Samsung are – the razor-thin margins. and Latin America. The company sold over 70 million mobile phones in 2015—while aggressively building out a robust ecosystem. a. Under worldwide area structure. MIUI for Android of Google. Within 2014.) are enjoying MIUI in their devices worldwide. Operation authority and strategic decisions to each of these activities are decentralized to each area. whereas. However. By 2016 it had started to expand internationally. international expansion had become an important part of the company’s overall strategy. output capacity. and quick expansion in the international market. it would take considerable time and effort to tailor the company’s Android-based MIUI operating system for diversified markets—and obtain market-access qualifications. Xiaomi used Worldwide Area Structure. it was facing a declining domestic market and increased competition. . With headquarters retaining authority for the overall strategic direction on the firms and financial control. Xiaomi’s international plan included ten countries in Asia. Singapore. For one. But expanding to other countries would be a challenging road. and cross- culture management development. the world is divided into geographic area. C. Xiaomi had quickly become an industry leader in the Chinese market. Xiaomi has started the journey as a software developing company and released a user- friendly interface. online selling strategy. Therefore. competitive cost advantages. The next year or two would be critical for Xiaomi—and it needed to make the right strategic decisions to succeed in its globalization efforts. 3. Xiaomi had expected to sell 80 to 100 million units that year. Other challenges included building out sales channels. Thailand with its online presence. Hong Kong with its official presence and Indonesia. Therefore. After one year of their journey.

only 3 – the core founder of the Xiaomi. brazil and Poland. . In Xiaomi. there were not enough information about their organizational structure. There are advantages in this organization like the short-line communications are quicker and more efficient as well as the decisions are made quicker. Singapore. Xiaomi Technology has an extremely flat structure. there will be so much disruption on their company. indonesa. which will make the efficiency and productivity of the company much higher c. Because xiaomi were private company and using flat structure for their organization. despite they were using worldwide area structure with geocentric based market in india. the department leader and the employees. if one employee gone. there the not much hierarchy. we think xiaomi did this because they want to protect their employed from being taken by other company because they used flat structure organization.b.

and with xiaomi success it prove that flat structure organization work best with xiaomi cultural environment that family and clan model. with structure like this there will be shorter and faster communication between division. therefore efficient in using production factor .