Focusing on the field of intelligent projection, Xgimi built a strategic development model with the whole machine, algorithm, and software system at the core. It creatively integrated projection, audio, and an intelligent system, thus becoming a leading enterprise in the domestic projection devices industry. In the development process, Xgimi faced the challenge of deciding whether to switch from cost-effective competition to differentiation competition. This necessitated a comprehensive analysis, considering factors such as the target customers, the company's ability to meet customer needs, competitive products or substitutes, competitors, differences between them, competitors' reactions, Xgimi's core competencies, and whether it had sufficient resources to drive the switch in the strategic direction (including price adjustment). This case provides an example of a transition from low-end to high-end product competition for a firm in an emerging market or a developing country. It also exemplifies a firm's commitment to technology and innovation-driven growth.
Established in 2007, JD Capital was able to quickly gain a strong foothold in the Chinese private equity (PE) market by massively investing in pre-IPO deals and taking advantage of the high valuation offered by the ChiNext Board. JD Capital has engaged in a "factory-style" operational model. The firm has approximately 60 branch locations across China with more than 300 employees, where each local office is responsible for local deal sourcing and for strengthening communications with local governments, banks, and securities firms. Chinese private equity market has experienced drastic changes since 2012. The issuance of new IPOs slowed down and was later suspended, the opportunities for exit have greatly narrowed, and the raised funds have rapidly decreased. JD Capital's early success had enabled it to obtain a large portfolio of deals, most of which are pre-IPO projects, the slowdown and suspension of IPOs imposed serious exit challenges. Can JD Capital's past investment strategy and business model continue to be effective? Is listing on the New OTC Board a lifesaving solution? As China's capital market has become more mature, how should JD Capital transform itself to stay competitive in the industry?
Fuda Cancer Hospital is an early private entrant, specialized cancer hospital in China. Since its establishment 11 years ago, it has grown from a little-known private hospital to a well-known, specialized cancer hospital that has nearly 400 beds and attracts patients from more than 70 countries and regions. As China's healthcare care has long been dominated by public hospitals, Fuda Cancer Hospital was able to survive and grow by pursuing a differentiation-oriented strategy and a modern hospital management system. The hospital adheres to the strategy of "differentiated development" in the following aspects: Patient positioning - therapy of cancer in middle and advanced stage; Market positioning - Mainly overseas cancer patients in early stage Service; concept positioning - patient-centered, etc. To further expand operation, Fuda Cancer Hospital started to make preparations for IPO in 2011, planning to use the raised funds for hospital relocation and technical reform projects, scientific research and training center construction projects, and brand and market system restructuring projects. However, the hospital is faced with numerous setbacks in its endeavor to go public. From 2011 to 2013, the net revenue of the hospital has been declining, with a decrease of 47.80% in 2013. The cancer therapy, which the hospital is proud of, is challenged in the industry as it brings a negative impact on the IPO of the company. Moreover, since the national government has lifted policy restrictions on private capital in the medical market, many listed companies have invested in private hospitals, and Fuda Cancer Hospital will be confronted with fiercer competition. However, China's IPO market was frozen for nearly two years and Fuda experienced major roadblocks in its IPO journey.
Founded in 1892, Nanjing Gulou Hospital, is one of the earliest western medical hospitals in China. It was founded by Dr. William Edward Macklin, M.D., Disciples (Canada) Mission to China, with the assistance of Prof. Frank Eugene Meigs, the Curch of Christ (USA), and the local Nanjing community. At its early stage of establishment, the hospital took "Love, Kindness and Public Service" as its philosophy and "No prejudice to patients as the first priority", proposed by Macklin, as an aspiration. However, due to the uneven distribution of medical resources, neglect of humanities in China's medical education, among other reasons, Chinese public hospitals showed a lack of human concern over a long period of time. In 2004, the president of Gulou Hospital, Ding Yitao, took humanism as a breakthrough point, and first proposed the missing of honoring the hospital's heritage of humanism and building the best humanistic hospital. At a high level, the strategic transformation is implemented along three dimensions: building a memorial hall to honor the heritage of humanistic spirit of Gulou Hospital, launching an expansion project for the hospital that improves availability and quality of health care, as well as transforming hospital management, operation and performance evaluation that stimulate the cultural consciousness of all employees and create a humanistic hospital. Since Gulou Hospital embarked on the journal to build the best humanistic hospital in China, it has generated positive results in terms of patient attraction and satisfaction level. Gulou Hospital has become an exemplar of modern, humanistic hospital in China and received many awards. However, going forward, the hospital faces mounting challenges. How to further deepening the reform and engage all employees? Will Gulou Hospital's core competency sustain into the future and continues to enable the hospital to gain a strong foothold in the increasingly crowded healthcare market?
Established in 1994, the Tsinghua Science Park ("TusPark") is one of the earliest university science parks in China and was rated the first A-class university science park by the Ministry of Science and Technology and the Ministry of Education. The main functions of TusPark are to promote regional independent innovation, build a university-industry cooperation platform, facilitate the commercialization of research achievements, and incubate start-up enterprises. Today, TusPark hosts about 550 enterprises, including 380 technology companies. These enterprises have created total sales revenue of over RMB 4 billion, and together, they apply for more than 2,000 intellectual property rights each year. Despite these remarkable achievements, Mei Meng and his team are looking further into the future. As China is transitioning from a manufacturing-based economy to an innovation and entrepreneurship-driven economy, there is an enormous opportunity for TusPark to play an important role in this transition. Nevertheless, changes in the external environment also prompted TusPark to adjust its development strategy accordingly, and the question is, how?
In 2006, Dr. WANG Shan was appointed as the president of Peking University People's Hospital (hereafter referred to as "PKUPH"), a large class 3A public hospital in China. Prior to his appointment, PKUPH had experienced three consecutive years of financial losses due to poor internal management. No standard operating procedure was established to prescribe the level of activity expected from each responsible person or decision units, and the amount of resources that a responsible party should use in achieving that level of activity. No formal management control systems were installed to collect, process, analyse accounting (particularly cost-related) information and provide timely feedback to the management. As a result, actual costs significantly exceeded budget. Loopholes in the system stemming from loose monitoring and control gave rise to severe agency problems. To turn the situation around, WANG Shan launched an IT-led management reform. By 2012, the reform has yielded significant and positive results. Annual revenues and profits increased significantly. Management and operational efficiency was also significantly enhanced. This case is intended to demonstrate how an institutionally complex organization (particularly hospitals) can overcome institutional challenges and upgrade management with an IT-oriented strategy.
Established in 1958, Xinhua Hospital Affiliated to Shanghai Jiao Tong University School of Medicine (hereafter referred to as "Xinhua Hospital") is an integrated modern teaching and research hospital with a comprehensive set of disciplines and a specialization in paediatrics. Xinhua Hospital currently has 1,586 beds, 47 clinical departments and 66 specialties. It has three National Key Disciplines, one Shanghai Key Discipline, five Shanghai Jiao Tong University School of Medicine Key Disciplines, one Ministry of Education Key Laboratory (MOE-Shanghai Key Laboratory of Children's Environmental Health), and two of Shanghai clinical centres, respectively. In 2005, Xinhua Hospital co-founded Shanghai Xinhua Hospital Group with Shanghai Children's Medical Centre Affiliated to Shanghai Jiao Tong University School of Medicine, No.3 People's Hospital Affiliated to Shanghai Jiao Tong University School of Medicine, Chongmingbao Town People's Hospital, and Xinhua Hospital Chongming Branch. Under the arrangement, members remain as stand-alone legal entities, and are financially and operationally independent. Since 2007, Xinhua Hospital has been importing talent to lead its disciplinary development and enhancing its management through informatization development. In 2011, the hospital had 3,400 employees and its number of accident & emergency unit patients reached 3.3 million, the highest in Shanghai; it treated 69,000 inpatients and undertook 41,000 operations. Xinhua Hospital is a large Class 3A (the highest grade in China) public hospital. The focus of this case study is to understand how was it able to implement an EMR-centered (electronic medical records, also known as electronic patient records or electronic health records) information system within its complicated, traditional organizational structure.
China Machine Press (CMP), founded in 1952, is a leading multi-field, multi-discipline and multimedia publishing group in China with large scale, comprehensive and specialized business that integrates paper media, audiovisual media and online media, and combines research, publishing, training, printing, issuing and distribution. Currently, CMP publishes more than 3,700 new books and imports over 400 foreign books each year. In 2010, its sales volume of books and periodicals reached RMB one billion. CMP's core competitive advantage lies in its innovative business strategy and management concepts, rigorous publishing standards and high product quality. In 2007, CMP was ranked among the Top 500 Most Valuable Chinese Brands by the World Brand Lab with an estimated brand value of RMB 787 million. From 2008 to 2010, CMP had been on the list for three years in a row, and with brand value rising beyond RMB 1.66 billion in 2010. CMP started as a state-owned institution, and as part of China's publishing industry that is highly regulated by the government, it was also subject to strict government supervision. Therefore, the focus of this case study is to understand how Wang Wenbin, President of CMP, devises new business strategies to gain a competitive advantage in a regulated industry and leads the company to carry forward marketization reform.
Beyondsoft, a leading software outsourcing enterprises in China, began to make preparations for its overseas listing in 2004, including establishing a red-chip structure needed by overseas listing and introducing overseas institutional investors. However, a global financial crisis broke out when Beyondsoft was going to submit its listing application to the U.S. Securities and Exchange Commission in 2007. As a result, Beyondsoft had no choice but to temporarily shelve the listing plan and to wholeheartedly cope with the sudden crisis. Only after Beyondsoft showed steady performance and cash flow in 2009 did its listing was put on agenda again. However, the U.S. capital market was no longer as booming as it had been in the past after the peak of the crisis, making it difficult to reopen a window for the listing in the U.S. To wait patiently, looking forward to the next boom in the U.S. capital market to come soon, or to turn to other overseas markets or resolutely give up the overseas listing plan and go back to the domestic A-share market? Beyondsoft President Ben Wang fell into repeated comparisons and options. Finally, Beyondsoft chose to return to the domestic A-share market and was successfully listed at the SME board of the Shenzhen Stock Exchange on January 6, 2012. The cases of Beyondsoft IPO include part (A) and part (B). (A) is used mainly for classroom discussion and (B) is an after-class reference for students
Founded in 2007, Kunwu Jiuding Capital Co., Ltd (hereinafter referred to as Jiuding) is a Chinese private equity (PE) firm that specializes in equity investments in late-stage, pre-IPO companies. Despite its brief history, the firm had secured a strong foothold in China's PE industry with its tremendous growth and dazzling investment returns. As of 2011, Jiuding had 260 employees and 6 RMB-denominated funds with 6 million RMB under management. While investors showed strong enthusiasm for the firm, Jiuding nevertheless had generated much debate in the PE community about its pioneering investment practice - known as the "PE factory" model where investment activities were carried out in a way similar to large-scale industrial production. This model has subverted the traditional PE business practice in many ways. Concerns were raised about whether or not Jiuding's business model was sustainable in the next ten years, given the fast-changing landscape of China's PE industry.
Xinxing Dutile Iron Pipes Co. is a Chinese state-owned enterprise (SOE) that manufactures cast pipe products and steel products. The company had grown to become a dominant player in the ductile iron pipe industry, holding more than 40% domestic market share and nearly 20% global market share. Historically, Xinxing Pipes' management control system was based on standard costs. This system worked well until the global financial crisis in 2008 where market demand for steel declined rapidly, resulting in intense price fluctuations in both upstream and downstream. The existing management control system failed to respond in a rapid and efficient manner. As a result, Xinxing Pipes reformed its management control system. The reform was based upon two core ideas: (1) keep close watch on the market, increase communication among departments, take coordinated actions, and respond quickly to external market changes; (2) transform the production divisions' cost-centered model into a profit-centered model." These two guiding ideas gave birth to the "Production-Supply-Sales Rapid Linkage" and the "Simulated Legal Entities".
Juner New Materials (Juner) is a private China - based company that develops, produces, and distributes modified plastic compounds. Founded in 1995 by female serial entrepreneur Xiaomin Chen, Juner has exhibited strong performance and growth potential in the past fifteen years. The company currently has a workforce of more than 300 employees and is an icon of high-technology ventures in Zhejiang province. As Juner strives to become the leader in China's modified plastics industry, the company presently faces scalability challenges primarily limited by financing constraints. Recently, with two major competitors having raised additional capital through their respective public offerings, Juner has reacted to these market changes. Since competition was aggressively dedicating new resources toward production and service capacity expansion, by June 2010 it was apparent that external funding was imperative for extending and sustaining Juner's competitive edge. Upon several discussions, Chen and the board of Juner concluded that it was opportune to take Juner public. The decision to go public has led to the discussion of several issues: (1) the choice of stock exchange, (2) the "justified" valuation based upon Juner's fundamentals and respective comparables, and (3) the methods Juner would adopt to maintain its growth rate and exceed investor expectations before and after the IPO.
Many startup companies go through the so-called "entrepreneurial crisis" when they reach a headcount somewhere between 50 and 100 employees. At this point, the CEO and her team have to transition from a personal to a professional management style. Management systems play a critical role in managing this transition effectively. Contrary to the popular belief that the development of such systems kills the entrepreneurial spirit, startups that implement these systems are associated with faster growth, larger size, and a lower turnover of their CEOs. Venture capital backed startups are more likely to implement these systems faster. This article also examines why these systems are adopted and the different roles they play in high-growth companies.
The (A) case follows Dr. Zhengrong Shi, Founder, Chairman and CEO of Suntech Power Holdings, on his journey to create a global solar PV company headquartered in China. It covers his background and inspiration for the idea, his dealings with the local Chinese government authorities, the company's business strategies, competitive landscape, and performance to date. The case concludes with the founder contemplating future options for his company, including the possibility of taking the company public on the New York Stock Exchange. The (B) case follows the company in the post-IPO years, providing an update on strategy, financial performance, and the competitive landscape.
The (A) case follows Dr. Zhengrong Shi, Founder, Chairman and CEO of Suntech Power Holdings, on his journey to create a global solar PV company headquartered in China. It covers his background and inspiration for the idea, his dealings with the local Chinese government authorities, the company's business strategies, competitive landscape, and performance to date. The case concludes with the founder contemplating future options for his company, including the possibility of taking the company public on the New York Stock Exchange. The (B) case follows the company in the post-IPO years, providing an update on strategy, financial performance, and the competitive landscape.
Since its official launch in January 2000, Baidu.com, Inc. (Baidu) quickly grew to become the leading Internet search engine in China. After three rounds of private funding, Baidu registered to go public on the NASDAQ Stock Market (Ticker Symbol: BIDU) on August 5, 2005. This case can be used for at least three types of courses: business valuation, entrepreneurship in emerging markets, or doing business in China. When used for a business valuation or corporate finance course, the case highlights issues involved in the valuation of early-stage companies in emerging growth industries and economies. When used for an entrepreneurship course, the case highlights the opportunities and challenges of starting and growing ventures in emerging markets; it also illustrates how a start-up company can take an existing entrepreneurial idea and proven business model from another country and successfully adapt it to the home market. Three steps in this successful adaptation are: (1) leveraging its local knowledge and expertise, (2) creating a unique competitive advantage for the venture, and (3) creating an entry barrier for its competitors. In a course on doing business in China, the case highlights the strategies for business success in China and the role of culture, government, economy, legal and financial systems, and consumer market in shaping these strategies.
This case introduces the story of RedMed, the leading provider of sleep apnea devices. The company, founded by Dr. Peter Farrell and Dr. Colin Sullivan (the device's inventor) in Australia, quickly became international. The company set up a second headquarters in San Diego and soon was selling devices in Europe, Asia and the Americas, in addition to its "home" market. The case addresses the various strategies the company followed to establish a position and gain leadership in its various international markets.