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Innovation in the Local Context: A Case Study of BYD in China

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2018, International Journal of Innovation and Technology Management

In this paper, we have used the case of build your dream (BYD) to examine firm innovation in the context of China. From a historical perspective, with its strategic diversification from battery to mobile phone manufacturing to automobile manufacturing, we find that BYD has been innovative in its production method, vertical integration strategy, and design of product for local customers. The effective understanding and leveraging of local contextual factors including supply of labor (especially low cost-highly skilled labor), growing middle class, and local industry environments have played important roles in BYD's innovation in China.

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  • Academia ©2024

BYD targets the world

By: Andrew Inkpen, Kannan Ramaswamy

The case focuses on the growth of electric vehicle (EV) market in China and the emergence of BYD as a major player aspiring to gain a significant foothold in global EV markets. The case traces the…

  • Length: 12 page(s)
  • Publication Date: Jun 11, 2024
  • Discipline: Strategy
  • Product #: CBS043-PDF-ENG

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The case focuses on the growth of electric vehicle (EV) market in China and the emergence of BYD as a major player aspiring to gain a significant foothold in global EV markets. The case traces the growth of the industry in China, identifying factors that have contributed to the rise of Chinese companies in this industry. In doing so, it offers a rich portrait of the industry landscape encompassing contextual factors, including the role of government and governmental subsidies to the industry, the intensity of competitive rivalry shaping the race for Chinese market share, and the nature of buyers and how their demands have forced Chinese companies to hone their skills in design and value engineering, which can be used to mount an assault in global markets. After providing a broad discussion of the industry, the case delves deeper into the strategic choices made by BYD as it rose to the top ranks of global players in units produced. The case closes with broad questions about the directions that BYD could pursue as it seeks to conquer advanced country markets from its China homebase. In doing so, the case sets the stage for debate on issues relating to transferability of home-grown advantages, the entry barriers that they will confront in markets such as the United States, and ways in which the barriers can be overcome.

Learning Objectives

The case is ideally suited for classes in strategic management with an emphasis on global strategies. It can also be used in classes that cover issues on cross-border trade.

Jun 11, 2024

Discipline:

Geographies:

Asia, China, Europe, North America, United States

Industries:

Automotive industry, Goods, trade, and consumer services

Copenhagen Business School

CBS043-PDF-ENG

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