Edward Tse - China’s Disruptors: How Alibaba, Xiaomi, Tencent, and Other Companies are Changing the Rules of Business
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In September 2014, Chinese e-commerce giant Alibaba raised $25 billion in the worlds biggest-ever initial public offering. Since then, millions of investors and managers worldwide have pondered a fundamental question: Whats really going on with the new wave of Chinas disruptors?
Alibaba wasnt an outlierits one of a rising tide of thriving Chinese companies, mostly but not exclusively in the technology sector. Overnight, its founder, Jack Ma, appeared on the same magazine covers as American entrepreneurial icons like Mark Zuckerberg. Ma was quickly followed by the founders of other previously little-known companies, such as Baidu, Tencent, and Xiaomi.
Over the past two decades, an unprecedented burst of entrepreneurialism has transformed Chinas economy from a closed, impoverished, state-run system into a major power in global business. As products in China become more and more sophisticated, and as its companies embrace domestically developed technology, we will increasingly see Chinese goods setting global standards. Meanwhile, companies in the rest of the world wonder how they can access the fast-rising incomes of Chinas 1.3 billion consumers.
Now Edward Tse, a leading global strategy consultant, reveals how China got to this point, and what the countrys rise means for the United States and the rest of the world. Tse has spent more than twenty years working with senior Chinese executives, learning firsthand how Chinas most powerful companies operate. Hes an expert on how private firms are thriving in what is still, officially, a communist country. His book draws on exclusive interviews and case studies to explore questions such as
*What drives Chinas entrepreneurs? Personal fame and fortuneor a quest for national pride and communal achievement?
*How do these companies grow so quickly? In 2005, Lenovo sold just one category of products (personal computers) in one market, China. Today, not only is it the worlds largest PC seller; it is also the worlds third-largest smartphone seller.
*How does Chinese culture shape the strategies and tactics of these business leaders? Can outsiders copy what the Chinese are doing?
*Can capitalists really thrive within a communist system? How does Tencents Pony Ma serve as a member of Chinas parliament while running a company that dominates online games and messaging?
*What impact will China have on the rest of the world as its private companies enter new markets, acquire foreign businesses, and threaten established firms in countless industries?
As Tse concludes: I believe that as a consequence of the opening driven by Chinas entrepreneurs, the push to invest in science, research, and development, and the new freedoms that people are enjoying across the country, China has embarked on a renaissance that could rival its greatest era in historythe Tang dynasty. These entrepreneurs are the front line in Chinas intense hunger for success. They will have an even more remarkable impact on the global economy in the future, through the rest of this decade and beyond.
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In the Internet era, China has outpaced most advanced countries in terms of new technology adaptation and economic growth. In this book, Edward Tse clearly illustrates how Chinas explosive growth in business will continue to impact the whole country and the rest of the world.
YU GANG, PH.D. , chairman and cofounder, Yihaodian
Edward Tse is to Chinese corporate strategy what\ Kenichi Ohmae was to Japanese corporate strategy. This is a book that I could not put downa deeply insightful book on China that no Chinese strategist or analyst, let alone corporate captain, can ignore.
ANDREW SHENG, former chairman of Hong Kong Securities and Futures Commission and chief adviser, China Banking Regulatory Commission
Edward Tse is an influential thinker in the Chinese business community given his unique background coupled with global knowledge and perspective. Chinas Disruptors will enlighten global business leaders with new visions coming from China.
WANG WEI, chairman, China Mergers & Acquisitions Association
This is the book for every person who is wondering how Chinas impressive growth in business is going to impact the rest of the world.
DR. HUBERT LIENHARD, president and CEO of Voith GmbH and chairman of the Asia-Pacific Committee for German Business (APA)
Chinas Disruptors provides a birds-eye view of the entrepreneurs driving growth and innovation in China. Edward Tses insights into how Chinas leading businesses will shape the future are important for understanding the global marketplace. These insights along with the personal stories of Chinas business leaders make for a fascinating read.
NANCY MCKINSTRY, CEO and chairman of the executive board, Wolters Kluwer, NV
Edward Tse explores very clearly the rise of Chinas entrepreneurs and the opportunities their rise will generate. After I read the book it became clear to me how global businesses will inevitably have to become more Chinese in their manner of operating.
RONNIE LETEN, president and CEO, Atlas Copco AB
This book will change the way you view China, even if you think you are an expert. Edward Tse uses his unique insights and knowledge of Chinas homegrown entrepreneurs to craft the story of the countrys emergence as a global powerhouse driven by innovative disruptors. A must-read.
RAKESH KAPOOR, chief executive officer, Reckitt Benckiser Group plc
In Chinas Disruptors, Edward Tse provides the kind of insight that only comes from a true insider. If you want to understand whats behind the unprecedented growth of Chinas private sector and what it means for the rest of the world, read this book.
FENG LUN, chairman of the board, Vantone Holdings Co., Ltd.
An amazing book on Chinese entrepreneurs who are reshaping the Chinese economy and perhaps the world in the longer term. It helps businesspeople from the West to better understand how this major new force has come about and how it might change the economic landscape worldwide.
VINCENT H. S. LO, GBS, JP; chairman, Shui On Group
Essential insights about an emerging class of competitors from China who will dramatically change the competitive playing field as we know it, told by Chinas leading global strategy consultant, Dr. Edward Tse.
RONALD R. HADDOCK, vice president, strategy and business transformation, Johnson Controls
Edward Tse offers a fascinating and insightful journey through the successive generations of spirited entrepreneurs who overcame a once business-averse environment to shape Chinas free enterprise.
OLIVIER BOHUON, chief executive officer, Smith & Nephew Plc
Edward Tse has been discussing the eventual onslaught of Chinas disruptors for well over a decade. The day when these disruptors are on the world stage and are changing the economics and geopolitics of business is finally upon us. If youre running a global business in any industry, the Chinese disruptors will reshape your business. No one understands that better than Ed and no one can tell the story in such a compelling fashion. A must-read for todays business leaders.
SHANE TEDJARATI, president and CEO, high growth regions, Honeywell
China will become, if it is not already, the most important market for all high-growth companies in the world. Edward Tses book will provide important insights to the decision makers in these companies.
ANTONY LEUNG, group CEO, Nan Fung Group; former financial secretary, Hong Kong Special Administrative Region Government
Edward Tse has perfectly captured what todays Chinas economy is made of. Chinas disruptors, often looked down upon by their Western counterparts, are the main drivers behind Chinas dynamism today. We in the West have much to learn from them. Today, Chinas disruptors; tomorrow, the worlds disruptors.
ROLAND DECORVET, former chairman and CEO of Nestl Greater China
In Chinas Disruptors, Edward Tse takes us into the fascinating world of Chinas leading entrepreneurs. In the process, he shows us a business community that is far more adaptive, flexible, open-minded, and innovative than international observers realize. Chinas Disruptors is a must-read for those who wish to understand the companies and entrepreneurs that are changing China and eventually the world.
MICHAEL J. ENRIGHT , Sun Hung Kai Professor, University of Hong Kong, and director, Enright, Scott & Associates
PORTFOLIO / PENGUIN
Published by the Penguin Publishing Group
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First published by Portfolio / Penguin, an imprint of Penguin Publishing Group, a division of Penguin Random House LLC, 2015
Copyright 2015 by Edward Tse
Penguin supports copyright. Copyright fuels creativity, encourages diverse voices, promotes free speech, and creates a vibrant culture. Thank you for buying an authorized edition of this book and for complying with copyright laws by not reproducing, scanning, or distributing any part of it in any form without permission. You are supporting writers and allowing Penguin to continue to publish books for every reader.
ISBN 978-0-698-18411-4
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Over the last two and a bit decades, based in Shanghai, Beijing, and Hong Kong, and working in many other cities across China, I have had the perfect seat to watch the extraordinary transformation of the worlds most populous country from economic also-ran to global superpower.
Except, of course, countries dont transform themselvestransformations are wrought by people.
This book is about the people who are largely responsible for that transformation. Not the political leaders, who, important as they were in creating the conditions for business to take off, are not directly responsible for economic growth. Nor Chinas state-owned enterprises, whichcontrary to widespread popular beliefhave seen their importance in the Chinese economy decline sharply. But, of course, its entrepreneursthose people who actually set up businesses and grew them by delivering the goods and services that people were prepared to pay for, and in the process creating the jobs that would allow people to buy those goods and services.
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