EnterpriseECommerce
The China Factor: How Can Companies Compete

August 10, 2016

Amy Karam, author of the book, The China Factor:Strategies to Compete, Grow and Win in the New Global Economy, recently was interviewed at Google's Mountain View campus, providing insight for companies to better compete.



"The main intention of "The China Factor" is to equip western-based companies with strategies and tactics and knowledge to better compete with emerging entrants like those from China," says Karam. "China has risen, they're doing a great job, there a strong force in our economy and they do business differently. The premises is that we as western-based companies need to change our game. We need to know that emerging competitors have different approaches and we need to be more creative about that."

"The other element is the innovation advantage and how do we protect or maintain and evolve our innovation advantage?" she asks. "How did China become so strong? What are the strengths and weaknesses of each side, the West and the East?"

Working for Cisco in China Was Eye Opening

Karam's time at Cisco where she was involved in the Cisco sales strategy shaped her opinions of how Western companies can better compete. "The results were eye opening," she said. "Wow, this isn't business as usual. It's not like our domestic competitors. It's not a product superiority play anymore, where it's like my box is better than your box so I'll win the business. That's not what was happening in emerging markets and especially with some emerging competitors."

"That was the catalyst for me to say, wow, this is not a trend, this is not a blip, this is here to stay." She noted some big competitive differences with Chinese companies. "First is the severe price discounting and that's no shocker right? Most of us know that that's generally a pretty consistent market penetration strategy, but there was really no bottom to it. I encountered a lot of escalations where they say, hey my competitors just discounted me by another 25% and I need approval for another discount. We realized that wasn't going to be a successful strategy for either competitor and even for the customer, it wasn't a winning game."

"Another big thread was financing, which we didn't really get into very much as a Western based company but that's a a real helpful tool for emerging customers. This competitor would help them with financing and to an extreme degree. Sometimes they would help finance over a very long period of time and that was a real great value to these emerging markets customers."

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