Anything is possible: Just do it -a comparison of the evolutionary process of Chinese and Western newcomers

Abstract

Chinese multinationals are currently progressing at an impressive speed towards high-end industries, and China is now seen as a country with strong competitors utilizing a unique set of advantages such as cost innovation. This simultaneously triggers insecure behavior by Western companies towards Chinese firms. Are the Chinese multinationals changing the rules of the game and are the concerns of Western companies‟ legitimate? By exploring the different competitive approaches used by Western and Chinese newcomers, we examine if the existing theories within competitive behavior can explain the new emerging competition. By conducting two case studies within the sports industry; Nike and Li Ning, two different approaches towards global interplay are compared. The purpose is to examine the explanatory power of existing theories and to provide Western managers with a more comprehensive understanding and new competitive mindset towards the emerging competitors. Although higher profit margins and cost innovation are evident, Li Ning is still imitating the strategic behavior of its Western counterparts, and take advantage of the same strategic logic. Hence, Western companies should accept the challenge and seize opportunities in China, rather than running away in fear.