Dragons at Your Door: How Chinese Cost Innovation Is Disrupting Global Competition Hardcover – Illustrated, June 12, 2007

Chinese firms have a cost advantage. That is not news. However, this may be the first book to point out that emerging Chinese competitors - companies as powerful as the "dragon" metaphor of the book's title - also have a managerial advantage: Cost innovation, which involves much more than simply manufacturing products cheaply. Ming Zeng and Peter J. Williamson show how some of China's leading manufacturers combine cheap labor, competitive domestic markets and technological innovation to forge a very powerful edge. The authors contend that Western firms may have to relocate high-value activities to China to counter its cost innovation advantage. We suggest that all companies can benefit from this suggestion to march forward instead of retreating in the face of Chinese cost-innovation competition.

Having read countless books on the topics surrounding the Chinese economy and the rise of Chinese companies, I believe that this is certainly one of the best.As suggested in the heading of my review, this is finally a book that deals with the business issues of China (and the greater issue of outsourcing) critically and comprehensively.I too have spent some time in China speaking with a number of different businesses and managers, and this book comes closest to describing the way in which Chinese managers think. In fact, this book can be read in the context of Porter's "Competitive Advantage of Nations", in order to shed light on the ways in which market space and the business environments have and will continue to change.Based on the difficulties associated with the Chinese business environment, Chinese companies have managed to develop strategies to overcome a number of basic disadvantages, and to turn these into inherent advantages.My tip, be aware of your strategic position and your competitive scope and do not sacrifice the long term future of your company on the alter of short term gains.

Its always interesting to look at the companies and predictions made about them in business books. This book, about Mainland China firms, is interesting and got a lot of attention when it came out in 2007. I was skeptical of its arguments that Chinese firms had somehow figured out 'cost innovations' that no one else could see or appropriate (incongruously, researchers and pundits used to say that about Japan and Japanese firms, that somehow their costs were lower than everyone else's which was a bizarre declaration given Japan's excruciatingly high costs in so many areas). If you look at the firms this book talks about, some, a decade later are doing fairly well (Huawei, Haier), others are doing just ok, though have hardly become world beaters (electronics firm Shinco), while others did not do well at all (Comac's ARJ21 medium jet-aircraft is an example -- the book says they wanted to sell two or three hundred in the years after 2008; they have shipped six as of this writing in 2017. Many more sales have been on the books for years by airlines in Mainland China mostly, but few deliveries have been made). Actually, if you look at many of the firms in this book, it is odd that the authors would call them "world beaters" as most of them are not multinational enterprises at all, with very limited overseas activities (sometimes they have some significant overseas assets, but these are often financial or land / building assets and not part of their core businesses). In fact, much writing on China firms repeats stories of the same ten firms or so, and then reminds everyone to "watch out" as "more and more" competitors or coming. Well its good to "watch out" but its also good to revisit predictions. And the 'dragons' in this book mostly did not turn out to be dragons, and they are hardly at any doors. If anyone is interested in an well-done, empirical update on China MNEs, and their limited footprint, see the excellent article in the management literature -- Rugman, A. M., Nguyen, Q. T. K., & Wei, Z. 2016. Rethinking the literature on the performance of Chinese multinational enterprises. Management and Organization Review, 12(2): 269–302. That article will bring you up to date on the empirical evidence for Chinese MNEs. The fact is, there are very few true MNEs from China (Alibaba and the other IT firms are not MNEs and do not compete in truly competitive, open markets).

Not even a good or well argued idea, once again as in far too many business books stretched beyond what would have been a badly argued article to a bad argued book

Wow, what an eye opener. The book provides "great" case studies on China's industries/companies and their relationship with the Chinese government; and how they are emerging as a world economic powerhouse. Get ready and defend our industries.....

Very average book - a lot of anecdotal stories, no overall concept

great book I ever read about the new wave from China , becomes a global leader with the powerful weapon that breaks our conventional rules in strategy. How can they afford high technology, variety & customization, and specialty products without increasing costs? This book can answer every your questions. forget the past that they are producers of cheap, low -quality products.Everyone who believes the world is flat must read this book..

China has come to the party. Not only that the country is the world's factory, but also home to some of the leading global MNCs. Little known are the strategies that have led to graduation of Chinese companies from low-cost imitators to world-class innovators. The book by Zeng and Williamson offers theories on how Chinese companies compete on an equal footing with world leaders. The three key strategies are: offering high-technology at low-cost, variety at low-cost, and speciality products at low-cost.Some of the factors driving China's cost advantage are access to low-cost talent across skill levels, access to state's asset and intellectual property at discount, exceptional management autonomy, and strong incentives to succeed.I particularly liked the 'loose-brick' strategy adopted by Chinese companies to get a market foothold and eventually dislodge the incumbents. Equally unique is China's strategy of 'demand-wedge' where its market power forces incumbents to share core technologies for participating in large scale projects.The book is an eye-opener on why Chinese companies can't be overlooked any more.

This is a very interesting book showing how Chinese companies mature and grow in 3rd world markets under the radar of western competitors and then take over their western home markets often with a radical lower price points that were necessary to compete in the developing markets. As the product sold in millions matured enough and is often driven down further down in cost when hitting the western market it quickly gains market share while the baffled western competition is unable to slash costs quickly enough to compete. Highly recommended read especially for those who feel safe in their high margin markets.Good examples are given and it is shown that this is about more than just cost.

Great book thank you.