Running Head: BUSINESS STRATEGIES 1

Business Strategies

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BUSINESS STRATEGIES 2

1. A company is diversified when it owns operates in several unrelated business

segments and this type of companies come with their own specific benefits and

limitations. There are two types of diversification that companies employ;

concentric diversification, which involves adding similar products or services to

the existing business. When a company that produces computers starts

manufacturing laptops it is said to be employing concentric diversification. The

other type of diversification technique is Horizontal diversification, this technique

involves providing new and unrelated products or services to existing consumers

of their products. Like a when a pen manufacturer starts manufacturing notebooks

for their consumers and the probability of failure to this technique is not high.

2. Xiomi is diversifying into electric vehicles and computer chips with shipments in

China alone increasing by 52% year after year due to market share wins with

Xiomi now holding 15% of the domestic market (Seiberth & Gründinger 2018).

Xiomi is using expansion strategies due to their desire to expand globally and are

focusing on cost control, marketing penetration and market entry. Beyond its

products, Xiomis’ core strategy has allowed it to stand out through the years.

3. Deep motion is a Beijing startup that develops digital mapping technology for

autonomous vehicle. The acquisition of deep motion is aimed at shortening the

time to market for their products and speed up the autonomous driving research.

The purchase of deep motion will lead to creation of new revenue streams for the

company. This acquisition will help enhance the technological competitiveness of

its electric business. Xiomi hopes to become a competitor to other autonomous

driving and electric car manufacturers such as Tesla and Waymo in the U.S. to let

everybody enjoy smart driving across the globe, Xiomi has offered to invest $10

billion to its upcoming electric vehicle business.

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4. Xiomi is pursuing this strategy since this will lead to an expansion into China’s

auto sector and this could greatly expand Xiomi mobile ecosystem and lead to

creation of new sources of their revenue. Xiomi is not just a smartphone

manufacturing company, it is business of technology-based services, electronic

products and many more (Sun & Fah 2020). And as Xiomi is looking to be best

auto manufacture globally expansion strategy since it is an integral part of their

digital marketing. The company has been innovating in its main revenue stream

with products such as television, shoes, sunglasses, backpacks, all such products

have no relation to the main business which is a smartphone.

5. The Boston Consulting Group (BCG) growth-share matrix is a planning tool that

uses graphical representation of a company’s products and services in an effort to

help the company decide what to keep, sell or invest. The deep motion matrix

breaks down products into categories that assist in product classification. The

BCG requires that firms classify all their product into horizontal axis which relates

with the market share, and the vertical axis which represents market growth rate.

BCG helps companies know the need achieve a return on innovation investment

and fill the gap between the company’s product and the consumer. BCG

innovation to impact helps companies to evaluate the readiness of their innovation

programs to operate in a consistently high-level efficiency and top effectiveness.

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References

Seiberth, G., & Gründinger, W. (2018). Data-driven business models in connected cars,

mobility services & beyond. BVDW research, 1, 18.

Sun, L., & Fah, C. T. (2020). Xiaomi-transforming the competitive smartphone market to

become a major player. Eurasian journal of social sciences, 8(3), 96-110.