Why Western Digital Firms Have Failed in China

Many leading American digital firms, including Google, Amazon, eBay, and Uber, have expanded internationally by introducing their products, services, and platforms in other countries. However, they have all failed in China, the world’s largest digital market. A comprehensive five-year study systematically identified the reasons behind these failures. The research drew on interviews with executives from leading Western firms and their Chinese competitors, and with seasoned expert observers in China. The executives pointed to a lack of strategic determination and patience by the Western firms as the cause of failure. The expert observers had a different take, pointing to the failure of the Western firms to adapt to China’s business environment. Both groups agreed on several steps that Western digital firms could try to get back in the game, including improving their understanding of China’s business environment, becoming more effective at strategy making and communication, and improving in operation and execution. But it’s important to remember: Sometimes doing everything right is just not enough.