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Case Study

Tencent: Copying to success

By Michael R. Wade, Weiling Kang and Yulin Fang

18 pages

December 2011

Reference: IMD-3-2274

The case provides a history and description of the Chinese Internet company, Tencent – one of the largest Internet companies in the world. It is not a decision case; there is no decision point and no case protagonist. It has been written largely from public sources. The case is up to date as of the middle of 2011. The case describes Tencent’s interesting approach to innovation wherein the company takes established products and services, sometimes from within China and sometimes from overseas, and adapts them to the local market. There is some controversy with this strategy, as many see Tencent as an imitator (perhaps an illegal one) with very little of its own product development or innovation. The case does not pass judgment on this issue, but provides a balanced account of the pros and cons of this business model.

Learning Objective

The case opens a window to the world of Chinese Internet companies. On the surface, Tencent can be seen as an unscrupulous copier and imitator. However, a most nuanced analysis shows a company that excels at incremental innovation based on a sophisticated understanding of its target customers. The case can be used as a study in digital ethics. It can also be used in an innovation course to show the process of incremental innovation, at the expense of radical innovation.

Keywords

Innovation, Imitation, Internet, General Management, Strategy

Settings

China
2011

Available Languages

English

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