Pearson BTEC Level 7: Xiaomi - Strategic Management & Leadership

This report examines the strategic management and leadership practices of Xiaomi, a prominent technology company. It analyzes the impact of leadership styles, particularly transformational leadership, on the company's strategic decisions, product development, and organizational culture. The report explores how Xiaomi's leaders, including founder Lei Jun, have fostered innovation, customer-centricity, and a strong brand identity. It delves into the alignment of leadership with strategic goals, the influence of management styles on strategic choices, and the adaptation of leadership to economic challenges and management succession. Furthermore, the report provides recommendations for leadership strategies and a development plan for leadership skills, considering external environmental influences and emerging situations. The analysis highlights the importance of leadership in driving strategic success and building a strong relationship with stakeholders and customers.

Running head: DEVELOPING STRATEGIC MANAGEMENT & LEADERSHIP SKILLS
ASSIGNMENT COVER PAGE
Assignment: Developing Strategic Management & Leadership Skills at Xiaomi
Subject: Developing Strategic Management & Leadership Skills
Programme: Pearson BTEC Level 7
Extended Diploma in Strategic Management & Leadership
Student Name: Lam Cheuk Wai
Student No.: 179148101
Assessor Name: Alfred Yu
Due Date: 13 August 2018

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Executive Summary
The purpose of the assignment is to determine the dynamics in between organizational leadership
and strategic management. The leaders of an organization have significant role in the success of
the company’s achievements. The case study that has been chosen to analyze in the assignment is
Xiaomi which is a technology company popular for its high quality low price Smartphone
portfolio. The company is relatively new and in a span of less than 10 years has gathered
significant prominence and goodwill in the industry as well as among the stakeholders. The
organization has focused on the customers as their priority for their product development. The
assignment covers various aspect of leadership in the company.

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Contents
1. Introduction..................................................................................................................................3
1.1 Company Overview...............................................................................................................3
Task 1 (LO1)....................................................................................................................................5
1a. Leadership aligned with strategic management of Xiaomi (AC 1.1 and 1.2)........................5
Impact of management and leadership styles on strategic decisions...........................................7
1b. Leadership styles required to adapt the situations of economic recession and management
succession of new leader (AC 1.3)..............................................................................................8
Task 2 (LO2)....................................................................................................................................9
2a. Impact of leadership on strategies of Xiaomi (AC 2.1).........................................................9
2b. Recommendation of leadership strategy that should be adopted by the company (AC 2.2)
...................................................................................................................................................11
Task 3 (LO3)..................................................................................................................................12
3a. The requirements of current leadership with external environmental influences (AC 3.1).12
3b. Leadership required to deal with different emerging situations (AC 3.2)...........................14
Task 4 (LO4)..................................................................................................................................15
4a. Development plan of leadership skills (AC 4.1)..................................................................15
4b. Justification of the development plan (AC 4.2)...................................................................16
Conclusion.....................................................................................................................................18
Reference List:...............................................................................................................................19

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Bibliography..................................................................................................................................22
1. Introduction
Strategic management is the process by which organization take and implement decisions
in order to be a successful venture. Strategic management includes rationalizing and planning
process of the business which will be based on logical data and reasoning. There are a number of
theories and concepts that have been developed by scholars regarding strategic management.
Marketing, Administration, finance, Human resource, operations, organization structure, and
organization culture are some of the subdivisions of strategic management (Wheelen et al. 2017).
Leadership in an organization plays an equal important role in the success and achievement of
the objectives that have been implemented by the strategic management decisions of the
organization. The decisions that are taken in the company are based on the type of leader that
runs the organization as the values and principles of the leader reflects in the culture of the
company as well (Adair2009). For example: if the style of leadership in the organization is
transformational then the culture among the work place will be encouraging creativity and
innovation as transformational leadership drives changes and accepts alterations in the
organization as a positive aspect (Sallehand Grunewald2013). This aspect therefore assures that
there is a direct impact of leadership in the strategic management of the company. The
organization that has been chosen to study the strategic management and leadership is Xiaomi
Corporation. It is one of the leading start-up in the international market and in a very short period
of time the company has gained a lot of prominence in the technology industry on a global
platform.

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1.1 Company Overview
Established in 2010, Xiaomi is a privately owned Chinese organization that is reported as
one of the most valuable technology start up in the global platform(Mi.com, 2018). The Logo of
the company is MI stands for mobile internet and also Mission Impossible, as the management
has faced a number of challenges in the early days of establishment(Mi.com, 2018). The
company stands for innovation and is motivated to reach out to the customers with making high
quality technology and making it available for the customers in minimum price. Lei Jun is the
man behind the endeavor and in 2014 Forbes magazine recognized him as the businessman of
the year owing to the rapid growth and expansion of the company. The product portfolio of the
company ranges from Mi phones, Redmi Phones, Mi TV, Smart Devices, audio accessories, Mi
Power bank (Mi.com, 2018). The company is a multinational organization having its operations
and distribution in Taiwan, Hong Kong, Singapore, Malaysia, Philippines, India, Indonesia and
Brazil(Mi.com, 2018). The innovation and the mission and objectives of the company will be
explored and aligned with the leadership styles that have been included in the organization to
bring it to success. One of the qualities that have been observed across the leaders in various
segments of Xiaomi is that the people are experienced in their field and have knowledge and
practical experience. This cumulative experience of the people has enabled the company to take
decisions which have helped in achieving the recognition and success in the industry(Mi.com
2018).
The objective of the company is to be one of the most user-centric mobile internet
company, this decision is taken based on the style of leadership as one of the feature of
transformational leadership is to inspire and reach out in order to provide the best possible
solution in order to build a valuable relationship with the stakeholders(Mi.com, 2018).

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Task 1 (LO1)
1a.Leadership aligned with strategic management of Xiaomi (AC 1.1 and 1.2)
The company believes in innovation in the product development and makes products
keeping in mind the needs and requirements of the customers. The company is strives to provide
the customers with best quality product at the minimum price possible. The price of the products
are kept low hence this does not mean that the quality of the product is low or is compromised
with. The culture of the company is driven by the loyal customers who are recognized as “fans”
of the company (Adair 2009). The company will develop products and continue to achieve the
milestones in order to reach out to these “fans”. The company works with the employees as a
team in order to provide the customers with the best user experience possible by pursuing
perfection in the endeavor, constantly refining and enhancing the products. The company
continues to launch one product after another with higher specification keeping a check on the
price. Therefore, it can be said that innovation is a large part of the business model. The
company operates in the technology industry specifically Smartphone industry making the
competition very tough and in order to maintain the edge over the other organization the
company has strategic management decisions regarding the price and products development. The
strategic management decisions taken by the company revolves around innovation and thus the
kind of leadership that is prevalent in the organization is appropriate (Gold et al. 2010). Lei Jun
is the founder and CEO of the organization and before MI he was associated with a number of
successful startup ventures, he is a person who is known for having visionary approach in the
business. The kind of leadership style that is incorporated by him in the company can be easily

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termed as Transformational. Transformational leadership is the style where a leader encourages
and motivates changes and welcomes innovation in the organization (Adair 2009). Such a leader
welcomes changes as an optimistic aspect of the business and in this case Lei Jun is a person
who is always looking forward to change and improve in order to provide the company with
customers with best possible outcome (Gold et al. 2010). As the strategic management decisions
taken by the company is always looking forward for change in the system and in the products
therefore it is important to have a transformational leader, who is far-sighted and is visionary so
that the company can keep up with the dynamics of the industry and accordingly cater to the
requirement of the loyal customers (Adair 2009). Form an employee perspective; a company that
seeks innovation is always encouraging the people to explore their creativity. This aspect of the
company provides the employees with a flexible work culture. The role of a leader is very
important in the way motivation is employed in thework culture. The leader is responsible to
ensure job satisfaction among the people and to grow a sense of commitment among the
employees. The people who are in the higher management of Xiaomi are the leaders in the
organization and each of them share their perspective of innovation with the employees by
motivating and inspiring them with their involvement of the passion for what they create (Gold
et al. 2010).
The role of a leader in a startup company is more prominent than an established
organization as the number of challenges for a company that is new is comparatively more than
an established business (Adair 2009). The role of the leaders in Xiaomi is divided according to
their expertise and their knowledge, the role of the leaders of the departments is to achieve the
objectives of the company and in order to does that ensure the people are motivated and are
excited to work with the company. Not only that the leaders focus on building a team and

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making collective effort to strive and achieve success. As a start up the organization has built a
very coherent culture which encompasses the “fans”, which is a major part of the strategic
management to keep up with the culture of the Company the leaders make sure that the process
of product development or any strategies further taken are based on the customers’ requirement
(Mullins2010). One of the major roles of the leaders of Xiaomi is to be the representative of the
organization, during any product launch or announcement the company is represented by the
founder or any of the co-founders as representative of the company to communicate with the
customers and the stakeholders. The representatives with their communication share their
excitement and their passion for the company. One of the objectives of the company is to build a
valuable relationship with the customers and this representation of the leaders’ help the company
establish the same (Mullins2010).
Impact of management and leadership styles on strategic decisions
Strategic decisions of a company are formulated with the help of rational reasoning for
example: market research. The management of Xiaomi take decisions and employees strategies
based on the culture, values and principles that define the organization, this also includes the
leadership style(Johnston and Marshall 2016). As mentioned above the leadership style that drive
the company is transformational therefore constant change and improvement in the process and
product of the business are the foundation of the decisions that are taken by the management.
The role of a leader is to take decisions for the company in order to achieve the objective of the
business and the style of leadership impacts these decisions. As a transformational leader Lei
Junensures that the process of innovation and change is consistent in the company(Johnston and
Marshall 2016). The objective of the company is to provide a low-cost, hi-specification
Smartphone to the customers, and in order to achieve this objective the company incorporates

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financial investment in research and development department. For example: the company
continuously upgrades the user interface thus making it easier for the user to utilize the product
to its full potential. The management of the company has a MI Forum where the fans of the
company can interact with the customer service and provide valuable feedbacks for the products
and services (Johnston and Marshall 2016). This decision is taken by the management in order to
understand the requirements and the trends of the industry so that they can cater to the customers
better. This is in sync with the characteristics of a transformational leader as the leader following
this style is always looking forward for development in the process (Mullins2010).
1b. Leadership styles required to adapt the situations of economic recession
and management succession of new leader (AC 1.3)
Any business organization operates in two business environment: internal and external.
While the internal business environment factors are under the control of the management of the
company the external factors are not, therefore the management should adapt to the dynamics of
the industry in order to survive. Political, economic, society, technology, environment and legal
aspect of the environment in which the business is operating impact the decisions taken by the
management of the organization. Economic recession is a part of the economy factor of the
eternal environment and is a situation of crisis for any organization (Bolden2016).Organizations
take decisions according to the dynamics of the external business environment in order to be able
to combat such crisis situations. A leader should be far-sighted so that he or she can be ready to
mange such crisis situation. During recession the purchasing powers of the people reduce which
in turn makes it difficult for any organization to earn revenue through sale; the stock price of the
companies in such situation is also low (Yukl2013). Fiedler's contingency theory of leadership
state that effectiveness of a leaderis not only based on the style but is also based on how the

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leader manages a certain situation. For the case of recession first and foremost the leader should
accept the situation and be able to communicate the crisis and the steps that are going to be taken
with the employees as in the time of economic recession the employees will be apprehensive
about their position in the organization as well as the position of the organization in the industry
(Fiedler2015). Inorder to adapt the situationthe leader must take decisions based on rational
reasoning and ethics (Yukl2013).
In the case of management succession of a new leader, it is important for new leader to
understand the dynamics of the company first. This will help the leader to adapt to a style that is
fit for the organization and is aligned with the culture and the prevalent management of the
company. With the help of simple strategic management tools like PESTEL analysis and Porter’s
five forces, Value chain analysis etc., the leader can understand the factors that drive the
company as well as understand the strengths, weaknesses, opportunities and threats of the
company(Morden 2016).
Task 2 (LO2)
2a.Impact of leadership on strategies of Xiaomi (AC 2.1)
The leadership style that is incorporated in the organization leads to the way the
organization run, defines the culture and the structure that is prevalent in the company. There are
a number of types of leadership styles that are employed by the owners and the managers to
support the team in order to achieve the objectives of the business. Strategic management
decisions of the business begin by defining the mission, vision and objectives (Tyssen et al.
2013).Thus the type of leaders in the organization also influence the kind of objectives the
business follow for example: if a leader is transactional in nature then they will be inclined to

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make profits more than taking other responsibilities of the people and the planet. There are a
number of types of theories that are developed over the years by scholar in order to understand
the style of leadership among the individuals. Some of the examples are: Transformational
Leadership, Transactional Leadership, charismatic leadership, situational theories etc. As the role
of a leader of an organization is taking decisions and implementing them, the strategies that the
leaders make in the process of business are based on the type of leader they are ((Tyssen et al.
2013). In the case of Xiaomi, the leaders are transformational in nature, therefore any decisions
that the management formulate comprises of a change in the process of product.
The leaders of Xiaomi are transformational as the company runs on the business model
where innovation and change plays are large role. The objectives of the company to focus on the
customers and be responsible towards the society and the environment are derived from the
values and principles that the leaders of the organization share (McCleskey2014). The optimistic
approach towards the business and the industry is also the culture that drives the success of the
company and the leaders play an important role in establishing the same among the people
associated with the company. The leaders of the company believe that something wonderful is
about to happen is what defines the company. There are multiple layers of leadership in the
organization which maintains the consistency and understanding in the process of business. The
leaders of each department is responsible in their own ways to run the segments, however the
style of leadership is similar as the culture of the company is based on innovation and the passion
to offer the customers with high quality products (Sethuramanand Suresh 2014).
Jun Lei is the founder, chairman and the CEO of the company; he is a man with vision
and is responsible for developing the objectives and the vision of the company (Mi.com 2018).
The values and principles of the company are also aligned with his outlook and principles. He

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has the experience of working as a leader in other IT organisations as well and through his tenure
he has learnt a number of aspects for developing Xiaomi. In 2011, he gathered all his experience
to invest in this company. He is a transformational leader as the company believes in change,
which is a major part of transformational leadership. The competitive strategy of the company is
to provide the customers with products of high quality parallel with some of the leaders in the
market in the affordable rate (Mi.com 2018). Thus, Lei invests in research and development, Lei
believes that technology has to evolve and as the company is based on technology it is only
fitting that the growth is aligned with the innovative approach not only in the products but also in
the process of business. Change management is a big part of transformational leadership as the
leader is responsible of strategizing change, communicating with the employees and ensuring
that they are committed to achieving the objectives of the company (Sethuraman and Suresh
2014). One of the major features of a transformational leader is the optimistic approach towards
change and Lei has always been optimistic towards the products he has developed and provided
the market. Focus on the product development and quality has been the central idea which has
led to this confidence in him (Mi.com 2018).
He has gathered a team of leaders to participate in the endeavor and look after the various
departments of operations. Lei is more of a transformational leader as he encourage and motivate
the subordinates to strive to innovate and make changes in the process in order. His participation
in among the team helps the subordinates to be focused in their work and achieve short term
goals at a time. Lei has gathered an experienced team to lead the organisation as he as a
transformational leader respects the talent of the other leaders (Mi.com 2018).
Other members of the management team of Xiaomi are: Bin Lin, Wanqiang Li, Feng
Hong, liu De, Wang Chuan, all these people are the co-founders and the vice president of the