THE CONSTRUCTION OF XIAOMI’S INNOVATION ECOSYSTEM

This paper describes how Xiaomi, one of China’s largest and fastest growing technology companies, constructed its ecosystem in order to achieve disruptive innovation in a number of different industrial sectors. In this paper, we argue that in order to understand how this comes about, we need to consider the role of the firm’s broader ecosystem in the disruption construction process. This is because a disruptive innovation requires the coordination of widespread resources and environmental conditions in order to achieve lift-off. We address the question of how an ecosystem comes into being so that it can be used usefully by the organisations within it, and particularly by the firm that is leading the disruption attempt through constructing the ecosystem to its own advantage. Too often the literature on innovation, and especially on disruptive innovation, assumes that product development processes are linear and
binary. We argue that the systematic development of innovation ecosystems remains underexplored, that this is an evolutionary process whose construction depends on the shaping of a heterogeneous set of interactions and organisations. In this paper we examine the process brought about by one high-growth company, Xiaomi, a serial disrupter of high tech markets in China and subsequently elsewhere.