Mindray Medical International Limited, China's second largest medical device manufacturer, had global sales of 2.23 billion RMB in 2007. Since 2002, it had launched between seven and nine new products every year across four product lines: Patient Monitoring & Life Support products, the In-Vitro Diagnostic Products, Medical Imaging Systems and Veterinary.

The case describes the history of BYD, a Chinese firm that started out making batteries but expanded into automotives, where innovation drove the competitive advantage of the business. BYD entered the automotive industry hoping to leverage its capabilities in batteries, but ultimately finds itself struggling and in a downward spiral. What should it do?