How Business and Society Can Thrive Together: Tongwei’s Innovation of a Brand-new Green Energy Market in China

Published 23 May 2023
Reference 6811
Topic Strategy
Region Asia
Length 12 page(s)
Language English

This case describes how Tongwei Group, a China-based global leader in both aquafeeds and photovoltaics, created a fast-growing new market for green energy and a model for sustainable economic development by integrating high-yield aquacultural ponds with water-based PV plants in eastern and central China, regions where utilizable land resources were scarce and demand for electricity was high and ever increasing. The Chinese government's increasing restrictions on coal-fired power plants to achieve its carbon emission targets led to the urgent need for green energy development in the country, especially in eastern and central China, where population and industrial activities are concentrated. Yet most solar companies ignored the pressing demand for clean energy in these regions because of the shortage of utilizable land resources there. Tongwei rose to the challenge by combining high-yield fishponds with water-based solar farms and rolling them out in these regions, overcoming the regions’ perceived unsuitability for solar energy development. This innovative approach created a burgeoning new green energy market, which not only increased clean energy production in eastern and central China, but also multiplied income for fish farmers and the regions’ tax coffers, providing a sustainable socioeconomic development model that addresses green energy objectives and economic development goals simultaneously. This case provides an illustrative example of "nondisruptive creation", a new concept crafted by W. Chan Kim and Renée Mauborgne in their book Beyond Disruption (2023). By going into geographical areas other companies eschewed, Tongwei created a new market of profitable growth and a thriving new business without disrupting the existing solar energy industry.

Teaching objectives

1) Illustrate what nondisruptive creation is and what the major advantages of this market-creating method are. 2) Explore why Tongwei made a distinctive strategic decision to build PV power plants in China and how the company identified a burning and unaddressed problem for eastern and central China – the tension between the ever-increasing demand for electrical power and the limited land resources for green energy development. 3) Discuss what unique resources and capabilities Tongwei leveraged in creating a viable solution to the aforementioned key problem. 4) Discuss why the Tongwei strategic move is nondisruptive by exploring how different parties concerned benefit from the fishery–PV integration projects and why no displacement and disruption happened to existing players. 5) Use the key analytics and concepts learned through the Tongwei example to discuss the next possible opportunity for nondisruptive creation in solar energy development based on the information provided in the case.

  • Non-Disruptive Creation
  • Business&Society
  • Sustainable Economic Development
  • China
  • Green Energy
  • Renewable Energy
  • Market Creation
  • Blue Ocean Strategy
  • New Market Space
  • Non-Disruptive Market
  • Carbon Emissions
  • Poverty Alleviation
  • Clean Energy
  • Solar Energy
  • Q22023