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Executives at multinational corporations operating in China should view themselves more as entrepreneurs than traditional employees to successfully navigate the complex, swiftly evolving market, according to the president of a leading German healthcare equipment manufacturer’s China division.
The key to survival for top executives in China’s medical industry is cultivating an entrepreneurial mindset, emphasized during an interview at the recent China International Medical Equipment Fair. “Seeing yourself as an entrepreneur is essential for breakthrough growth,” he stated.
With China’s medical device industry entering a phase of slower growth, multinational companies like GE Healthcare, Siemens Healthineers, and Philips have experienced declines in revenue over the past two years, prompting leadership changes in some firms.
When market conditions are favorable, regional heads often align their strategies with headquarters. However, expectations frequently diverge from corporate headquarters’ visions. In such cases, local managers must adopt an entrepreneurial approach, taking responsibility and being accountable for their initiatives.
China has become a significant hub for innovation within the global healthcare sector, fundamentally shifting how foreign firms approach the market. Previously, emphasis was on rapid growth, but now there’s a stronger focus on high-quality development driven by innovation.
The rise of Chinese medical device companies like Shanghai United Imaging Healthcare and Shenzhen Mindray Bio-Medical Electronics has garnered international attention—especially since Shanghai United Imaging’s advanced medical imaging equipment now reaches global markets. Yet, there remains a developmental gap in original medical device technology compared to the progress seen in innovative pharmaceuticals.
It may take some time before China produces a substantial number of first-in-class or breakthrough medical device innovations. Still, the growth of domestic companies has increased pressure on multinational corporations operating within the country.
Because decision-making and implementation are often dispersed across different locations, communication costs among regional teams tend to be high, creating information gaps. Conversely, local Chinese competitors tend to have more centralized control over production, R&D, innovation, sales, and after-sales services—posing additional challenges for multinational leaders in China.
Furthermore, bridging the communication gap between Chinese operations and headquarters remains a significant hurdle, as the unique conditions of the Chinese market are sometimes misunderstood.
For example, corporate headquarters might prioritize equipping devices with cutting-edge technology or flashy features, while local medical professionals prioritize tools that enhance workflow efficiency. “Doctors mainly want AI tools that simplify tasks and save time, not just features that look impressive,” he explained.
In response, major companies like GE Healthcare, Siemens Healthineers, and Philips have increasingly localized their manufacturing and operations in China, setting up more production facilities for high-end medical devices locally, and outsourcing warehousing and logistics within China to streamline processes.
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