Over the past six years, (between the period 2014 -2019), China's electronic information industry and mobile Internet industry has morphed rapidly in line with its economic performance. This is attributable to the strong cooperation between smart phones and the mobile Internet, capitalizing on the rapid development of mobile terminal functions. The mobile Internet is the underlying contributor to the competitive environment of the entire Chinese smartphone industry. Xiaomi began its operations with the launch of its Android-based firmware MIUI (pronounced “Me You I”) in August 2010; a modified and hardcoded user interface, incorporating features from Apple’s IOS and Samsung’s TouchWizUI. As of 2018, Xiaomi is the world’s fourth largest smartphone manufacturer, and it has expanded its products and services to include a wider range of consumer electronics and a smart home device ecosystem. It is a company focused on developing newgeneration smartphone software, and Xiaomi operated a successful mobile Internet business. Xiaomi has three core products: Mi Chat, MIUI and Xiaomi smartphones. This paper will use business management models from PEST, Porter’s five forces and SWOT to analyze the internal and external environment of Xiaomi. Finally, the paper evaluates whether Xiaomi has a strategic model of sustainable development, strategic flaws and recommend some suggestions to overcome them.