Type of Proposal
Odette School of Business
Dr. Zhenzhong Ma
24-3-2015 1:00 PM
24-3-2015 1:50 PM
Importance of the Project
With the fast changing technology, firms are constantly forced to catch up and respond to the demanding market to remain in the leader positions in their fields. Many companies have realized the importance of innovation and started to integrate it into their plans. Therefore the concept of innovation has been gaining significant attention from the research field over the past decade, especially in China. This research is intended to explore technological innovation in China by examining the impact of cultural context and institutional factors on Chinese firms’ technological innovation, with the focus on what particular factors help improve firm performance and then on how cultural context moderates this relationship. An examination of the relationship between strategic choice and institutional constraints on innovation and firm performance will help China maintain its long-term economic development and exploring the unique characteristics of Chinese culture will also facilitates multinationals’ entry into the Chinese market.
Existing State of Knowledge
Current research studies focused on the innovation at firm levels and innovation at national level is underexplored. It is very important to study innovation at national level because often times a nation's innovation capabilities effect its ability to provide an appropriate environment for firms to innovate (Fu & Mu, 2014; Xu, Chen & Guo, 1998). The reasons for the gap between existing knowledge may include that national research is harder to conduct, it may be more costly, and it may take a longer period to see the results.
Innovation has became one of the biggest challenge for China as it moves from a developing country to developed country and from imitation to innovation. In 2006, China further announced its “Guideline for the National Medium- and Long-term Science and Technology Development Programs (2006-2020)”, the focus of which is to emphasize the strategic role of innovation and to lay out strategic plans to booster China’s aspiration for an innovation center by 2020 (Ma, Lee, and Chen, 2009). Another purpose of the MLP plan is to hopefully lightening up and eventually overcome China's demand for resources and social and environmental challenges (Serger & Breidne, 2007). Many research articles indicated that investment on innovation plays a critical role in both Foreign Direct Investment (FDI) and government funding (Fu & Mu, 2014; Gu et at., 2009; Hutschenreiter & Zhang, 2007; Turro, Urbano & Peris-Ortiz, 2014). However, in all current studies there shows no clear evidence of how much of that FDI and government investment on innovation actually contributed to the growth of China's GDP. There is also lack of research on the effectiveness of the MLP on China's innovation capabilities and economic growth at the current stage. Instead, many research only focused on forecasting the effects of MLP but with no follow up in depth investigations (Cao, Suttmeier & Simon, 2006; Gu et al., 2009; Hutschenreiter & Zhang, 2007). In this article we attempted to look at the relationships between innovation and organizational culture at firm level, innovation and institutional factors, and innovation and culture factors at national level with a specific focus on China.
This research is intended to explore the relationship between various cultural and institutional factors and technological innovation capability in China, with the focus on what particular factors help improve firm performance and then on how cultural context moderates this relationship.
Literature review is the method we used in this research. We reviewed over 15 recently published journal articles in this field and developed insights on technological innovation and its antecedent factors, with propositions developed for the possible relationships between technological innovation and various factors.
Innovation capabilities remain one of the biggest obstacles for China to become the world's leader in Science and Technology. We proposed that firms in China have shown improvement on innovation capabilities over these past years due to the implementation of the MLP program. In addition, the MLP program has brought significant improvement in China's national innovation system and GDP has increased proportionately. From the literature review we anticipated that increase in market demand for innovation will have a positive effect on firms' innovation capabilities. We also propose that the Chinese culture has a positive impact on innovation capabilities in China. In conclusion, based on our prediction, improvement on overall innovation capabilities and China's growth in GDP will have a positive relationship.
Innovation for sustainability: Antecedents for technological innovation in China