Chinese High Technology Firms Research Articles

Different forms of supplier involvement, knowledge orchestration capability, technological uncertainty and new product development performance: a test of three-way interaction

PurposeThis paper examines the role of purchasing in facilitating early supplier involvement in new product development (NPD) in contexts of technological uncertainty (TU). Taking a purchasing perspective, it develops a moderate model to explain the effects of supplier involvement on NPD performance and whether and how knowledge orchestration capability (KOC) and TU affect these relationships. Additionally, KOC drivers are defined.Design/methodology/approachA total of 317 usable questionnaires from Chinese high-technology firms were collected. Moderated multiple regression (MMR) was used to test all hypotheses. Resource orchestration theory (ROT) was the adopted theoretical lens.FindingsTwo forms of supplier involvement (as knowledge source and co-creator) were found to distinctly affect NPD performance and have potential substitutive relationships. Purchasing KOC positively moderates the relationships between forms of supplier involvement on NPD performance. TU strengthens the moderating role of purchasing KOC. Furthermore, purchasing status and supply complexity are important antecedents for purchasing KOC.Practical implicationsThese findings serve as a blueprint for involving purchasing in technologically uncertain NPD projects and improve supplier NPD integration. Additionally, management should recognize the purchasing function's role and empower it to identify ideas, knowledge and solutions within supply networks.Originality/valueThis research contributes to the ROT by examining the role of purchasing KOC on supplier involvement in NPD performance, especially under TU. Moreover, it demonstrates significant and positive relations between purchasing department status and external supply complexity on its KOC.

The negative effects of the US-China trade war on innovation: Evidence from the Chinese ICT industry

Many countries, including China, have gradually realized the importance of leading innovation capabilities in the world market. The innovation capabilities of the information and communication technology (ICT) industry have received widespread attention as an important means to stimulate a productivity revolution in the new era and its innovative development. This paper adopts a differences-in-differences method and treats the US-China trade war as a quasi-natural experiment to empirically analyze its impact on technological innovation in the Chinese ICT industry. The results find that the US-China trade war has a significant negative impact on ICT firms' technological innovation, mainly by increasing their operating costs, and that the negative impact of the trade war is much greater than the positive impact from the reverse incentive effect. Moreover, the decline in technological innovation of ICT firms is mainly due to the reduction in innovation efficiency caused by the decrease in the number of patent applications for inventions with the highest technological content, rather than the change in R&D investment. In the US-China trade war, firms with low financing constraints and non-state enterprises are more significantly affected. Thus, it can be seen that the intention of the US-China trade war to inhibit the development of Chinese high-technology firms has been achieved to a certain extent, which requires new countermeasures from the Chinese government.

Rising to the Challenge: Top Executives with R&D Background, Risk-Taking and Corporate Innovation

More than half of Chinese high-technology firms are led by top executives (chairman and CEO) with R&D background. This study investigates whether and how top executives’ R&D background affects corporate innovation outcomes using a sample of listed firms in the high-technology industries in China. We find that the R&D background of top executives is positively related to innovation outcomes. We also find evidence on the mediating effect of R&D expenditure and moderating effect of corporate risk-taking on the above relationship. Our baseline results are robust to tests that address concerns caused by potential unobservable characteristics, reverse causality and other issues. Findings of our study have important implications for firms that aim to enhance their innovation outcomes and countries regarding their research policymaking and R&D management.

The more the merrier? Chinese government R&D subsidies, dependence, and firm innovation performance

AbstractWith the understanding that innovation and high technology industries are essential for sustained economic development, government R&D subsidies have become ubiquitous. However, existing studies on the impact of R&D subsidies have found mixed or conflicting results. Insights from resource dependence theory (RDT) and the Attention‐Based View (ABV) help account for these discrepancies. This study of Chinese high technology firms using the Innovation‐Oriented Firms Database from the Ministry of Science and Technology, finds an inverted U‐shaped relationship between R&D subsidies and innovation performance. The article shows that high government resource dependency, expressed through high percentage of R&D spending coming from government subsidies, diverts attention resources in recipient firms and results in declining innovation performance. The article then tests the impacts of different managerial responses on the dependency‐innovation relationship and find that technology alliances and employee feedback systems mitigate these negative effects. These findings have implications for government innovation policies and firm‐level responses to those policies: government subsidy policies have limits to their effectiveness and firms have strategic options for capitalizing on government resources without sacrificing innovativeness.

Fraud and Innovation

We show that fraudulent firms allocate resources differently than honest companies. Resources obtained through fraudulent means are likely to be viewed as unearned gains and are less likely to be invested in productive activities, such as recruiting talent. We posit that honest and fraudulent companies also invest in different types of innovation: honest firms pursue technically significant innovations, while fraudulent companies are likely to make smaller investments in less challenging inventive opportunities that contribute to the appearance rather than the substance of innovation. We test these predictions in a longitudinal dataset tracking the personnel recruitment and patenting activities of 467 Chinese high technology firms, all of which applied for state-funded innovation grants. We identify fraud by comparing two sets of financial books prepared by each company in the data in the same fiscal year, which are legally required to be identical but are discrepant in over 50 percent of cases, in a direction that benefits the firm. We find that relative to honest companies, fraudulent firms are more likely to receive state grants and are less likely to recruit new employees or produce important inventions in the post-grant period.

Joint actions with large partners and small-firm ambidexterity in asymmetric alliances: The mediating role of relational identification

This article investigates the role of relational identification in the relation between joint actions and small-firm ambidexterity in asymmetric alliances. Using survey data on Chinese high-technology firms, we find that joint problem-solving and joint sensemaking are both positively associated with a small firm’s relational identification. We also find a positive relationship between a small firm’s relational identification and knowledge exploration and exploitation. More importantly, we show that relational identification mediates the relationships between joint actions (i.e. joint problem-solving and joint sensemaking) and small-firm ambidexterity, except for the relationship between joint sensemaking and small-firm knowledge exploitation. This study advances our understanding of the association between joint actions and ambidexterity by providing a social identification explanation.

Dual-level transformational leadership and team information elaboration: The mediating role of relationship conflict and moderating role of middle way thinking

Transformational leadership studies identify a dual-level model comprising group-focused and individual-focused transformational leadership. In this study, a relational perspective is used to develop a moderated mediation model linking dual-level transformational leadership to within-team information elaboration. Data collected from 100 teams in 32 Chinese high-technology firms reveal that group-focused transformational leadership increases information elaboration, while differentiated individual-focused transformational leadership decreases information elaboration. Team relationship conflict mediates the effects. Furthermore, middle-way thinking as a culture-specific Chinese thinking style moderates the indirect effects. Theoretical and practical implications are discussed.

From knowledge sharing to firm performance: A predictive model comparison

This study investigates how knowledge sharing (KS) contributes to firm performance (FP) through the enhancement of innovation and/or intellectual capital (IC) using data collected from Chinese high-technology firms. The paper proposes three alternative models that suggest different mediating roles of innovation and IC components in the KS→FP nomological network based on existing theory. The paper then compares these models in terms of in-sample explanatory and out-of-sample predictive powers using consistent partial least squares path modeling (PLSc). Results indicate that in the best performing model, innovation and IC simultaneously mediate the relationship between KS and FP in this specific context. The findings offer insights regarding the parallel mediation roles of innovation and IC in the KS→FP process, showcase the predictive utility of PLSc, and can help managers set priorities when leveraging KS to achieve specific performance goals.

Picturing firms' institutional capital-based radical innovation under China's institutional voids

This study provides an institutional framework to interpret firms' resource management in China. We identify the formal and informal institutional capital that firms acquire via their relational network and solicit from the government, and their distinctive effects on firms' radical innovation. We address how firms' utilization of the formal and informal institutional capital would be influenced by their multi-level contexts (local context, market context, and organizational context). Using a survey data from 280 Chinese high-technology firms, we find that firms' informal institutional capital has a higher positive effect on firms' radical innovation than the formal institutional capital does. The effects of firms' formal institutional capital on radical innovation would be higher in the complex market, and for the state owned enterprises, whereas the effect of firms' informal institutional capital on radical innovation would be higher in the developed provinces but lower in the complex market.

"The Power of Local Networks: Returnee Entrepreneurs, School Ties, and Firm Performance"

Returnees—nationals of a developing country who have studied or worked in a developed economy and later returned to their home countries—appear ideally positioned to start new ventures. Yet a growing body of research suggests that they perform no better—or even worse—than home-grown entrepreneurs, a phenomenon we refer to as “returnee liability.” While previous research has sought the solution to this puzzle in institutional conditions in returnees’ home countries, the key contribution of this paper is to propose a novel mechanism that accounts for returnee liability; namely, returnees’ lack of social networks in the regions where they start their new ventures. To provide evidence for this mechanism, we explore how a returnee entrepreneur’s and her top management team’s local social capital affects her venture’s performance. Using a unique, hand-coded dataset on Chinese high-technology firms, we find that ventures established by returnee entrepreneurs with more school ties in the region where the new ventures are located are less disadvantaged, relative to those founded by home-grown entrepreneurs, than those founded by returnees who have fewer school ties there. We also find that returnee entrepreneurs who lack local school ties can benefit from the local school ties of their top management team members, but only if these members have an equity stake in the venture. These findings expand our understanding of returnee entrepreneurs and provide important new evidence for the role of social networks in creating new ventures.

The determinants of corporate growth: evidence from Chinese high technology firms

Drawing on the economic growth and social cognitive theory, this paper investigates the effects of management strategies-based factors (knowledge management process competence and innovation capability) and dynamic capabilities-based factors (rewards system and marketing fit) on corporate growth in the Chinese high technology firms. The results show that the knowledge management process competence, innovation capability, and marketing fit exert significant effects on corporate growth. In particular, this study identifies a significant curvilinear relationship between innovation capability and corporate growth. The findings suggest that both management strategy-based and dynamic capabilities-based factors should be considered in achieving long term corporate growth in Chinese high technology firms. These results have important implications for researchers investigating the determinants of high technology firms’ growth performance in transitional economies as well as practitioners seeking to improve corporate growth. This paper concludes with a discussion of the implications and limitations of the research.

The knowledge management strategy and its effect on firm performance: A contingency analysis

This study seeks to examine the impact of knowledge management strategy on strategic performance in Chinese High Technology firms drawing on the theory of resource-based view. The results from moderated regression analysis show that the knowledge management strategy—performance connection is contingent on both performance-driven strategies, (including reward system and process innovation) and knowledge management-based competencies, such as R&D from past projects, market intelligence, and intraorganizational knowledge sharing. The findings suggest that both performance-driven strategies and knowledge management-based competencies should be considered in the implementation of knowledge management strategy in Chinese High Technology firms. These results have important implications for researchers investigating the effectiveness of high technology firms’ adoption of knowledge management strategies in transitional economies as well as practitioners seeking to improve corporate strategic performance.

THE NATURE OF R&D-MARKETING INTEGRATION IN CHINESE HIGH-TECH COMPANIES

This study offers continued insight into R&D-marketing integration with particular attention to the Chinese context. Examining the responses of 200 Chinese R&D and marketing managers, an exploratory investigation of marketing and R&D integration in Chinese high technology firms was undertaken. Study results find that Chinese high technology firms with higher levels of achieved integration perform better. It was also found that R&D involvement in screening new product ideas, designing communication strategies for the customers of new products, training users of new products and analysing customer needs appear to be top priorities for R&D integration in Chinese companies. These and other results are compared to prior findings in US and Japanese samples to support general propositions for R&D-marketing integration. We offer explanations for the results and discuss theoretical development of the R&D-marketing integration construct. Future research considerations are presented to spur continued focus in this area.

Unravelling the link between knowledge integration and new product timeliness

This paper examines the impact of knowledge integration on new product timeliness in Chinese high technology firms. The results show that the knowledge integration–new product timeliness connection is contingent on managerial factors (reward system and top management support) and product-based competencies (technical skills adequacy and marketing fit). The findings suggest that reward system, top management support and technical skills moderate the relationship between knowledge integration and new product timeliness. The implications for Chinese high technology firms and further research have been discussed.

Antecedents and consequences of knowledge management strategy: the case of Chinese high technology firms

Built on the knowledge management and corporate growth literatures, this paper examines the antecedents of knowledge management strategy (KMS) and its consequences. Grounded by a resource-based view and corporate growth theory, results reveal that a firm's knowledge management strategy and strategic performance relate to long-term corporate growth. Technological turbulence also relates to the firm's use of knowledge management strategy. Environmental turbulence and learning orientation do not exert significant effects on knowledge management strategy. Learning orientation has an interacting effect on long term corporate growth, while environmental and technological turbulences do not. Implications for knowledge management practitioners are discussed.

Subsidiary Technology Upgrading and International Technology Transfer, with Reference to China

This paper reviews the research on technology upgrading in the subsidiaries of transnational corporations and the research on the development of Chinese high technology firms. On the basis of this it develops fresh policy options for government intent upon facilitating international technology transfer to their jurisdictions. Technology upgrading is the use of increasingly complex technologies in products and processes, and the development of the managerial and organizational capabilities needed to leverage those technologies effectively. Technology upgrading by the subsidiaries of transnational corporations can contribute to the economic development of the host region and is often driven by the entrepreneurial activities of subsidiary management. The upgrading process involves collaborating/lobbying with suppliers, headquarters and sister subsidiaries. Economic development policy should foster subsidiary technology upgrading as part of initiatives to increase international technology transfer.

The impact of interaction between R&D and marketing on new product performance: an empirical analysis of Chinese high technology firms

This study investigates empirically the impact of R&D-marketing interaction on new product performance in Chinese high technology firms. R&D-marketing interaction is defined along three dimensions: information exchange, influence, and departmental conflict. Based on data collected from 114 firms in China, the results suggest that information exchange and marketing's influence on product decisions have significantly positive impacts on new product performance. Furthermore, the results show that the impact of R&D-marketing interaction depends on product newness and project formalisation. Research and managerial implications are drawn.