Small And Medium-sized Enterprises In China Research Articles

An Investigation of Innovation Capability in Small and Medium-Sized Enterprises of China

Over the last decades, small and medium-sized enterprises (SMEs) have grown exponentially and become a key element in China’s economy. The purpose of this paper is to conduct a compararive evaluations of innovation capabilities status of SMEs in China across different sectors. Six dimensions of innovation capability that influence mostly NPD performance of firms are identified, such as technology, organization, strategy, organizational climate, manufacturing and marketing. A practical survey was carried out in the manufacturing industry of Zhejiang Province. We find that in different firm sizes and development stages SMEs have significant disparities in intensity of different capability dimensions respectively. Medium firms has higher scores in all of innovation capability dimensions than small firms. The bottleneck of capabilities in small firms are found in Org_Process, M_C, and MKT_S. All of firms in three stages are consistently adept in MKT_L, Climate_L, and lack in Org_Process; Mature firms exhibit the greatest level in all of innovation capability dimensions, and growing firms and startup firms are lower in sequence.

Development Strategy for Demand of ICT in SMEs of PRC

Information and Communication Technology (ICT) Penetrates into All Aspects of Industrial Production Worldwide. with Time Passed, ICT Has Changed the Whole Process of Industry. in the past Years, Small and Medium-Sized Enterprises (SMEs) Have Played an Important Role in the Economy. but Little Attention Has Been Paid to the Usage of ICT in SMEs in China. in this Paper, we Analyses ICT–based Issues from Technicians in Linyi Yelong General Machinery Limited Company. the Methodology for Carrying Out the Tasks Mainly Contains Questionnaires According to Normative Delphi Technique. the Paper Ends with Recommendations which SMEs Authorities Should Take in Order to Properly Integrate ICT in their Production.

Financing high-tech SMEs in China: A three-stage model of business development

This article examines the financing of high-tech Small and Medium-sized Enterprises (SMEs) in China at different stages of business development, based on a survey of 74 face-to-face interviews with high-tech SMEs and additional nine informal face-to-face interviews with bank and government officials in the two Chinese provinces of Guangdong and Guangxi. Attention is focused on distinguishing different financing methods according to particular stages of an SME's business life cycle. The findings show the importance of informal financial sources from individuals and firms’ employees for high-tech SMEs at all three development stages. Such sources have become a central aspect of the financial infrastructure for the private sector in China. The article distinguishes between the alternative methods or practices used by firms at all three stages, seeking to either overcome particular financial constraints or to avoid the commitment of large capital investments in relatively long-term projects. It identifies the absence of demands and a gap for medium- and long-term funding for high-tech SMEs, placing a serious barrier on the ability of high-tech SMEs to engage in R&D for making more fundamental innovation and developing new/distinctive products. It concludes by making the implications of these findings for China, and internationally.

SMEs as motor of growth: A review of China's SMEs development in thirty years (1978–2008)

China's economic and enterprise reforms since 1978 have dramatically altered the structure and dynamics of its enterprises. One of the most remarkable changes during the entire reform process is the rapid growth of small and medium-sized enterprises (SMEs). By looking at its thirty-year development, the contribution provides a thorough review of China's SME since 1978. It illustrates that the development of Chinese SMEs followed a principle of pragmatism. It shows that while the progress has been strongly affected by government policies and regulations, the emergence and expansion of SMEs are closely linked with social and economic problems that occurred during economic transitions and institutional changes. The key factors that affect SME development are identified, especially relating to cultural and institutional influences. The opportunities and challenges for SMEs in the new economic environment are discussed with special focus on their integration in the global economy. The issues of management development in SMEs are examined generally and in the Chinese context. Although major problems may differ at each stage of the reforms, evidence shows an increasing importance of SMEs in China's transformation to both modernization and industrialization. Indeed, SMEs have become the driving power in China's socialist market economy.

What influences the propensity of a firm to cooperate? An empirical study of high-tech SMEs in China

This study investigates the significant factors which determine a firm’s ability to engage in technological cooperation. The framework builds on the resourced-based view and its extension theories, including strategic leadership, knowledge-based view and dynamic capability view of the firm. Data are collected from 133 high-tech small and medium-sized enterprises (SMEs) in China. The results are concluded as: firm size has significant impact on the propensity of a firm to cooperate; R&D intensity and top leader’s competence do not play significant role in adapting cooperation strategy. The study suggests inter-firm cooperation is not preferable to very small firms. Entrepreneurial small firms in their early stage have to grow by accumulating resources internally.

Overcoming barriers to innovation in SMEs in China: A perspective based cooperation network

Innovation has been one of the key drivers of sustainable competitive advantage for small and medium-sized enterprises (SMEs). On the basis of a survey sample of 188 Chinese manufacturing SMEs, this paper explores barriers, cooperation networks and policy requirements in innovation for SMEs. This paper reveals that the ‘lack of technical experts’ is the most important barrier; the ‘customer’, the most important cooperation partner; and the ‘preferential tax policy’, the most favorable policy in innovation for SMEs. These findings reveal that many Chinese SMEs have difficulties in achieving successful innovation. Therefore, policies should be made based on internal and external constraints to facilitate innovation of SMEs, and varied depending on the size as well as the mode of ownership of firms.

Managing human resources in SMEs in a transition economy: evidence from China

The objective of this study is to explore the changing nature of people management on the under-researched area of small and medium-sized enterprises (SMEs) in China. A mix of research methods, which combined a survey approach with in-depth, semi-structured interviews, was adopted. The major characteristics of people management in China's SMEs were then identified. Problems and difficulties that may occur during HRM take-up were illustrated. Key factors influencing the nature of people management in China's SMEs were highlighted. People management in SMEs in China was compared and contrasted with Western HRM models. The findings indicate that a relative convergence with Western HRM practice, although one that is strongly influenced by unique ‘Chinese characteristics’, will be the trend of development of people management in China's SMEs. The study leads to a better understanding of SMEs in China and helps fill some of the gaps in the analysis of management in China. Since, in the presence of cultural disparities, organizational practices and their effectiveness may differ from those in the West, the findings of the study contribute not only to the development of SMEs, but also to the debates of possible convergence or continuation of differences in management practice worldwide.

Small and medium-sized enterprises in China: a literature review, human resource management and suggestions for further research

As the importance of small and medium-sized enterprises (SMEs) has increased, it has been accompanied by an increase in the amount of research attention paid to them. This has been the case in Asia, and also China. However, this work concentrates mainly on entrepreneurship, small business development and government support. Moreover, the fact is that in terms of issue focus, it is finance, marketing and ownership rather than people management that are the central themes of the discussion. However, there are some studies of human resource management (HRM) in SMEs in China. Our study here provides a broad review of prior work, and the results highlight some important issues for the study of HRM in SMEs and call for the development of more sophisticated theoretical models and more longitudinal research.

Proactiveness, legitimation via ISO certification and the growth of SMEs in China

According to the literature on entrepreneurial orientation (EO), proactive firms are more likely to achieve first-mover advantage and higher performance. The neoinstitutionalism, however, suggests that enterprises with more legitimacy will acquire more growth opportunities. Usually, the first mover might face more legitimacy obstacles. To date, there has been little research on how proactive firms cope with legitimacy constraints and achieve firm growth. Integrating the legitimacy perspective and the EO literature, this research examines the roles of ISO certification as a strategy for seeking legitimacy of small and medium-sized enterprises (SMEs) in emerging economies, and the relationship between proactiveness and firm performance. In particular, it hypothesizes that ISO certification has a mediating effect on the relationship between proactiveness and firm growth. We test the hypothesis using a sample of 632 firms collected from a nationwide survey on SMEs conducted by the Chinese SME Association. The results reveal that ISO certification partially mediates the relationship between proactiveness and firm growth, suggesting that proactive firms tend to use legitimation via ISO certification to enhance firm growth. Our paper contributes to the literature by shedding light on the important relationship between seeking legitimacy, entrepreneurial orientation and firm growth in SMEs in an emerging economy.

Does inter-firm technological cooperation enhance innovation performance? An empirical study of high-tech SMEs in China

This study, utilising data drawn from a sample of 133 China's high-tech Small and Medium-sized Enterprises (SMEs), examines the effect of inter-firm technological cooperation on product innovation. The framework builds on the emerging strategic management theories, including resourced-based view, knowledge-based view and dynamic capability view of the firm. Results are concluded as: Firm size, coupled with cooperation, has significant influence on patent creation; the success rate of cooperation increases as the number of cooperative projects increases; more firms engage in cooperative relationships, better firms perform in sales and profitability.

The Sustainable Development of ICTs in China: An Empirical Study of Small and Medium-Sized Enterprises

Abstract The wide application of new information and communication technologies (ICTs) has been argued to be critical to business success of small and medium-sized enterprises (SMEs), especially to those in the developing countries. Drawing upon existing literature, this article will examine the determinants of ICTs application in SMEs in China based on data collected from interviews with top managers and/or owners of 70 SMEs. We identify 20 factors affecting ICTs application in SMEs in China and divide them into four broad categories, namely pressures, firm specific factors, technical factors and local milieu. We also pay special attention to the Chinese business environment affecting ICTs application. Our analysis shows that local ICT infrastructure, external pressures from competitors and ICT knowledge of employees are the determinants of Internet application by SMEs, while product characteristics and market target are important factors of e-commerce adoption.

SME financing in China: the current situation, problems and possible solutions

Small- and Medium-sized Enterprises (SMEs) support the steady, sustainable economic growth and assist the development of China's market economy. This paper discusses the financing of the SMEs in China, the related problems and the possible solutions.

Unpacking the effect of IT capability on the performance of export‐focused SMEs: a report from China

Abstract. Export‐focused small and medium‐sized enterprises (SMEs) in China face a number of barriers to success, two primary ones being the liability of foreignness and resource scarcity. In order to transcend these challenges and be able to survive/prosper in the hypercompetitive international market, where players include large resourceful multinational organizations with experience in varied national contexts, these firms need to develop different organizational capabilities. In this paper, we specifically examine the role of a key organizational capability – information technology (IT) capability – and its different dimensions, in determining performance of export‐focused SMEs in China. Our study reveals that IT capability has a positive impact on such firms' performance. This finding indicates the need for their owners/managers to invest in IT capability. Further, the study also highlights specific sub‐dimensions of IT capability that export‐focused Chinese SMEs should (or should not) develop, so as to derive maximum performance‐related gains for the minimum amount spent on IT.

Barriers to the implementation of cleaner production in Chinese SMEs: government, industry and expert stakeholders' perspectives

This paper applies an analytic hierarchy process (AHP) to examine and prioritize underlying barriers to adoption of cleaner production (CP) by small- and medium-sized enterprises (SMEs) in China from the perspectives of government, industry and expert stakeholder groups. First, on the basis of the findings of previous research and literature review, 20 barriers are identified and grouped into four categories: (1) policy and market barriers; (2) financial and economic barriers; (3) technical and information barriers; and (4) managerial and organizational barriers. Second, an AHP model is developed and a survey questionnaire was designed, tested, and refined. Third, the questionnaire was distributed to the representatives of three stakeholders of CP, i.e. enterprise managers, government officials, and experts. The returned questionnaires were validated in terms of consistency and in some cases followed up for verification. Fourth, the 20 barriers were rated by analyzing the valid questionnaires through the AHP model. The top three barriers to CP adoption by Chinese SMEs were found to be: (a) lack of economic incentive policies; (b) lax environmental enforcement, and (c) high initial capital cost. The researches conclude that current governmental policy should give higher priority to lessening those external policy and financial barriers rather than internal technical and managerial barriers. The findings shed some new light on readjusting public policy in order to help to facilitate widespread CP implementation in SMEs in China.

Graduate Employment and Small Businesses in China

In contemporary China, there are two far-reaching developments that impact directly on graduate employment: (a) a highly entrepreneurial and rapidly growing small business sector and (b) a rapidly expanding higher education sector. Paradoxically, while the small business sector continues to suffer from acute skills shortages, new graduates are still reluctant to seek employment in smaller firms. The attitudes of Chinese graduates are not unusual, and most tend to perceive employment and promotion prospects as significantly better in larger organizations. Competition for jobs in China is increasing and there is growing pressure on new graduates to consider smaller firms as a viable and long-term career option. The authors argue that it is necessary to take a holistic view of graduate employment issues and to facilitate better and closer linkages between small and medium-sized enterprises (SMEs) and higher education institutions. This article highlights the need of the Chinese small business sector for a better qualified and more dynamic graduate labour force to help sustain the momentum of rapid growth experienced in recent years. It highlights specific areas in which the higher education sector could make a significant contribution to the long-term competitiveness of SMEs in China. The scope and direction of further research are identified and discussed.

An institutional analysis of marketing practices of small and medium-sized enterprises (SMEs) in China, Hong Kong and Taiwan

This paper uses an institutional perspective to examine the interplay among government intervention, manufacturing systems and business approaches and its impacts upon the marketing activities of small and medium-sized enterprises (SMEs) in China, Hong Kong and Taiwan. An integrative approach, blending the narrative method and content analysis, is adopted to analyse 391 published news stories about Chinese owner-managers in China, Hong Kong and Taiwan, and to disentangle the effects of environmental differences. SMEs in China, which come under strong government influence, carry out minimal planning in marketing and their marketing activities are implicit. They adopt a relation-oriented marketing approach and place emphasis on building relations with government agencies. Most SMEs in Hong Kong operate under the original equipment manufacturing systems and they tend to invest minimal amounts of time and money in marketing. SMEs in Hong Kong adopt a transaction-oriented marketing approach, place emphasis on pricing, product service and sales forecasts, and adapt promptly to market changes. Taiwanese SMEs operate in a politically constrained but economically free environment. They invest substantial amounts of time and money in marketing and fostering customer and dealer relations. Upgrading to the original brand manufacturing systems, Taiwanese SMEs develop their own brands and adapt their marketing plans explicitly and substantially in response to the specific marketing environment. Based on the research results, a tentative schema is proposed depicting the interplay and its impact on the marketing practices of Chinese SMEs.