Exploration of organizational and knowledge strategies in Chinese manufacturing firms Ludovico Alcorta Mark Tomlinson Bengt-Åke Lundvall BRICS workshop 2/2006

Origins of the Project Innovation Systems (IS), firm focus Cognitive perspective IS as a process of ‘codification’, ‘collectivisation’ and ‘deepening’ of organisational knowledge Trespassing Sources Application: Jiangsu Province, China

The survey Questionnaire design –Sources –Adaptations –Additions The questions –Type –No. –Administration The population Firm selection The respondent Data collection The results Data analysis

Factor analysis of organizational and HR variables – Technical personnel characteristics experienced knowledgeable highly specialized in their field studious inquisitive creative broad-minded communicative team-player active in publishing locally active in publishing internationally active in professional networking motivated to perform at its best remains loyal to the company

Results in 3 factors Factor 1 –(KNOWLEDGE INTENSITY) –Creativity, experience and specialization Factor 2 –(OPENNESS) –Loyal, communicative and broad minded Factor 3 –(PROFESSIONAL DISSEMINATION) –Codification and networking (ie publication in local and international and prof networking)

Factor analysis of organizational and HR variables – managerial personnel characteristics experienced competent creative change-oriented tolerates failure communicative team player active motivated to perform at its best remains loyal to the company

Managerial characteristics Just cluster together in one factor So there are fundamental differences in the characteristics of managerial and technical professionals in Chinese firms But does this have any bearing on innovation?

Factor scores for innovators and non-innovators

Knowledge base The company is in the world frontier of scientific and technical knowledge in its field The company has several individuals/groups that follow world-wide scientific, technical and market developments in their field and translate them into corporate needs The company’s technical personnel participates and contributes to leading local and international conferences in their field The company has access to key data and to professional and scientific journals in its field Considerable effort is undertaken by the organization’s scientific and technical personnel to address issues and problems The company’s technical personnel has contacts with the ability to solve any potential question that may arise The company’s scientific and technical personnel contribution is well accepted within the organization The company’s scientific and technical personnel expertise is sufficiently experienced and diverse to draw on other fields The company’s scientific and technical personnel is highly mobile within/between the organization The company has many employees that can integrate research, development, production and marketing demands The company has a well established and very much used information and documentation archiving and retrieving system The company often uses external consultants for scientific and technical purposes

2 factors roughly delineated as global and local Factor 1 –(GLOBAL KNOWLEDGE BASE) –Forefront of knowledge in field, international linkages, external consultancy network Factor 2 –(LOCALIZED KNOWLEDGE BASE) –Focussed on knowledge within the companies own personnel

Innovative strategies Reproducing what is available on existing documents, manuals and catalogues Reproducing through observation or ‘reverse engineering’ what competitors manufacture Scientific, managerial and production personnel’s know how after their normal period of education and training Scientific and technical knowledge widely available in the industry The technology embodied in the machines and software the organization purchases Never repeating or experimenting with what others have already tried and tested. Focusing on simple technologies, products and correction of defects and problems. Minimization of technological efforts to save on production costs. The exclusive contribution of a foreign partner, or the direct application of a foreign license.

3 factor solution Factor 1 –(IMITATIVE STRATEGY) –Copying and reverse engineering Factor 2 –(EMBODIED KNOWLEDGE STRATEGY) –Personnel knowledge + existing available knowledge Factor 3 –(MINIMUM EFFORT STRATEGY) –Minimizing effort/use of partner knowledge

Relation of knowledge base, innovative strategy and product innovation

Building up a picture of Chinese innovation in manufacturing E.g., global knowledge related to experience and creativity of tech staff

Minimum effort strategy related to more localized knowledge base