Chinesemanufacturers’technologyupgradealignedwiththe“MadeinChina2025”visionByYuNan
Wecannotrelymerelyonoverseasacquisitionsfortechnologicalbreakthroughs.Betterresearchandstrongdomesticinnovationiscrucial.
WangRuiguo,GeneralManager,ShandongKaitai
ChinesemanufacturingcompanyShandongKaitaiMetalAbrasivehasadouble-prongedstrategytoboostinnovation.Afterconcludingthreemergerandacquisition(M&A)dealswithoverseascompaniesinthepastthreeyears,itisseekingtoacquirearesearchanddevelopmentcompanythisyeartomoveupthevaluechainintermsofmarketpositioning,brandvalueandinnovativetechnology.
ThisisinlinewiththegrowingtrendamongChinesecompaniestopursueoverseasM&Asandbringforeignbrandsandtechnologytothedomesticmarket.
However,thatisnotenough.“Wecannotrelymerelyonoverseasacquisitionsfortechnologicalbreakthroughs,”saidWangRuiguo,GeneralManagerofShandongKaitai.“Betterresearchandstrongdomesticinnovationiscrucial.”
Wang’scompanyiscollaboratingwith15domesticeducationandresearchinstitutionsforinnovativeproductsandtechnologies.Ithasalsobuiltlaboratoriesfor15well-knownindustryexpertstoacceleratethecommercializationoftheirresearchresults.Currently,ithas186patentsofitsown.
Themagicwand
Once“madeinChina”wasregardedasbeingcheapandinferior-qualitygoods.Thelackofinnovationcapacityandhighvalue-addedproductswasachallengeforChinesemanufacturing.
ButareportearlythisyearbytheMcKinseyGlobalInstitute(MGI)saysChinawillbecomeagloballeaderininnovationifChinesecompaniesenhancetheirstrengthsincreativescienceandengineering.
ItsaysinnovationisessentialtoChina’slong-termsustainablegrowth.Overthepastthreedecadesthenationreliedmainlyonabsorbingandadaptingtechnologyfromothercountries.ButnowinnovationshouldplayalargerroleacrossallsectorsoftheChineseeconomy.
JonathanWoetzel,DirectorofMGI,saidtheChineseGovernmenthassupportedinnovationwitheconomicpoliciesandinvestments.However,continuedreforms,particularlyinstate-ownedenterprises,areneededtospeeduptheinnovationdrive.
SomeChineseenterprisesinthemanufacturingsectorhaveweatheredtheslowingdownoftheeconomythroughinnovativeactivities.TheHimileGroupisanexample.
TheShandong-basedcompanyhasbecomeaworldleaderinthetiremoldindustry,witnessinganaverage50percentgrowthinannualoutputvalue.Itstiremoldproductshold15percentoftheinternationalmarketshare.
ZhangGongyun,Presidentofthecompany,saidtheyreceivednearly70,000innovativeproposalsfromemployees.Someofthemhavebeenimplemented,generatingmorethan60millionyuan($9.16million)ineconomicbenefits.
Himilenowhasmorethan158nationalpatentsandisplanningtoexpandoverseas.“Wehavefullintellectualpropertyrightstomorethan60percentofourproductionequipment,”Zhangadded.
ZhangBin,anassociateresearcherattheChinaInstituteofInternationalStudies,saidChinahasthelargestnumberofgrowingbusinesseswhichwillbecomethemainforceofthenation’seconomicgrowthinthefuture.
Qualityoverquantity
Whileinnovationisthekeytospuracompany’svitality,itneedsqualityforsustainabledevelopment.
“Wevaluequalityoverquantity.Itisimpossibletowinordersfromwell-knowncompanieswithoutqualitycontrol,”saidCuiLixin,PresidentofShandongInnovationMetalTechnology,analuminumproductmanufacturerandsupplierformanyglobalelectronicsmanufacturers.
In2009,analuminumalloyproductbyShandongInnovationfailedtomeettherequirementofaleadingelectronicscompany.Thereafter,itbroughttogetherexpertsfromhomeandabroadtocomeupwithabetterproduct.TheymanagedtodothatafterfouryearsandShandongInnovationisnowthemainsupplieroftheelectronicscompany.