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TWO STRATEGIES FOR HI-TECH INDUTRY DEVELOPMENT:
LESSONS FROM CHINA
SHEN Shougin XU Qingrui XU Jingxin
Dept of Finance School of Management EE Dept
Zhejiang University Zhejiang University NUS
Hangzhou, China 310027 Hangzhou China 310027 Singapore 119260
Email: sbaxugr@ dial.zju.zju.cn sbaxuqr@dial.zju.edu.cn elexujx@nus.edu.sq
ABSTRACT:
PART 1 Benefits of Hi-Tech Industry Growth
Hi-Tech industry grows very fast these several years in China, especially in the
eastern coast cities like Shanghai, Shenzen, etc and Capital Beijing.
The high rate growth of the Hi-Tech industry has brought huge benefits to China’ s
economic condition. The most eminent point shown in the recent several years is giving
large impact to the exports of Chinese goods. The weight of Hi-Tech products in the total
Chinese export goods rise very fast in comparison with the other porting of export goods
in the last three years.
The high rate growth of Hi-Tech Industry also offers positive/good influence the
structure change of the industry - this is one of the important mission facing the China.
PART 2 Comparative Study of the experiences of Hi-tech Industry at Different
Region of China
This comparative study focus et several developed area as Beijing, Shanghai,
Shenzen, Dailei, Qingdao, Hangzhou.
The Delphi approach was employed in the studying of the development of the Hi-Tech
Industry in these above-mentioned region and cities.
Through this study, seven main factors of successful development experiences in
China was identified, they are:
¢ Entrepreneur
¢ Venture Capital
* Tech Talents
* Market mechanism
¢ Government support
¢ Tech and industry choice
¢ Innovative culture.
PART 3__ Three Generals (Laws) of Hi-Tech Industry Development were discovered
Through the Comparative Study between US and China on Hi-Tech Industry
Developments
In this part, first found the successful experiences and lessons from the US, especially in
2 regions, i.e. Silicon Valley and Rout 128 in Boston area of MASS.
The lessons and experiences were studied too. On the basis of these, three gereral laws
were discovered as follows:
¢ The integration of diversified business development with the clustering
firms’ growth.
¢ The integration of technological innovation with organizational
innovation, including institutional innovation;
¢ The integration of marketing mechanism with the government supports.
PART 4 Two Strategies for Hi-Tech Industry Development --- Lessons from Hi-Tech
Industry Growth in China
Two path of Hi-Tech industry development were studied, these two path can de shown
by 2 different loops:
PATH 1 _ Innovation-based developing path.
The loop of path 1 is as follows:
Resource allocated ---R&D --- Manufacturing --- Marketing --- Returned Capital
(profit involved) --- Resource back
PATH 2 Tech acquisition - based developing path
The loop of path 2 is as follows:
Resource allocation --- Tech acquisition --- manufacturing --- Marketing --- Returned
capital --- Resource back
The comparison of these 2 path by system dynamics modeling and analysis.
Path 2 although offers quick return, but slow in competence leverage, while the path one
Via the self- development is very much helpful for competence cultivate and leverage.
CONCLUSION _ The balance of resource allocation between these 2 path is extremely
Important for sustainable competence leverage and sustainable competitive advantages.
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