Open Innovation in China: Transitioning From Copycat to an Innovate Hub

By in
Open Innovation in China: Transitioning From Copycat to an Innovate Hub

A challenging technology

China’s own technology companies are now challenging market leaders and setting trends in telecommunications, mobile devices and online services. Companies like Seeed Studio, a global leader in open hardware innovation, has transformed into a new model of hardware innovation offering hardware kits to makers and offering personalized services to enable companies to move quickly from an idea to mass production by identifying moments of transition , where a company lacks the knowledge on how to scale up.  WeChat smartphone application, dominates China’s mobile messaging market with 272 million monthly active users from around the world clearly challenging WhatsApp. These are some but a few exemples of Open Innovation in China.

 So what exactly is encouraging this innovation ecosystem?

The rise of China’s tech industry is fueled in part by its growing investment in research and development. According to a study by U.S.-based Battelle Memorial Institute, R&D spending in China will likely reach $284 billion this year, up 22% from 2012.

The education has encountered a rise of Chinese graduates, from as few as 1 million graduates in 1999 to almost 7 million in 2013, with 31% of the undergraduates holding engineering degrees.

Other positive factors are the growth of a vibrant venture capital system in the country and an increasingly important market for multinational companies as Chinese consumers are increasingly more demanding of products that are tailored to their unique tastes and habits.

Indeed China still has its challenges such as perception of low-quality products, talent shortage due to graduates leaving to conduct research in richer countries, intellectual property rights issue but it is sure on the right path to becoming an innovative hub.

A recent paper (“How Chinese firms employ open innovation to strengthen their innovative performance” by Jin Chen et al) showed that Chinese firms start widely using open innovation:

1. Technology in-licensing agreements to obtain access to technologies

2. Long-term alliances with foreign partners to access state-of-the-art technologies

3. Collaboration with local universities and R&D institutes to broaden their technological strengths

4.  Collaboration with the local industrial community to deepen their technological skills.

We would like to ask you our reader, what role do you think open innovation has in helping China to accelerate its innovation? Who would benefit? We would like to hear your thoughts?


You may also like

Leave a reply