Managing technological
innovation: China’s strategy
and challenges
Raja Irfan Sabir
School of Management, Chinese-German Institute for Intellectual Property,
Huazhong University of Science and Technology, Wuhan, China, and
Raja Moazzam Sabir
Department of Computer Sciences, Allama Iqbal Open University,
Islamabad, Pakistan
Abstract
Purpose – The aim of this paper is to highlight the importance of industrialization and its role in
realizing technological innovation leading towards economic development. China has made a 15-year
plan to develop an innovation driven economy, for which it requires a strong and a structured
industrial base. An overview of China’s industrial strategy has been provided, followed by the
challenges and the possible measures needed to be taken in order to achieve its long-term goals.
Design/methodology/approach – Phenomenology, exploratory research and inductive approach
for analysing management of technological innovation, industrial clusters and economic development,
and, China’s innovation plan.
Findings – China has emerged as the fastest developing economy and is currently in the transition
stage from factor driven to investment driven. In order to stabilize and move towards the investment
driven and then to the innovation-driven stage, China requires a strong industrial base. In order to do
so, China needs to cope with the challenges of: a weak system of intellectual property management:
lack of skilled and technical labour and adequate financial resources: slow pace in competence and
competitiveness upgrading: a weak educational system: industrial pollution; and, lack of basic
research.
Originality/value – The paper serves as a guide to students and researchers by presenting a
summary of global trends regarding technological innovation, industrial clusters, and China’s
industrial policies to develop an innovation driven economy.
Keywords Technology led strategy, Innovation, Economic development, China
Paper type Viewpoint
Context
Economic development and stability has been the main concern for nations ever since the
advent of human civilization. State policy makers and practitioners are continuously
analysing and developing strategies which can be used to stimulate economic growth
and prosperity, and one of them evolved during the last 50 years is the use of
technological innovation. According to the concept of national innovation system
(Lundvall, 1992), the growth of a nation depends upon its capacity to produce innovative
and high-tech goods to be offered within and outside its territories. More and more
countries are focusing on enhancing their competitiveness through innovation for
development (Fagerberg et al., 2003), because a nation’s standard of living is increasingly
dependent on the competitiveness of its firms (The Competitiveness Institute, n.d.);
The current issue and full text archive of this journal is available at
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Managing
technological
innovation
213
Journal of Technology Management
in China
Vol. 5 No. 3, 2010
pp. 213-226
q Emerald Group Publishing Limited
1746-8779
DOI 10.1108/17468771011086238