paper 7: innovation capacity of chinese manufacturing (chen)

2010-7-2 1

The Evaluation of Innovation Capacity of Chinese Manufacturing

CHEN Fang, Professor MU Rongping

Institute of Policy and Management, CAS

3rd International Workshop on Innovation and Performance Management

2010-7-2 2

Content

Introduction

Literature Reviews

Evaluation Framework of Manufacturing

Innovation Capacity in China

Evaluation Results of Innovation

Capacity of CM

Conclusions

2010-7-2 3

Introduction

China wants to become an Innovation-Driven Nation by

2020. Now China is the largest manufacturing country,

but not the strongest one.

How to monitor the progress of manufacturing

innovation capacity-building in China, to indentify the

key factors affecting capacity-building, and to provide

effective policies.

It is important and necessary to build up a systemic

evaluation framework of innovation capacity for CM.

2010-7-2 4

Content

Introduction

Literature Reviews




Capacity of CM

Conclusions

2010-7-2 5

Literature Reviews

European innovation scoreboard, 2009

Summary innovation index includes enablers, firm activities,

outputs.

WEF Report is concerned with innovation capacity

index(ICI).

IMD Yearbook have S&T competitiveness.

World Bank puts out knowledge economic index(KEI).

Luis、Furmana、Porter、Stern、Mathews etc.

《Oslo Manual》(OECD)

Emphasizing the research on industrial innovation measuring,

concerning innovation for product, process, institution, market, etc.

2010-7-2 6

Literature Reviews

The Report on Innovation and Development in China,

2009(the Center for Innovation and Development of

CAS)

The Report on Innovation and Development Index in

China, 2008(RUC)

The survey report on China’s industrial innovation

capacity(Ministry of Science and Technology, P.R.

China,2006)

2010-7-2 7

Content

Introduction

Literature Reviews




Capacity of CM

Conclusions

2010-7-2 8

Evaluation Framework

Definition of manufacturing

innovation capacity

Manufacturing innovation capacity

index

Evaluation method

2010-7-2 9

Definition of Manufacturing

Innovation Capacity

Manufacturing innovation capacity is the capability of

manufacturing to carry out technology development,

diffusion, application and other innovation activities so

as to achieve economic and social performance under

certain conditions.

In broad sense, manufacturing innovation capacity is a

wide range of the capability of manufacturing

enterprises to integrate innovation resources so as to

transform them into wealth.

2010-7-2 10

Manufacturing Innovation

Capacity Index

Innovation Strength

innovation input

innovation output

innovation performance

Innovation Effectiveness

innovation input

innovation output

innovation performance

Indicator System of Manufacturing Innovation Capacity

S&T Input

Finance Tax ……

2010-7-2 11

Index Sub-index Indicator

Innovation Strength Index

Innovative Input Strength Index

Personnel engaged in S&T activities

Funding for S&T activities

Expenditures for absorb and digest

Projects for S&T activites

Number of S&T institutions

Innovative Output Strength Index

Invention patents owned

Invention patent applications

Utility model or design patent applications

Innovative Performance Strength

Index

Gross industrial value added

Revenue from the sale of new products

2010-7-2 12

Innovation Effectiveness

Index

Innovative Input Effectiveness Index

S&T personnel (% of workforce)

Funding for S&T activities (% of turnover)

Expenditures for absorb and digest (% of expenditures for indraught oftechnology)

Projects for R&D (% of projects for S&T activities)

Enterprises having S&T institutions (% of total industrial enterprises)

Innovative Output Effectiveness Index

Invention patents owned per enterprise

Invention patent applications per 10,000 S&T personnel

Invention patent applications per 100 million funding for S&Tactivities

Utility model or design patent applications per 10,000 S&T personnel

Utility model or design patent applications per 100 million funding forS&T activities

Innovative Performance

Effectiveness Index

Labor productivity

Revenue from the sale of new products (% of turnover)

Gross industrial values added per energy consumption

Gross industrial values added per industrial waste water discharge

Industrial solid wastes utilized (% of total wastes utilized, stocked,treated, and discharged)

Volume of industrial waste gas emission (% of volume of waste gasemission and removed)

Gross industrial values added per original value of productiveequipment

2010-7-2 13

Evaluation Method

A revised Min-Max Normalization is applied for

computing the standardized value of the indicator, in

order to make the index comparable within several

years.

the maximum value and the minimum number should

be less the smallest one, and they are determined by

experts with considerations of the pre-calculation by

Trend Extrapolation Methods

the weight of each indicator is given according to its

importance assigned by selected experts in China

2010-7-2 14

Evaluation Method

Firstly, the standardized value of indicator, ranging

from 0 to 1 as follows:

Positive indicator

Negative indicator

_ min

_ max _ min

s

j j

j s s

j j

X XI

X X

_ min

_ max _ min1

s

j j

j s s

j j

X XI

X X

2010-7-2 15

Evaluation Method

Secondly, the index is calculated according to the

Weighted Arithmetic Average method. The index

score of the indicator l at the level k , is given by:

( , ) ( , ) ( , )

( , ) 1

im

k l i j i j

i j

I w I

2010-7-2 16

Content

Introduction

Literature Reviews




Capacity of CM

Conclusions

2010-7-2 17

Leather, Fur, Feather and Related Products

Textile Wearing Apparel, Footware and Caps

Printing, Reproduction of Recording Media

PTWBRPSP

Paper and Paper Products

Artwork and Other Manufacturing

Articles For Culture, Education and Sport Activities

Processing of Food from Agricultural Products

Foods

Furniture

Plastics

Beverages

PPCPNF

Textile

Non-metallic Mineral Products

Rubber

Metal Products

Chemical Fibers

Smelting and Pressing of Non-ferrous Metals

MIMCAOW

Special Purpose Machinery

Raw Chemical Materials and Chemical Products

Tobacco

Medicines

General Purpose Machinery

Smelting and Pressing of Ferrous Metals

Electrical Machinery and Equipment

Transport Equipment

CECOEE

2007 2008

Rank Score

1 39.00

2 32.42

3 28.26

4 23.96

5 22.88

6 22.35

7 20.18

8 19.55

9 18.43

10 16.78

11 15.62

12 13.25

13 12.73

14 12.56

15 12.40

16 12.36

17 11.71

18 11.62

19 11.09

20 11.07

21 10.66

22 10.45

23 10.32

24 10.28

25 10.03

26 8.95

27 8.18

28 8.06

29 7.67

Top 10 industries

in terms of MICI

are as following:

1. CECOEE (Communication

Equipment, Computers and

Other Electronic Equipment)

2. Transport Equipment

3. Electrical Machinery &

Equipment

4. Smelting & Processing

of Ferrous Metals

5. General Purpose Machinery

6. Medicines

7. Tobacco

8. Raw Chemical Material

& Chemical Products

9. Special Purpose Machinery

10. MIMCAOW (Measuring

Instruments and Machinery for

Cultural Activity and Office

Work)

2010-7-2 18

0%

3%

6%

9%

12%

Tobacco

Smelting and Pressing of Ferrous MetalsCECOEE

Transport Equipment

Metal Products





Medicines

Furniture


Textile

Non-metallic Mineral ProductsTextile Wearing Apparel, Footware and CapsBeverages


MIMCAOW

Rubber



Foods

Chemical Fibers



PTWBRPSP

Plastics

Articles For Culture, Education and Sport Activit iesPPCPNF

The Average Annual Growth Rate of

MICI from 2001 to 2008

2010-7-2 19

Top 10 industries

in terms of innovation

strength index of CM

are as following:


Equipment, Computers &

Other Electronic Equipment )


3. Smelting & Processing of

Ferrous Metals


Equipment

5. Raw Chemical Material &

Chemical Products



8. Smelting & Processing of

Non-Ferrous Metals

9. Textile

10. Medicines


PTWBRPSP

Furniture

Articles For Culture,Education and Sport Activities



Chemical Fibers


Rubber

Plastics


Foods

Beverages

Tobacco

MIMCAOW


Metal Products

PPCPNF


Medicines

Textile







Transport Equipment

CECOEE

2007 2008

Rank Score

1 38.90

2 32.53

3 25.82

4 24.06

5 15.67

6 14.93

7 11.79

8 8.98

9 8.36

10 8.13

11 6.58

12 5.31

13 4.94

14 4.48

15 4.48

16 4.28

17 3.74

18 3.07

19 2.77

20 2.65

21 2.57

22 2.38

23 2.07

24 1.68

25 1.35

26 1.23

27 0.95

28 0.83

29 0.79

2010-7-2 20

Top 10 industries

in terms of innovation

effectiveness index of

CM are as following:


Equipment, Computers &

Other Electronic Equipment )

2. Medicines

3. Tobacco


Equipment



7. MIMCAOW (Measuring

Instruments & Machinery for

Cultural Activity & Office Work)


9. Chemical Fibers

10. Raw Chemical Material &

Chemical Products




Textile


PTWBRPSP


PPCPNF


Foods


Articles For Culture, Education and Sport Activities

Beverages

Plastics

Metal Products

Furniture



Rubber


Chemical Fibers


MIMCAOW


Transport Equipment


Tobacco

Medicines

CECOEE

2007 2008

Rank Score

1 39.10

2 36.57

3 36.07

4 32.45

5 32.32

6 30.82

7 29.07

8 25.06

9 24.43

10 23.44

11 22.56

12 22.27

13 22.10

14 21.18

15 20.53

16 19.53

17 19.50

18 19.41

19 19.22

20 18.24

21 18.22

22 18.11

23 17.30

24 17.07

25 16.42

26 16.36

27 15.58

28 13.74

29 13.65

2010-7-2 21

Conclusions

The evaluation method is more reasonable for innovation

capacity of CM, whose score is comparable not only among

industries, but also in the several years.

Chinese government enhances innovation policies’ support for

technological development and industrialized activities, The

innovation capacity of CM has continuously been

strengthened in general.

Many industries of CM quickly expand their scales of

innovative activities, obviously reinforcing their innovation

strength. However, the innovation effectiveness makes a little

progress that has been the important factor to hinder

promoting the innovation capacity rapidly.

2010-7-2 22

Conclusions

To enhance creation, protection, utilization and management

capabilities for IPRs.

To strengthen manufacturing design, system integration and

manufacturing capacity.

To build innovation infrastructure and industrial R&D system so

as to speed up the restructuring and upgrading of industrial

structural.

To boost the upgrading, extension and development towards

the service sector.

To accelerate the development of the strategic emerging

industries.

2010-7-2 23

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