china, chinese market, R&D Research and development, research, economic development, investment, european market, american market, trade, international trade, exchanges, imports, multinational companies, chinese multinational companies, innovation strategy, macroeconomic analysis, risk, financial risk, human resources, african market, aeronautic industry, food industry, france
China is changing its strategy. From the mass production of products at very low costs and quality, Chinese state is now orientating its economy in order to be able to capture a growing part of the added value and to change the international production process to its advantage.
In terms of research and development (R&D) China is about to become the first country in the world with high levels of investment and an increasing control over all innovations in many sectors of the economy. This situation is at the same time, the result of a series of macroeconomic advantages provided by the current dynamism and also lack of regulation of the Chinese market but also by an increasing tendency from European and North American investors and companies for risk adversity.
In that context, Chinese multinational companies are the spearhead of this process as they develop in every aspect of the economy and invest with a strong pragmatism on foreign territories with the objective of taking control over best and most innovative part of all major industries in the world.
France, with its specific historical advantages still benefits from a strong capacity to innovate and to compete with Chinese companies. However, the innovation strategy led by Chinese multinational companies in France seems to show a strong efficiency and should lead, in the medium term, to an increasing competition with Chinese multinational companies even in high technology and high innovation sectors were competitors used to be only from western countries.
This fast catching-up phenomena can be explained by the Chinese very pragmatic innovation in France. Those strategies especially focus on taking control of existing structures and benefiting from the current patents and human resources to take an advantage in specific sectors. In fact, only a very limited number of Chinese multinational companies have decided to develop, in the French territory, innovation structures ex nihilo.
The current success of these strategies today raises two new questions especially on the feasibility of this strategy in the long term, especially in terms of financial equilibrium but also on the possible change after ensuring Chinese advantage over the R&D part of the production process, to new innovation strategies in order to conquer the market of services which also offers a high level of profitability.
[...] The benefits of using gray literature are many. First, it allows access to more elaborate, precise and consistent information than newspapers. What is more, it also contains a wider variety of situations and, a broader view over what might become a trend in the industries and the microeconomic reasons behind those trends Interviews with members of companies included in the perimeter In order to gather more precise and detailed information, several e-mails were sent to French branches of Chinese companies in France. [...]
[...] In that aspect, France has some strength for Chinese multinational companies especially as it is considered a very effective country to gain access to most of European countries' markets but also to a large part of the African market. C. An overview over Chinese MCN innovation strategies in France in that context When looking at all information available about Chinese multinational companies' innovation strategies, one of the most important elements that can be noticed is a strong pragmatism on these issues . [...]
[...] Another possible trend can be identified in the Chinese multinational companies' innovation strategy is the desire to now develop processes and innovation that will lead them to conquer the other part of the smile curve and to benefit from the strong profitability of the service providing industry. This situation can appear as the next big thing in which Chinese multinational companies will focus once they have reached a high level of technology. In fact, the right part of the smile curve is mostly one of the aspects of today's economy where Chinese multinational companies have not been able to develop as strong as in the industry and the R&D. [...]
[...] This cooling in the relations between France and China will last until April 2010. Last but not least, the period we are observing contained a major diplomatic event between France and China as 2014 was the 50th anniversary of the establishment of diplomatic relations between those two countries15. This anniversary culminated with the signature of conventions about research, higher learning and innovation and was a way to fix damages on the diplomatic relation caused by the Tibet question Definition of the perimeter One of the first questions that can be raised regarding this memoir is the perimeter and especially how can we define a company can be considered as Chinese? [...]
[...] In that aspect, but also as every company is supposed to reflect its country, the image risk appetite from Chinese multinational companies is getting lower and lower as the company is more and more exposed and more and more identified as a leader and a reflect of the Chinese state, government and society. B. Main drivers and challenges for Chinese MNCs to have a localized innovation strategy in France 1. The persistence of historical advantage On today's basis, France still benefits from historical advantage in many high-level industries. [...]
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