Entovation International
China - Accepting the Knowledge Challenge

Debra M Amidon, Entovation International

Although the country represents a developing matrix moving swiftly from an agricultural to an industrial society, government and academic leaders are studying - systematically - the implications of the knowledge economy challenge.

In May, ENTOVATION Global Liaison Professor, Zhouying Jin, Director, Center for Technology Innovation and Strategy Studies of Chinese Academy of Social Sciences (CASS), organized a ten-day series of seminars to introduce the concepts and examples of practice to a variety of Chinese leaders. The tour was sponsored by Zou Zuye, Chairman of the Beijing Science and Technology Commission and hosted by Li-Wan, Secretary General of the Beijing Science and Technology Consultative Industry Association and Zhouying Jin.

Several organizations hosted various events, including: Dr Wang Tongsan, Deputy Director, Institute of Quanti-Economics and Techno-Economics of CASS; Madam Zhang Yuzhen, Deputy Director, High-Technology Department of State Science and Technology Commission; Zhang Xiu Ying, Office of Foreign Affairs for the Beijing Special Zone for Development of New Technology Industries; Niwei-Dou, Vice President, Tsinghua University; Yin Zhi-he, Executive Chairman of Beijing Software Industry Association; and Peng Shutang, Deputy Secretary General, China Non-Governmental S & T Enterprise Association.

In the new book 'Drucker on Asia' (Butterworth-Heinemann, 1997), Peter F. Drucker suggests the imperative:

"The short-term future of China and the critical decisions will be made within the next five or ten years - probably the most important issue for the world economy and world politics. A prosperous China that at the same time has a modicum of social peace, would be the greatest market opportunity since the tremendous recovery of defeated Europe and defeated Japan in the years following the Pacific War. A China in collapse, a China perhaps even in Civil War, may be the greatest danger we face."

Therefore, the world depends upon a strong China - economically, politically and socially. Given the scope of its geographic and demographic influence, it will have an extraordinary influence on how the future unfolds. Indeed, how well China emerges in the next millennium will have implications for other developing and industrialized nations. The broad representation of companies, universities and government agencies participating in the dialogue indicate that China is up to the task.

For example, Zhao Mulan, Director, Research Section for Reformation and Development of BEZ - presented an example of a major research study: "The Knowledge Economy in ZGC (Zhong Guan Cun) Area". The content of the Report outlines the basic concepts of the Knowledge Economy, an analysis of the area, information about further developments and the value of this approach. It suggests that "The Knowledge Economy is about the present, not the future"!

  1. Human Resources: Dealing with a high density of highly qualified resources; value of the knowledge asset - not one of consumption, core competence leveraging the capabilities of human power, fluidity of manpower inside the company and across other companies.
  2. Emerging Companies: Role of the entrepreneur combining knowledge of technology and market to create new knowledge; uncertainties of technologies and non-linearity of the process seeking indicators of sustainability.
  3. Venture Capital: Leveraging investments becoming a knowledge industry itself; role not just transfer of capital; activities must be long lasting.
  4. Knowledge Company: Knowledge Innovation i.e.creation, transfer and application; need for interfaces with traditional industries; new management structures; boundaries fading; focus on networked knowledge flow.
  5. Regional Innovation Network: Characteristics of self-organizing, balancing and harmonizing based upon local conditions; utilizing resources worldwide; economic globalization requiring both competition and collaboration.
  6. Knowledge Industry: Variety and diversity of companies (eg R & D, Information Management, Education companies etc.); the zone is the distribution base for knowledge products and services, not conventional services; highly condensed S & T resources and market information; complicated development structures.

Another example is the report produced by the State Science and Technology Commission (SSTC) outlining a decade of research funded through the 863 program. 70% investments in R & D and 30% on the transfer of research results. Breakthroughs in Applied Research on key technologies has led to commercialization and industrialization - the transformation of traditional enterprises and the formation of new enterprises.

Dozens of studies, like the ones outlined above, are providing a solid foundation upon which the country is building its "High-Technology R & D Strategy for 21st Century of China" under the leadership of State Science and Technology Commission.

Shao Xinping, Deputy Director of the Beijing Haidian Experimental Zone (HEZ) provided a summary of the ten year history and vision of the 100 square kilometre corridor of the city. It includes 5000+ new technology enterprises, 73 universities and colleges, 232 scientific research institutions creating a 'knowledge galaxy of talent'. The annual growth rate is more than 30% over the ten year history. 24% are state-owned, 25% collective, 17% foreign and 26% owned by stockholders. Investment comes from 60+ US Companies including General Electric, HP, National Semiconductor and Microsoft. The target of gross sales of BEZ in 2010 will be $25B.

The Beijing visit was covered by the China Light Industry Press, China Economic Times, The Beijing Science and Technology News and live television broadcasts. New additions to the ENTOVATION Network include representatives from: Chinese Academy of Social Sciences, The Research Academy for 21st Century Development of Tsinghua University, Zhejiang University, Stone Group Corporation, ETV, BEZ, China Harbour Engineering Company, Information Analysis and Research Center, Sinotime Marketing Investigation Company, China Institute of Intelligence Intensive Zone, China Power Engineering Consulting Corporation, Hi Sense Computer Company, Peking University, MEI United Inc, Great Dragon Telecom Group, Beijing Caistar Consulting Company and the Great Wall Enterprise Institute.

This tour was in anticipation of the soon-to-be-released Chinese version of 'Innovation Strategy for the Knowledge Economy: The Ken Awakening' which was translated by Zhouying Jin and Jin Chin. It will be available in September 1998. For details contact Zhouying Jin at e-mail: zhouy@moon.bjnet.edu.cn

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Reprinted from I3 Update - 22.