Title: Practices for building innovation capabilities of local employees at German manufacturing subsidiaries in China

Authors: Wenqian Zhou; Vivek K. Velamuri

Addresses: Rolf Schrömgens Professorship in Entrepreneurship and Technology Transfer, HHL Leipzig Graduate School of Management, Jahnallee 59, 04109 Leipzig, Germany ' Rolf Schrömgens Professorship in Entrepreneurship and Technology Transfer, HHL Leipzig Graduate School of Management, Jahnallee 59, 04109 Leipzig, Germany

Abstract: Many German multinational companies aim to transform their subsidiaries in China that previously solely focused on manufacturing into subsidiaries that also drive innovation. However, these companies face numerous challenges, due to local differences compared to the West. In order to facilitate the process, this paper studies practices for building innovation capabilities at German manufacturing subsidiaries in China, taking into account the local challenges. Based on in-depth interviews with managers in China, this study identifies three practices for driving the build-up of innovation capabilities within the subsidiary organisation: build knowledge, establish a mindset for innovation and increase measures for employee retention. The study adds to extant research by detailing these practices with approaches that target local challenges. Compared to the West, the local challenges include differences in skills and knowledge, culture, as well as work behaviour.

Keywords: building innovation capabilities; German subsidiaries; China.

DOI: 10.1504/IJEIM.2020.108251

International Journal of Entrepreneurship and Innovation Management, 2020 Vol.24 No.4/5, pp.374 - 392

Accepted: 07 Mar 2019
Published online: 07 Jul 2020 *

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