An Empirical Analysis and Evaluation of Innovation Strategy: The Case of Information and Electronic Industry

• Main Authors: Yee John Su, 蘇奕中
• Other Authors: 歐進士
• Format: Others
• Language: zh-TW
• Published: 2004
• Online Access: http://ndltd.ncl.edu.tw/handle/38211994591636912637

碩士 === 國立中正大學 === 會計學研究所 === 92 === Innovation is the powerhouses of business survival and growth. Facing global competition in 21st century, firms must continue to innovate which creates and maintains their competitive advantages in order to outstand numerous competitors. However, innovation is not only a slogan. To improve it’s competitive strength by innovation, a firm must set up and follow innovation strategies, which guide and encourage employees’ behaviors. Therefore, we proposed to examine the effects of innovation strategies on firm performance. Through surveys we obtained data about innovation strategies of information and electronic companies listed on TSE and OTC in Taiwan and examined the associations between those strategies and profitability of enterprises with regression model. R&D intensity, employee compensation level, firm scale, and firm age are also considered as control variables. Innovation strategies mentioned here include product and technology leadership, innovation type, innovation sources and R&D investments. R&D incentive system and protection of invented fruit are also included as other strategies associated with innovation activities. Performances are measured as operating income ratio of 2002 and average operating income ration over the past 3 years. The purpose of this study is to understand the association between innovation strategies and firms’ profitability. The empirical result shows that product and technology leadership and performance are positively correlated as hypothesis predicted. The degree of depending on internal innovation sources is correlated to 3-year average operating income ratio positively, indicating that the results of R&D take time to mature. However, the level highlighted in investing in R&D researchers has a negative effect on performance. This may show that if a firm over emphasizes on R&D researchers’ investment and ignores the need of investing in R&D facilities, there will be less resource for R&D activities and product and technology development, which will lower the competitive strength of the company. Protecting by low price is also positively correlated with performance. There’s also a negative correlation between patent protection and operating performance. This result may suggests that the costs and time spend of both registration and enforcement of patents are too high, causing the resources spend on obtaining and protecting the patents are not cost-effective and therefore leading to bad performance. The results of this study can provide valuable information for information and technology companies as they set up their innovation strategies.