Corporate R & D Fails (aborted) Project Eva Method

The more fierce market competition leads to a bad economic efficiency for many chinese enterprieses currently.The key issue is that technological innovation capability is not strong.Through researching the important factors which impact the technological innovation capability of Chinese enterprises, it is discoveried that research and development capabilities of the enterprises make the greatest contribution to their technological innovation. Basically, both of the personnel and cost inputs can impact the technological innovation capability of enterprises, but the staff inputs have a greater impact than financial inputs.Therefore, the fundamental driving force of enterprise innovation is that using the change of incentive mechanisms and methods of distribution to strengthen the sense of innovation and cultivate culture of innovation, and to stimulate R & D personnel's enthusiasm for the work at the greatest degree.For the enterprise, to enable it to gain the long-time competitiveness in the market, it certainly must research and develop the new project, which is the only way it will maintain the good competitive advantage. But for any new project, because of its uncertainty, enterprise's research and development may be risky.However any research man also hopes to do the project successfully finally, and wants to take research and development project with low content of technology and small risk, or the similar one he has done before,because such project has a high successful probability,and much less time and energy cost. But this causes no personnel to want to research and develop the project wih risk and superiority finally.Therefore, to solve this problem, we should fully mobilize research and develop personnel's enthusiasm, encourage them to research and develop the scientific research items which have challenge.If the project fails, but the achievement based on it may have value for fature scientific research, we should give the affirmation and the compensation to it. This will cause research and develop the personnel to have the enough enthusiasm to research and develop the high difficulty project, even if it fails finally, they will also obtain the corresponding compensation according to the front research results.Theoretically,this paper analyzes the necessity of encouraging R&D personnel and why to use the EVA method for R&D personnel incentives, and describes the incentive method.The focus of this paper is to research the EVA methodology to determine business R&D failure (suspended) project and explain the incentive reasons of R&D failure (suspended) project. Through the theory's induction and summarization,this paper determines the the EVA distribution method for R & D failure (suspension) project. Based on the EVA incentive theory, risk theory and the theory of relation between motivation and risk theory, by using TOPSIS analysis method and net present value method, through improving the R&D projects, economic feasibility of decision-making model, this paper derives the value of EVA phase.This paper does a case study combining Yuxi Institute of Mining and mining projects,and it analyzes the implied risk and factors in the implementation process of the project, and it use AHP to give weight to the risk factors.Then it uses TOPSIS method to eliminate the project with the highest risk,which enables the institute to reduce the risks. Finally, taking an R & D failure (suspended) project as example,this paper uses the formula of the value of EVA phase to arrive at the EVA values for the project team.