The Mechanism And Path Of Value Chain Upgrade Of Equipment Manufacturing Enterprise In Henan Province

Equipment-manufacturing industry is the basic industrial department of an economy. Right now, Global Value Chain has rebuilt the world’s labor division system. Industry development should take back on the upgrade of its enterprises in GVC, where technology gap reduction plays an essential role. In the circumstance of single enterprise, for one thing, firm’s R&D resource enhances its technology progress, for another, dynamics game between enterprises finally determined technology gap, as well as firm’s GVC status.Enterprises in developing countries and areas always be "captured" when they insert themselves into GVC, as they are always be force to join the global producing system dominated by the dominating enterprise in GVC, and their management are be defined and technology are be locked, as a result, their external property right is weakened. For another, because of the imperfect contract and modularizing producing model in equipment manufacturing enterprises, there are various kinds of secondary organizations with independent power appearing. Top manager, for maximizing profit, share the power of demanding surplus profit with secondary organizations. As a result, enterprises’internal property right is decentralized. Based on the above, we can build a multiple game model with power owners both inside and outside the enterprise, explore the general mechanism and path by with top manager can make enterprise’s value chain upgrade come true.Because enterprises in Henan province are in front of both weakened external property right and decentralized internal property right, they are fit for the general upgrade mechanism reasoning from the model:weakened enterprises in GVC have to reduce the technology gap between dominating enterprise, brake the lock, and force it drop technology locking. To do that, top manager should respect secondary organizations’benefit demand in resource distribution, make them activity in producing process, and maximum economic resource in the hands. Various strategies are utilizable to accelerate the accumulation of resource, to enhance the R&D, substitution and jumping of technology.Taking complex circumstance of Henan enterprises into account and change certain basic hypothesis in model, we can see that dominating enterprise in GVC cannot take their impact into practice freely because of the trade barrier and product difference. Therefore, weakened enterprises can get a "safe room" in local market as preparation for international marketing and GVC upgrade. Local enterprises can buy technology, expand scale and build local value chain to compete with other firms in local market. Therefore, equipment-manufacturing enterprises in Henan will be well advised to grow in local market firstly, and upgrade along the GVC in international market secondly.Based on the value chain upgrade’general mechanism of Henan enterprises, scale expanding and local value chain building both should be involved in the general upgrade path, and combine the perfect path together. In fact, strategies about accelerating resource accumulation are well obtained. While among strategies about technology progress, enterprises pay more attention on traditional strategies like R&D but not new strategies such as technology substitution and jumping. In local market, enterprises focus on technology buying and closed value chain but not open value chain. As practical strategy option is different with the regular in perfect path, Henan enterprises still have opportunity to improve their behavior. Government should take measures to help them modify their behavior, and enhance enterprise try to upgrade in GVC in scientific path.