Research On The Upgrading Paths Of China’s Enterprise Under The Perspective Of The Global Value Chain

Zhejiang is a large province of small and medium-sized manufacturing enterprises (SMME).In the past decades, the SMME in Zhejiang got considerable profits by inserting into the globalvalue chain, but with the rapid economic globalization, growth of raw material price and laborcosts etc., the SMME in Zhejiang can not get considerable profit by the used ways of insertingglobal value chain. So a lot SMME in Zhejiang want to solve these problems by the way ofupgrading in the global value chain, but most of the SMME in Zhejiang have little knowledgeabout the upgrading in the global value chain. For that reasons the research on the upgrading ofZhejiang small and medium-sized manufacturing enterprises under the global value chain isimportant and necessary.First, on the basis of literature study this paper concludes the main way of SMME in Zhejianginserting into the global value chain and the main problems in their developing. Second, under theanalysis on the factors and measurement of SMME’s upgrading in global value chain, this paperputs forward the corresponding research hypothesis, and then builds a theoretical model. Third,though the questionnaire design and enterprises’ survey, this paper makes an empirical analysis onthe upgrading of SMME in Zhejiang under the global value chain. Last, the paper put forwardsome upgrading paths in the global value chain for the SMME in Zhejiang according to the resultof empirical analysis. The following are the final conclusions the paper gets:1. At present, SMME in Zhejiang has four ways inserting the global value chain: OEM,Processing, ODM and OBM, but the main ways are OEM and Processing. Under that insertingways the SMME in Zhejiang faces many problems in the process of developing: the suppress ofthe controller in the global value chain, the suppress of the context and transverse parallelenterprises, the restriction of the enterprise managers, the incapability of knowledge internalizationand capitalization, the restriction of business model and technology innovation etc.,2. This paper concludes the main factors of SMME’s upgrading in the global value chain, theyare quality of entrepreneur, human resources management, level of technology innovation, abilityof knowledge internalization and capitalization, cost and capital support needed in the upgrading and environment of policy. and on the basis of that it builds a theoretical model of upgrading ofSMME in Zhejiang in the global value chain.3. The empirical analysis shows that the factors of quality of entrepreneur, human resourcemanagement, level of technology innovation and ability of knowledge internalization andcapitalization have positive relationship with the upgrading of SMME in Zhejiang in the globalvalue chain. While the hypothesis of other two factors: cost and capital support needed in theupgrading and environment of policy can not pass the test, because the result of empirical analysisof these two is inconsistent to the hypothesis.4. Based on the result of the empirical analysis, this paper put forward four upgrading paths inthe global value chain for the SMME in Zhejiang：(1)deepen OEM and realize productupgrading,(2)improve the ability of knowledge digestion and absorption,(3)transform from ODMto domestic OBM then to international OBM,(4)transform to the producer service enterprise.