An Empirical Study Of The Relationship Between Innovation Strategy Practice And Product Quality In Chinese Manufacturing Industry

Innovation strategy has been greatly encouraged by Chinese government and gained large popularity among Chinese companies in recent years.In the middle of the specific period of China's manufacturing industry transforming and upgrading,the effective implementation of innovation strategy and practice is the most important tasks for many manufacturing companies.Meanwhile,product quality is also the important factor which has significant influence on Chinese manufacturing companies' obtaining competitive advantage and satisfying market requirement.Therefore,the influence of a manufacturing firm's innovation strategy and innovation practice on its product quality has always been a debatable question in both academic literature and business practice.The paper aims to empirically investigate the relationship between innovation strategy,innovation practice,product quality and product market performance.This paper proposes a conceptual model linking these constructs.The model is tested in Structural Equation Model,using the data from 201 manufacturing companies in China.Innovation strategy is measured in terms of the degree of innovativeness;innovation practice is divided into technological and non-technological innovation.Technological innovation involves product innovation and process innovation.None-technological innovation involves organization innovation and market innovation.Product quality is divided as normal quality and attractive quality;product market performance focuses on financial measurements.The results reveal that innovation strategy has no significant influence on normal quality but has positive influence on attractive quality and therefore can foster product market performance.Technological innovation practice has positive influence on product quality but product innovation has no significant influence on improving attractive quality.The study also demonstrates the core status of organizational innovation among all types of innovation practice,which can convey the positive influence of innovation strategy on innovation practice.These results make contributions to the empirical study on the influence of innovation on product quality in academic area.In addition,the research introduces firm size as the moderating variable,testing its moderating role in the relationship between technological innovation and product quality.The testing results confirm that while the large firms can effectively exploit attractive quality performance through process innovation,SMEs rely more on product innovation to improve attractive quality.Based on the results above,the research proposes different suggestions on innovation and quality management for the manufacturing companies of different sizes.