Research On Innovative Performance Of Xiaomi Group’s Implementation Of Dual-class Share Structure

Innovation is the primary driving force for enterprise development,stimulates the overall economic vitality,and becomes an important means for enterprises to continuously obtain competitive advantages.Under the traditional equity structure,enterprises will continue to raise funds in order to obtain capital needs for development,and the founders’ equity will be continuously diluted,and the proportion of voting rights will gradually decrease,thus losing the actual control of the enterprise.For high-tech enterprises with rapid development,high innovation is their main characteristic,and innovation activities need the founder team.Under the circumstance that sufficient external funds are fully guaranteed and the founders’ control rights are protected,the dual share system emerges at the historic moment.Xiaomi Group,which takes "innovation" as its lifeblood in the science and technology innovation industry,has always placed innovation in the main position since its establishment.Since 2018,when the dual-class share system was officially implemented on the Hong Kong Stock Exchange,Xiaomi Group has become the first technology company to list with a dual-class share structure.In this paper,Xiaomi Group is selected and the impact of dual-class share structure on innovation performance before and after its listing is compared with Lenovo Group in the same industry by means of case study from three aspects: innovation input,innovation output and financial benefit.The influence of dual-class shares on innovation performance is analyzed by three relative indicators: the ratio of R&D investment,the capitalization rate of R&D investment and the number of patents per unit R&D investment.The following conclusions are drawn: First,the dual-class share structure meets the practical needs of Xiaomi Group,which guarantees the founder’s control right while obtaining financing.Second,dual-class share structure has a positive impact on innovation performance of Xiaomi Group.Dual-class share structure encourages enterprises to give play to the creative and design ability of the company team,pay attention to the investment in innovation,improve the R&D input and patent output of enterprises,and promote the innovation of enterprises.Third,the dual-class share structure as a whole is conducive to the long-term and stable development of Xiaomi Group.By promoting enterprise innovation,it has a positive incentive effect on the profitability and growth ability of Xiaomi Group on the whole,creating value for the enterprise and effectively guaranteeing the power of enterprise development.Combined with the case study of Xiaomi Group,this paper proposes that Xiaomi Group should continue to increase innovation investment,pay attention to talent introduction,pay attention to research and development results,improve the founder’s personal literacy to enhance the enterprise’s innovation ability and core competitiveness;Establish and improve the supervision mechanism and restraint mechanism;Encourage enterprises with dual-class share structure to allocate science and technology directors;Make an effective sunset clause and give full play to its value.It provides a reference for other Chinese enterprises to choose the dual share listing and promote innovation performance.