The Performance Evaluation System Of China's High-tech Enterprises

In recent years, our state paid more and more attention to high-tech enterprises with the deepening of China's industrial restructure. Encouraging technological innovation is also at the center of debate during the two sessions. In the government work report, Premier Wen Jiabao repeatedly placed great emphasis on developing science and technology, encouraging innovation and building an innovative nation. It indicates that the development of high-tech enterprises has become the main focus of the industrial restructure. For the high-tech enterprises, how to invest, how much it requires to make the most effective output are issues related to performance evaluation. Therefore, it is widely discussed between academics and business executives that how can we evaluate the performance of high-tech enterprises in an objective and accurate manner. Given the high input, high innovation and high risk in high-tech enterprises, it is of great necessity to design a specific performance evaluation system to fit the need of high-tech enterprises'operation and performance management.The main part of this paper includes three parts. The first part lays the foundation for high-tech enterprises performance evaluation by the analysis of system theory, contingency theory, stakeholder theory and control theory. Meanwhile, it summarizes and describes the business performance evaluation criteria, which provides necessary theoretical groundwork and analytical premise for this paper. As the key chapter, the second part performs comprehensive analyses on high-tech enterprises'features and high-tech enterprises performance evaluation's defect in current China based on relevant performance management theories. This part makes efforts on designing a series of indicators by incorporating widely-accepted performance management principles, furthermore provides a suitable and practical performance evaluation indicator system for Chinese high-tech enterprises. In the third part, an empirical analysis is conducted using a sample of 68 high-tech enterprises in China. Based on the enterprises performance evaluation indicator system discussed in part two, a performance evaluation system is constructed by principal component analysis approach. It can be concluded that research and development indicators play an important role in performance evaluation. The input of research phase has greater impact over performance, compared to development input. Based on this analysis, it is proposed that high-tech enterprises should pay attention to research investment, e.g. to increase research investment in line with own financial strength after feasibility study to improve the R&D, innovation and enterprises performance. The upgraded competitiveness will promote long-term sustainable developmet.