Overcoming barriers to innovation in SMEs in China: A perspective based cooperation network

Innovation has been one of the key drivers of sustainable competitive advantage for small and medium-sized enterprises (SMEs). On the basis of a survey sample of 188 Chinese manufacturing SMEs, this paper explores barriers, cooperation networks and policy requirements in innovation for SMEs. This paper reveals that the ‘lack of technical experts’ is the most important barrier; the ‘customer’, the most important cooperation partner; and the ‘preferential tax policy’, the most favorable policy in innovation for SMEs. These findings reveal that many Chinese SMEs have difficulties in achieving successful innovation. Therefore, policies should be made based on internal and external constraints to facilitate innovation of SMEs, and varied depending on the size as well as the mode of ownership of firms.