In the past, the layout structure of foreign-funded enterprises in China usually focused on sales and light on R&D, but now this situation is changing. With the support of the government, many foreign-funded headquarters are accelerating their transition from management decision-making and sales and service centers to innovation centers and R&D centers, trying to open up the entire chain of "local innovation-result transformation-enterprise upgrading-industrial leap".
Recently, at a foreign investment and foreign trade transformation and upgrading promotion conference in Jing’an, Shanghai, some companies shared their own transformation cases.
In the field of biomedicine, Sanofi is increasing its presence in Shanghai, China, and is planning to establish a China R&D Innovation Center in Jing'an. Tang Lei, head of translational medicine at Sanofi China, said that the company will set up a new R&D center legal entity in Jing'an District, which is a comprehensive strategic upgrade of the existing China R&D center.
According to Tang Lei, the Shanghai R&D Center will become Sanofi's largest translational medicine research center in China and will be deeply linked with Sanofi's six global translational medicine centers. It will make full use of Shanghai's world-class scientific research resources and open policy environment to comprehensively accelerate the research and development of innovative drugs in key areas such as immunity, chronic diseases, tumors and rare diseases. In addition, the company will promote the simultaneous international development of new drugs and the launch of innovative drugs in China, and accelerate the delivery of innovative drugs in key areas to benefit Chinese patients.
In the field of beauty and health, Clarins will locate the world’s first overseas laboratory and the world’s second largest R&D center in Jing’an. Clarins Asia Pacific R&D Director Song Xianli said that the center specializes in studying the skin quality needs of Chinese consumers, from touch and fragrance to packaging, and collaborates with the Paris headquarters to develop high-end beauty products that truly fit the Chinese market and achieve localized innovation for global beauty brands.
Why do these foreign-funded enterprises need to transform? Zhao Lantian, deputy director of the Jing'an District Commerce Commission, gave the answer. According to him, during the "14th Five-Year Plan" period, the total foreign trade import and export volume of Jing'an District reached 484.51 billion yuan, and the total actual foreign investment reached 4.51 billion US dollars. The foreign-related economic scale has ranked first in the central city for 10 consecutive years. It has gathered 148 multinational company headquarters and more than 6,100 foreign-invested enterprises. The economic density of headquarters and the concentration of global brands rank first in the city. However, with the changes in the global trade pattern and domestic high-quality development requirements, the traditional foreign trade layout of "emphasis on sales and light on R&D" has been unable to adapt to development needs, and promoting the transformation and upgrading of foreign trade enterprises has become an inevitable choice. To this end, Jing'an anchors on the three major advantageous tracks of biomedicine, beauty and health, and high-end consumption, uses R&D innovation to solve transformation problems, and makes innovation the core basis for foreign trade companies to rise in level.
Zhao Lantian believes that increasing investment in R&D and innovation by foreign-funded enterprises can not only effectively enhance their core competitiveness and promote steady improvement in operational quality and efficiency, but also drive continued enhancement of regional economic contribution and continuous improvement of industrial ecology, achieving symbiosis and win-win between enterprise development and regional prosperity.
According to Zhao Lantian, relevant departments have established a gradient cultivation mechanism for foreign capital headquarters to support enterprises in extending from single functions to composite functions and from regional functions to global functions, enhance decision-making authority such as global strategy, business planning, resource allocation, and fund settlement, and encourage foreign-funded enterprises to set up industrial investment funds, participate in mergers and acquisitions and reorganizations, build cross-border cooperation platforms, integrate into the global service provider ecosystem, and deeply link domestic and international dual cycles. Up to now, a large number of foreign-funded enterprises have completed the role transformation from Chinese sales to global functions.
