Discussing from the case of industrial vertical integration, the innovative capacity is to what extent affected by the absorptive capacity

Abstract

Development of third-generation semiconductor—silicon carbide—has been a hotpot, catching   the attention from worldwide scholars, meanwhile, the Sanan Optoelectronics as leading Chinese   enterprise made a series of technological breakthroughs. This paper will discuss about innovative   capacity, which is the one of the standards to gauge the competitive advantage of a tech firm, there   are three factors, demand chain, complementary technology and strategic intent will improve firms ’ absorptive capacity, which is a primary contributor to R&D activities. The vertical integration, as a   strategy resorted by Sanan to exploit and consolidate its market position, has interrelationship with   those factors and therefore the potential reason to Sanan’s success, will be considered further. The   research  will  be   conducted  by   empirical  and  qualitative   study,  attempting  to   find  out  the   cause-effect  relationship  between  critical  variables.  The   strategies  for  entrant  companies  to   challenge incumbents will be the foremost concern and primal achievement of this research.