“Protecting Intellectual Property in China” by Schotter & Teagarden Essay

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Updated: Feb 21st, 2024

Introduction

Multinational corporations that operate in China encounter an issue of Intellectual Property (IP) protection. The loss of IP is a major problem in China, and it leads to companies losing their profit and competitive advantage. However, companies cannot ignore Chinese markets due to their rapid growth. Therefore, they have to employ a number of strategies to protect their IP and lower the risk of losing essential information. IP loss can originate from staff turnover and transfer to other companies and partners.

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IP leakages can happen because of the state, as China wants to gather as much information as possible to become a leader in technological advancements by 2050. The increasing rate of foreign investments into the local industries also leads to the asymmetric development of some spheres, creating harsh conditions in which domestic and international companies have to compete. The need to be at the top of the industry drives some businesses to copy others’ ideas. Furthermore, some sociocultural factors also contribute to IP leakage, as China has a different view of education and private property.

Main body

To retain essential knowledge inside companies, they should create an IP protection web that includes a number of useful practices and principles. The legal system in China is not efficient enough for businesses to help solve their issues in court. Thus, other methods have to be considered to prevent leakage in earlier stages. First of all, some defensive practices should center on external aspects of protection. Established strategic clarity is necessary for a company to develop. It helps a business to explain what the firm is doing in the country and why. Some boundaries have to be specified here as well.

Second, business intelligence should be gathered prior to engaging with the local market. As China’s different regions offer different levels of development and protection, companies should collect necessary information before proceeding. Third, the company should find balance in dealing with legal matters. The legal fundamentals of the country should be analyzed and understood in relation to the business’ specifications. Fourth, a level of interest alignment should be outlined by the company. Business in China involves maintaining good relations with the government, local communities, customers, and employees. Personal ties and mutual understanding can help the company to protect its resources.

Furthermore, some internal strategic options should also be examined. Thus, a fifth principle deals with process decentralization. The separation of some activities and their disaggregation can help firms to hide essential information. Next, a controlled discipline should be developed for employees to follow. As Chinese workers may not have a similar understanding of the standards employed in one’s home country, it is necessary to point them out. Dynamism in creating new solutions is also an essential part of IP protection. Moreover, companies should manage their human resources as they often become the source of IP leakage. Some employee retention strategies may help companies to keep the knowledge inside the firm. Finally, corporate social responsibility (CSR) may benefit the company’s image and make the organization more respectable, thus, shielding it from IP loss.

Conclusion

These internal and external practices should be combined and utilized before the leakage happens. While they offer a base for protection, companies should develop their own methods to comply with the dynamically changing Chinese market environments. There is no single best solution to the problem of IP leakage because Chinese companies continuously improve their ways of incorporating gathered information into their operations.

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IvyPanda. (2024, February 21). "Protecting Intellectual Property in China" by Schotter & Teagarden. https://ivypanda.com/essays/protecting-intellectual-property-in-china-by-schotter-amp-teagarden/

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""Protecting Intellectual Property in China" by Schotter & Teagarden." IvyPanda, 21 Feb. 2024, ivypanda.com/essays/protecting-intellectual-property-in-china-by-schotter-amp-teagarden/.

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IvyPanda. (2024) '"Protecting Intellectual Property in China" by Schotter & Teagarden'. 21 February.

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IvyPanda. 2024. ""Protecting Intellectual Property in China" by Schotter & Teagarden." February 21, 2024. https://ivypanda.com/essays/protecting-intellectual-property-in-china-by-schotter-amp-teagarden/.

1. IvyPanda. ""Protecting Intellectual Property in China" by Schotter & Teagarden." February 21, 2024. https://ivypanda.com/essays/protecting-intellectual-property-in-china-by-schotter-amp-teagarden/.


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IvyPanda. ""Protecting Intellectual Property in China" by Schotter & Teagarden." February 21, 2024. https://ivypanda.com/essays/protecting-intellectual-property-in-china-by-schotter-amp-teagarden/.

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