Proceedings of ICM’ 2007 The 6th International Conference on Management August 3-5, 2007 Wuhan, China

National Natural Science Foundation of China

Huazhong University of Science and Technology

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Proceedings of ICM’ 2007 The 6th International Conference on Management August 3-5, 2007 Wuhan, China

Globalization Challenge and Management Transformation

Zhang Jinlong, Zhang Wei, Xia Xinping, Liao Jianqiao (Eds.)

(VOL.I)

Science Press S Beijing, China

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ABSTRACT

This book is the proceedings of the 6th International Conference on Management (ICM’2007). ICM’2007 is a conference organized by Department of Management Science, National Natural Science Foundation of China (NSFC) with Huazhong University of Science and Technology, which is held on August 3-5, 2007, in Wuhan, China. About 300 papers are selected in the proceedings. These papers, submitted from 11 countries and areas, cover three key issues in management science: basic theories and methods, business administration, and macroeconomic management. The proceeding is a precious reference to those people who wish to either understand the new trends and new requirements on management sciences in the foreseeable future, or familiarize with the status and development of management sciences.

Published by Science Press

16 Donghuangchenggen North Street, Beijing,100717, P.R.China Copyright ©2007 by Science Press ISBN 978-7-03-019372-8/C.246

All right reserved. No part of the material by this copyright notice may be reproduced or utilized in any form or by any means,electronic or mechanical,including photocopying, or by any information storage and retrieval system,without written permission from the copyright owners.

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Preface

The International Conference on Management (ICM) is a conference in series organized by Department of Management Science, National Natural Science Foundation of China (NSFC) with a local partner. The first to five of this conference were successfully held in Beijing (1994), Hong Kong (1996), Shanghai (1998), Xi’an (2001), and Macao (2004). A common sense is that the scope of management sciences is dramatically expanding and developing with the globalization of the world economy. Hence, the theme of this conference, i.e., the 6th ICM to be held in Wuhan, is determined as “Globalization Challenge and Management Transformation”. The conference provides an international academy forum for various management professionals to share and exchange new ideas, theories, methods, and fruits on the theory and practice of management studies, and promotes the communion and innovation of the management science between China and the world. About 300 papers will be presented at this conference and are selected in the proceedings. These papers, submitted from 11 countries and areas, cover three key issues in management science: basic theories and methods, business administration, and macroeconomic management. I believe that this proceeding is a precious reference to those people who wish to either understand the new trends and new requirements on management sciences in the foreseeable future, or familiarize with the status and development of management sciences in China. I would like hereby to thank Science Press for the timely and elegant publication of the proceedings. All members of the program committee and organizing committee contributed to the success of the conference. Particularly, several faculty members of Huazhong University of Science and Technology and National Natural Science Foundation volunteered their time and efforts in organizing the conference and editing the papers. Their helpful works are greatly appreciated. Meanwhile, I would like to express my gratitude to many organizations domestic and abroad for their sponsorships. The names of these organizations are listed at the front page of this proceeding. Finally, I wish the conference successful and valuable to all involved.

Guo Chongqing Director General, Department of Management Sciences, NSFC August 2007

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Proceedings of ICM’ 2007 The 6th International Conference on Management

Globalization Challenge and Management Transformation

Sponsor Department of Management Sciences, National Natural Science Foundation of China

Organizer Huazhong University of Science and Technology

Jointly Organizers Southwest Jiaotong University Chinese University of Hong Kong

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Conference Chairman Prof. Guo Chongqing (郭重庆, Beijing, China)

Consultant Committee (by alphabetic) Prof. Cheng Siwei (成思危, Beijing, China) Prof. Li Jingwen (李京文, Beijing, China) Prof. Li Shantong (李善同, Beijing, China) Prof. Liu Renhuai (刘人怀, Guangzhou, China) Prof. Liu Yuanzhang (刘源张, Beijing, China) Prof. Lu Youmei (陆佑楣, Wuhan, China) Prof. Wang Yingluo (汪应洛, Xi’an, China) Prof. Wang Zhongtuo (王众托, Dalian, China) Prof. Wu Jiapei (乌家培, Beijing, China) Prof. Wu Qidi (吴启迪, Beijing, China) Prof. Yu Jingyuan (于景元, Beijing, China) Prof. Zhao Chunjun (赵纯均, Beijing, China)

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Program Committee Chairman Prof. Li Peigeng (李培根, Wuhan, China)

Co-Chairman Prof. Huang Haijun (黄海军, Beijing, China) Prof. Wang Shouyang (汪寿阳, Beijing, China) Prof. Zhang Wei (张维, Beijing, China)

Members (by alphabetic) Prof. Chen Guoqing (陈国青, Beijing, China) Prof. Wu Shinong (吴世农, Xiamen, China) Prof. Chen Jiyong (陈继勇, Wuhan, China) Prof. Wu Shoushan (吴寿山, Taiwan, China) Prof. Chen Naiji (陈乃骥, Macao, China) Prof. Xi Youmin (席酉民, Xi’an, China) Prof. Chen Qijie (陈启杰, Shanghai, China) Prof. Xiao Baichun (萧柏春, Chengdu, China) Prof. Chen Shou (陈收, Changsha, China) Prof. Xu Erming (徐二明, Beijing, China) Prof. Chen Rongqiu (陈荣秋, Wuhan, China) Prof. Yang Deli (杨德礼, Dalian, China) Prof. Chen Xiahong (陈晓红, Changsha, China) Prof. You Jianxin (尤建新, Shanghai, China) Prof. Deng Mingran (邓明然, Wuhan, China) Prof. Yu Li (于立, Dalian, China) Prof. Gao Ziyou (高自友, Beijing, China) Prof. Zhang Weiying (张维迎, Beijing, China) Prof. Gu Siming (古思明, Taiwan, China) Prof. Zhang Xinming (张新民, Beijing, China) Prof. Guo Daoyang (郭道扬, Wuhan, China) Prof. Zhang Yishan (张屹山, Jilin, China) Prof. Hong Maowei (洪茂蔚, Taiwan, China) Prof. Zhao Shuming (赵曙明, Nanjing, China) Prof. Huang Haijun (黄海军, Beijing, China) Prof. Zheng Zukang (郑祖康, Shanghai, China) Prof. Lan Hailing (蓝海林, Guangzhou, China) Prof. Zhu Daoli (朱道立, Shanghai, China) Prof. Li Hanling (黎汉林, Taiwan, China) Prof. Xiuli Chao (North Carolina, USA) Prof. Li Rui (李端, Hong Kong, China) Prof. Ming-Jer Chen (Virginia, USA) Prof. Li Tiansheng (李天生, Hong Kong, China) Prof. Ming Huang (New York, USA) Prof. Li Wei’an (李维安, Tianjing, China) Prof. Wei Huang (Ohio, USA) Prof. Li Yijun (李一军, Haerbin, China) Prof. Teck-Hua Ho (California, USA) Prof. Liang Dingpeng (梁定澎, Taiwan, China) Prof. K. K. Lai (Hong Kong, China) Prof. Liu Jianhua (刘建华, Hong Kong, China) Prof. Lode Li (Connecticut, USA) Prof. Liu Xing (刘星, Chongqing, China) Prof. Shouyong Shi (Toronto, Canada) Prof. Luo Zuwang (骆祖望, Shanghai, China) Prof. Jing-Sheng Song (North Carolina, USA) Prof. Qi Ershi (齐二石, Tianjing, China) Prof. Zhigang Tao (Hong Kong, China) Prof. Shen Zhonghua (沈中华, Taiwan, China) Prof. Jiang Wang (Boston, USA) Prof. Shi Qintai (史钦泰, Taiwan, China) Prof. K. K. Wei (Hong Kong, USA) Prof. Song Kai (宋 铠, Taiwan, China) Prof. Tianqin Xu (West Ontario, Canada) Prof. Wang Chongming (王重鸣, Hangzhou, China) Prof. David Yao (New York, USA) Prof. Wang Fanghua (王方华, Shanghai, China) Prof. Yingyu Ye (California, USA) Prof. Wei Minghai (魏明海, Guangzhou, China) Prof. Shaohui Zheng (Hong Kong, China) Prof. Wei Yiming (魏一鸣, Beijing, China)

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Organizing Committee Chairman Prof. Zhang Jinlong (张金隆, Wuhan, China)

Co-Chairman Prof. Chen Xiaotian (陈晓田, Beijing, China) Prof. Jia Jianmin (贾建民, Chengdu, China)

Secretary General Prof. Xia Xinping (夏新平, Wuhan, China) Prof. Liao Jianqiao (廖建桥, Wuhan, China)

Members(by alphabetic) Prof. Cao Yong (曹勇, Wuhan, China) Prof. Long Lirong (龙立荣, Wuhan, China) Prof. Chen Pinglu (陈平路, Wuhan, China) Prof. Lu Yaobin (鲁耀斌, Wuhan, China) Prof. Cui Nanfang (崔南方, Wuhan, China) Prof. Ma Shihua (马士华, Wuhan, China) Prof. Feng Zhiyan (冯芷艳, Beijing, China) Prof. Meng Erling (孟二陵, Wuhan, China) Prof. Gong Pu (龚朴, Wuhan, China) Prof. Tian Zhilong (田志龙, Wuhan, China) Prof. Huang Dengshi (黄登仕,Chengdu,China) Prof. Wang Zongjun (王宗军, Wuhan, China) Prof. Jing FengJie (景奉杰, Wuhan, China) Prof. Yang Cao (杨超, Wuhan, China) Prof. Li Hao (李昊, Wuhan, China) Prof. Yang Liexun (杨列勋, Beijing, China) Prof. Li Jun (李军, Chengdu, China) Prof. Zhu Xuezhong (朱雪忠, Wuhan, China) Prof. Liu Zuoyi (刘作仪, Beijing, China)

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CONTENTS

VOL.I

SECTION ONE Management Science

An Agent-Based Knowledge Transfer Model for Implementing and Operating ERP Systems Dong Jichang, Tan Dapeng, Huo Guoqing 3 An Adaptive Particle Swarm Algorithm for Global Optimization Guo Chonghui, Li Hong 8 A Study on Dynamic Modeling for Chinese Resident’s Consumption and Investment Decision with Housing Liu Zhixin, Huang Lingling 13 New Formulations for Second-Best Congestion Pricing Problems on a General Transportation Network with Elastic Demands: An Excess-Demand Approach Liu Nan, Chen Daqiang 19 Fuzzy MPMP Production Planning Problem with Minimum Risk Criteria Yuan Guoqiang, Liu Yankui 29 Optimizing Designs to Improve the Blockage Behavior of Emergency Networks Wu Weiwei, Angelika Ning, Ning Xuanxi 37 An Approach to Solve Large Scale Multiple Traveling Salesman Problem with Balanced Assignment Wang Dazhi, Wang Dingwei 43 Optimization Methods and Models Supplier Selection for N-Product under Uncertainty: A Simulation-Based Optimization Method Wu Chunxu, Dong Feifei, Fu Jianbing 46 A Feasible Case Study of Applying Critical Chain Multi-Project Management in Semiconductor Turnkey Services His-Hsien Yu, Sheng-Kuan Chiu 51 A Fuzzy Multi-Objective Programming for Optimization of Reverse Logistics for Solid Waste He Bo, Yang Chao, Zhang Hua 59 The FIP Problem with Uncertain Demand in Several Scenarios Yang Jun, Liu Shuji, Xiong Jing 65 Information Sharing Strategy and Data Processing Model for SMLE Alliance Qi Ershi, Gao Yinan, Huo Yanfang 71 Solving Capacitated Facility Location Problem Using Tabu Search Minghe Sun, Eliane Aparecida Ducati, Vinícius Amaral Armentano 76 Research on the Hybrid Ant Colony Labor Division Algorithm with Optimization and Its Application Xiao Renbin, Zhang Qiang and Zhang Xinhui 82 Semicontinuty of the Solution Mapping of ε-Vector Equilibrium Problem Kenji Kimura, Yeong-Cheng Liou, Jen-Chih Yao 90

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Optimization of Distribution Network Design Based on Retailer Satisfaction Zhang Min 101

Optimizing Linear Optimization Problems under Fuzzy Relational Equations with Max-Star Composition Yan-KuenWu 107

SECTION TWO Operational Management

Virtual Cellular Manufacturing Systems: Emerging Research Issues in Global Manufacturing & Supply Chain Contexts Nallan C. Suresh 117 A Study on the Performance Characteristics of Closed-loop Asynchronous Automatic Assembly Systems W.K. Leung, W.C. Ng, Y. Ge 122 Container Slot Allocation Model with Liner Shipping Revenue Management Bu Xiangzhi, Chen Rongqiu, Li Li 130 Production Order Evaluation Based on Neutral Network Model Qiu Jie, Chen Zhixiang 138 Distribution the TOC Way: Review and a Case Study Cui Nanfang, Leng Kaijun 145 The Research on Distribution of Large Scale Chains Enterprise with Time Window Da Qingli, Zhang Heng 152 Multi-Objective Layout Optimization in Dynamic Environments: A Heuristic Approach Dong Ming, Liu Fei, Hou Forest, Zhang Franky, Chen Feng 159 A Centralized Inventory Policy for Open-Loop Reverse Supply Chain Gou Qinglong, Liang Liang, Xu Xiping, Xu Chuanyong 165 Research on Development of Modern Logistic Industry in Area along New Eurasian Land Bridge (China’s Section) Based on Spatial Economic Relationship Ji Shouwen, Chen Jiajuan, Xie Fang 175 A Simulation Based Research on Loading -Unloading Strategy in Railway Container Terminal Li Dong, Wang Dingwei 180 A Fuzzy Evaluation Method of Integrated Logistics Service Networks Zhao Zhiyan, Li Bo 186 Formulation and Complexity Analysis for 3PL Transportation Problems Li Kunpeng 191 Study of the Partial Task Management under Constrained Resources Li Mingyu, Bi Yiming, Li Bin 195 A Study on Guaranteed Delivery Time Based Inventory Model of Component Commonality in Assemble-to-Order Systems Lin Yong, Chen Kai 200 Outsourcing Decision-Making of Equipment Maintenance in Process Industries Liu Liping, Ji Jianhua, Fan Tijun, Hu Jiling 212 A Location-Allocation Problem Applying in Scrap Steel Recycling Network Design liu Yang, Tang Jiafu 215 A Dynamic Inventory/Allocation Problem Based on Internet Auctions Liu Shuren, Hu Qiying 221

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Reliability of Transportation Network Service Capacity Based on Effective Agile Theory Song Rui, He Shiwei 226 Information Increment and Information Value in Supply Chains Wang Jing, Wang Xun, Li Yuxiang 232 Information Sharing in a Supply Chain with Learning Effect Wu Jianghua , Xin Zhai 239 A Study of the Production Planning and Control System for Remanufacturing Xie Jiaping, Ren Yi , Zhao Zhong 245 A Production I1nventory Model for Intangible Deteriorated Items with Demand-Dependent Deteriorating Rate Xu Xianhao, Tang Ziyi 254 The Impact of Positive Externality on Returns Policy Xu Chuanyong, Liang Liang, Gou Qinglong, Zha Yong, Zhou Chuiri 260 Study on a Model of Lean Supplier Management Based on the Lean Production Xu Zhiduan, Guo Yixun 269 Study on Lead Time Inventory Models Based on Customer Waiting Time Yan Lei, Chen Rongqiu, Li Li 276 The Method Based on the PSO Algorithm for the Order Planning of the Steel Plant Zhang Tao, Cheng Haigang, Chu Xiaoxuan, Xie Meiping 281 Positioning Model of Purchasing Based on Kraljic’s Purchasing Portfolio Matrix and Factor Analysis Zhao Zhenfeng, Guo Danxia, Ding Liuming 289 Research on Coordinated Replenishments by Alternative Supply Sources in a Logistics System Zheng Aihua, Zhao Qiuhong 296 Solving the Joint Replenishment Problem with Warehouse-Space Restrictions Using a Genetic Algorithm Ming-Jong Yao 302 An GA-based Alternative Approach on the Capacitated Warehouse Allocation of Customers with Uncertain Demands ZhouGengui, Ye Feng, Cao Jian, Cao Zhengyu 308 Evolution of Manufacturing Systems: from Product Competitive Advantage towards Collaborative Value Creation Yongjiang Shi 316

SECTION THREE Decision Theory and Application

Efficiency Improvement with Minimum Amelioration Zha Yong, Liang Liang 325 A Method of Fuzzy Multi-Attribute Group Decision-Making Problem with Linguistic Variable Deng Wei，Wu Qizong 333 Research on E-Business Investment Decision Making Based on Option Games Han Guowen 340 Resolve the Multi-Factor Tradeoff Problem in Bid Evaluation by Using Computer Regression Analysis He Liang, Zhao Ping, Wu Ming, Kang Hui 345 Monotonic Vector Space Model and Its Partition Algorithms Hu Jianwen, Hu Xiaofeng, Zu Shuguang, Si Guangya 353 Fitting Analysis of the Airport Passenger Throughput Based on Arima Model Jia Chuanliang, Sun Ying, Wang Lubin, Ma Yanlin 359 v

Research on the Knowledge Reorganization Methods of Emergency Plans Jia Xiaona, Rong Lili 365 Relative Closeness Method for MAGDM with Heterogeneous Information Li Dengfeng 372 A Maxmin Model for Allocating the Fixed Cost Based upon DEA Li Yongjun, Liang Liang 378 Empirical Analysis on the International Competitiveness of China Telecommunication Operators Li Yuanhui, Ding Huiping 384 An Improved Approach to Conjoint Analysis for the Complex Decision-Making Liu Chengming, Li Chunhao 392 Applying Fuzzy Set and Rough Set to Evaluate Risk Level in IT Project Management Lu Xinyuan, Zhang Jinlong 399 Research on the Dynamic Choosing Question about Network Product Compatibility and Price Sheng Yongxiang 405 Military Conflict Decision Modeling Based on Fuzzy Hypergame Song Yexin, Dai Mingqiang, Cui Yan 410 Research on Inferring ELECTRE-III’ s Parameters and a Case on Naval Gun Weapon System Integration Sun Shiyan, Wei Hua, Wang Hangyu, Li Lu 416 A Co-Marginalistic Contribution Value for Set Games on Matroids Sun Hao, Xu Genjiu, He Hua 425 Dynamic Features Extraction in Soybean Futures Market of China Meng Jie, Wang Huiwen 431 Extension of the VIKOR for Decision-Making Problems under Fuzzy Environment Wang Yongchun 437 Extended Models to Non-uniqueness of Cross Efficiency in Cross Efficiency Evaluation Wu Jie, Liang Liang 443 Evaluating the Comparative Performance of the Regional S&T Competitiveness of China: A DEA Application and Problem Wu Qiang, Wang Xiaoye 448 Auctioning Total Permitted Pollution Discharge Capacity under a Uniform Price Zhao Yong, Chen Yang, Wang Qing 454 Application of the Fuzzy Simulation in the Evaluation Investment of Advanced Manufacturing Technology Zhao Zhenwu，Tang Wansheng 459 Survey on Rough Set Theory Based on Connection Degree Zhou Xianzhong, Li Huaxiong, Huang Bing, Yang Pei 466 A Study on the Safety Situation and Countermeasures to Chinese Natural Resources Zhao Guohao 473

SECTION FOUR Information Management and E-Commerce

A Comparison of Domestic and Overseas Current Situation of Web-Based Survey Research Cheng Du, Shao Peij, Fang Jiaming 481 Factors Influencing Consumers’ Repeated Online Shopping in China: An Empirical Study Chang Yaping, Zhu Donghong 487 Risks versus Intendance Policies to Information Systems Engineering in China Fang Deying, Sun Guorui 493 vi

Research on Core Competence of Enterprises in Electronic Business Management Mode Hao Chunlu 499 The Xia-Jin Bridge’s Impact on Local Tourism of both Sides of the Taiwan Strait from the Customer Value Perspective Chien Yung-Tsai, Liao Sen-Kuei, Duan WanChun 505 Studying on Customer Demands Information Processing Lei Yi, Tang Bingyong 512 The Evaluation of Knowledge Management Performance Based on AHP Liu Peide 517 A Study of Pricing Patterns for Keyword Advertising Auction Liu Shulin, Rong Wenjin 523 The Model Research of the Knowledge Transfer and Sharing in the ERP Implement Yunfeng Shi，Lingling Zhang, Xiuyu Zheng 532 A Framework of Identifying IT Application Capabilities Based on IS Lifecycle Wang Nianxin, Zhong Weijun, Mei Shu’e, Zhong Yulin 539 Study on Product Lifecycle Management Coordination Management System Model of the Shipbuilding Enterprise Wang Zhiying, Ge Shilun 546 Design of Link Structure of Electronic Commerce Website Wu Shaofei, Wei Siying, Zhang jinlong 552 Mitigating Risks in Software Projects Through Phased Development Process: A Real Options Analysis Chen Tao, Zhang Jinlong 556 Building on Management Knowledge Platform of Outsourcing Wu F., Li P.P., Wang Q. 562 EAI(Enterprise Application Integration)Conceptual Architecture Composition in Telecom Industry Yang Hongbin 569 Online Training Industry Supply Chain System Planning Based on CAS Theory Zhao Jinshi, Zhao Ying, Zheng Xiaotao 574 A Tool for Risk Mitigation in Public Sector IS/IT Projects: An Evidence-Based Information Systems Project Risk Checklist Lihong Zhou, Ana Cristina Vasconcelos, Miguel Baptista Nunes 580 Assessing Risks through Information Systems Failure Probability Based on the Life Cycle Theory Liu Shan, Zhang Jinlong, Chen Tao, Cong Guodong 590 The Research of Project Performance-Oriented of Software Process Improvement Model and the Decision Support System Yu Benhai,Zhang Jinlong, Chen tao, Cong Goudong, Zhang Dongfeng, Hu Xianbiao 599 Research of the Collaborative E-Business System Constructed Yang Limao, Tian Liang 605 Index of First Authos 613

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CONTENTS

VOL.II

SECTION FIVE Financial Engineering and Risk Management

Review on Some Research in Behavioral Finance with Multi-Agent System Based Financial Market Zhang Wei, Zhao Shuaite 617 The Real Options Model of Optimal Timing in Banks’ Write-off Decisions under Dynamic Circumstances Chen Jinlong, Xiong Tao, Zeng Wuying 623 Analysis on Development of China’s Integrated Circuit Industry in 2006 Chen Desheng, Li Chunqing, Lei Jiasu 629 An Econometric Model on Interest Rate Risks on Basis of CKLS Process and Pertinent Empirical Analyses: Taking Chinese Treasury Bond Market as an Example Du Jinmin, Liu Xiangyun 636 Can Sentiment Affect Asset Pricing? Evidence from Chinese Security Market Wu Yanran 643 Research on Listed Company Credit Risk Modeling He Xubiao, Gong Pu 648 Financial Constraints on Corporate Investment Behavior Huang Fuguang, Zhang Shuangcai, Nie Huiqiang, Wang Xiaozhuo 654 Reserves Models for Portfolio of Endowment Insurance Contracts with Stochastic Interest Rates Dong Ming 662 Combining Forecast Model Based on GA for Personal Credit Scoring Jiang Minghui, Yuan Xuchuan 667 The Study of the Capital Financing Ability of Investment Banks Based on the Financial Integration Liu Ruibo, Zhai Yinjia 672 R/S Analysis for Chinese Stock Market Efficiency Liu Weiqi, Wang Yaoqing 679 Distribution Modeling of LGD: Fitting Distribution Method Cui Jie, Shen Peilong 685 A model and Its Solution for the Control of the Stock Price by the Banker with Two-Stage Decision Yang Naiding, Wang Liang, Yan Pengyu, Zheng Zheng 690 Valuation and Hedging of European Contingent Claims bythe Interacting Particle Models Wang Jun, Ji Meifeng 697 Optimal Timing of R&D Investment under Uncertainty and Incomplete Information Wu Jianzu 703 The Theoretical Fallacy and Valuation Bias of Existing WACC Formula Wei Yi, Xu Qin 709 Analysis and Review of Monte Carlo Method for Pricing of Convertible Bonds Yang Fei, Ma Junhai 714

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Option Game Pricing Model of R&D Alliances with Sequential Investment Xue Minggao 722 A Study on the Effect of Macro Economy on the Liquidity Comovement between Stock and Bond Markets Zeng Zhijian, Xie Chi 729 The Empirical Research of Long-Term Memory of Stock Market Returns of Shanghai Zhang Xiaoli 735 The Mobilization Efficiency of Venture Capital in China Zhao Changwen, Chen Chunfa 740 The Overvaluation of Renminbi Undervaluation

Yin-Wong Cheung, Menzie D. Chinn, Eiji Fujii 754 Analysis of Optimal Strategies of Convertible Bonds with the Game Theory Analysis of Options Meng Jianling, Gong Pu 759

SECTION SIX Accounting and Finance

Research on Business Process-oriented Knowledge Auditing Model Zhang Yuejin, Zhang Lingling, Shi Yong 769 Underpricing and Overvaluation in Chinese IPO Market Wang Yixia 775 Executive Compensation, Speculative Bubbles and Earnings Manipulation Li Shuangyan, Wan Difang, Shi Yarong 784 The Value Relevance Study of the Allocation of Assets Impairment Reserves Li Yang, Tian Yixiang, Luo Yushu 789 Hedging Device or Entrenchment Device? Evidence on the Cash Holding Motives of Chinese Listed Companies Luo Qi, Lei Ming, Wang Junliang 794 Study of Management Layer’s Acting Motivation and M&A Performance of Chinese Listed Company Song Jianbo, Shen Hao, Li Aihua 800 Design of Market Incentive for Managers in Chinese Listed Firms Xia Tian 806 Study on Financing Constraints and Inefficient Investment of Ultimate Owner in Private Pyramid Firms Han Zhili, Yang Shu-e 811 Management Overconfidence and Capital Structure Yu Minggui, Xia Xinping, Pan Hongbo 817 An Empirical Research on Determinants of Agency Problem of Controlling Shareholders: Evidences from Chinese Listed Companies Yang Qingxiang 824 Control Rights Allocation and Shareholder Wealth Effect in M&A Li Shanmin, Zheng Nanlei 831 Capital Structure and Corporate Performance Zhang Zhaoguo, He Weifeng, Ye Bei 838 Control Shareholding and Effect of Top-Management Stock Incentive˲Empirical Evidences from Chinese Listed Companies Cheng Zhongming, Wu Long, Zou Bin 850

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SECTION SEVEN Marketing

From Storyline to Box Office: A New Approach for Green-Lighting Movie Scripts Jehoshua Eliashberg, Sam K. Hui, and Z. John Zhang 859 Effects of Voice in a Telemarketing Context Jean-Charles Chebat, Kamel EL Hedhli, Claire Gélinas-Chebat 875 Research on the Customer-Perceived Value and Its Drivers Bai Lin 886 Discount Impact: Effects of Multiple Reference Prices on Price Perception Chen Rong, He Feng, Wang Yi 893 Symbiosis of Marketing and Quality: Antecedents and Consequences Du Peng, Wan Houfen 899 Research on Mechanisms of Power and Action for Cause-Related Marketing: Perspectives of Enterprise and Non-Profit Organization Du Lanying, Hou Jundong, Huang Yupeng 908 The Sales Control System and Salespersons’ “Loafing on the Job” Jiang Ruochen 914 What Factors Do Influence Enterprise Purchase Behavior? An Empirical Research on Chinese Enterprises Li Guihua, Yao Tang 923 The Effects of Consumption Experience to Customers’ Satisfaction Li Chuncheng, Li Chongguang 929 Two-Factor Strategy: A New Tool for the Continuous Attribute-Level Performance Improvement of Hypermarket Liu Xinyan, Yang Zhi 939 A Study on Value Creation Based on Implicit Demand Mining of Customers Luo Yongtai, Liang Qiang 945 The Relation between Price Level, Product Standard and Price Elasticity of Premium Brand: An Empirical Research to the TV Industry in China Qiu Xiaodong, Hu Song, Zhao Ping 952 System Dynamics Modeling for Strategy Implementation of Service Quality Su Ying, Jin Zhanming 957 An Exploring Study on the Dimensions of Perceived Quality Bao Gongmin, Wang Jie 963 Brand Knowledge Structure and Its Marketing Managerial Implications in Chinese Context Wang Haizhong 968 Examining the Moderating Effect of Price Consciousness on the Relationship between Involvement and Consumer Satisfaction Wang Xia, Wang Yi, Zhao Ping 978 Customer Innovation Motivations, Innovation Investment and Customer Knowledge: An Empirical Study in IT Applications Wang Yonggui, Gao Zhongyi 985 Empirical Study of Customer Value Evaluation Model for Telecom Enterprise Based on SEM Xu Heng, Zhao Songzheng, Wu Jianhua 992 An Empirical Study on Life Satisfaction and Consumption of Chinese Aging People Wei Yujie, Yu Chunling 999 v

The Marketing Opportunity Evaluation Model of House Product’s Implicit Demand Exploitation Zhao Yanhua, Luo Yongtai 1005 Customer Assets Value Estimate Based on Accounting Zhou Lei, Yan Zouxian 1011 Empirical Study of Moderating Effects in Growth Mechanism of the High-Tech BtoB Brand Wang Xingyuan, Wang YiˤYu Wei 1016 The Framework of Global Service Marketing: Service Segmentation, Strategy Dimension and Strategy Implementation Wu Xiaoyun, Liu Xia 1023 A Study of International Market Entry Modes: A Network Perspective Jiao Yongbing 1029 A Study of Global Marketing Strategy Based on a Research of Hundred Chinese Multinationals Deng Zhuqing 1035 The Antecedents of Marketing Standardization Strategy: Empirical Evidence from Chinese Manufacturing Multinationals Zhang FengˤWu Xiaoyun 1042 A Study on Consumer’s Purchase Intention Based on Corporate Social Responsibility Practice Yan Jun 1050

SECTION EIGHT Human Resource Management

Retaining People That Differentiate Dr. Debasis Sanyal 1059 Empirical Study on the Relationship between HR Managers’ Competency and HRM Performance Chen Wansi 1064 Strategic HRM and Firm Performance: The Mediating Role of Organizational Culture Liu Jun, Wei Liqun 1071 The Descriptive Research of the Host Country Conditions and the Investment Patterns of China-Singapore Joint Ventures in China Luo Yushu, Jing Runtian 1078 Research on the Incentive Mechanism of Manager of IT Corporate Tao Changqi, Xu Ye 1083 Empirical Research on Fulfillment Effect of Psychological Contract for the Knowledge Worker Xu Yonghu, Hong Xianyou, Huang Dacheng 1088 Manipulation Effect of Managerial Discretion on CEO Pay Level: Evidence from Listed Firms of China Zhang Changzheng, Li Huaizu 1093 A 360 Degrees Factor Function Measurement Model: The Revision of Human Capital Value Factor Function Model Zhang Hongyou, Zhang Tongquan 1103 A Study of the Relationship between Human Resource Management System and Organizational Performance: An Organizational Learning Perspective Zhang Xiaobing, Zheng Xianming, Li Xinjian 1111 Career Perceptions and Coping Strategies of Professional Women in Performance-Oriented China Zhou Erhua, Tian Li 1116

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Hedging the Uncertainty of Temporary Worker Demand by Applying the Compound Options on Temporary Workers Ying-Chyi Chou, Ming-Guan Huang, Pao-Long Chang 1122

SECTION NINE Organiztion Theory

Relevance of Non-Financial Indicators as a Decision Tool: A French Inquiry Based on the Organizational Architecture Theory Grégory Wegmann 1129 Three Kinds of Management Cultures/Practices and Their Impact on Organizational Learning Capability and Performance Chen Guoquan 1136 Simulating the Structural Behaviors on Organizational Knowledge Communication Based on Small-World Networks Chu Jianxun, Tang Shukun, Ye Wen 1148 Job Opportunity, Organizational Commitment,Turnover Intention and Its Gender Difference Liang Qiaozhuan, Sun Hui, Huang Yingbo, Liu Zhen 1154 A Model to Measure the Employees’ Organizational Embeddding Force from the Social Capital’s Input-Output Perspective Liang Xiaowei 1161 The Construct Validation of Chinese Employees’ Work Motivation Lu Xiaojun, Li Mingfei 1166 A Comparative Study of the Role Balance of Chinese Men and Women Entrepreneurs Guan Peilan, Luo Dongxia, Ren Jing 1173 The Moderating Effect of Emotional Labor upon the Relationship between Emotional Intelligence and Job Behaviors Sun Jianmin, Liu Xiaoyu 1179 Analysis of Social Relationships Construction between Enterprises in Cluster Based on Repeated Games Theory Wang Wenping, Deng Yulin 1185 Social Capital and Organizational Performance: Is Learning Orientation A Missing Link? Wu Yechun, Ge Zhiliang, Wang Cheng, Xie Hongming 1193 On R&D Alliances Structure with Sequential Investment Xue Minggao, Gong Pu 1200 Employee’s Perception of Personality Similarity and Interpersonal Factors Yang Yuhong, Cheng Yu, Meng Fanchen 1210 Organizational Commitment Mediates the Relationship between Organizational Climate and Turnover Intention Zhang Kai, Ji Ting, Song Jiwen , Jiao Changquan 1215 Job Satisfaction and Organizational Commitment of Chinese Civil Servants: An Empirical Study Zhu Suli, Long Lirong 1222 Psychological Contract Breach and Employees’ Responses: The Moderating Effects of Leader-Member Exchange Zhong Lifeng 1228 Effects of Paternalistic Leadership on Subordinates’ Organizational Justice: Evidence from Mainland China Zhou Hao, Long Lirong 1238 vii

SECTION TEN Strategic Management

Strategic Management and Performance of Humanitarian Systems: Some Patterns from the Study of Two NGOs Fahim Youssofzai, Taïeb Hafsi 1249 Understanding Chinese Business Behaviour: A Study and Interpretation of the Three Kingdoms Novel Taïeb Hafsi, Li Yan 1269 On the Link between Strategic Option and Corporate Social Responsibility: Empirical Evidence from Chinese Private Firms Chen Honghui 1283 Business Capability Formation and Evolution Mechanism Based on Value Creation: An Analysis of Logistics Enterprise Ding HuipingˤHe Lin 1290 Guanxi Network and Acquisition of External Resources by Business in Mainland China Gao Yongqiang 1296 Chinese Firms' Internationalization and Entry Mode Choice: A Case Study Zhang Yuan, Jing Runtian, Ma Zhenzhong 1302 The Influence of the Upgrading of Corporate Capability on the Evolution of Core Competence: An Empirical Study of Corporations in China Rui Mingjie, Chen Xiaojing 1309 How External Environmental Characteristics Affect Strategic Change˷An Empirical Research on China’s Listed Firms Wang Yu, Ting jui Chou 1315 Organization Structure Evolution and Human Resources Management Strategy in the Internationalization of Enterprises Wu Cisheng, Sun Chaoping 1326 Knowledge, Commitment and Consumer-Perceived Value: Some Thoughts on The Internationalization of China Consumer Electronics Manufacturers Xie Qunyong 1332 The Effect of Industrial Character on Innovational Strategic Choices: Study on Electronic Industry and Petroleum and Chemical Industry Xu Erming, Zhang Han 1342

A Study on the Key Risk Identification of the Enterprises’ International Operation Xu Hui, Zou Huimin 1347 Research on the Self-Organizational Evolution Model and Its Dynamic Mechanism Based on Porter’s Diamond System Yuan Zepei, Liang Yunwen, Zheng Yanhua 1354 Research on Outsourcing Network Management: Formation and Operation Patterns Yin Jianhua, Wang Zhaohua 1361 An Empirical Study of the Effects of Unrelated Diversification on Investment Decisions: A Financing Constraint Perspective Zhou Jie, Zhang Shiyun 1367 Index of First Authors 1375

viii

CONTENTS

VOL.III

SECTION ELEVEN Technological Innovation

Effect of Biased Technical Change on Factor Demand: An Investigation into Chinese Manufacturing Panel Data 1980-1994 Bi Xianping, Zhao Wenzhe 1379 Beyond Path Dependence: Organizational Learning in the Innovation of Complex Technology Cao Xuanwei, Xi Youmin 1386 On Structure and Pattern of Enterprise Core Competence from the Aspect of Implicit Knowledge Cao Xing, Chen Qi 1392 Cyber Café Entrepreneurs: Their Socio-Economic Profile A. Sahay, M. S. Chhikara 1398 Knowledge Sharing within the Firm, Absorptive Capacity and Innovation Capability: An Empirical Investigation on Chinese Firms Song Zhihong, Fan Libo 1415 Technological Capability Development of the Enterprises in Developing Countries: The Case and Implication Hong Yong, Su Jingqin 1422 Female Entrepreneurship in China: Evidence from Hubei Province’s Cases Hu Huaimin 1429 The Impact of Knowledge Integration on Dynamic Capabilities and Sustainable Competitive Advantage Jian Zhaoquan, Wu Longzeng, He Ziwei 1434 The Study on Life Cycles’ Evolution Mechanism of the S&T Industrial Cluster Constant Innovation Xie Xuemei, Zeng Saixing 1442 A Research of Innovation-Originated Nation Statistical Indicator System: Based on the Vision of Technology Sustaining and Leading Economic Development Zheng Wei, Li Lianshui 1448 Entrepreneurial Orientation, Learning Orientation, and Product Innovation Guo Hai, Liao Xiuwu 1455 Technology Capability, Marketing Capability and Network Capability: Their Impact on Innovation Success Mei Shuen, Nie Ming 1461 The Impact of the Volatility of Venture Capital Market on Enterprise Innovation in China and U.S.A Mai Yiyuan, Shan Yuqing, Gan Zhilong 1468 Knowledge System Integration of New Product Development Project and Innovation Mechanism Ou Guangjun 1473 Analysis on the Impact Factors of Basic Research Investment: Empirical Research of Chinese Innovation System and International Comparisons Wang Yali, Wu Dan 1478

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Take the Non-Financial Factors into High-Tech Enterprise’s Performance Measurement Wu Weiwei, Wu Qiang 1482 The Entrepreneurial Process in technology-Based Ventures: The Case in Pre-Startup Stage Xiao Jianzhong 1487 Learning and Performance: Is Technical Innovation a Missing Link? An Empirical Study of Firms in South China Xie Hongming, Wang Qi, Luo Huiling, Wang Cheng 1496 Impact of Enterprise's Orientation on Innovative Choice and Its Internal Control Modes Xu Rui, Shi Jifeng, Song Xiaomin, Li Jianfeng 1502 A Review of Enterprise Innovation Strategy in China Yang Jianjun, He Ying 1509 A Game Analysis on Innovation Impetus of Firms in Cluster Yang Jian, Liang Liang 1514 Shortcoming Analysis on Scientific &. Technical Innovation and Operation System in China Yang Weiguo, Jin Zhe, Yang Zheng 1522 Government Roles in the Different Operation Patterns of Incubators* Yin Qun, Zhao Lijun, Liu Qing 1529 Technology Innovation and Patent Backed Securitization Yuan Xiaodong, He Ningxin 1535 Technology Innovation& Entrepreneurship The strategies and mode choices of entrepreneurial economy based on economic ecosystem view Zhang Monan 1540 The Role of Chief Technology Officer in Japanese Corporations Akio NagAhira, Cao Yong, Isao SuGiYai, Takashi MasAki 1549 Academic Tech Transfer and IP Management in Japan: Recent Developments and Some New Evidence Cao Yong, Akio NagaHira, Chen Rensong, Zhu Xuezhong 1557 Estimation on Technological Progress Contribution to Economic Growth of Hubei Province Lan FeiWang Hua HuShuhua 1565

SECTION TWELVE Macroeconomic Management

Capability Gap, Growth and FDI Spillover in China Chen Taotao 1573 The Vertical Balance of Pension Fund of China: An Overlapping Generations CGE Approach Chen Pinglu 1580 Analysis of the Spatial Determinants of Japanese FDI in China Gong Xue, Gao Changchun 1585 On Strategic Delegation Equilibrium in Duopoly Market Guo Xinshuai, Miao Baiqi 1591 Grey Relevancy Analysis about Energy Consumption of each Industry and Economic Growth in China Lin Shoufu, Zhao Dingtao 1597 Study on Chinese Corporate Tax Burden in International Tax Competition Zhang Rui, Chen Weihua 1604 Estimating the House Price Gradient with respect to True Commuting Time in Beijing Zheng Siqi, Yang Zhenpeng 1610

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A Study of the Choice for RMB Interest Rate Regulation Mode Based on Benchmark in the Process of China’s Interest Rate Marketnization Zheng Changjun, Ma Cheng, Peng Dewen 1615 Inflation and Openness: A Study of Selected Developing Economies Dr. Sunil Ashra 1623 Standards and International Trade: The Case of China and USA Ge Jing, Li Wei 1646

SECTION THIRTEEN Resource and Environment Management

Environment, Energy and Natural Resources of China, Cooperation with the Silk Road Countries and the USA Youyu Phillips 1655 The Input-Output Analysis of Structural Change, Industrial Linkage and Electricity Consumption of Sectors Guo Juan, Li Yujie, Guo Chonghui, Hu Xiangpei 1661 The Environmental Effects of Water Pricing Policy in China Han Hongyun, Zhao Liange 1668 A Study of Manufactured Goods Export, Industry Pollutions and Investment in Environment Protection of China Li Jun, Long Weizong 1676 Development of A Grade Sensitive Transit Bus Driving Cycle in San Francisco Li Ling, Christie-Joy Brodrick 1683 Optimal Tax Policy with Environmental Quality in Dynamic Economic System Li Shoude, Wang Daozhen, Gu Mengdi 1688 Economy Growth Cointegration Test Between Fushun and Medial Megalopolis in Liaoning Province Liu Haibin, Liu Zhenling 1694 Study on Interaction Mechanism between Environmental Management and Sustainable Development in China Shi Fang, Chen Hongtao, Xu Zaishi 1700 Integrated Management for Renewable Energy Resources and CDM Resources: A Case Study Deng Jing, Su Mingshan 1708 Controlling Chaos in the Energy Resource System by Time-Delayed Feedback Sun Mei, Tian Lixin, Jia Qiang 1714 Circular Economy Based on The Green Supply Network： The Theory and Practice Wu Di, Wu Chunyou 1720 Energy Consumption Change with High Economy Growth in China Cheng Jinhua, Wu Qiaosheng 1726 Consumer’s Attitudes and Willingness-To-Pay for Green Food in Beijing, China Zeng Yinchu, Xia Wei 1737 Status Quo and Optimization of 3E in Qinghai Province Yan Liang, Zhang Chunmei 1747 The Sustainability Evaluation of County Ecosystem Based on Ecological Footprint and Environmental Friendship Index Zhao Dingtao, Huang Xibing, Li Haidong, Qi Wei 1755

v

Assessment of Social Impacts of the 3-North Shelterbelt Forest System Program: A case Study in Hetian County Zhi Ling, Zhang Yongjie, Li Nuyun, Liu Junchang 1762 SECTION FOURTEEN Non-Profit Organization Management

Evaluation on the Efficiency of Public Health in Township Hospitals of China Fang Pengqian, Zhang ahui, Zhang Zhiguo 1781 Volunteers’ Motives and Motivations in Non-Profit Organization Liu Yonghong 1788 Using Analytic Hierarchy Process to Evaluate the Competence of Agricultural Product Wholesale Market Sun Qingli, An Yufa 1796 Simulation Based Budget Control of a Voucher System Wang Dingwei, Gu Jiaozhong 1801 The Healthy Breeding Aquatics Village: On Symbiotic Innovation of Agribusiness Mode Zhang Lixiang, Zhang Xicai 1807

SECTION FIFTEEN Special Issues of China’s Management

IPO Underpricing and Investor Sentiment: Evidence from China Wang Junliang, Xia Xinping, Wang Yixia 1815 The Survey on Incentive Compensation Satisfaction of Science and Technology Personnel: Take the Area of Nantong as an Example Chen Tao 1822 Learning Organisations and Chinese and American Pragmatism: A Way ahead for the West Malcolm H Cone,Graham Elkin 1829 1829 The Evaluation of Metropolitan Region and Manufacturing Industry Reciprocal Development in China Li Lianshui, Cao Peng 1836 Board of Directors, Committees and Corporate Performance: Evidence from Public-Listed Companies in China Liu Xiaoyuan, Zhou Jian*, Yu Wei, Hua Xinyi, Cheng Bin 1841 An Empirical Study on the Block Shareholders’ Degree of Exploitation in China’s Listed Company Ma Lei, Xu Xiangyi 1850 SHRM under the View of Chinese Family Firms’ Sustained Growth Qian Shiru, Han Yu 1856 The Project Management Model of Hydropower Development Enterprises: An Analysis of HeXie Management Theory Zeng Xianju, Xi Youmin, Li Ziye 1861 The Growth of IT Enterprises in China: A Positive Study Xu Ye, Tao Changqi 1869 Study on Enterprise Group Governance Framework from the Visual Angle of Harmony and Cooperation Xu Xiangyi, Ma Lei, Xie Mingliang 1875

vi

Empirical study on Corporate Political Strategy under the Influence of Chinese Traditional Culture Ye Guangyu 1881 Research and Design of Sustainable Development Strategy of China’s PC Industry Zhou Wei 1887

SECTION SIXTEEN Other Issues in Management

Zero-Level Pricing with CARA Utility Function and Transaction Cost Sy-Ming Guu, Jying-Nan Wang 1895 Free Cash Flow Preference Research of Listed Firms Basing on the Background of Fluidity Surplus Wang Shicai, Chen Wenxiu 1899 Causes of Long-Term Asset Write-offs by Listed Companies in China’s Capital Market Zhu Yan, Gu Weimin 1907 Technical Tote – EOQ and EPQ with Linear and Fixed Backorder Costs: Two Cases Identified and Models Analyzed without Calculus Kit-Nam Francis Leung 1918 Some Notes on Qualitative Case Study Research Lu Qiang, Lincoln Wood, Victoria da Gama 1922 Research on the Improvement of Fault Tree Analysis Bu Quanmin, Bi JunYuan Zengwei 1929 Evolutionary Game Theory Analysis of the Travel Mode Choice of Urban Traveler Chen Xingguang, Zhou Jing 1933 Science and Technology Foundation Products Management Systembased on OLAP Ma Le, Dang Yanzhong, Guo Weisen 1939 An Positive Analysis of Food Demand of Urban Residents in China Dong Guoxin, Wang Yeyuan, Zou Jiang 1947 An Evolution Model of Multiclass, Multicriteria Stochastic Traffic Equilibrium Assignment under ATIS Guo Renyong, Huang Haijun 1953 Bipartite Network Description on Collaboration-Competition Systems Zhou Yueping, Chang Hui, He Daren 1959 Analysis on the Organizational Nature of Industry Cluster and Governance Mechanisms Hu Dali, Gai Yongmei 1965 Study on Complex Phenomena of Marketing Organization Hu Bin, Zhang Zhen 1972 Prototype Development of Technology Tracking System Based on Patent Quotation: An Empirical Study of Robot Technology Kang Yuhang, Su Jingqin 1978 China’s Emergency Management: Building a Framework Liu Xia, Li Shijun 1983 The VAT Evasion Based on Cash Transactions between Enterprises: Between the Double-Subjects Enterprise and the Single-Subject Enterprise Liu Hua, Ding Guangzong, Wang Sheng 1988 Research on Multi-Agent Based Flexibility Resource Constraints Project Scheduling Problem Luo Ronggui, He Tao, Tan Lu 1994 Visual Principle FCM Clustering Algorithm in Complex Network Application Wang Zhongjun, Mo Chunling 2000 vii

A Method of Building Response Mode on Emergency Rong Lili, Sun Yong 2005 The Output Value of China's Basic Disciplines of Intellectual Property Input Analysis Peng Xiaobao, Song Wei 2010 Research on the Cross-Cultural Integration & Innovation within Sino-Foreign Joint Ventures Tang Yanzhao, Lu Wei 2016 Modeling the Mode Choice and Equilibrium Commuting Behaviors in a Bottleneck-Constrained Highway with Private Cars and Buses Tian Qiong, Huang HaiJun 2026 On Industrial Structure Optimizing, Perspective from Intersector Linkage Wang Fang 2032 A study on Coordination of Quantity-Based Dispatch and Inventory under VMI Yang Peng, Liu Pengfei, Zhang Zhengyu 2037 Research on Integration Method and Application of Enterprise Multidimensional Standardization Management System Based on Knowledge Management Yang Qifeng, Feng Bin, Nie Guihua, Liu Pingfeng 2043 Research on Human-Information System Interaction Efficiency in Enterprises Computerization Environment Yi Shuping, Li Faquan, Yang Wencai, Wang Haixia, Xiong Shiquan 2050 Analysis of a Two-Stage Telecom Resale Supply ChainCoordination with Revenue Sharing Contract Zhang Li, Zhang Hong 2056 The Analysis of Industrial Innovation Zhang Zhihe, Xie Zhongquan, Sun Lijie 2062 The Impact of Social Network on Alliance Capability Zheng ShengHua 2068 Analysis on Velocity of Advanced Manufacturing System Based on Petri Net Zhou Rongfu 2074 Optimal Capital Structure in Various Tax Systems Tsai-Yen Chung, Sheng-Te Chou 2078 2078 Index of First Authors ...... 2085

viii

SECTION ONE MANAGEMENT SCIENCE

1

An Agent-Based Knowledge Transfer Model for Implementing and Operating ERP Systems∗

Dong Jichang, Tan Dapeng, Huo Guoqing GS School of Management of the Chinese Academy of Sciences, Beijing, P. R. China, 100049

Abstract To implement and operate an Enterprise Resource Planning (ERP) system, knowledge transfer is an important method to constitute effective Knowledge Management (KM) systems and develop effective transfer strategies to enhance competitive advantage. In this paper, an agent-based knowledge transfer framework is presented for ERP life cycle, and discussions about the relationship between the knowledge transfer in ERP life cycle and ERP effects are provided. We investigate the use of knowledge transfer to select, implement and use ERP systems and propose some knowledge agents. Key words ERP, Knowledge transfer, Agent, ERP effects

1. Introduction In the last few years, thousands of companies around the world have implemented enterprise resource planning (ERP) systems. The commercially available ERP software packages promise seamless integration of all information flows in the company, such as financial and accounting information, human resource information, supply chain information, and customer information. ERP system provides two major benefits that do not exist in non-integrated departmental systems: (1) a unified enterprise view of the business that encompasses all functions and departments, and (2) an enterprise database where all business transactions are entered, recorded, processed, monitored and reported. The unified view increases the requirement for, and the extent of, interdepartmental cooperation and coordination. ERP system enables companies to achieve their objectives of increased communication and responsiveness to all stake holders (Dillon, 1999)[3]. ERP implementations are accompanied by large data warehouses that are designed to facilitate data access and improve the reporting capabilities. Because of the size and cost of the data warehouse, some knowledge managements may be able to exploit the underlying information and database structure. In other hand, it has been estimated that virtually all of the Fortune 500 firms have either implemented an ERP system or are implementing an ERP system. Also, some small to medium enterprises have adopted ERP systems too. So the knowledge transfer needs can vary substantially across different clients for the ERP firms. More often, implementation of ERP systems needs consulting firms. During the late 1990s, it was estimated that roughly one-third to one-half of the consulting done by the major consulting firms has to do with selecting, implementing, or using ERP systems (Public accounting report, 1998)[10]. Further, additional consulting often is done after the ERP system has been installed, e.g., improving configuration and security. As a result, there is a large potential for knowledge transfer through the life cycle, both for consultants and the companies implementing the software. Also, when the ERP software is developed, there is also knowledge transfer between the consultants and the programmers who may be from the ERP companies or specific software companies (Daniel, 2002)[2]. Furthermore, all too often the knowledge assets created during ERP projects are lost, ignored, or not leveraged to their fullest potential in the implementation (Linda, 2001)[5]. These valuable assets include the relationships and rules embedded in the software, the project design criteria and decision history, testing and training scenarios and scripts, and “user experiences”. The most successful implementations avoid losing the knowledge created in the selection, implementation and early deployment stages through careful, early planning of KM systems. Organizations can improve their institutional “learning curve” by establishing the processes and systems needed to capture, manage, access, and replenish knowledge across the entire ERP life cycle. From the analysis above, we can find that knowledge transfer is emerging as important tool to support ERP

∗ Supported by SSFC (No. 05CTQ002), China.

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systems. The purpose of this paper is to discuss the knowledge transfer across the entire life cycle of ERP system to select, implement and use ERP system. In this paper, we discuss the relationship between the knowledge transfer in an ERP life cycle and ERP effects in Section 2. Then a multi-agent based framework for knowledge transfer in the ERP system is proposed in Section 3. Section 4 provides the knowledge agents in the entire ERP life cycle for enterprises to select, to implement and use ERP system. Finally, we summarize the paper briefly in Section 5.

2. The Effects of Knowledge Transfer to ERP Life Cycle Entire ERP life cycle is generally characterized by three stages: selecting, implementing and using. These stages are different in their critical needs and goals, but they share the common objective, and improve the competitive power and value of the enterprise. According to Linda (Linda, 2001)[5], a great deal of codified knowledge is contained in an ERP system, both in the software structures provided by the vendor and in the process knowledge and business rules developed by the enterprise. But a corresponding set of auxiliary knowledge is captured only in the form of project documents (formal and informal), training documents, data models, additional business rules and formulas, and in the brains of the project team. We cannot easily access or derive this valuable knowledge from the software or the operational system. In general, we can conclude the relationships between the knowledge transfer in ERP implementation and ERP effects as below: (1) The knowledge level of consultants (or experts) that assistant to software development is positively related to ERP implementation effect. A great deal knowledge is embedded in the ERP software. The process of software development just is the process that the consultants or experts transfer theirs management method and other knowledge into the software. It is the first and more important transference which affects the effect of the implementation. Scott (2000) testifies that the knowledge contents in ERP software are positively related to their assistance to the function of an enterprise[11]. The effect of SAP, People Soft and other ERP firms are benefit from the assistance of the consultant company, such as Price Waterhouse Coopers. (2) The gap between the current knowledge of an enterprise and the knowledge needed by ERP implementation is positively related to the risk of ERP implementation. In an enterprise, the key leaders would not support the implementation of the ERP, if they were short of understanding the value of the ERP software. If the education and training were not well done, it must lead to the bigger gap between the current knowledge of an enterprise and the knowledge needed by ERP implementation. Also, culture gap can be considered as a knowledge gap, but this gap will be changed difficulty. All these knowledge gaps can result in great effects to ERP implementation effect. (3) When the individuation level of ERP software is higher, an enterprise transferring more its special knowledge to the ERP software is positively related to ERP implementation effect. However, when the individuation level of ERP software is lower, an enterprise transferring its optimal practice knowledge to the ERP software is positively related to ERP implementation effect. In general, the ERP firms and the consultant company often advise the users not to make a big modification to the ERP software because the standard flows of the ERP are from the optimal practices of the relative industry. The bigger modification would affect the ERP implementation effect (Bancroft, 1998; McCaskey, 1999)[1][6]. An enterprise needs to fit the ERP software through modifying the flows of it. But some scholars argue that ERP firms cannot provide every flow for each industry because each enterprise holds its special flows and rules, so it is necessary to redevelop the software in some extents (Swan, 1994)[12]. This problem lies in the individual characters of ERP software in nature, and the enterprise should transfer more its special knowledge to the ERP software.

3. An Agent-based Knowledge Transfer Framework The levels of the knowledge in the ERP software depend on the management, and the process of knowledge

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from the expertise transferred to a software programmer and embedded in the software at last. An enterprise implementing ERP is a process that internal and external knowledge are transferred into the software and become the “power” of the enterprise. Just these knowledge transferences decide the effect of the implementation of the ERP system. Fig. 1 illustrates the knowledge transfer process in ERP life cycle. To gain the useful knowledge, a knowledge transfer framework (Nonaka, 1991)[8], which identifies which information we should retain, who will eventually use that information, and how we will capture that information at each stage of the ERP life cycle, should be provided. In addition, the knowledge transfer framework provides a model of the knowledge environment over the life cycle of a system and illustrates the relationships and dependencies of people, business processes and events, and knowledge domains. With this framework, we can anticipate and plan for the knowledge requirements of subsequent phases of the ERP project. We can also develop mechanisms for transferring or transforming the knowledge base from one phase to another. Selecting, implementing and using REP systems can result in a number of issues that can benefit from the knowledge transfer. We provide an agent-based framework for knowledge transfer in ERP system life cycle (Shown in Fig. 2). Different knowledge contents in each stage of life cycle of ERP system can be dealt by the knowledge agents: Selecting Agent, Implementing Agent and Using Agent in the framework. Using of this framework, we can see that both explicit knowledge and tacit knowledge can be transferred among the actors in the process of implementation of ERP system. The following section will provide a detailed introduction to the knowledge agents in the framework.

Industrial ERP ERP Software ERP Company Implementation Expertise Software Consultant Programmer Enterprise

ERP Implementation Consultant

First Knowledge Transfer Second Knowledge Transfer

The Efficiency of ERP Implementation

Fig. 1 A general knowledge transfer process in ERP life cycle

Selecting Agent Web Browser Implementing Agent User Using Agent Interface

Fig. 2 An agent-based knowledge transfer framework

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4. Knowledge Agents 4.1 Selecting Agent Knowledge transfer can facilitate the choice of ERP system. In order to facilitate access to information and eliminate information asymmetries, a Selecting Agent designed to capture and make available information regarding the ERP systems in a timely manner, would have been a helpful device. Information about each of the ERP systems under consideration could have been embedded in this agent. According to the current literatures including selection process the following knowledge contents can be transferred into this agent from the external entities or internal entities of the enterprise (Langenwalter, 2000; Minahan, 1998; Oden, 1993)[4][7][9]. (1) Vision. Clearly define the corporate mission, objectives and strategy. (2) Feature. A proposal that contains the feature and function list should be created. Typically, this proposal describes how the company wants each department or function to operate and consists of instructions to the supplier, the terms and conditions, supplier response forms, and so on. (3) Software Candidate. Select only ERP providers that are right for the business of an enterprise. Price, supplier support, ease of implementation, closeness of fit to the company’s business, flexibility when the company’s business changes, technological risk and value (total implemented cost versus total value to the company) are the important criteria to select an ERP system. Using this knowledge agent, make a final decision on the implementation. In extreme cases, if necessary, reverse the decision to implement ERP, change vendors, or renegotiate the contract. During this stage, the knowledge actors include a team composed of respected individuals who are familiar with the various software packages, company processes and the industry, business unit managers, the manager of the enterprise, consultants, and so on. 4.2 Implementing Agent During the implementation stage, Combining business and industry-related knowledge with the knowledge structures (processes, data architectures, and so forth) of the ERP system is an important goal at this stage. The project managers of ERP implementation will require current, accurate information and support tools in order to accomplish tasks. The human experts and system knowledge, the project management and change request documentation and audit trails, and other information are the main knowledge in this stage. In order to accomplish these goals, the Implementing Agent is needed. The following knowledge contents can be transferred into this agent: (1) ERP Model. Capture the organization’s business processes and rules in the context of the ERP software and provide models for the final system’s configuration. (2) Toolkit. Provide project management, document management, collaboration and message, expertise and team-skills management, and a lessons-learned process repository. (3) IT. IT knowledge components-software code, models, rules, and so on. Moreover, the Implementing Agent should provide an integrated access to external data sources and integrates the information received in the context of the ERP implementation project instance: context, priority, and others; a real time communications and collaboration environment that includes shared documents, media, and discussion spaces with appropriate security and access controls; a single point of access to a wide range of relevant knowledge bases (external and internal), without regard to data format or sources that include documents, databases, management reports, and performance metrics. 4.3 Using Agent When enterprise is living with the ERP system, a Using Agent is needed to ensure the transfer of knowledge to new team members and system users, to use the system, and to continue to identify and communicate key issues to all the communities. Developing and delivering training and maintaining training documentations are also important in order to support the ERP-system knowledge transfer to the business community in the implementing stage. In this stage, we will also need to provide complete and accurate documentation for testing, 6