Value Co-creation through IoT: An Investigation of the Synergies between Market and Government Policies in the Equipment Manufacturing Industry of Shandong

: Currently, many equipment manufacturing enterprises in China lack effective management integration. While research on total factor productivity measurement and influencing factors exists, there is a lack of systematic research from the perspectives of different stakeholders, both inside and outside the enterprise market and government. To address this gap, this study examines the differences in demands for integrated management among enterprises of different ownership and sizes. Using the theory of value co-creation and Internet of Things technology, 273 enterprises in 16 cities in Shandong Province were sampled. The study also compares the impact of market fiscal and tax incentives on enterprise resource allocation and innovation performance, as well as the differences between "tangible and intangible" means of the market and government. The Internet of Things technology is utilized to build integrated management systems and verify the mechanisms of market incentives and government policies. Results reveal that market incentive policies have a differential effect on enterprises of different ownership and sizes, and the total factor productivity of sample enterprises is significantly and positively correlated with the strength of market incentive policy. Moreover, there are noticeable differences in the impact of government subsidy policies on enterprises of different sizes. Small and medium-sized enterprises do not respond significantly to fluctuations in government subsidy policies, while large enterprises are more sensitive to such fluctuations.


Introduction
With the implementation of "Made in China 2025" strategy, the competition in the equipment manufacturing industry has intensified, urging Shandong Province to make profound adjustments towards the objectives of "project management integration and total factor productivity improvement." However, the high degree of product customization and specialization in the industry requires a manufacturing mode customized to meet customer needs, leading to issues such as "overall concept dilution" and "low efficiency of cross-departmental work." Hence, a comprehensive and holistic management approach is necessary. Currently, existing research on equipment manufacturing management mainly focuses on a single perspective and lacks systematic studies from the perspectives of different stakeholders in enterprises and governments.
Engineering management in the equipment manufacturing industry involves stakeholders such as the government, construction, operation, and consumers, with enterprises as the core. Constructing an "integrated" engineering management model for the industry requires relevant parties to leverage their resource advantages, strengthen cooperation and coordination, and achieve value co-creation. Thus, this study aims to build an integrated management model based on the value cocreation theory, emphasizing the value co-creation process among different stakeholders in integrated management, facilitated by the utilization of Internet of Things technology.

Literature review
In response to the common management integration problems in the equipment manufacturing industry, scholars have primarily focused on industrial structure upgrading. Qi Liangqun et al. (2011) [1] proposed that addressing management integration requires consideration of factors such as demand, supply, enterprise interests, and national industry competitiveness. Li Qiang (2020) [2] suggested establishing a complete chain of high-quality development measurement for equipment manufacturing enterprises and conducting empirical analyses of the effects of government and market policies on enterprise management capabilities. However, the imbalance between government and market policies has led to adverse effects on industrial development [3]] . To address this, scholars have proposed market-oriented reforms and government administrative system reforms to foster an "effective market" and a "promising government" [4][5] . Additionally, the impact of government fiscal policy on the total factor productivity of China's

Value Co-Creation Theory
The concept of value co-creation theory originated from the idea of suppliers and consumers jointly creating value [7][8] . As new factors emerged in different ages, researchers explored the mechanism and connotation of value cocreation (Prahalad&Ramaswamy, 2004; Vargo&Lusch, 2008; Baron&Warnaby, 2011). Given the comprehensive and complex nature of project management, different stakeholders need to leverage their advanced technology and management experience to collaborate. The theory of value co-creation aligns with the process of project management collaboration, i.e., "different stakeholders integrate resources and cooperate to jointly create value" [9] .

Internet of Things Technology Facilitates Building an Integrated Management System
To address the problem of ineffective management integration in equipment manufacturing enterprises and achieve higher total factor productivity, assistance from Internet of Things (IoT) technology is required. IoT can support multidimensional data report export and statistical analysis, meet the needs of equipment manufacturing enterprises in different application scenarios, help improve integrated management capabilities and overall total factor productivity, and enhance consumer experience.

Research Sample and Data Collection
This study aims to explore the reasons and practices of enterprise, government, and market integration management based on the value co-creation theory from the perspectives of different stakeholders within and outside the enterprise and government market [10][11] . Single case studies focus on time series analysis and in-depth tracking of a significant proportion of literature. Multicase studies focus more on cross-case analysis and comparative analysis of the unity and difference between cases. Therefore, this study uses the multi-case method for analysis.
Following the theory of triangulation verification, data collection was conducted through field interviews, questionnaire collection, literature research, and empirical analysis. A total of 273 equipment manufacturing enterprises in 16 cities in Shandong Province were selected for case analysis. The main reasons for this selection are: (1) Typicality -the economic aggregate of the equipment manufacturing industry in Shandong Province accounts for 13% of the industry, and the main business income and profit rank second; (2) Contradiction -management problems are contradictory, structured, and centralized. The study of multiple cases in 16 cities in Shandong can provide experience for other regions to carry out integrated management of the equipment manufacturing industry. Table 1 is to survey the distribution of enterprises.

Requirements for engineering integrated management of equipment manufacturing industry
Effective engineering integrated management in the equipment manufacturing industry requires a comprehensive approach that considers enterprise management, government policy, and market incentives.
(1) Enterprise Management: Despite the increasing contribution of the equipment manufacturing industry to the GDP added value in Shandong Province, long-term and structural issues remain. Different ownership and scale enterprises have unique challenges in implementing government policies and market incentives. Therefore, it is essential to establish a unified management system across the region that integrates enterprise internal management and operations.
(2) Government Policy: The promulgation of policies and regulations has outlined the strategic requirements of engineering integrated management in the equipment manufacturing industry. Shandong Province has responded to the national call by implementing several actions, including the Implementation Plan for the Transformation and Upgrading of Shandong Equipment Manufacturing Industry and the Opinions of the General Office of Shandong Provincial People's Government on Accelerating the Development of Shandong Equipment Manufacturing Industry.
(3) Market Incentives: To enhance overall total factor productivity, Shandong Province has integrated and applied key technologies in advantageous areas and promoted intelligent integrated manufacturing supply support capacity. This initiative requires extensive research, development, production, and management. Figure 1 shows that the management department forms a collaborative management mechanism with other relevant parties

Result analysis 4.1 Differences between enterprises of different ownership and size in the integrated management needs of government departments
The panel data analysis in Table 2 reveals that government subsidies have a positive impact on the total factor productivity of both state-owned and private enterprises, but the effect is stronger for state-owned enterprises due to their closer ties with the government. State-owned enterprises often enjoy more subsidies than private enterprises due to their role in generating government revenue and market access. Large enterprises are more responsive to changes in government subsidy policies, while small and medium-sized enterprises are less affected. The study also shows that introducing a year fixed effect dummy variable can improve the accuracy of analysis. Table 2.Different aspects of the differential effect regression results

Analysis on the effect of "tangible and intangible" means of government and market
To analyze the impact of government subsidy and R&D expenses on total factor productivity, they were used as explanatory variables in two separate columns in Table 3. The results showed that both variables had a significantly positive coefficient. Additionally, the effect of R&D expenses plus preferential deduction intensity was stronger than that of government subsidies.

Conclusion and Prospect
(1)State-owned enterprises benefit more from government subsidies than private enterprises, indicating a need for integrated government management.
(2)Goernment subsidies and market incentives, such as increased R&D spending and preferential deductions, positively impact total factor productivity and industrial upgrading.
(3)Internet of Things technology can enhance equipment manufacturing management and provide technical support for stakeholder value co-creation.
(4)The study provides a reference for government engineering management and stakeholder coordination in equipment manufacturing, but further research is needed to improve its universality beyond Shandong Province.