Damanpour and Wischnevsky (2006)’s research set two types of Management innovation , which are internal and external. The paper chooses external management innovation as a topic. It analyzes the mode generation process and the characteristics and proposes a threelayer research framework, including entrepreneur individual decisionmaking, entrepreneurorganization transition, and organizational innovation behavior. Research questions and corresponding study methods are suggested in each layer. Case study on strategic innovation in Dalian Hengli Measure & Control Instrument Engineering Co., Ltd is used to test the theoretical framework, aiming at understanding the process and mechanism of externaloriented management innovation, which may build a theoretical base for successfully enhancing the rate of management innovations in Chinese enterprises.