As a Ph. D. student who earned master degree in China University (Xiamen University) and is now studying in Virginia Tech, I would say there are different changes needed in China universities and U.S universities. I will try to share some of my own ideas about changes in higher education in China as the purpose of higher education in different countries are quite different.
As the support of modernization, higher education in China aims at providing more well-educated workforce for society, which leads to a outcome that the number of students each year in higher education is increasing. This trend will continue for years as the percentage of Chinese people who have a bachelor degree is still very low. Therefore, one professor will have to teach a lot of students per year. When I was a master student, my adviser had five students in one year. All students under the supervision of my adviser is more than 30 including master and Ph. D. students. Therefore, I would argue that the biggest change in higher education in China should be recruiting more teachers and separate these teachers based on two tracks: teaching (main)+research and research (main)+teaching. For each track, the purpose or the duties are different for teachers. However, no matter which track teachers choose, he or she should teach course and the difference is just the time of teaching course. This change do have some flaws but at least it could satisfy the basic need of education in China: modernization.
Except the changes mentioned above, there are something that needs to preserve in the higher education in China. The first and most important is that higher education should be affordable for common people. No students are allowed to lose the opportunity if they are admitted to a university. I stayed in Europe for some time and find tuition in European universities are quite low because the income tax rate in relatively high. The government are responsible for providing the education to common people rather than making education become a business.