Guide to Research and Innovation Strategies for Smart Specialisation

Innovation friendly business environments for SMEs
Why should an innovation-friendly business environment be part of smart
specialisation?
SMEs are at the centre of the creation of jobs and growth at regional level. Furthermore,
SMEs are key players in introducing new products/services into the market place and offering
innovative solutions to the grand challenges. Entrepreneurship is necessary to make sure that
innovation ideas are turned into sustained growth and quality jobs.
Therefore, it is important to provide at regional level the right mix of financial and non
financial supports to assist entrepreneurs to create new firms and existing enterprises to
innovate and develop. The support should aim to increase the innovation capacity of SMEs
enabling them to develop, to access and to absorb new knowledge and thereby to grow and to
compete on increasingly global markets.
Regional policy makers also have to understand the different forms of innovation such as nontechnology
services, cross-sector technology integration, system and business model
innovation, which are today as important as the technology breakthrough innovation for
SMEs. It is relevant for the regional authorities to adapt their offer of support services to the
demand of the different types of enterprises: manufacturing, service oriented, high-tech or
social ones. In this context, analysis and benchmarking of regional policies can be an
important starting point towards the development of regional strategies44.
SMEs, and especially micro-enterprises, are heavily dependent on their regional environment
where proximity plays a key role for innovation, in particular regarding the spread and
absorption of tacit knowledge. SMEs need policy support in tapping into the necessary
outside resources, principally access to knowledge, in the form of advice through innovation
support services and tailored counselling, technology or qualified human capital, to face up to
the new forms of competition that are developing in the global economy. SMEs are thus at the
core of Cohesion Policy.
For the period 2007-2013, the Community Strategic Guidelines on Cohesion emphasize the
key role of SMEs, notably when it comes to increasing and improving their investment in
R&D, facilitating innovation and promoting entrepreneurship. Cohesion Policy in fact
provides the largest financial Community support to SMEs, including through financial
engineering instruments such as JEREMIE45. For the period 2014-2020, the Commission has
proposed an even stronger focus on enhancing the competitiveness of SMEs in the context of
Cohesion Policy.
Moreover, the Cohesion Policy support often provides the initial platform for an increased
number of SMEs to access the FP7 or the CIP, and will indeed continue to do so for the
forthcoming successors of these programmes.
44 See for example the Regional Innovation Monitor initiative at: http://www.rim-europa.eu/
45 http://www.eif.org/what_we_do/jeremie/index.htm
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