What is Innovation?“change that creates a new dimension of performance.”(Drucker, 2005)“Innovation is defined as the commercialisation of all newcombinations based on the application of: New materialsand components; the introduction of new processes; theopening of new markets; and the introduction of neworganisational forms.”(Schumpeter, 1934)
What is an SME? Small is STRONG! SMEs = Small or Medium sized EnterprisesSmall: Less than 50 employees and less than £6.5millionturnover.Medium: Less than 250 employees and less than £25.9million turnover.SMEs account for over 99.9% of all European business.(2008)SMEs have a pivotal role in the European economy as theyare able to quickly respond to new ideas and the rapidlychanging market.
What is the importance of an SME formodern day innovation?“Innovation often starts with a tiny idea but it can turn intosomething legendry.”(Virgin Media Business, 2012)Small firms are more likely to introduce new innovations asthey have less commitment to existing practices andproducts than similar larger firms.Small firms can be important to high-tech sectors ascreators of significant innovations due to the niche roles inwhich they often perform.
Innovation and SMEs...what’s happening?SMEs to benefit from TSB Fund: £6.5m to be shared among180 firms to boost innovation:“Many small companies have great ideas, but lack the funds toenable them to carry out the important initial feasibility workrequired to see if their ideas are workable.”(Bott, 2012)Innovation and Research Strategy for Growth:This strategy is a result of the government’s want to make themost of the strengths of the UK, for example;universities, research institutes, small businesses.Willetts stated that, “A new innovation landscape, combinedwith continued investment and collaboration with business, willensure that the UK is a world leader in innovation.”(Nathan, 2011)
SMEs...What’s the Innovation?“A good deal of the innovation that happens in the UKcomes from SMEs and with innovation comes businessgrowth.”(Gray, 2011)“We recognise that by improving the incentives forcompanies to innovate they will continue to create life-changing products to drive future innovation and growth.”(Cable, 2011)Evidently, with SMEs making up 99.9% of Europeanbusinesses, helping to keep them going is seen as the keyto innovation.
Bibliography• Al-Hakim, L. And Jin, C., 2010. Innovation in Business and Enterprise: Technologies and Frameworks. Pennsylvania: Business Science Reference• Enterprise Directorate: Small and Medium Enterprise Statistics for the UK and Regions. Availbale at: http://webarchive.nationalarchives.gov.uk/+/http://stats.bis.gov.uk/ed/sme/ [Accessed:21 March 2012]• Nathan, S. 2011. UK innovation strategy means SMEs take centre stage. The Engineer. Available at: http://www.theengineer.co.uk/news/news-analysis/uk- innovation-strategy-means-smes-take-centre-stage/1011174.article#ixzz1nIcCo6uu > [Accessed: 20 March 2012]• Small and Medium Sized Enterprizes: Definitions. Available at:http://www.lib.strath.ac.uk/busweb/guides/smedefine.htm [Accessed 22 March 2012]• Unknown. 2010. SMEs to benefit from TSB Fund: £6.5m to be shared among 180 firms to boost innovation. Innovation News. Available at:http://www.innovationuk.org/news/innovation-news/0270-smes-to-benefit-from-tsb- fund.html [Accessed: 25th March 2012]• Virgin Media Business. 2012. About Innovation Nation. The Guardian. Available at: <http://www.guardian.co.uk/innovation-nation-awards/about-innovation-nation> [Accessed: 20 March 2012]