A Significance of Innovation Cycle at a Firm Level for Better Innovation Policies for Smes

This paper’s ambition is to contribute to overcoming the limitations of existing policies facilitating innovativeness. The article addresses the need for more tailored targeting innovation support measures to small and medium-sized enterprises (SMEs) so as to maximize their economic and societal impact. Specifically, the aim is to advance methodological frameworks for segmenting or selecting innovative SMEs by providing a conceptual proposition based on the innovation cycle at a firm level. This objective is achieved through exploration of the literature on the innovation cycle concept, and the adaptation of the model developed by Abernathy and Utterback (the A–U model) for the purpose of innovation policy. Particular phases of the innovation cycle are transformed into variables and values, and based on the research findings on behavior of SMEs illustrative weights are assigned dependent on a preferred policy approach including supporting innovativeness as such or supporting innovativeness and SME’s standing in the long run. As a result, the paper presents a tentative working procedure of assessing enterprises according to operationalized criteria derived from the A–U model. Added to this, collaborative efforts in developing innovations are briefly discussed from the innovation policy perspective. It is believed that the new conceptual proposition outlined in the paper will be instrumental in segmenting companies and selecting innovative projects, and serve policy-makers and intervention organizations in the implementation phase of the innovation policy process, thus contributing to more efficient and transparent allocation of support instruments by public institutions.

Download the full report (PDF) here.

©2017-2020 SMETHOD

This project has received funding from the EU Horizon 2020 research and innovation programme under grant agreement No 777491.