In connection with the new collaboration with IMP³rove – Academy, sat down with Sven Schade, Policy Officer at European Commission, to explore how small and medium-sized entities can benefit from having increased access to innovation management tools and learning.

InnovationManagement (IM): Why is it essential that SMEs devote time (and resources) to innovation management learning?

Sven Schade (SvS): In a recent survey conducted for DG Enterprise and Industry among innovation experts, the lack of innovation management capacity in SMEs was identified as the second most important barrier to SME innovation after a lack of financial means. We still see too many non-strategic and early abandoned innovation projects resulting in waste. And it is not only the resources of the enterprises that are wasted here but (often) also the public funds that support enterprise innovation. So it is in everyone’s interest to undertake and support those innovation activities that deliver the highest impact. IMP³rove is one tool that can orient innovation have such impact.

IM: Generally speaking, how can special frameworks (such as IMP³rove) help SMEs in the long run?

SvS: For small and medium-sized companies the impact of such frameworks develops very fast. In the long run, they can become an element of a much more systemic approach to innovation. Within IMP³rove, for example, the gap analysis on the company’s innovation systems would allow innovation agencies to perform ‘customer segmentation’ – a term used by a working group of national innovation agencies. ‘Customer segmentation’ is essentially a means to better match programs with the requirements or a company but also strengthen individual SMEs. A dream scenario would be adapting the Korean ‘loan guarantee scheme for technologically advanced enterprises’ to Europe by making the proven ability to transfer innovative ideas in company growth a decisive criterion for a loan guarantee. We are not there yet but in the long run IMP³rove might provide the toolbox for an approach of the kind.

IM: Once more effective in their work, these entities can contribute to raising the living standards in their respective countries. What are the macro effects of firms becoming more innovative and efficient? 

SvS: For entities developing an innovation policy the ultimate interest is society’s wellbeing. Competitive and economic structures are essential here, though. An individual, innovative, but small company has, by itself, only a very limited power of changing regional economic structures. Still, it can be the catalyst of more fundamental change if it manages to team up with large enterprises that possess this market power and can offer a stable cooperation. A functioning innovation management will have this external dimension beyond the own enterprise. All in all, I hope to witness more small enterprises becoming catalysts of innovations for entire industrial value chains.

About Sven Schade

Sven Schade works as Policy Officer at the Innovation Directorate within the Directorate General for Enterprise and Industry under the European Commission, while the focus of his work is providing better innovation support services for SMEs as, for example, in innovation management and peer-learning among innovation support providers across Europe. Before joining the European Commission in 2006 he worked as a freelance consultant for innovation projects, including the establishment of cluster initiatives and an incubator in Lithuania.