Report

Teaser, summary, work performed and final results

Periodic Reporting for period 1 - SMEthod (Methodology for efficient segmenting innovating SMEs based on lifecycles, represented sectors and regional characteristics)

Teaser

SMEthod addresses the need for delivering a better methodology of segmenting innovating SMEs in order to eventually achieve more efficient outputs from innovation supporting instruments. Better segmenting is crucial for matching appropriate innovation supporting measures to...

Summary

SMEthod addresses the need for delivering a better methodology of segmenting innovating SMEs in order to eventually achieve more efficient outputs from innovation supporting instruments. Better segmenting is crucial for matching appropriate innovation supporting measures to given groups of enterprises. The point is to use such instruments that will create as high socio-economic impact as possible.
An emphasis has been put on both economic and societal dimension, and the most important issues are life cycle and sectors. This is related to the conclusion of innovation support agencies that innovation and its impact is strongly associated with many features of the firms, including organizational culture, their business models, enterprise life cycle (ELC), and represented sectors.
The importance of sectors is associated with regional characteristics that should be better identified in order to enable more efficient support for innovating companies, and take into account specific needs, expectations and problems of the European regions.
Furthermore, SMEthod develops a decision support system that will enable innovation supporting organizations more effective segmentation of SMEs and matching appropriate instruments to identified segments. The decision supporting system will be delivered in a form of a decision support tool (DST) that will be hosted on a web platform offered in a few languages.

Work performed

The most important work carried out in the project during the first half of its duration included:
1. Evaluation of existing approaches to segmenting innovating SMEs for the purpose of innovation support allocation.
Methods applied by innovation support systems in SMEthod case study countries, i.e. Finland, Poland, Spain and the United Kingdom, were analysed, evaluated and compared. Studies on the methods of segmenting businesses by institutions focused particularly on analysing the criteria that national innovation agencies use to evaluate application submitted by firms. The results of this work are presented in “Report on assessment of selected methods of market segmentation” that is available on the project website (www.smethod.org).
2. Evaluation of the efficacy of innovation supporting measures (e.g. grants, tax credits and loans) in terms of socio-economic development of SMEthod case study countries.
In order to evaluate the efficacy of means supporting innovation microdata from Community Innovation Survey, and a SMEthod database containing primary data on SMEs collected by the project members in case study countries were analysed using econometric methods and techniques. Findings from the research were included and discussed in two reports: ‘Report on the internal and external factors on the behavior and performance of SMEs’, and ‘Report on evaluation of the impact of support measures’, both available on the project website.
3. Analyzing the literature on enterprise life cycle, innovation cycles, industry sectors and socio-cultural characteristics of selected regions.
This research delivered a credible scientific background for a further development of the SMEthod’s improved methodology of segmentation which will take into account studied processes and issues.
4. Identification of positive approaches and practices used by innovation policies which could be utilized in the SMEthod methodology.
Research findings on existing strategies and practices of innovation support institutions were analysed in order to conclude which elements of the approaches that have been used so far could be reflected in the SMEthod improved methodology of segmentation. The result of this work is ‘Report on functional elements in analysed methodologies of segmenting SMEs’, available on the project website.
Furthermore, during first 15 months of the project duration another two important tasks started which concern developing new criteria of segmentation, and matching innovation support measures to segments. Also, a first cloud version of the DST with a significant part of the functionality has been already created and is under review and testing.
In addition to this, a set of communication and dissemination tools and activities were used, including, among other things:
project website (www.smethod.org);
social media (LinkedIn, Twitter, Facebook);
project leaflet;
banner-stand;
project videos;
newsletter;
networking activities with other projects;
attending conferences and other events;
publication.

Final results

Initial project results contributed to increasing the knowledge of innovation-related activities and their effectiveness in a few dimensions, some of which were hardly covered by existing studies. Those results are presented in SMEthod public reports and serve as a point of reference in developing the improved methodology of segmentation.
Until the end of the project SMEthod will deliver the methodology for segmenting (potentially) innovating SMEs for the purpose of pro-innovation support, including improved criteria for matching innovation support measures to segments. Its beyond the state-of-the-art character will stem from using novel concepts and approaches such as enterprise life cycle, and sectoral and regional analyses which will enable an efficient identification of both innovating SMEs and those with the potential to innovate.
What is more, the decision supporting tool in a form of an easy-to-use IT tool will be created. It will be based on the methodology developed in the project and will be a useful, effective, efficient and time-saving tool for organizations segmenting SMEs and deciding a suitable support measures. The DST will have a capacity to be personalized for each country and will be available in project partners languages.
The project’s impact encompasses a chain process:
- starting with better understanding of patterns of innovation in different SMEs segments and the influence of specific innovation support measures leading to increased uptake and efficiency;
- leading to improved targeting and timing of innovation support measures;
- leading not only to nominally more innovations launched by SMEs, but due to smart targeting to innovations with the most desirable societal impact (efficiency demands that these innovative solutions should be delivered at the lowest cost hence in innovation support allocation decision social benefit will be weighed against social cost);
- finally leading to a stronger SME sector, whose competitiveness is enhanced through a stronger innovation profile and a more innovative, competitive and sustainable European society and economy.

Website & more info

More info: https://www.smethod.org/.