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S3 = SucceSS

christianChristian Saublens outlines the role of incubators in research and innovation strategies for smart specialisation

For the 2014-2020 programming period, the EU administration has deemed that all the regions adopt Research and Innovation Strategies for Smart Specialisation (RIS3) in order to better channel their support to SMEs in the field of R&D+I and competitiveness. This new step in programming ERDF interventions will lead to a stronger result-oriented approach, and necessitates a better design and subsequent implementation of support services to entrepreneurs and SMEs in Europe.

SMEs, by and large, represent a large share of the innovative and job-creation capability in the current economy. It is imperative that they are geared towards the new types of business models, which consider the current major trends with respect to the multi-faceted aspects of innovation, as we know it. Open innovation, social innovation, business innovation, just to name a few, are concepts that need to be introduced and embedded into the business models of existing SMEs, and incorporated right at the beginning in to any new potential high-growth innovative start-up.

There are two major elements that shape all RIS³ initiatives. The first being the unique assets that characterize the economic shape of specific European regions, and secondly, the need to concentrate on the entrepreneurial discovery process. It is fundamental, therefore, for all SME support organisations to be an active part of the renewed support environments that will deliver the RIS³ priorities. The various socio-economic realities of the EU regions and their SMEs strongly differ from one another, calling for multiple tailor-made solutions, which can be better designed when SMEs and start-up support practitioners are engaged in this from the very beginning.

The real focus here is clear. Through their RIS³ strategies, regions will mainly home in on sectors in which they have already identified a strong competitive advantages, and where there is a proven willingness of private sector representatives to invest in innovation - all types of innovation. On the other hand, if the regional, and the European Regional Development Fund, managing authorities can succeed in developing better support services, specialised intermediary organisations, such as incubators, will have the chance to become part of the ecosystem, playing a central role in the successful implementation of an RIS3. But this requires that a few key principles need to be followed:

  1. SMEs and their representative organisations, such as business incubators and innovation centres, need to be involved in RIS3 development design in order to better identify the different categories of the regional SME population that require targeted and high valueadded services.

  2. Support service schemes need to be adaptable to a wide variety of enterprises and they need to include services that introduce innovation. There needs to be a willingness and readiness amongst management teams to innovate, and to focus support not only on R&D, but also on innovation in the wider sense.

  3. A policy mix combining financial support, with complementary advice, needs to be created. This includes accessibility to specialist infrastructures, as well as to a network of professional facilitators. Highlevel services need to be deployed such as, riskreduction tools, investment-readiness support, proofof- concept and end-user testing. Last but not least, it is vital to ensure the leveraging of public procurement to support SME innovation and growth.

  4. 4.    Monitoring and evaluation techniques need to be properly used, to measure the desired structural change and to manage the implementation of the strategy, allowing for informed corrections of the policy-mix. It is not sufficient just to measure transactions.  

Incubators should be part of any RIS³

 Certainly, incubators are able to deliver most of the high added-value support services SMEs need to access in order to innovate and compete. Those services are in the field of: • Business support infrastructure • Financial instruments • Advisory services • Support to commercialisation of new products/services • Networking In the future - due to cuts in public expenditure or strictly applying the concentration and specialisation desire of any RIS³ - public authorities should undertake a thin segmentation of the SMEs which will be relevant to the various types of support services on offer. (See Figure 1) Incubators will need to look deeply within their enterprise portfolio to identify those SMEs and start-ups who are already contributing to the regional RIS³ priorities. They will also need to identify those clients who have the potential, but need tailored support to become eligible to receive RIS³ support. Incubator tenants should receive the same attention. Indeed, it might be advisable that those business incubators and innovation centres who will be involved in the deployment of a RIS³, are required to review their range of support services in order to make the needed adjustments, or to expand it and bring it in line with the defined priorities.

SME readiness: continued support needed

 Public authorities should also make sure that intermediary organisations carefully check the capacity of SMEs to maximize the benefits of the scheme/tools they are applying. In this respect, a diagnosis of the SME needs could be implemented based on this matrix (Figure 2), for instance.

Finding the right mix

 In the new programming period, public authorities will most probably have to offer SMEs a package that combines financial and non-financial support services. Financial support for SMEs in need of competitiveness support are usually channeled via debt finance - micro-loans, guarantee schemes and loans. SMEs in the higher-growth bracket are normally offered funds in the form of more advanced equity finance - seed capital, venture capital, technology funds, etc. Under RIS³ these will need to be coupled with professional non-financial support, to render the entrepreneurs to actually become market-ready. Here again there is room for business incubators and innovation centres to play an important role in the delivery mechanism of the RIS³ in their regions.

Specialisation within specialisation

 Public authorities should pay a special attention to ‘first time innovators’ and they definitely need to put in place dedicated specialised support services for them. Radical and disruptive innovation can take place in regions deploying RIS³, and new types of solo-entrepreneurs should be supported, taking advantage of combining technologies such as 3D printing and e-commerce. This is no novelty for those European incubators who work in the innovative spheres of entrepreneurship; they have been doing this for a long time. There is a wide pool of existing experience, and now there is an excellent opportunity to channel this through a more dedicated regional programme.

Monitoring and evaluation

 Last but not least, thanks to the proximity to SMEs and startups, incubators can play a key role supporting the assessment of publicly-funded entrepreneurial support schemes, such as, of course, the RIS³. Those incubators who will be involved in the deployment of the regional Smart Specialisation Strategies can undertake both quantitative data and qualitative assessments, contributing to its ongoing and final evaluation.

Published on 21-10-2013 12:45 by David Tee. 1362 page views

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