There are around 23 million SMEs in Europe – representing 99% of all companies and providing around 80% of the jobs in some industries in the private sector. SMEs are a catalyst of innovation and one of the things that makes Europe competitive. A number of regional, national and EU funding programs are available as an important instrument in promoting innovative practice in SMEs and strengthening their research and development activities. The Steinbeis-Europa-Zentrum (SEZ) ensures that EU programs provide support more suited to the needs of SMEs.
The SEZ is working on a joint EU project called MaPEeR SME. Over the course of this project, it has been analyzing the experiences made by SMEs on public research and innovation programs. MaPEeR SME is being backed as part of the 7th Research Framework Program funded by the European Commission. Its aim is to gain insights into the planning, implementation and impact of national, regional and European funding programs targeted at research and innovation in SMEs.
The EU study was launched to find out more about the problems, requirements and benefits to SMEs that stem from publicly funded programs. The study also looked at the general needs and problems encountered while implementing research and development activities, and what happens when innovations eventually go to market. 14 project partners contacted SMEs in 27 EU states plus Bosnia and Herzegovina. Each SME was surveyed using a standardized questionnaire. In total, the SEZ evaluated nearly 1,000 valid questionnaires. The aim of the project is to provide policy makers with specific ideas for improving funding programs by matching them more closely to needs of SMEs.
The SMEs in the survey were split into five categories according to their R&D capacities. The categories with the least and most R&D resources were scrutinized more closely. They were also broken down and analyzed by EU region and company size. Most of the SMEs in the survey with low-level R&D capacity were small enterprises (10-49 employees) working in manufacturing. There was a tendency for these to be in the accession states that joined the EU in 2004. The majority of these SMEs have never taken part in a sponsored R&D program. The second group, with the highest level of R&D resources mainly fell into the micro-business category (less than 10 employees). Most of these were in the ICT business and a large number of them had already been involved in national or EU-backed programs.
One of the main reasons SMEs do not take part in funding programs is the quagmire of administrative and financial hurdles to overcome, which can be a major headache while the program is running. This indicates that the rules for SMEs to participate in funding programs should be simplified. Also, additional sources of funding play a decisive role for SMEs if they are going to meet the expense of research and innovation projects.
The survey also examined whether the needs of SMEs are better addressed on a domestic level or through EU funding. It was found that EU research programs are favored because, compared to national programs, they promote internationalization, help forge networks and enhance the reputation of companies (especially through transparency in research findings). In terms of administration, national programs scored better.
Both R&D capacity groups had a different perception of the benefits of participation in national R&D funding programs. As a rule, the study indicated that SMEs with more R&D resources gained more benefit by participating in programs than the SMEs with lower R&D resource levels. For SMEs with more R&D capacity, the value of funding programs was shown in improvements to in-house know-how and skills, and the improved access to complementary third-party expertise. The SMEs with the lowest R&D capacity mainly reported commercial benefits and enhanced company reputation.
When asked to name “good examples” of funding programs, the companies with the highest level of R&D capacity pointed to SME schemes with simple application procedures and simple reporting requirements. They also praise short time-to-funding periods with high funding rates and the possibility to apply for subsequent funding by accessing additional third-party backing. The SMEs also expressed a need for closer involvement in policymaking relating to the planning and implementation of research programs. SMEs with the lowest levels of R&D resources would like SME funding programs that not only offer the aforementioned financial and administrative improvements but also ways to train project managers to run projects and oversee innovations, as well as support when forging contacts with suitable networks and research partners. The results of the survey will be published shortly in Steinbeis-Edition.
During live projects