Innovation is a fundamental factor of competitiveness:
- A means of continual improvement in product quality, marketing, management and logistics through technological up-dating and associated organisational changes.
- However, in reality, many small firms have not yet developed a culture of innovation and they lack capabilities and incentives to address more creatively evolving competitive challenges.
- In the long run, the possibilities for SMEs to survive and create jobs will depend on their ability to put innovation at the core of their business strategy.
Specific issues pertaining to innovation:
- What are the most important framework conditions that influence SMEs' incentives and capacities to innovate?
- Which measures are warranted to correct market failures that affect the financing of investment in innovation, including investment in training and organisational change?