Luminita Nicolescu, Ciprian Nicolescu ISSN 2071-789x RECENT ISSUES IN ECONOMIC DEVELOPMENT Economics & Sociology, Vol. 5, No 2a, 2012 71 Luminita Nicolescu
The present paper has as a starting point the close relationship existing between entrepreneurial activity, innovations and the development of Small and Medium Sized Enterprises (SMES.
and analyse the SMES innovation activity over a period of time as an indication of how entrepreneurship evolved
types of innovative activities, investments in innovations, the intensity of renewing the existing products, the use of IT, the use of the Internet, etc.
Luminita Nicolescu, Ciprian Nicolescu ISSN 2071-789x RECENT ISSUES IN ECONOMIC DEVELOPMENT Economics & Sociology, Vol. 5, No 2a, 2012 72 that analyse innovations in SMES
and to comment on the influence of the recent economic crisis on them. It has a descriptive character, offering a general image of innovations in Romanian SMES, ending with a couple of advices for policy and organisational decision making.
the multistage process whereby organizations transform ideas into new/improved products/services or processes, in order to advance, compete
Also, Mcadam, Keogh, Reid and Mitchell (2007, p. 386) defined innovation as the harnessing of creative ability within customers,
Laforet and Tann (2006) discuss the different streams in SMES innovation research (as being oriented economics stream, the organization-oriented stream and the project-oriented stream),
DEVELOPMENT Economics & Sociology, Vol. 5, No 2a, 2012 73 Mitchell, 2007) and concluded that innovation studies in SMES must be highly contextualized
, cultural attitudes to bribery, lack of transparency, informal economy), environmental barriers and skill barriers. A completely different situation was portrayed for SMES in the food and drink industry in UK,
The Romanian economic context economic crisis and effects Romania was and still is influenced by the economic evolutions at the world level.
The economic crisis that hit the world in 2007 was also felt by the Romanian economy,
even though with a particular time lag. The global financial crisis that determined the collapse of a number of financial institutions,
the closing down of many companies and consequently the loss of jobs affected many economies, including the Romanian one.
In an unstable international economic context, the first obvious sign of the economic crisis were felt in Romania in 2009,
when it took place a drastic contraction of the economic activity reflected in the decrease of the real GDP with 6. 6%.The decreasing trend continued in 2010,
Inflation increased immediately in 2008 with 3%from 4. 8%in 2007 to 7. 8%in 2008 and maintained relatively high levels up to 2011,
when it was 4%and Luminita Nicolescu, Ciprian Nicolescu ISSN 2071-789x RECENT ISSUES IN ECONOMIC DEVELOPMENT Economics & Sociology, Vol. 5, No 2a,
Due to the economic crisis the level of economic activity diminished in Romania in the last years and SMES had to adapt their level of business to the market conditions from both the internal and the external markets.
as in the last years, hit by the economic crisis many SMES went from the medium to small size due to the decrease in the number of employees.
1256 1099 1485 1723 Micro-enterprises 53.97%55.29%62.43%53.48%64.10%52.68%66.20%71.83%Small enterprises 32.35%30.83%27.73%33.45
%26.44%34.85%24.32%21.83%Medium enterprises 13.68%13.88%9. 84%13.07%9. 46%%12.47%9. 48%6. 44%Structure of SMES 1378 1398 1306 1178 1256 1099 1485 1723 Luminita Nicolescu, Ciprian Nicolescu ISSN
2071-789x RECENT ISSUES IN ECONOMIC DEVELOPMENT Economics & Sociology, Vol. 5, No 2a, 2012 75 economic branches TOTAL number Industry 26.44%17.17%17.50%21.41
%Services 22.56%17.95%21.59%17.28%18.78%21.98%23.51%20 49%Sources: Carta Alba a IMM-urilor din România (White Charter of SMES from Romania), Editions 2004,2005, 2006,2007, 2008,2009, 2010,2011.
the level of investment in innovative activities and about specific innovative aspects such as renewing products and using the internet and the intranet in the activities.
Ciprian Nicolescu ISSN 2071-789x RECENT ISSUES IN ECONOMIC DEVELOPMENT Economics & Sociology, Vol. 5, No 2a, 2012 76 Sources:
Results show that the most frequent innovations for the whole period were the introduction or the renewal of new products and services.
and services and new ways of delivering them to customers (Blumentritt, 2004; Laforet and Tann, 2006.
when the Romanian economy had an ascending economic trend, the peak being registered in 2006/2007
Ciprian Nicolescu ISSN 2071-789x RECENT ISSUES IN ECONOMIC DEVELOPMENT Economics & Sociology, Vol. 5, No 2a, 2012 77 last year.
However, starting 2007/2008 once the global economic crisis had begun the trend towards introducing new technologies decreased.
illustrating the negative influence of the economic crisis on innovative activities in Romanian SMES. Other negative tendencies include the doubling of the percentage of SMES that have not conducted innovative activities at all,
who are focused more on short term survival rather than innovating in a period of economic crisis. The level of investment in innovative activities illustrates the propensity towards implementing organizational changes that would sustain the future growth of the organization.
Table 3 and Figure 2 present the dynamics of the level of investment in innovations in the studied SMES.
Table 3. Investments in innovations in Romanian SMES in 2003/2004 2010/2011 Percentage out of total investments 2003/2004 2004/2005 2005/2006
2006/2007 2007/2008 2008/2009 2009/2010 2010/2011 0%22.87%24.72%24.51%17.95%22.17%20.27%46.58%47 48
However, while the percentages of SMES that invested small percentages (0-5%)of their overall investments remained constant over time, the ones investing larger percentages (10-20%)decreased over time.
%and over 50%of their investments in innovations was on the entire period small (less than 10%),
Another very visible change in the last two years was the doubling of the percentage of SMES that had no investments in innovations,
This trend is attributable also to the economic crisis. On overall, in the analyzed period, the percentage of SMES investing g highly in innovations is small
and after 2007/2008 the percentage of investments allocated to innovating products, processes and the organization in the SMES studied diminished further,
Generally speaking, it is considered that the SMES'limited access to finance and capital for innovations,
limits innovation and that investments can act as a constraint for SMES engagement in innovations (Chao and Chandra, 2012).
Overall, financial difficulties are common for Luminita Nicolescu, Ciprian Nicolescu ISSN 2071-789x RECENT ISSUES IN ECONOMIC DEVELOPMENT Economics & Sociology, Vol. 5, No 2a
and this also affects investments for innovations. This is also the case for Romanian SMES. Figure 2. Dynamics of investments in innovations in Romanian SMES Renewing products either as new products/services or modernized products/services
as a main form of innovative activities took place in Romanian SMES at different levels.
looked at the type of innovations envisaged by SMES through their investments, and found that product innovation have received the majority of attention (Baregheh, Rowley, Sambrock and Davies, 2012).
Table 4. The level of renewing products and services in Romanian SMES in 2003/2004 2010/2011 (percentage of the turnover collected from the sale of innovative products) The level of renewing products
/services 2003/2004 2004/2005 2005/2006 2006/2007 2007/2008 2008/2009 2009/2010 2010/2011 0%22.10%22.44
Ciprian Nicolescu ISSN 2071-789x RECENT ISSUES IN ECONOMIC DEVELOPMENT Economics & Sociology, Vol. 5, No 2a, 2012 79 Sources:
illustrating a tendency towards greater use of the virtual environment for disseminating information about the organization and its products.
This comes as an argument for previously encountered findings that state that internet developments have been found to be critical for SMES to build successful interactions with business customers (Tseng and Johnsen, 2011, p. 573.
Luminita Nicolescu, Ciprian Nicolescu ISSN 2071-789x RECENT ISSUES IN ECONOMIC DEVELOPMENT Economics & Sociology, Vol. 5, No 2a, 2012 80 After an initial increase
Figure 4. Dynamics of the use of IT in Romanian SMES in 2004/2005 2010/2011 Information technology is used in Romanian SMES mainly for communication purposes,
the web-based Luminita Nicolescu, Ciprian Nicolescu ISSN 2071-789x RECENT ISSUES IN ECONOMIC DEVELOPMENT Economics & Sociology, Vol. 5, No 2a, 2012 81
shows that there was a change of priorities in the utilization of these means of communication.
At the beginning of the 2004/2005 2007/2008, these means were used for connecting with the external environment of the organisation:
mainly to communicate with suppliers and clients and to collect information about the business environment.
A shift towards a more intense use of IT for facilitating communication and activities within the company, took place over the period,
The inward orientation tendency might be explained by the decrease in demand and, lately, in business opportunities,
not only as fallout of the economic crisis, but also as potentially improved internal communication and business mechanisms within the company.
Table 6. The use of Internet/Intranet in SMES from Romania in 2004/2005 2010/2011 The purposes of using the Internet/Intranet 2004/2005 2005/2006 2006/2007
2007/2008 2008/2009 2009/2010 2010/2011 Facilitating communication within the firm 29.61%27.87%28.52%28.50%44.04%38.79%65.21%Transactions
contracts, payments 19.67%27.64%28.95%24.84%38.49%33.94%53.16%Obtaining information about the business environment 59.01%56.89%55.52%61.86%62.88%61.55%37.58%Communicating with suppliers
The results of their study are similar to the results of the present study in the sense that Romanian SMES tend to use the Internet in limited ways, such as finding new suppliers and emailing prospective customers.
Generally speaking, SMES are perceived to lag behind large Luminita Nicolescu, Ciprian Nicolescu ISSN 2071-789x RECENT ISSUES IN ECONOMIC DEVELOPMENT Economics & Sociology, Vol. 5, No 2a, 2012
2011). 0 10 20 30 40 50 60 70 80 Facilitation of communication within the firm Transactions, contracts, payments Obtaining information about the business environment Communicating with suppliers,
and new managerial approaches. b) investments in innovations are limited in Romanian SMES. The economic crisis had a negative impact on them in the last few years.
Investments for innovations decreased in time in SMES, especially since the economic crisis reached Romania as well, which ended up in 2011 with almost half of SMES without any investible surplus at all for innovations. c) innovations decreased in the last few years in Romanian SMES.
Even though product innovation was the main form of innovation in Romanian SMES, the intensity of renewing products (seen as a percentage of the total company turnover that is accounted for by innovative products) decreased over time,
culminating with only 45%of the SMES declaring that they do not have modernized new or products in 2011. d) IT innovations play an important and ascending role in Romanian SMES.
Luminita Nicolescu, Ciprian Nicolescu ISSN 2071-789x RECENT ISSUES IN ECONOMIC DEVELOPMENT Economics & Sociology, Vol. 5, No 2a, 2012 83 Based on this general
as a country affected by the economic crisis much like the whole Europe and the practically the entire globe world, is seen also as having negatively impacted SMES'activity
since the start of the economic crisis with more than 35%of SMES not being involved at all in innovative activities after 2009. b) in spite of the generally decreasing trends in innovative activities in SMES,
b) as one way to better cope with the economic crisis, by assimilating cheaper ways of doing business.
The use and the integration of the new IT technologies in the current activities of SMES, ensures the development of communication, promotion, advertising,
governmental financial facilities (such as decrease or tax exemption for profit reinvested in innovations. b) At organisational level.
marketing) ways that do not necessarily involve large investments, but a different and better organisational way of getting things done.
a) offers information about innovative activities in SMES, seen at a general level, within an economy wide sample,
Luminita Nicolescu, Ciprian Nicolescu ISSN 2071-789x RECENT ISSUES IN ECONOMIC DEVELOPMENT Economics & Sociology, Vol. 5, No 2a, 2012 84 References Avermaete
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Innovation in Ireland innovation is the creative process of exploiting new ideas 2008 Department of Enterprise, Trade & Employment Department of Enterprise, Trade & Employment23 Kildare Street, Dublin 2, Irelandtelephone:+
Our goal is to develop an innovation-driven economy that maintains competitive advantage and increases productivity.
we must continue to deliver consumer-driven innovative products and services as well as further developing new business models, new organisational structures and skills for innovation.
The Statement also explores opportunities where innovation can be exploited better. We have identified ten key policy areas that underpin the Government's approach to innovation in support of the knowledge economy and enterprise.
The Statement also provides a reference point and wider context for implementation of the Strategy for Science,
However, emerging sectors where innovation can be exploited better include services and public procurement and these two areas will be given additional focus.
TD Dr Jimmy Devins, TDTÁNAISTE and Minister for Enterprise, Minister for Science, Trade and Employment Technology and Innovationdr Jimmy Devinsinnovation in Ireland 2008 Innovation in Ireland 2008
, Clusters and Gateways 17 6 Intellectual Property Protection and Management 21 7 Services and Emerging Sectors 23 8 Entrepreneurship and Business Expansion 25 9
Partnership and Workplace Innovation 29 10 Competition and Better Regulation 31 Conclusion 33 Innovation in Ireland 2008 Innovation in Ireland 20081ireland is recognised internationally as a stable and progressive society
We are responding to these challenges, not only by providing capital investment through the Strategy for Science, Technology and Innovation and other initiatives,
For enterprise, the aim is to create and apply technology innovation in products, services and business processes.
Success, however, does not depend on Government and policy alone. It requires a joint commitment by enterprise,
society and Government to promote innovation in every sphere of business and public service. The Government is working to create a sustainable advantage based on Ireland's reservoir of skills
human capital and flexibility in serving markets. For Ireland in the 21st century, competitiveness will depend on merging these attributes with flair
and a commitment to innovation that is unmatched by competing economies. In short, our ambition is to put innovation at the core of our policies and strategies for the future,
including the development of new or enhanced products and services and the introduction of new business models, new organisational structures or new work practices.
business innovation is often incremental and built on the day-to-day expertise of employees and their thorough knowledge of customers and competitors.
New thinking and policies on services innovation are being developed. Many services firms serving international markets from Ireland, for example, have been particularly successful in adopting innovative approaches to servicing international supply chains.
Innovation andpublic policywhile enterprises and individuals are the primary sources of innovation, public policy can establish the right framework conditions for innovation to flourish.
The State has committed already €8. 2 billion to implementing the Strategy for Science Technology and Innovation.
and Innovation at the Department of Enterprise, Trade and Employment and the Department of education and Science.
In this Innovation Policy Statement we identify ten key policy areas where innovation will be exploited in support of enterprise and the knowledge economy.
Innovation in Ireland 20083 The Government recognises the value that investment in research, development and innovation represents,
National Development Plan 2007 2013 Over the lifetime of the National Development Plan 2007 2013 the Government will invest €8. 2 billion in initiatives designed to enhance human capital
Most of this investment will go towards the implementation of the Strategy for Science, Technology and Innovation 2006 2013.
and will enhance the development of a knowledge-based economy. Building a world-class research system Knowledge creation Innovation in Ireland 2008 Main aims of the Strategy for Science,
and equip them with generic and transferable professional skills that are relevant to a modern knowledge-based enterprise economy;
andaccommodate industrial placements to facilitate development of enterprise expertise. Commercialisationincrease outputs of economically relevant knowledge, know-how and patents from third-level institutions;
Industrial researchtransform the quality and quantity of research undertaken by enterprise both directly and in cooperation with third-level institutions;
Leverage complementary strengths in institutions and enterprises in Ireland and Northern ireland through increased cross-border cooperation.
and quantity of research carried out in Europe the Lisbon Strategy set a target of 3 percent of EU GDP for research investment.
R&d expenditure Gross expenditure on R&d (GERD) across all sectors of the economy reached €2. 33 billion in 2006,
Innovation in Ireland 20087 One of the most important assets in Ireland's innovation system and vital in a small economy with limited resources is the quality of the public research infrastructure and its links to industry.
In this context, the enterprise development agencies are addressing two issues: The capacity of small and medium-sized enterprises to absorb
and apply research and new knowledge; and The increasing demand from enterprise for readily accessible applied research capabilities.
Higher education Industry linkages We are supporting a number of specific initiatives to develop these vital links between higher education and enterprise.
Examples are: The establishment of SFI Centres for Science, Engineering and Technology with the aim of significantly advancing knowledge and exploiting opportunities for discovery
and innovation these Centres involve research partnerships between Irish universities, leading multinational companies and SMES.
From research to the marketplace Knowledge Transfer Innovation in Ireland 2008 8 Significantly increased support for Technology Transfer Offices in third-level institutes to ensure better economic returns from R&d investment these offices
work with the researchers to identify commercial opportunities negotiate with enterprises, and protect and manage intellectual property.
The provision of Innovation Vouchers that enable businesses to collaborate with higher education‘knowledge providers'to obtain an innovative solution to an enterprise need these vouchers offer SMES the opportunity to forge new relationships with higher education institutions and, ultimately,
to develop new products and services. Innovation in Ireland Summary 2008building knowledge partnershipsour development agencies are attuned fully to keeping innovation at the core of their strategies and policies.
Enterprise Ireland the agency charged with the development of indigenous industry provides significant funding for R&d projects and investment in new R&d facilities through the R&d Advocate programme
the Innovation Management scheme, and the Innovation Partnerships initiative. It also works with companies to raise their awareness of the importance of R&d in the sustainability of the enterprise,
and to support them in their early stages of R&d. Enterprise Ireland is also very active in fostering collaboration between the academic and enterprise communities,
and in helping companies to forge active relationships with suitable research partners. It works closely with the research institutions to ensure that intellectual property arising from publicly funded research is protected
so that it delivers optimal returns to The irish economy. Enterprise Ireland coordinates Irish participation in the EU Framework Programmes
and has appointed a national director to ensure a coherent and optimised approach. A key objective is to ensure that funding from Europe's Seventh Framework Programme for research
and technology development (FP7) is relevant to Irish researchers and that it complements the existing R&d and innovation strategies for enterprise in Ireland.
and their applications in life sciences, communications, power electronics and other industries. FUSION is an ongoing all-island network managed by Intertradeireland
Enterprise-led Competence Centres are being set up with highly qualified researchers to undertake strategic market-focused R&d for the benefit of industry;
A Research and development Fund is available to support R&d in enterprises. It offers up to 45 percent funding for R&d activities
and sustaining training opportunities. The current Social Partnership Agreement, Towards 2016, recognises this need, from both an economic and a social perspective.
Better skilled and better educated employees are good for the economy as a whole and for the firms that employ them.
Adult and Further Education Programmes are targeted at providing second-chance education opportunities and training designed for early school leavers
The National Training Fund will provide opportunities for people already in employment to be given improved access to training,
opportunities to develop new skills, acquire recognised qualifications and continually progress to higher-level qualifications. Lifelong learning and the National Skills Strategy Skills Development Innovation in Ireland 2008 12 The Minister of state with special responsibility for lifelong learning
Sean Haughey, TD, coordinates the lifelong learning agenda across both the Departments of Enterprise, Trade and Employment and Education and Science.
The National Framework of Qualifications Continuously updating the skills of our workforce in a knowledge economy requires a flexible framework,
robust enough to respond to the needs of the economy, and, at the same time, provide authoritative accreditation of qualifications in which all stakeholders can have confidence.
The National Framework of Qualifications (NFQ) provides a single unified framework with the potential to cover all awards in the State.
Towards a National Skills Strategy sets out a vision of Ireland in 2020 in which a well-educated and highly skilled population contributes to a competitive, innovation-driven, knowledge-based economy.
and accreditation for skills acquired outside the formal learning environment; and Targeting of specific groups for skills development, through analysis of sectoral and occupational groupings.
Two initiatives which benefited from this investment are: The FÁS One step Up programme, which provides financial supports for training employees.
Skillnets, which is led an enterprise support body dedicated to the promotion and facilitation of learning as a key element in sustaining Ireland's national competitiveness.
Skillnets supports over 150 networks of enterprises in Learning Networks, which are led and managed by the enterprises themselves.
Between them, these two programmes trained approximately 46,500 people in 2006. We have provided also funding for a strategic alliance between FÁS and several training providers
The specific needs of managers in high-technology industries are being addressed by Enterprise Ireland through the Leadership 4 Growth programme,
and in particular, the European Social Fund (ESF), has presented always opportunities to pilot innovative approaches to upskilling, training and new employment areas.
It is important that we continue to exploit opportunities for capturing good practices as developed by such pilot projects.
and we will exploit opportunities for imaginative procurement practices that promote innovation in the enterprise sector
Public bodies can request tenders that provide innovative solutions rather than just basic products or services.
Selling to the public sector is an opportunity for firms especially SMES, to demonstrate their capabilities,
and prove the viability of new products or services. In this way, innovation in public procurement can stimulate long-term export success by showcasing emerging and innovative products and services and providing authoritative reference clients for Irish companies.
Pre-commercial procurement where the risks are shared between public procurers and firms-can be used to promote innovation while respecting State Aid rules.
as the size, agility and adaptability of such enterprises often enables them to develop new and more cost-effective solutions.
This rapidly growing global market in which the public sector is the most likely early mover is open to SMES with innovative products and services.
both in the public sector itself and in the enterprise sector. e-Procuremente-Procurement, used throughout The irish public sector,
Enterprise Ireland, in cooperation with Intertradeireland and Invest Northern ireland, has developed Go-Source, an all-island public procurement directory and web site,
Our policy is geared towards stimulating and supporting networks of enterprises and other innovative forms of collaboration
Networks Significant benefits accrue to enterprises and particularly SMES that collaborate. They can share information on technology,
markets and business models, collaborate on skills development, pool resources for R&d or specialist equipment, and provide mutual support in a variety of other ways.
Enterprise Ireland is currently providing funding for such activities through its Industry-Led Networks Pilot programme
and develop all-island business networks in sectors that are considered to be especially important for future economic growth,
and more successful economies and help increase innovation and productivity levels of their constituent parts.
Effective knowledge flows between suppliers and customers; and Collaborative, focused attention to common problems. In Ireland, clusters are emerging in sectors such as software,
These are being developed with the support of Intertradeireland, Enterprise Ireland and IDA Ireland. Strategic cooperation between Enterprise Ireland, Invest Northern ireland
and Intertradeireland provides the critical mass to accelerate the development of all-island world-class companies.
Enterprise Ireland has ten regional offices throughout the country, and drives innovation in the regions by:
19 Enterprise Ireland has invested heavily in business incubation activity, funding 25 incubation centres, 16 of which are based in Institutes of Technology.
Enterprise Ireland provides financial support for a number of Centres of Excellence in applied research in the institutes,
By 2008, twelve centres were receiving investment of €15 million, with plans to support a further thirty centres in the fourteen Institutes of Technology.
and faster to market demands. They must develop wider and deeper partnerships that harness and develop regional scientific and technological knowledge.
and it works closely with several County and City Enterprise Boards (CEBS) to raise awareness of IP issues among entrepreneurial start-up companies.
The Enterprise Ireland Techsearch initiative helps companies and in particular SMES to locate suitable partners locally or internationally,
Maximising return on investment Intellectual Property Protection and Management Innovation in Ireland 2008 Exploitation of research resultstwo codes of practice have been published relating to the management of intellectual property arising from publicly-funded research (in whole
confidence and consistency to all stakeholders and underpin Ireland's attractiveness as a location for R&d and its subsequent exploitation.
Enterprise Ireland's Intellectual Property Fund for the Higher education Sector and the Intellectual Property Assistance Scheme provide advice
We have created an attractive fiscal environment for ownership and licensing of intellectual property. The sale of intellectual property is exempt from stamp duty,
Innovation in Ireland 200822 Innovation in Ireland 200823 Nearly 70 percent of The irish workforce is employed now in the services sector,
and, with services exports worth €64. 8 billion in 2007, Ireland is now the 11th highest exporter of services in the world.
The Government and state agencies recognise the great potential value of innovation in services to The irish economy.
We are refining policies and supports in line with both the opportunities that services innovation offers,
Creating opportunities for innovation The focus of innovation has traditionally been on the manufacturing industry.
Ireland's focus on services has the potential to give us an‘early mover'advantage. This enables us to develop truly innovative policies
Forfás convened The Services Strategy Group to develop a national services strategy with the aim of maximising the returns from existing enterprise services,
and developing new service industries. The Group acknowledges the need for and recommends the development of a National Services Innovation Policy and Strategy.
Innovation where it's most needed and least expected Services and Emerging Sectors Innovation in Ireland 2008 Innovation in Ireland 2008international financial services Financial services have become more important as a source of both wealth generation and employment in Ireland.
The international financial services sector operates in a global environment, in which innovation and productivity are essential drivers of competitive advantage.
Ireland is positioned well in this sector: the Global Financial Centres Index (funded by the City of London) ranks Dublin as the fifteenth most important international financial centre in the world.
More specifically, in terms of its business environment, Dublin is ranked tenth, reflecting Ireland's strong regulatory environment,
Innovation in environmental goods and services While climate change and the need for more sustainable use of resources pose significant challenges for industry,
they also offer significant opportunities for innovative products and services in a range of sectors.
The environmental services sector has expanded greatly in recent years, with annual global sales now at €680 million,
Forfás and Intertradeireland are currently conducting an all-island study of the sector to identify opportunities for existing firms and potential entrants,
The Global Entrepreneurship Monitor ranks Ireland second in the EU and fifth among OECD countries for entrepreneurial activity.
The climate in Ireland for entrepreneurship and innovation is positive assisted by our benign business framework conditions,
Our state agencies and County and City Enterprise Boards promote and support entrepreneurial and enterprise innovation activities, by providing direct funding, information, training, advice and facilities.
Start-up funding The state agencies provide practical supports and funding to high-potential, export-orientated start-up companies.
Irish taxation policy supports investment in emerging companies. The Seed Capital Scheme and the Business Expansion Scheme provide tax incentives for investment in start-ups and expanding businesses respectively.
The innovation future Entrepreneurship and Business Expansion Innovation in Ireland 26 Access to know-how The State has invested in a number of schemes to ensure that developing businesses have access to the information, training and advice that they need.
The Enterprise START Programme provides new start-ups with information and training delivered by experienced entrepreneurs;
the Skillnets programme is designed to enhance management capability in SMES; the Enterprise Platform Programme provides entrepreneurs with a structured one-year training and support programme.
Enterprise Ireland, for example, in its Leadership 4 Growth programme and its International Selling Programme, is working with companies to ensure they have world-class management teams with skills in the critical areas of sales, marketing
, technology and innovation. The recently launched Tech-Check scheme, run by the County and City Enterprise Boards,
offers ICT audits for growing businesses to ensure that they are optimally exploiting available information and communications technology.
Access to facilities The Community Enterprise Centres throughout the country provide a supportive environment for entrepreneurs at local level.
We are targeting the expansion businesses and encouraging innovation in existing enterprises. R&d tax credits, for example, are intended to encourage in-house R&d.
Dedicated teams in Enterprise Ireland are working with companies to help them achieve annual sales in excess of €20 million
and to become sustainable global enterprises. Innovation in Ireland 2008 Innovation in Ireland 200827 Fostering entrepreneurshipour policies are geared towards stimulating latent entrepreneurial potential (particularly amongst women
and enhancing the culture of entrepreneurship. The County and City Enterprise Boards encourage female entrepreneurship by promoting successful female entrepreneurs as role models
using mentoring and networking opportunities through the Women in Business initiative. They have also been very successful in attracting women to participate in training programmes, such as Start your Own Business courses and Management Development Programmes.
Women make up nearly 60 percent of participants on these programmes. The County and City Enterprise Boards promote programmes such as the enterprise in second-level schools through Student Enterprise Awards.
Tapping the entrepreneurialskills of immigrantsimmigrants are making a significant contribution to Irish society and economy.
They have skills, talents and new perspectives that can be of benefit to Ireland. The skills profile of immigrant workers in many cases exceeds that of the resident population.
and economic growth The State agencies are working to maximise the opportunities presented by this new pool of talent,
and to reduce the barriers to entrepreneurship presented by, for example, language difficulties or cultural differences.
supported by the European Social Fund and Skillnets, helps alleviate this through the promotion of entrepreneurship in ethnic minorities
and by providing free training to ethnic minority entrepreneurs at pre-enterprise, start-up and growth stages.
This has led to a series of detailed programmes that have delivered unprecedented levels of economic stability, social cohesion and industrial peace.
and focuses on actions to stimulate workplace change and innovation, within a social partnership environment.
The key message of the National Workplace Strategy is that the quality of Irish workplaces is critical to Ireland's transition into an even more dynamic, highly skilled, innovative and knowledge-based economy.
It is administered by Enterprise Ireland in collaboration with the NCPP and has three main strands: A public awareness campaign:
Promotion of innovation at enterprise level: This focuses on companies who are seeking to leverage workplace innovation to improve their competitiveness and productivity.
The Workplace Innovation Fund is a unique opportunity for SMES to receive financial support for projects seeking to develop partnership and participation within the workplace leading to productivity improvements, improved performance and employee well-being.
Innovation in Ireland 200831 Competition fuels innovation The pressure to be competitive drives innovation across the range of business practice;
With greater competition in markets, companies need to draw on all their entrepreneurial and innovative skills to develop new products and services,
and to meet their customers'needs effectively. Enhancing competition within Ireland's domestic economy is critical to improving the cost competitiveness of internationally-trading Irish-based firms.
Competition Authority The Competition Authority has a role in promoting competition, and it has completed recently studies into a range of sectors,
including banking, private health insurance, and the professions (engineers, architects, optometrists, dentists, solicitors and barristers. Further studies are expected in this series.
The Authority has an important role in enforcing competition laws. Government as a driver of Innovation Competition and Better Regulation Innovation in Ireland 2008 32innovation in Ireland 2008better regulation The challenges facing regulatory bodies include ensuring that regulation is not too burdensome on the enterprise sector,
and the cost of compliance does not impact on competitiveness. The current consensus, as reflected by the National Competitiveness Council,
is that the regulatory environment has played a beneficial role in the development of Ireland's international competitiveness.
taxation, health and safety, environment statistics, employment and company law. 33 h Innovation in Ireland Summary 200833innovation in Ireland Conclusiontracking our Progressthroughout this document, we have identified the depth and breadth
and have described the substantial progress that we have made in building capacity and in drawing out the latent imagination and creativity within The irish economy.
Our enterprise support agencies are geared now highly to stimulate and assist people and firms to produce new services and products and gain new markets.
We now have quality programmes in place to create knowledge and to build on the skills and talents of our people,
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