Employees also acquire entrepreneurship skills through interactions with their co-workers, suppliers, clients and consultants on projects such as
those to improve quality control methods or products. These interactions often take place through interactions between SMES and providers of what are known as Knowledge Intensive Service
the delegates, experts and Secretariat members for their contributions. I trust that this publication will provide inspiration to policy makers around the world and,
The following experts comprised the Scientific Advisory Group that helped guide preparation of this publication
Assistance in developing the Country Notes was provided by the following experts Petr Adamek, Bergman Group, Czech republic
basic university research and highly-skilled workers are most important. This is associated with important local knowledge spillovers in these sectors.
employees by SMES is much less common than for large firms. Despite the general importance of vocational education and training (VET) to skills development in firms
enterprises with less than 50 employees provide significantly less employee training than larger firms. This is even true for countries known for their strong training cultures, such as
younger, better-educated workers in highly-skilled occupations such as managers professionals and technicians have greater access to training opportunities than less
educated â€oeroutine†(i e. involved in routine tasks) and older workers. One of the problems is that externally-provided entrepreneurship training approaches for managers and workers
are geared not sufficiently to the â€oehow to†nature of competences that firms require The smart use of Knowledge Intensive Service Activities (KISAS) by SMES can nevertheless
provide a significant boost to the entrepreneurship skills of SME employees. This involves SMES bringing in outside firms and consultants to help them implement change, for example in
quality control, marketing or product development. Experts may be called on in a range of areas, such as in research and development, legal, information technology, marketing and
other knowledge-intensive activities. Their advice and joint work with SME workforces upgrades skills, increasing the ability of SMES to develop,
employers industry representatives, unions, labour market and training intermediaries (temporary work agencies and group training companies), local and regional government agencies
and community representatives, in order to develop skill strategies and deliver training The final thematic chapter concerns social entrepreneurship and social innovation
and implementing new labour market integration processes, new competencies, new jobs, and new forms of participation, as
e g. innovation brokers, labour mobility schemes, programmes for the commercialisation of university research), and intelligence functions aimed at anticipating future needs and
Promote local labour mobility such as through university-industry staff exchange programmes â Use the concept of â€oerelated variety†to guide policy.
making diaspora populations aware of local job vacancies Learning processes are at the core of entrepreneurship and SME innovation.
innovation by employees in existing SMES. The following recommendations are offered â Build up entrepreneurship education in universities and higher education institutions by smartly
consultants providing knowledge-intensive service activities (KISA), for example using â€oeinnovation vouchers†for SMES â Strengthen local skills ecosystems.
programmes through the engagement of employers, unions and individuals. Create integrated training strategies combining training located in higher education, vocational
employees, while â€oegazelles†account for less than 1 per cent of such enterprises. 1 They nonetheless generate large impacts.
universities and other firms or business angels, from labour mobility among firms and organisations and from informal social capital contacts.
consultants and other firms often brings new non-technological ideas into the firm with respect to business practices, workplace organisation and marketing (OECD, 2010a
stable employment in large firms and a central role of unions and employers in regulating
regulation of labour markets and a strong welfare state. The reduced power of large firms and unions,
turbulence and labour market flexibility increased the strain upon it Social entrepreneurs and social enterprises such as nonprofit organisations have
innovation rates per employee not per firm (Audretsch, 1995. On the other hand, there is a strong suggestion that SMES are associated particularly with bringing forward so-called
and interacting occurs on the job as employees face ongoing changes that confront them with new problems and can be fostered by organisational practices within the firm, such as
service activity providers such as consultants (OECD, 2010a, forthcoming â Entrepreneurship skills. Another often overlooked factor affecting the propensity for
older and routine workers. These problems need to be addressed Finally, Chapter 5 examines social innovation and social entrepreneurship.
growth in employees greater than 20%a year over a three year period and with ten or more
employees at the beginning of the observation period. â€oegazellesâ€, as measured by employment, are enterprises which have been employers for a period of up to five years, with average annualised
growth in employees greater than 20%a year over a three-year period and with ten or more
employees at the beginning of the period 2. See also NESTA (2009 3. The OECD/Eurostat Entrepreneurship Indicator Programme is developing internationally
-comparable indicators of entrepreneurship based on this definition Bibliography Acs, Z. and D. Audretsch (1990), Innovation and Small Firms, MIT Press, Cambridge MA
Haltiwanger, J. 1999), â€oejob Creation and Destruction by Employer Size and Age: Cyclical Dynamicsâ€, in
experts and delegates to the OECD Working Party on SMES and Entrepreneurship and OECD Local Economic and Employment Development Committee
employees. The dataset follows the International Standard Industrial Classification (ISIC Rev. 3 for the classification of economic activities (see Annex 2. A1
with more than 20 employees, and therefore exclude micro enterprises OECD Product Market Regulation (PMR) indicators
referral service linking firms to experts within industries SMES, ENTREPRENEURSHIP AND INNOVATION Â OECD 201048
labour market Lack of access to knowledge or technology Uncertain demand for new goods or services
external experts; and providing physical office space Nine centres have been selected in two competitive tenders. Their setup and operation are supported
are shared, including with international experts. The budget for the whole intended programme life cycle amounts to EUR 77 million, a third of which comes from federal money, a third from the regions, and a
Consultants commercial labs or private institutes Government or public research institutes 0 0. 5 1. 0
Consultants commercial labs or private institutes Lack of qualified personnel Difficulty in finding co-operation
Consultants commercial labs or private institutes Government or public research institutes 0 0. 5 1. 0
employees taking part in the innovation processes of the beneficiary companies and public institutions Applicants and projects from educational, cultural and knowledge institutions are welcomed.
Consultants commercial labs or private institutes Government or public research institutes 0 0. 5 1. 0
and covers more than one-third of R&d in businesses with less than 50 employees, but less than 3%of R&d
in businesses with more than 500 employees. Tekes directed approximately 26%of the total funding for
businesses to the smallest enterprises employing less than ten employees, approximately EUR 75 million in 2008.
six years and with less than 50 employees, and willing to seek and accept new owners and investors
provides incentives for experts, such as serial entrepreneurs, to become mentors and active developers in new ventures.
Such experts are positioned well to offer high-quality advice and contacts for start-ups to accelerate their growth and internationalisation,
Consultants commercial labs or private institutes Government or public research institutes 0 0. 5 1. 0
Consultants commercial labs or private institutes Government or public research institutes 0 0. 5 1. 0
entrepreneurship among university employees and students. Projects at universities and non-university research institutes can apply for financial support in the form of a non-repayable grant over a three-year
Consultants commercial labs or private institutes Government or public research institutes 0 0. 5 1. 0
Consultants commercial labs or private institutes Government or public research institutes 0 0. 5 1. 0
Consultants commercial labs or private institutes Government or public research institutes 0 0. 5 1. 0
Consultants commercial labs or private institutes Government or public research institutes 0 0. 5 1. 0
Consultants commercial labs or private institutes Government or public research institutes 0 0. 5 1. 0
Consultants commercial labs or private institutes Government or public research institutes 0 0. 5 1. 0
Funding recipients should have less than 300 employees or capital below JPY 300 million. The majority of schemes target venture companies and SMES
Consultants commercial labs or private institutes Government or public research institutes 0 0. 5 1. 0
Consultants commercial labs or private institutes Government or public research institutes 0 0. 5 1. 0
young scientists, technicians and engineers in research and development projects, engaging experts in R&d and commercialisation projects,
reworking employee structures, to incorporate design-led positions and integration between functional teams; and developing new branding
design consultants and mentors, and external costs associated with prototyping SMES, ENTREPRENEURSHIP AND INNOVATION Â OECD 201086
Number of enterprises Number of employees Industry Services Total Industry Services Total %%%Micro 67 447 91.0 229 204 94.1 93.3 799 84 19.6 180 850 21.8 21.1
Consultants commercial labs or private institutes Government or public research institutes 0 0. 5 1. 0
Consultants commercial labs or private institutes Government or public research institutes 0 0. 5 1. 0
Consultants commercial labs or private institutes Government or public research institutes 0 0. 5 1. 0
Consultants commercial labs or private institutes Government or public research institutes 0 0. 5 1. 0
Consultants commercial labs or private institutes Government or public research institutes 0 0. 5 1. 0
new employees have been recruited in 76%of the projects (of these, 79%are employees with at least a master†s degree in
engineering); ) over 90%are planning the market introduction of a new product developed in the project
Consultants commercial labs or private institutes Government or public research institutes 0 0. 5 1. 0
competitive position, employee satisfaction, and internal process organisation Venturelab Venturelab provides customised education tools to promote innovative young entrepreneurs and to
Consultants commercial labs or private institutes Government or public research institutes 0 0. 5 1. 0
Consultants commercial labs or private institutes Government or public research institutes 0 0. 5 1. 0
business experts, and there is a requirement for matching funds from the firms themselves. TIP funds cover project costs only
Number of enterprises, 2005 Number of employees, 2004 Industry Services Total Industry Services Total No. firms%No. firms
employees. The industrial value added generated in these development zones accounted for 8. 95%of the
Size class of employees C. Administrative burdens on start-ups, 2008 Index scale of 0-6 from least to most restrictive
Consultants commercial labs or private institutes Government or public research institutes 0 5 10 15 20 25 30
work as experts. By the beginning of 2009,16 500 projects had been presented to the Foundation, and of
Size Employees Annual turnover Micro 1-15 Up to 1. 7 million euro Small 16-100 Up to 11.6 million euro
C. Growth in the number of employees in SMES 2001-2007 Thousands of people D. Barriers to entrepreneurship, 2008
these focus on improvement of research experts in the business sector. Besides the traditional programmes to support young researchers and young researchers from the business sector, the Public
Consultants commercial labs or private institutes Government or public research institutes 0 0. 5 1. 0
P. Private households with employed persons (ISIC Rev. 3) or Activities of households NACE Q. Extraterritorial organisations and bodies
In Table A, for Number of enterprises and Number of employees Industry includes ISIC Rev. 3 categories C, D, E,
of employees, Industry includes ISIC Rev. 3 categories C, E, and F. Services includes ISIC
of overseas skilled workers are three of the main channels through which global knowledge flows can revitalise local innovation systems
As to external constraints †the second strand of the literature †heavy labour market regulations and market entry requirements are deemed traditionally to discourage
resources that are key to the production process, a better match between employers and employees or buyers and suppliers, etc.
It is argued here that in knowledge-driven sectors such as those falling under the broad categories of high-tech manufacturing (HTM) and
intensity, basic university research and highly-skilled workers are most important. For example, in the United states, knowledge-driven industries such as semiconductors
workers and managers between companies within the local labour market are some of the clearest examples of â€oepassive†knowledge transfers.
The attraction of foreign skilled workers Renowned examples of attractive local economies, such as Silicon valley and Austin in the
-skilled workers to stimulate entrepreneurship. But it is also important in everyday economies For receiving places, the inflow of foreign talent has positive effects on the number of skilled
workers, levels of R&d, enrolments in graduate programmes and the potential creation of growth-oriented businesses by immigrants.
A number of factors affect the ability of a locality to attract a skilled labour force.
workers of the foreign affiliate to set out their own business. As to university spin-offs the gap between technological invention and commercial innovation should be
and links to external experts (see Austria†s Country Note â Interactive learning networks boost SME innovation and need to be stimulated
linkages to more technologically advanced firms or business experts (see Australia†s Country Note â The absorptive capacity of SMES needs be strengthened
â Labour mobility accelerates knowledge flows within an innovation system â More generally, labour mobility within an innovation system should be promoted as a
tool enabling local knowledge flows and spillovers via the transfer of skills and experience, although marked inter-firm labour mobility can deter private investments
in training, especially in SMES. University-industry staff exchange programmes should also be considered, although rigid university employment practices and the very
render this specific type of labour mobility difficult â Promote cross-fertilising technologies with multiple industrial applications
of highly-skilled foreign labour Notes 1. Innovation systems may also have a sector dimension, and part of the literature is devoted to
than ten employees may be excluded largely from this database The value of the ORBIS database for territorial analysis rests on the possibility to
turnover per employee growth rates according to turnover, value added or employment; productivity growth â Profitability indicators, e g. profit margin;
distribution of key economic variables (number of firms, turnover, employees, value added by classification variables (economic activity, firm size and location.
Also in the case of workers in existing SMES, data confirm the existence of a skills and training problem holding back innovation.
OECD countries, employees of SMES participate in formal training activities to only half the extent that staff in large firms do (OECD, 2010b, forthcoming.
-building measures have little take-up among low-skilled SME workers In the future there will be a need for new types of skills matching new types of jobs, as
informal entrepreneurship learning at work through the involvement of workers in knowledge-intensive service activities and entrepreneurship training by SME support
widely used to prepare future self-employed entrepreneurs and SME employees Vocational training colleges have had traditionally a craft focus.
employer. Apprenticeship programmes are widespread, with countries like Denmark Australia, Germany and France often being referred to as good practice.
apart from those employing apprentices) pay this â€oeapprenticeship tax†(Stone and Braidford 2008). ) Germany furnishes a second example †there the VET dual system includes on-the-job
120 000 apprentices in 1995 to over 400 000 by 2003. The numbers in Australian
Apprenticeships represent 3. 5%of the working population, one of the highest rates of contracted training in the developed world.
These incentives bring employer commitment to the system; they also create and fund intermediary bodies such as Group
skilled employees and do not explicitly train entrepreneurship skills, however, and would need to be expanded to impart entrepreneurship skills in a wider sense
employees. Participation in voucher-type schemes is high among employees, but on average only 50%of the amount of finance available for training is used
and there is a low participation from micro and small enterprises and from unskilled, semiskilled and older
employees. Training packages and apprenticeship schemes have been very successful in some countries as employers use the national qualification system to upgrade the skills of
their workforces. However, in general, voluntary policies have had greater success than compulsory measures (OECD, 2010a, forthcoming
policy measures should target both workers and enterprises, not providing financial incentives alone but also allowing freedom of choice and market transparency
objectives and information to both employers and employees and provision of standardised accreditation Another step that can be taken to fit the vocational training offer more closely to
â understand the roles, rights and responsibilities of individuals as employees, managers employers, entrepreneurs, investors, customers and global citizens
â are willing to take responsibility for and accept the consequences of their own actions â understand the positive and negative contributions of technology and business to
Examples are regular programmes to train new employees or potential team leaders and project management and foreign language language training (Markowitsch
Survey show that employees in enterprises with less than 50 employees receive significantly less in-company training than employees in larger firms.
This remains true in countries reputed for their high levels of training culture such as Denmark, the
In terms of annual volume of hours spent by employees in training, the average in firms with less than 50 employees is about half that of large
firms with 1 000 employees and more, and about two-thirds of the average of all firms.
In some countries a relatively high proportion of small firms with between 10 and 49 employees provide some formal training for their employees:
Denmark (48%),Finland 38%),The netherlands (36%),Sweden (51%)and the United kingdom (35%),but even here
countries for large firms of at least 1 000 employees is much higher (Greece 33%,Hungary
younger, better educated workers in high-skilled occupations (such as managers, professionals and technicians) have greater access to
training opportunities than less-educated older workers and workers involved in routine tasks (OECD, 2003; 2008a
One of the reasons that SMES undertake less formal training than large firms is cost
The result is that employees of small and micro firms can miss out on any type
employee-driven learning and trial-and-error behaviour can obviously be detrimental to both the firm and the employee
SMES, ENTREPRENEURSHIP AND INNOVATION Â OECD 2010176 4. ENTREPRENEURSHIP SKILLS SMES, however, can be highly innovative,
This provides an opportunity for employees to learn from others in different companies. In addition to enhancing SMES€ efficiency, innovative potential and growth
a high knowledge component, undertaken in collaborations between SME employees and external professionals or in SME employee work groups (OECD, 2006;
Martinez-Fernandez and Martinez-Solano, 2006. At the heart of this are knowledge intensive service activities
consultants, clients and suppliers in the firm†s network and/or value-chain, which could
employees in pursuit of new or improved solutions to current needs of the firm †at the
same time increasing the skills, knowledge and competencies of employees in significant ways. SME work with external KISA suppliers is important because the professionals
different workers involved, constituting a critical nexus of today†s networking economy Alternatively, internal projects can be undertaken,
employees learning from or together with their co-workers. Many entrepreneurship skills are acquired in the process of knowledge co-production;
attention of policy makers has tended to be on the contribution of knowledge workers to entrepreneurship and innovation.
workers can also make an important contribution to transforming SME activities to a context of increased knowledge intensity and innovation activity.
moving towards recognising the important contribution that routine workers can make both in innovative outputs and in skills acquisition for the firm.
floor workers with engineers in activities oriented to find new uses for old machinery The skills acquired in the process range from analytical, problem solving and
competitive advantage for these routine workers in the labour market. Working with engineers also helps routine employees to further analyse their own activities and how
they can better be performed (Martinez-Fernandez, Receretnam and Sharpe, 2007. These types of KISA †that act as a specialised â€oeservice†for the firm and where the component
and by employees usually classified as working in â€oelow -knowledge intensity†tasks KISAS are still a relatively unexplored area despite their importance to the new
performed in-house with external actors such as business consultants or other professionals from the SME€ s network and/or its value chain.
real entrepreneurs and experts SME management training According to a European commission document on management capacity-building policies for SMES, a common issue throughout Europe is that an overwhelming majority of
provided for owners and managers of independent enterprises with 250 employees or fewer, and at least partly funded by the organisation†(OECD, 2002, p. 6
It involves internal or external consultants that work with the business owner or managers to think about processes, business models or solutions to specific problems.
employers, industry representatives, unions, labour market and training intermediaries temporary work agencies and group training companies), local and regional government
Although training can in principle be provided by experts from other countries or regions, it tends to be seen as a local resource by both enterprises and employees.
This, and the positive effects of local networks and connectivity in achieving the vitality of local
development †training programmes for owners, managers and consultants in business planning, financial services, ICT and marketing
â Adult learning and links with the labour market â Regional development, including capacity building for Business Support Providers (BSPS
both workers and enterprises; limit administrative burdens; increase transparency and clarity of objectives and information to employers and employees;
give standardised accreditation â Embed an entrepreneurship mindset through the school education system â Develop the training function of small business support programmes including
â Use these and other approaches to support the integration of new employees and the
engagement of employers, unions and individuals, such as in programme design and management SMES, ENTREPRENEURSHIP AND INNOVATION Â OECD 2010182
Stone, I. and P. Braidford (2008), Engaging Employers in Continuing Training: An International Review of
15 000 social enterprises employing 350 000 employees, serving 5 million users and with an economic turnover of EUR 10 billion
11 million paid employees, equivalent to about 6%of the working population of the EU These aggregates underline the fact that this is a reality
would train the childcare workers, guaranteeing quality standards; Bancaprossima grants loans with no personal guarantee required.
Moreover the cooperative aims at employing local disadvantaged workers, thus contributing to the local employment of individuals from groups who may find it difficult
workers in service delivery areas Financially supported by local credit cooperatives, other cooperative support organisations and small contributions from local residents, the Health and Social Care
is the capacity-building opportunities offered to healthcare workers and scientists, with a possible further impact on economic development
capacity by training healthcare workers and scientists in clinical drug development, which in turn stimulates new avenues of economic development
job applications, the project offers information, advice, and guidance services free of charge to all (students and non-students alike
workers through regular physical activity exercises in the workplace With the help of strong national and local networks and allies, SIEL Bleu has been able to
identifying and implementing new labour market integration processes, new competencies, new jobs, and new forms of participation,
employment (for disabled and disadvantaged workers) and individual development accounts are all examples of recent and important social innovations (Phills, Deiglmeier
Programme workers also maintain close personal contact with clients to provide counselling and encouragement. The programme sponsor is responsible for
employees who live in the neighbourhood Aside from the currency, the Palmas Bank seeks to engage with communities†needs by initiat
meeting gathered a number of experts and social innovators, and concrete examples of existing social innovations were discussed.
â identifying and implementing new labour market integration processes, new competencies, new jobs, and new forms of participation,
greater engagement of employers, unions and individuals involved in new and small firms with lo
of skilled workers about where to live and work. These factors can include tolerance towards diversity, active cultural life, large green spaces, presence of recreational
universities, colleges, employment agencies, unions and training organisations /associations, and are supported by integrated policy approaches to skills development
employees. This number varies across countries. The most frequent upper limit designating an SME is 250 employees,
as in the European union. However, some countries set the limit at 200 employees, while the United states considers SMES to include firms
with fewer than 500 employees. Small firms are considered generally those with fewer than 50 employees and micro firms have at most 10 employees.
Financial information on turnover or balance sheets can also be used to define SMES Social economy The ensemble of entities that explicitly have both an economic and a social mission
These can include associations, cooperatives, mutual organisations, foundations and more recently social enterprises. This type of economy is regulated essentially by the
of persons excluded from the labour market Social entrepreneur A person who recognises a social problem and uses entrepreneurial principles to
competencies, jobs and forms of participation in the labour market, each of which contributes to improving the position of individuals in the workforce
A new firm that is created by a former employee of a company (i e. corporate spin-off
The attraction of foreign skilled workers Conclusions and policy recommendations Key policy recommendations Notes Bibliography Annex 3. A1.
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