The simple reason for this is that although companies want to be more active in innovation, they often lack organisational resources, capacities and knowledge. SMEs need practical, hands-on support to overcome this challenge, particularly as new value chains develop that cut across industrial sectors. Clusters – or to be more precise, industrial networks that are managed by a cluster organisation – can provide this support.
Catalysts for change
Clusters are a key pillar of industrial policy in all EU member states. They are an important breeding ground for innovation and can be catalysts for structural change. Until recently, policy makers have perceived clusters as being limited to specific industrial sectors. Nowadays, the concept has been widened and is seen more in terms of “clusters of related industries” that can generate growth-boosting complementarities.
Cluster organisations facilitate this by providing tailor-made advice and services to participating companies and researchers. This includes identifying business opportunities and brokering contacts across industrial sectors. However, many cluster organisations are still struggling with the development of the skills they need. There is a greater awareness of the potential that clusters provide for the development of emerging industries, yet this is not yet sufficiently reflected in the cluster programmes of most EU member states.
Existing programmes, and many are being planned in the context of the EU’s 2014-2020 Structural Funding programme, still reflect old sectorial thinking. With its emphasis on smart specialisation, the European Commission has challenged national policymakers to ditch this outdated thinking, but too many find it difficult to move on. Future policies to promote SME innovation should also continue with macroeconomic reforms and the reduction of administrative burdens.
There are some good examples of how to structure cluster programmes to facilitate SME innovation in emerging industries. A group of Nordic countries together with Germany and Poland have presented a “Perfect Cluster Policy” to show how an ideal policy and its programmes should look. They examined past mistakes and challenged old mind-sets to develop a new approach that has inspired cluster policy in other countries and is now being further developed through the European Cluster Observatory initiated by the Commission.
There is still a need for SME innovation support programmes, but much more emphasis should be placed on providing hands-on backing for SMEs through cluster organisations. Currently, though, only a few programmes offer sufficient support for cluster organisations’ skill-development capacities.
Examples of those that do so include those managed by Innovation Norway, the “Go-cluster” programme of the German Economics Ministry, and the cluster programme of Baden-Württemberg’s Finance Ministry. All place a stronger focus on technical assistance or peer review assessments to provide management advice to cluster organisations, generating more economic impact on SME development than the usual support grant programmes.
That offers an interesting lesson: perhaps it is wiser to spend less on fire-and-forget grant programmes and more on coaching. Doing that will require a shift in mind-set within administrations.
 Christensen/Lämmer-Gamp/Meier zu Köcker, 2011: Let’s make a perfect cluster policy and programme. Smart recommendations for policy makers, Copenhagen/Berlin
This article is part of Friends of Europe’s upcoming discussion paper on the future of dual-use technologies in Europe.
The full discussion paper will be available in early September. Read the other articles here.