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Bringing good ideas to life

Robert-Jan SMITS

A key part of the Europe 2020 strategy is the Innovation Union initiative which was launched on 6 October. Robert-Jan Smits, Director-General for Research in the European Commission, explains how it will help SMEs prosper.

'Europe can't compete with the rest of the world on its low wages or on its natural resources - or at the expense of its natural environment,' says Robert-Jan Smits, the incoming Director-General of Research at the European Commission, 'The only way we can compete is with our knowledge. And that means that we need to invest in research, education and innovation.'

Innovation is a key element in the context of the Europe 2020 strategy - how to do things smarter and greener. One of the new strategy's seven main flagship initiatives is the Innovation Union, which was launched in Brussels on 6 October. The Innovation Union aims to foster an environment that is conducive to not only developing good ideas, but deploying and commercialising them for the benefit of Europe as a whole.

'A lack of good ideas is not the problem,' believes Mr Smits. 'Europe has a tremendous amount of creativity - the issue lies in how to transform those good ideas into new products and processes. If you compare Europe with the US, we have the same amount of company start-ups, but while ours tend to stay small, in the US a much higher proportion grow to become multinational success stories.'

Why should it be the EU's job to support companies in such a way?

'We [the European Commission] should get involved as little as possible,' Mr Smits asserts. 'We should only intervene when there are market failures or bottlenecks which need to be addressed at the European level. The Innovation Union is all about creating an environment to let creativity and innovation take place.'

A key part of the Innovation Union is targeted at small and medium-sized enterprises (SMEs). 'SMEs are the backbone of the European economy,' continues Mr Smits. 'We have to find ways that allow our small companies to become large companies. This benefits everyone, as bigger companies employ more people, are more sustainable and are better able to compete in the global economy.'

The Framework Programme is one of the key instruments contributing to the objectives of the Innovation Union. However, while the Seventh Framework Programme (FP7) is open to all companies and markets, the reality is that over 90% of SMEs will never have anything to do with Brussels or the research programmes. But companies working in the high-technology or research fields are good candidates to participate. This includes (but is not restricted to) the spheres of Biotechnology, Agri-foods, ICT (information and communication technologies)/software and Virtual Reality. It is estimated that 20 000 SMEs will participate in FP7.

Simpler, easier, less red tape

An important aspect of the Innovation Union is to make entrance to the framework programmes simpler and therefore easier for SMEs to gain access to the funding they need. SMEs are particularly disadvantaged here, as many cannot afford to hire consultants to help them complete the application forms. In the future, if you want to work in the Framework Programme, you should not need to hire a consultant; you should be able to complete these forms in yourself. The benefits of participating in this programme stretch much further than the funding though and include a host of other benefits.

'You should never come just for the money,' stresses Mr Smits. 'You should come for the access to new knowledge, to internationalise your business and gain access to new markets and powerful new networks. If you don't need these, the Framework Programme then is not for your company.'

The Innovation Union is about creating the right conditions to allow creativity to take place, and to foster those good ideas so that they bring new products and services to market. Part of creating those better conditions is to agree on the European patent. 'Our current patents system is 15 times more expensive to navigate in Europe than it is in the US. Creating a unified, single patent system would make life so much easier for companies to commercialise good ideas - and a single system is now within reach,' underlines Mr Smits.

Commercial creativity

Innovation is not limited to technological innovation; it also includes social innovations such as new business processes and organisational models. Public procurement in Europe can also play a part in fostering innovative solutions. 'If we can move to a more intelligent system that rewards the most innovative ideas, rather than the lowest cost then this will act as a tremendous incentive to commercialise our collective creativity,' believes Mr Smits.

While the ambitions of the Innovation Union are high, changing cultures and regulatory systems will not happen overnight. 'This is a long term process,' admits Mr Smits. 'We don't just need to improve the innovation climate at a European level; in order to succeed we need to develop it at the national level too. But the Innovation Union brings with it a strong commitment to lead by example, and foster our natural creativity by making it easier for small companies to get on board.'