How can SMEs in the region integrate into an innovation ecosystem?

When we talk about innovation, there is no single definition. The same goes for innovation ecosystems, for which we can find varied references in literature that gives us a rough definition. One such description is the proposal by Bengt-Åke Lundvall, who defines it as “the flow of knowledge, technology and information between key people, companies and institutions to generate innovation processes. This includes the interaction between the actors who are needed in order to turn an idea into a process, product or service for the market.”

Innovation ecosystems are characterized by the presence of different stakeholders that interact with each other in order to forge partnerships, produce knowledge and new and innovative developments through co-creation and collaboration What enhances an innovation ecosystem is the ability of its participants to build synergies and align themselves to attain common goals, hence the relevance of being an active player.

SMEs account for 99.5% of the region’s business fabric, and as a result of the survey conducted in 121 countries by the International Trade Centre, COVID-19 is estimated to have impacted more than 60 percent of SMEs and 51 percent of medium-sized enterprises. Considering the current situation in the region, the role of SMEs within an innovation ecosystem becomes vital to the economic revival that we will be experiencing in the coming months.

But how can SMEs in the region integrate into an innovation ecosystem?

The first step in the efficient integration of an SME into an innovation ecosystem is the identification and recognition of its constituent entities. To this end, a useful tool is the triple helix model, which helps survey information of the entities representing the public sector, the private sector and the knowledge sector. This tool allows for an initial mapping of the actors (also known as stakeholders) present in the environment, which could become strategic partners.

The second step is the recognition of the internal needs that the SME cannot cover on its own, either because of lack of installed capacity, infrastructure, knowledge, or financing, among others. We must also identify opportunities and challenges that could incentivize the creation of high-value solutions at the social, environmental and economic level through innovation processes.

The third step is the design of the onboarding plan, where we must define the strategy to be implemented with each stakeholder, the value that each of them can generate and the value that the SME can contribute, thus trying to create a win-win relationship. At this point, checks must be made as to whether it is necessary to involve additional entities that were not initially mapped. Lastly, the SME must define the collaborative processes in which it is willing to participate, such as joint identification of opportunities or problems, generation of ideas based on challenges, development of validated projects, among others.

Being part of an innovation ecosystem brings great value to each of the stakeholders, as they are part of a system that encourages collaboration, the search and attainment of objectives together, professional and social growth. The relevant aspect about being part of this ecosystem is constant updating, and thus, SMEs interested in joining should do so for the purpose of and willingness to seize opportunities and become an active entity in working together with entities in other sectors and markets.

In support of SMEs in the region, CAF jointly designed with Chilean consulting firm Transforme the MOOC Business Innovation: How to boost it in my SME?, a completely online and free four-module course, where participants will learn various methodologies and tools that will allow them to kick off an innovation management process within their organization. The fourth module explains in detail the use of the triple helix model and the initial value it brings to entities, as well as the process for generating an onboarding plan into the innovation ecosystem in a strategic and targeted way. The course will be available until January, and the initial recommendation is to form a multidisciplinary group within the organization, in order to ensure greater use of the resources and methodologies in the course, as well as a systematic creation of the innovation road map as the main input for the entity.