Chapter Seven Entrepreneurship and SMEs in the European Union (EU)

What are SMEs Firms employing less than 250 employees Account for 95 % of all businesses % of employment Traditional domestic focus But group of SMEs increasingly international

Importance Contribution to employment Role in restructuring and streamlining of large businesses Innovation Capability to export Flexibility Contribution to competitiveness Role as seedbeds Role in provision of services

Impact in three areas Knowledge Effect on competition Effect on variety

Entrepreneurship

Rise in knowledge economy Support innovation Drive change within modern economy

Entrepreneurship Involves: -Exploitation of creativity and/or innovation -Entrepreneurs -Applications of entrepreneurship

Entrepreneurship EU poor record of SME creation In US higher. Why? -Lack of role models -Cost -Culture -Business environment

SME Internationalisation

Link between size and degree of internationalisation breaking down Emergence of Born Globals There is a process of rapid internationalisation

Why rapid SME Internationalisation? Form and nature of management Knowledge driven strategies Global mind set of managers Learning through networks

EU Enterprise Policy Key objectives - safeguard and improve the environment for business during the completion of the internal market and beyond; - develop policies that enable SMEs to exploit the opportunities created by the internal market; - ensure consistency between enterprise policy and other EU policies.

Key Generic Actions education and training for entrepreneurship; cheaper and faster start up; better legislation and regulation; availability of skills; improving on-line access;

Key Generic Actions getting more out of the single market; taxation and financial matters; enhancing the technological capacity of small business; successful e-business models and top class small business support; more effective representation at the EU and national level

Entrepreneurship actions Fuelling the entrepreneurial mindset Encouraging more people to become entrepreneurs Gearing entrepreneurs for growth and competitiveness: Improving the flow of finance Creating a SME friendly regulatory and administrative framework