Policy Support for the Diffusion of Innovation among SMEs: An Evaluation Study in the Spanish Region of Madrid

Abstract

Innovation is increasingly supported by public authority action focused on regions and small and medium enterprises (SMEs). In this line, the region of Madrid launched a programme to create Technology Diffusion Centres (TDCs) in order to promote innovation culture among the SMEs of the region. This article analyses the nature of innovation activities in these firms, and the achievements of the TDCs through their work with them. Different types of TDCs are compared according to the approach they applied and the agent to which they were linked. Ten indicators were used to examine the degree of embeddedness and performance of the different TDCs among the SMEs. Results show that a sectoral approach in conjunction with links to business association is the best option for the TDCs in urban and industrial areas. However, in the peripheral or less favourable areas, such as rural ones, a territorial approach in conjunction with links to local entities is the most effective alternative.

Acknowledgements

The authors are very grateful to Felipe Medina and Alvaro Areta for their help with the database used in the study. We also gratefully acknowledge the financial support of this research by the Spanish Ministry of Education and Science in cooperation with the Fulbright Commission.

Notes

The three rural areas display a predominantly rural character (45% of the regional territory, but only 2.4% of the population) and with less services and productive development infrastructures than the rest of the region (this rural character is even more significant in the Sierra Norte, a mostly uninhabited area). In 1994, the three areas were selected for their rurality to participate in the rural development initiative of the European Union LEADER II (1994–2000). In 2000, they were also selected to participate in the third phase of this initiative now called LEADER+ (2000–2006) (Cazorla et al., 2005).

In the area of policies on science and technology, the history of the practice of evaluation is quite short (Molas-Gallart & Davies, 2006). It is not until the late-1980s that evaluations of this type of policy began to be published (Grinder, 1990; Lemola & Siivonen, 1988). At that time, it was considered that “from the evaluation perspective, the most interesting interactions undoubtedly take place in the interface between knowledge generation and knowledge application sub-systems, as this interface can be effectively targeted in policy interventions” (Autio, 1998, p. 135). The evaluation of the TDCs of Madrid directly undertook the analysis of these interactions.

These participative techniques allow us to avoid a simple quantification of innovation input and output (Autio, 1998). Evaluation, thus, was transformed into a learning process (Diez, 2001) to analyse the transformation of innovation inputs into innovation outputs, and study the processes that lead to this transformation. A questionnaire was designed in order to obtain information about: (1) the degree of awareness and use of the TDCs among the SMEs of Madrid; (2) the degree of satisfaction with the services provided by the TDCs and (3) the impact of the different activities carried out by these centres upon the firms. Most of the questions had closed answers (multiple choices) to facilitate systemization and treatment of the quantitative data. The few questions that were left to an open answer were used to obtain qualitative information and enrich the quantitative data.

This sample included TDCs of different types in terms of agents to which the TDCs were linked (centres dependent on business associations, local entities and specialized), and in terms of the territorial or sectoral approach used in their work. The sample, thus, selected permitted the analysis of specific rural territories, such as the Sierra Norte and the Comarca de las Vegas, urban and industrial territories such as the city of Madrid, Corredor del Henares, Majadahonda, Pedrezuela and Galapagar, and sectors, such as agro-food, electronics, metallurgy, retail commerce and restoration.

This independent sample was also used to probe more deeply into some of the sectoral and territorial studies. The sectors of activity chosen for a deeper analysis were the agro-food industry (with activities within the primary and secondary sectors), and electronics and metallurgy (secondary and service sectors). The territories chosen for a deeper analysis were Sierra Norte (rural territory in the North of Madrid) and Henares (urban, industrial territory in the Northeast of Madrid).

Putting the two samples together, the global spectrum of the firms initially included reached the number of 7379 SMEs: 1547 from the lists provided by the TDCs and 5832 from the Madrid Chamber of Commerce lists. Of the first group, contact was made with 90% and the survey was completed with 277 SMEs (50 by e-mail and 227 by telephone), with which a minimum of 15 SMEs per TDC were surveyed. Of the independent sample, none were contacted by e-mail and telephone contact was established with 1000 SMEs. As a result of this contact, the survey was conducted with a total of 135 SMEs. The two samples together numbered 412 firms surveyed, mostly by telephone (86%) since the response by e-mail was only 6% (1000 questionnaires were sent and 58 were returned completed). Once the survey was introduced into a data base, the responses were analysed in function of criteria, such as size of the firm (micro, small and medium), whether or not it was innovative (those enterprises that had invested in innovation in the last 3 years), business sector to which it belonged, and the rural or industrial character of the area where it was located. Also, differential analyses were conducted according to whether the firms were on the lists provided by the TDCs or on those of the Chamber of Commerce (independent sample). Those from the TDCs' lists were differentiated by typology of the TDCs according to their sectoral or territorial approach, or in function of the agent to which it was linked (centres dependent on business associations, local entities and specialized).