FEATURE PAPER

Important Effects of Innovation: Norwegian SMES

The following paper was written by Sherry Robinson of Penn State University and Buskerud University College and Hans Anton Stubberud of Buskerud University College. It was presented at the 2011 Allied Academies International Conference in Orlando.

Abstract

Innovation is frequently viewed as the key to success in many arenas, from individual businesses to a nation's general economic growth. Business performance has been linked to overall innovativeness (Akgun, Keskin, Byrne & Aaren, 2007), and in a study of British SMEs, innovative firms were more likely to be operating profitably while non-innovators were more likely to be struggling (Gray, 2006). It is not surprising, then, that innovation is seen as a vital element in economic growth in Norway (Norwegian Ministry of Trade, 2010). Similar to many other nations, Norway is dominated by small and medium-sized businesses (Norwegian Ministry of Trade, 2010). SMEs face increases challenges in innovating due to their small size and limited resources. According to Eurostat (2009), larger companies are more likely than SMEs to control the resources necessary for innovation, including human and financial capital. This study uses data from the Eurostat Community Innovation survey to more closely examine innovation by
analyzing the self-reported effects of innovation on Norwegian SMEs and comparing these to the effects reported by businesses with 250 or more employees.

Introduction

Innovation is frequently viewed as the key to success in many arenas, from individual businesses to a nation's general economic growth. It is seen as a vital element in economic growth in Norway (Norwegian Ministry of Trade, 2010), where the economy is dominated by small and medium-sized businesses (Norwegian Ministry of Trade, 2010). SMEs, however, face significant challenges in their attempts to innovate due to their small size and limited resources. According to Eurostat (2009), larger companies are more likely than SMEs to control the resources necessary for innovation, including human and financial capital.

This study uses data from the Eurostat Community Innovation survey to more closely examine innovation by analyzing the self-reported effects of innovation on Norwegian SMEs. These reports effects are compared by business size, including small (10-49 employees), medium (51-249 employees) and 250 or more employees. In the next section, a brief review of the motivation for innovation is presented, followed by the methodology, results and analysis of this study.

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TIP OF THE WEEK

Building Customer Profiles for a CRM Program

Most entrepreneurs say that the best way to stay in touch with customers and to identify their needs is to talk to them. Such conversations lead to a detailed understanding of each customer and thus offer insights from which to build a customer profile, a collection of information about a customer, including demographic data, attitudes, preferences, ad other behavioral characteristics, as defined by CRM goals. IN a very small business, the customer profiles maintained in the entrepreneur's head often constitute the company's CRM "database." At some point in a company's growth, however, it becomes impossible for the small business owner to continue to develop profile using this method alone. It is then time to turn to formal, computer-based databases.

Customer profile are essential to a successful CRM program, as they represent building material for the required knowledge of customers. Customer contact data, from sources such as warranty cards and accounting records, can be used to develop a profile. For Web-based ventures, current information can be collected at the point of contact, as customers order online.

.Transactions.A Complete purchase history with accompanying details such as price paid, SKU (which identifies the product purchased), and delivery date.
.Customer contacts.Sales calls and service requests, including all customer- and company- initiated contacts.
.Descriptive information.Background information used for market segmentation and other data analysis purposes.
.Responses to marketing stimuli.Information on whether or not the customer responded to a direct marketing initiative, a sales contact, and/or any other direct contact

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The fourteenth annual conference of the National Business & Economics Society will be held March 6 through March 9, 2013 at the Marriott Los Suenos Ocean Resort & Casino in Herradura, Costa Rica. NBES is a multi-disciplinary academic association which focuses on promoting interdisciplinary research of both a theoretical and practical nature. It includes scholars from the fields of Finance, Accounting, Marketing, Management, Information Systems, Operations Research, Economics, Public Health & Administration, Psychology and related areas. Our goal is to broaden the expertise of business school academics and other professionals by promoting access to research and ideas in all disciplines. For more information,click here.

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ICSB

It's time to start planning for the Southern Management Association's 2012 Annual Meeting. The SMA meeting will take place October 30-November 3, 2012 in Fort Lauderdale, Florida. The meeting will be held at the Westin Beach Resort and Spa. The hotel's waterfront location offers access to miles of beautiful white beaches, but is also close to shops, entertainment, and business centers. For more information,click here.

Southern Management Association

It's time to start planning for the Southern Management Association's 2012 Annual Meeting. The SMA meeting will take place October 30-November 3, 2012 in Fort Lauderdale, Florida. The meeting will be held at the Westin Beach Resort and Spa. The hotel's waterfront location offers access to miles of beautiful white beaches, but is also close to shops, entertainment, and business centers. For more information,click here.

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ICSB

International Council for Small Business will be holding its International World Conference during June 10-13, 2012 in Wellington, New Zealand. For more information,click here.

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