Professional Documents
Culture Documents
ABSTRACT money;
The process of adoption of technological innovations in Small and – lack of supply side transparency;
Medium sized Enterprises (SMEs) is highly complex. Whereas – inhibiting external factors in the business environment (i.e.
SMEs are particularly important to the Dutch economy, the trust, security, etc.)
innovation potential of SMEs is still highly unused. Information
and Communication Technology (ICT) is seen as a modern SMEs are extremely important to the Dutch economy. According
catalyst for innovation. In this paper we propose the use of a to [3] the Netherlands have almost 700.000 companies, whereas
network of SMEs, industry organizations, intermediary parties only 1% has more than 100 employees. Therefore, more than 99%
and knowledge institutes, to achieve adoption of new information of private enterprises in the Netherlands are small and medium
and communication technologies. This proposed network is sized. SMEs account for employment of 2.3 million people (60%
motivated by our experiences in the ASPect project, which of the Dutch labor force) and 52% of national income in the
intends to enable the adoption and diffusion of Application private sector. Clearly, SMEs are a job engine for the Dutch
Service Providing within SMEs. We discuss the project’s economy.
organization, the results and effects and the lessons learned. The According to the Dutch Ministry of Economic Affairs (cf. [6]),
ASPect project thus serves as a case of how a knowledge network companies can improve their competitive position by using the
can foster ICT innovation. Finally, we argue that this knowledge opportunities of ICT. Low adoption of ICT might leave the
network may serve as a model for an R&D network of SME innovative potential of SMEs unused. This lead the Dutch
companies. government to develop a set of interventions and incentives that
aim at (a.o.) strengthening the communication infrastructure,
Keywords improving the knowledge infrastructure and improving the ability
Technology Adoption, Innovation, Application Service Providing, of citizens and companies in using new ICT developments. One of
e-business, SME. the ambitions of the Dutch government is to have a leading
position in Europe on the electronic highway in the year 2005.
201
subjects, such as electronic marketplaces, open source software sectors
Management and PR
and Application Service Providing. One of these theme projects Introduction line
SMEs
(ASPect) serves as a case in Section 2, where we discuss the
project’s organization and the obtained results. In Section 3 we
present a model of a knowledge network. Based on our sectors
SMEs
experiences in the ASPect project, we believe this model helps Knowledge line SME advisors
achieving adoption of ICT innovation amongst SMEs. We share market parties
202
In the course of the project 6 industry organizations were finally all project deliverables in detail: most of the material is disclosed
selected for participation. Criteria for selection were the via the ASPect website (cf. http://aspect.telin.nl).
professionalism of the industry organization, the number of allied The ASP brochures are meant as self-contained information
members, and (related to each other) the extent to which the material with a low ‘reading threshold’. The brochures are
selected industry organizations represent the Dutch SMEs in intentionally short and to the point, i.e. filling no more than two
general. The participating industry organizations were pages, elucidated with examples and checklists. The total of 30
– FOCWA: automobile damage repair and automobile body ASP brochures cover ASP-related subjects from very different
work, 2,100 members; viewpoints. These brochures are grouped along four thematic
– Koninklijke Metaalunie: metal processing industry, 11,000 lines: ‘ASP accents’, ‘ASP applications’, ‘The ASP life cycle’ and
members; ‘ASP innovation’ (cf. Figure 3). The brochures are available in
electronic and hardcopy form and can be ordered for free from the
– Uneto-VNI: installing companies and technical retailers, website.
6,000 members; ASP accents ASP applications ASP life cycle ASP innovation
– BOVAG ABA: independent garage owners, 3,200 members; Pros and cons Payroll Outsourcing of ICT The future
Technology Buying and selling ASP for me? Wireless access
– Mitex: fashion, shoes and sports retailers, 4,400 members; Security CRM Making the decision Web services
Applications & services ERP Getting started
– HBA: handicraft companies, 60,000 members. Organizational aspects Accounting In operation
Social aspects Security services When roads part
For each of these industry organizations it was investigated in ASP is quite common Demo’s
what way allied members can profit from ASP. Discussions with Risk control HRM
Customization Logistics
the boards and staff members led to global insights that were used Competences CAD
to formulate the questions for user surveys. These surveys SLA’s
provided insight in the ASP needs and possibilities in the Privacy
industries. The ASP-developments at the ICT-supply side were Figure 3 ASP themes covered in brochures.
also investigated for each sector. This knowledge was the starting
Experience of others (even of competitors) is an important
point for the industry organization’s strategic decision process,
inspirational factor for SME decision makers. For this purpose
which ASPect counseled. As soon as the goals were clear, an
approximately ten decision makers, who decided to actually let
outline of steps to be taken was made and formalized in a sector
their company use ASP, were interviewed. These user interviews
project plan. ASPect played an active role in the fulfillment of
were presented in brochure format. Also supplier interviews were
these sector project plans.
conducted, giving potential ASP clients a flavor of the ASP
Compared to each other, the industry introductions were of a very companies hidden behind the façade of their website. All user and
different nature. The main reason for this was of course that ASP supplier interviews are published on the ASPect website.
should be aligned with other ICT initiatives of the industry
The ASPect project developed decision support tools for SME
organization. One industry organization preferred an explicit role
decision makers and SME advisors. The ASP Toets-tool helps to
in the ASP partner selection process, whereas another industry
decide whether the company concerned can benefit from ASP.
organization just wanted to know the possibilities and benefits of
The tool guides the user through a set of questions, depending on
ASP for their sector. Each industry introduction, however, ideally
the goals the user wants to achieve or the problems he wants to
should at least have interaction with the industry organization’s
solve. The result of using the tool is an indication whether the
members in terms of interviews, surveys and publications in
company can benefit. If so, the tool offers a tailored steps plan.
sector periodicals.
Another tool, the COPAFIJTH Redeneertool, aids the user in
The diversity of needs from the industry introductions asked for a
systematically analyzing the effects of change. The COPAFIJTH
varied set of project deliverables. These deliverables should
acronym stands for Commerce, Organization, Personnel,
bridge the gaps between the levels of acceptance of the ASP
Administrative organization, Finance, Information, Juridical
model in the sector (cf. Figure 2).
aspects, Technology and Housing. COPAFIJTH represents all
What are the possibilities? Is it within reach? How to move market players? How to inspire others? important business aspects that might be affected by a change, for
What are the pros and cons? Where to start? How to move SMEs? How to keep it running?
example the introduction of a new technology such as ASP into
Unawareness Awareness Consideration Implementation Exploitation the organization.
Brochures Sector surveys and RfPs Knowledge base In the end, the effect of all efforts is what really counts for the
ASP interviews interviews
Pilots Knowledge transfer
ASP user experiences Supply scans mechanisms project’s success. This is hard to measure, because the project is
Market surveys Decision support tools ASP interest groups not performed under isolated laboratory conditions: the ASP
Website Feasibility studies market evolved during the project and also the adoption of web-
Publications Process facilitation
based applications (such as e-banking) gained momentum. It is
Workshops, courses
and events
therefore difficult to separate these autonomous factors from
factors that describe the impact of the project on SME adoption
Figure 2 Project deliverables related to levels of acceptance. and diffusion of ASP. Having said this, there still is evidence that
The following project deliverables will be discussed in some the project reached SMEs and SME advisors through many
detail: ASP brochures, ASP user and provider interviews, and different channels. The project received appraisal for its work
decision support tools. It is however not our intention to describe from industry organizations, market parties, SME advisors and
website visitors. Furthermore, the results of the project are
203
preserved in an ASP knowledge base, which will remain publicly 3.2 Lessons learned
accessible after the project has finished. From the ASPect project we learned a number of lessons that we
would like to share. These lessons might not only prove useful in
3. THE KEY TO ICT-ADOPTION knowledge networks, but for SME oriented ICT innovation
In the ASPect project we learned that it is hard to achieve
projects in general.
adoption of new information and communication technologies by
SMEs without the help of surrounding organizations, such as Involve industry organizations
industry organizations, knowledge brokers, supply chain partners Innovations are sometimes perceived by SMEs as a threat, rather
and customers. than an opportunity, because traditional roles may change. This
The ASPect project used a network of organizations, containing explains the conservative nature of some industry organizations.
industry organizations, a knowledge broker (Syntens) and a It is easier to involve industry organizations, if the innovation is
knowledge institute (Telematica Instituut). ASPs or software not only beneficial for allied members, but also for the industry
companies were invited to participate when opportune. We organization itself. Industry organizations need to keep their
advocate the use of such a network to facilitate ICT-adoption. members satisfied, and are often looking for ways to offer more
service and added value.
3.1 An SME knowledge network An active role for the industry organization guarantees more
SMEs do not actively monitor ICT developments. They need commitment, which may make the network more successful. On
external help to point out interesting developments. ICT the other hand, it can slow down the start up, as more time will be
companies have the knowledge, but also have a commercial spent on formulating the goals.
interest. SMEs need independent information that helps them
placing developments into perspective. ICT knowledge institutes For most industry organizations ICT is not core business. ICT
have an overview of ICT-developments and their general innovations may therefore have low priority. The path and time
importance. Industry organizations are able to assess the scheme for the knowledge transfer has to fit the industry
possibilities for new ICT developments in their industries. A organization’s general plan and time scheme.
broker organization can bring together industry organization and With each industry organization we agreed on a goal and wrote a
knowledge institute. Together they can create the knowledge plan to realize it. To emphasize the importance of the industry
desired by the SMEs. organization’s commitment, we signed a declaration of intent.
In preparing the innovation path, one will often deal with the
ICT company
organization’s staff members. The board, however, usually takes
the decisions. The board represents the allied members and
consists of opinion leading entrepreneurs. It is important to attain
Knowledge Knowledge
broker institute commitment from both staff members and board, right from the
beginning. Often, there is only one staff member for ICT. In this
case, it is even more important to attain commitment from the
Industry board.
organization
Involve ICT suppliers
Demand needs supply. It is of no use to inform users about new
SMEs ICT developments if these are not available on the local market. It
is therefore sensible to involve intended ICT suppliers in the
process.
Business In the ASPect project it turned out that SMEs in the ICT industry
Customers
partners also need knowledge on new developments. We received many
requests for information and help. These suppliers showed a great
Figure 4 A model for an ICT knowledge network. willingness to cooperate in a knowledge network.
Some knowledge brokers, like Syntens, are in close contact with Take time to build the relation network
the individual SMEs. They could disseminate the knowledge
directly to the SMEs. Besides this direct channel, we advocate to It takes time to get the network running, specially if the
involve industry organizations in the dissemination. Industry innovation subject is not demand driven and interest for
organizations play an important and sometimes even pivotal role participation still has to be raised. ICT investments are often
to encourage innovation in their sector. Allied members ask for a driven by necessity. Expansion, pressure from customers or
sector vision and trust the industry organization’s opinion. suppliers, and the need for new functionality are typical drivers
for ICT innovation.
Generating general information on ICT-developments is not
enough. SMEs prefer a personal advice and a referral to an ICT- There is a large heterogeneity between Dutch industry
supplier. ICT knowledge institutes can investigate which ICT organizations. There are considerable differences in size, i.e. the
suppliers are active on the local market. Knowledge brokers can number of members, the size of industry organization’s staff, and
involve intended ICT suppliers in the process and establish direct the degree of professionalism. These differences are important for
contacts between SMEs and suppliers. the pace of decision taking.
204
The broker organization should already have relations with either unused potential is the fact that SMEs have insufficient access to
the SMEs or the industry organizations. A new relationship must new knowledge. Only 2% of Dutch SMEs have a knowledge
be built between broker and knowledge institute. Individual relation with knowledge institutes such as universities and
advisors must learn what knowledge is available at the knowledge research institutes. The Netherlands lacks an adequate knowledge
institute. An initial set of information material is therefore a infrastructure, i.e. a system for circulation, diffusion and
prerequisite. application of knowledge. Too many companies do not have
All available means and channels to reach industry organizations access to new knowledge. New combinations of knowledge are
and SMEs should be used. Try to give the new development its required. Knowledge, and in particular the exchange of
own place in existing interventions. In the ASPect case, for knowledge, is therefore the key to innovation in the unfolding
example, the ICT scan that Syntens offers to industry knowledge economy of the Netherlands.
organizations now includes an ASP scan. According to Ravesloot (cf. [10]), Dutch SMEs need to know
For knowledge institutes a survey is an effective way of which new technologies and other innovative ideas will be
contacting industry organizations. Apart from measuring interest interesting and can be made applicable in the coming 2 years.
of industry organizations, a survey also results in a list of potential Large enterprises often have R&D departments that monitor
organizations that can be invited to participate in the network. scientific developments and scout opportunities. Some
opportunities are the result of several new developments that can
Tailor communication to the SMEs be combined. Usually, it takes a series of development steps to
Industry organizations know channels to reach the SMEs. They translate the knowledge into a concrete product or process that
often have their own media, like newsletters or magazines. The can be handed over to production.
industry organization itself is the best channel for direct contact. This R&D approach of large enterprises is not suitable for SMEs.
Tailor information material to the SME’s context and use sector SMEs do not monitor scientific developments the way R&D
specific examples. SMEs are inspired by examples that reflect as departments do. They need external help to point out interesting
close as possible their own situation. developments. These developments must be presented to the
entrepreneur in an understandable way. Contact must be made
Information material aimed at SMEs should be short, to the point
between an interested SME and the knowledge institute behind
and in the native language. In the ASPect project the information
the development. Most likely, the development process will not
was disseminated in short brochures, each one answering a
only involve a knowledge institute and the SME that is going to
specific question or taking a specific point of view.
produce or use the final result, but also enterprises that carry out
Questions about costs and benefits always arise. Anticipate by part of the development. These parties have to find each other first
answering them up front or having the answers ready. and then cooperate and communicate. Therefore they have to
Seeing is believing: success stories are a convincing means to speak each other’s language.
spread the use of new technology or methods. The closer the story A knowledge network, similar to the one we advocated for ICT-
approaches the entrepreneur’s situation, the more effective it will adoption, might bridge the gap between SME and knowledge
be. institute.
Knowledge Knowledge
4. KNOWLEDGE NETWORKS FOR R&D broker institute
The Dutch government has given priority to innovation. Based on
the Lisbon EC-treaty (2000), the Netherlands wants to belong to
the top of Europe as “the most dynamic knowledge based Industry
organization
economy in the world”. The ambition is to reach an R&D
expenditure of 3% of GNP by 2010. In 2002 the Dutch R&D
expenditure according to [9] was 2.02% of GNP, well below the
3% target. According to the Netherlands Bureau for Economic SMEs
Policy Analysis (CPB) (cf. [5]), the Dutch economy has
specialized in R&D-extensive industries, which accounts partly
for a relative low R&D-expenditure (compared for example to Business
Customers
Scandinavian countries). Still, the Netherlands performs well in partners
terms of inventions and takes a third place in terms of scientific
publications per citizen, just behind the USA and Switzerland. Figure 5 An SME knowledge network for R&D.
Note that, innovation is more than R&D alone: think of process The knowledge institute creates scientific knowledge and has
innovation and service innovation. This lack of accurate access to such knowledge created by other scientists. As argued
innovation figures may distort the discussion on the innovative above, an SME needs someone to point out the interesting
power of the Netherlands. developments. The knowledge broker can play this role. To
In the introduction to this paper we stated that SMEs are realize the development chain, parties have to find each other. As
important to the Dutch economy. According to [13] SMEs are there are few contacts between SMEs and knowledge institutes,
responsible for no less than 80% of the innovations in the help is also required here. The broker may bring SMEs and the
Netherlands, whereas only 7% of the SMEs is involved in knowledge institute together. For this, the broker can use the help
realizing these innovations. These figures point to an unused of the industry organization. The industry organization is able to
innovation potential. One of the factors responsible for this assess the feasibility of innovations in the sector and to involve
205
SMEs in innovation projects. For cooperation in the development 7. REFERENCES
chain it is necessary for the knowledge institute to present its [1] ASPect, Telematica Instituut: http://aspect.telin.nl .
results in an accessible way.
[2] Boekhoudt, P. Software uit de kraan. NextEconomy,
Innovation is stimulated if the SMEs not only absorb information November 2003, 36-38.
from knowledge institutes, but also feed the institutes with their
needs. Knowledge institutes may use this to steer their research [3] Centraal Bureau voor de Statistiek (CBS, Statistics
programs. Again, industry organizations play an important role in Netherlands): http://www.cbs.nl
this information stream. They know what is going on in their [4] Centraal Bureau voor de Statistiek (CBS, Statistics
sector and know the needs of their allied members. They may set Netherlands), De digitale economie 2003, Voorburg/Heerlen,
future directions and stimulate innovation in the industry. One 2003.
innovation induces others. Finally, industry organizations share http://www.cbs.nl/nl/publicaties/publicaties/bedrijfsleven/alg
innovation results and experiences with other entrepreneurs. emeen/p-34-03.pdf
This collaboration in a knowledge network is not common [5] Cornet, M., and Gelauff, G. Innovation Policy. Netherlands
practice yet. The ASPect project is an example of how Bureau for Economic Policy Analysis (CPB), Den Haag,
governmental financial incentives might resolve this problem of 2002. http://www.cpb.nl/nl/cpbreport/2002_2/s2_3.pdf
knowledge market failure.
[6] Dutch Ministry of Economic Affairs, Plan van Aanpak ‘Het
MKB in de Digitale Delta’. Report, Den Haag, 2001.
5. CONCLUSION http://www.ez.nl/upload/docs/Kamerbrieven/PDF-
The ASPect project used a network of organizations to achieve Documenten/01033996-bijlage.pdf
the adoption of ASP (Application Service Providing) among
[7] Iacob, M-E., Boekhoudt, P. and Ebeling, F. Helping SMEs
SMEs. This turned out to be a successful approach. Knowledge
to Engage in Electronic Commerce: The Dutch Way.
brokers and industry organizations are essential links between ICT
Accepted for publication in E-Business, Government and
industry and knowledge institutes on one side, and individual
Small and Medium-Sized Enterprises: Opportunities and
SMEs on the other. In this project they mainly facilitated
Challenges. Idea Group Publishing, Hersey, 2004.
knowledge dissemination. However, once the network has been
established, SMEs also have a channel to ventilate their needs. [8] Mensen, A.H.H.M and Van Rijt-Veltman, W.V.M. De
Kortste Route naar een Kennisrijk MKB: Onderzoek naar
All parties involved did benefit from the cooperation. The ASP-
Effectieve Kennisoverdracht naar het (Procesvolgend) MKB.
concept received much attention, which was beneficial for the
EIM, Onderzoek voor Bedrijf & Beleid , Zoetermeer, 2003.
application service providers. As a knowledge institute, we found
http://www.eim.net/pdf-ez/A200209.pdf
many new channels to disseminate our knowledge towards SMEs.
The knowledge broker updated its advisors knowledge on ASP [9] Nauta, F. and Steenhoven, J. Time to Choose:Knowledge
and added new parties to its relation network. The participating Economy Monitor 2003. Stichting Nederland Kennisland,
industry organizations gained enough insight to determine their Amsterdam, 2003.
strategic position with respect to ASP. A number of them plan to http://www.kennisland.nl/kennisland/binaries/KLsite/bron/k
offer ASP-advice or services to their members, enhancing their m2003/KL_Knowledge_Economy_Monitor_2003_lowres.pd
service portfolio. The SMEs gained an easy channel to learn about f
ASP. [10] Ravesloot, K.A. Tienpuntenplan Innovatie, MKB Nederland,
We strongly believe that this model works for all ICT innovation Delft, 2003.
among SMEs. We encourage others to copy our approach. In this http://www.higherlevel.nl/yabbse/attachments/Tien_punten_
paper we shared some useful lessons with those that want to plan_innovatie.pdf
follow our approach. [11] Snelders, H.A.J., Eecen, A.M.D., Electronisch Zakendoen:
Finally, we think the same approach can be used to stimulate 3-meting, NIPO, Amsterdam, 2003.
innovation in other areas than ICT. Knowledge brokers and http://www.ez.nl/upload/docs/nieuwsbijlage/pdf-
industry organizations can help build a network or chain of SME documenten/microsoft word - electronisch
companies for R&D activities. zakendoen3(1).pdf
[12] Social and Economic Council of the Netherlands (SER),
6. ACKNOWLEDGEMENTS Interactie voor Innovatie, Den Haag, 2003.
The authors would like to thank the ASPect project members for http://www.ser.nl/_upload/databank_adviezen/b22254.pdf
their direct and indirect contributions to this paper. The Dutch [13] Syntens, Innoveren met passie. Innovisie, 14, 3 (Sept. 2003).
Ministry of Economic Affairs, under the flag of ‘Nederland gaat
digitaal’, financed the ASPect project.
206