Not withstanding the announcement of the Knowledge Development Box in the recent Budget 2016, last year of the total business expenditure on research and development, circa 75% was carried out by foreign owned firms and only 25% by SME’s. So while the Knowledge Development Box is very attractive for large corporates and multinationals it doesn’t address some fundamental underlying problems that SMEs and Family Owned Businesses encounter. Lack of innovation represents a continuing barrier to growth for the small indigenous businesses, reduces long term profits and makes businesses uncompetitive. Here are 15 reasons for failure to innovate:
1. Lack of willingness to invest in upskilling, training and human resource development
2. Lack of strategic thinking
3. Absence of management capability
4. Third level institutions not seen as ‘SME-friendly’
5. R&D costs
6. Limited time resources
7. Lack of knowledge of available resources
8. Shortage of available funding
9. Lack of broadband penetration in the regions
10. Lack of awareness of tax benefits for R&D spend
11. Lack of global awareness, too insular in their thinking. Only 13% of SME’s export outside of the EU.
12. High cost of securing patents. Government needs to take major action on this point.
13. Lack of ambition in setting higher goals and objectives
14. Lack of understanding of the importance of coaching and mentoring
15. Poor quality cheap advisors
To identify the opportunities for growth in any businesses their must be strategic thinking. The completion of a strategic business plan can open up the way forward. For assistance in this contact Pat Sutton at firstname.lastname@example.org or call 045 530777.