Measuring and benchmarking the innovativeness of small and medium enterprises: A three-dimensional fuzzy logic approach

SMEs have been rather slow in adopting tools and techniques used in larger companies for improving their innovative performance, even if they are very well aware of the importance of innovation, due to difficulties in applying them in their practices. Furthermore, initiatives on improving the innovation within the SMEs in the past, have addressed ways of improving the product innovation process, through a wide spectrum of methods, techniques and tools without quantifying the degree of change of ‘innovativeness’. The approach presented in this paper, addresses both these issues. In the first part of this paper, the most commonly used measures of innovation are presented, and the difficulties in applying them to SMEs are described. In the second part a new methodology is presented, which is based on measuring and benchmarking innovation with fuzzy logic, through an innovation survey. This is achieved by addressing three inter-related, but separately measurable, aspects of a company's innovation process – the products developed; the innovation process utilized; the way the product innovation process is project managed. The approach aims at improving the iterative process of innovation in a SME, by assessing innovation and determining a product innovation profile. Finally an example based on data from 100 companies coming from the creative industries sector is presented.