Innovation is a contact sport, so what higher education does with local business really matters.

New maps show partnership is central to local growth

Anyone travelling from Land’s End to London or from the Cotswolds to Carlisle is aware of the changing geography from rural areas to urbanised sprawl, or from gentle undulation to steep-sided valleys.

The geography of UK business is less well-known. Particularly for small and medium-sized enterprises (SMEs).

Where in the UK, for example, do we find clusters of SMEs in creative industries? Or manufacturing? Or those where technology is an important element of their growth strategy?

Answering these questions has been the focus of the Enterprise Research Centre’s recent work for HEFCE, profiling different dimensions of the geography of England’s SMEs.

‘Innovation geography’

Our analysis is based on data for individual businesses collected by the Government and provided in secure form to the research community. In fact we do not actually know the name of any individual businesses or who works for them.

But we do know where firms are located, what services or goods they provide, and how they have grown in recent years. This means that for local areas – and subject to some rules around areas containing very small numbers of companies – we can profile the population of local businesses, what firms do, and how they have grown.

We have other data too which provides information on firms’ innovation activity – their introduction of new and improved products and services. This gives us another ‘innovation geography’ of England.

All this means that for the first time – and for any area in England – we can see very easily what sort of SMEs are most common, how local SMEs are performing and how active they are in terms of innovation.

Stimulating local growth

At a local level this type of intelligence can help universities and colleges to work strategically with local SMEs. And we know this really matters.

SMEs which work with external partners grow faster and perform better than those which go it alone. So universities have a potentially important role to play in stimulating local growth and innovation.

Tees Valley, for example, is one area of Northern England which performs well on our metrics for innovation and SME growth.

The area performs less well in terms of collaboration between firms and other organisations for innovation. On this metric, Tees Valley lags a little behind other areas.

And this matters too, as we know from other research that SMEs which collaborate develop stronger innovations than solo innovators.

This suggests that promoting collaboration – something which may involve universities – would help boost local innovation and growth.

The national picture

Our analysis should also be helpful at national level too.

Understanding the geography of England’s SMEs should help with targeting policy initiatives. It should also stimulate partnerships and help universities and colleges to share similar local challenges.

Where next?

We are interested to receive any feedback on this information and analysis.

Over the next couple of months we will be working for HEFCE, adding to the existing metrics by comparing the current profile of university-SME links to the SME populations in each area.

This will highlight areas of more and less intensive university-SME engagement across the country, enriching our understanding of the SME landscape.