Support Services To SMEs in Germany, Greece, Ireland, Italy and Sweden - A Comparative Study

Support Services to SMEs in
Germany, Greece, Ireland, Italy

and Sweden
A comparative study
Unioncamere
Unione Italiana
delle Camere di Commercio Ministero dell’Industria,
Industria Artigianato Commercio e Artigianato
e Agricoltura
With the financial support of the European Commission, Enterprise Directorate General
Table of contents
Page
0. Executive summary 1
1. Background, characteristics and expected contribution of

this report 3
1.1 Background 3
1.2 Characteristics and expected contribution of this report 3
2. Comparisons among countries, following the country

reports’structure 5
2.1 General overview 5
2.2 Demand structure 6
2.3 Most (and least) required services 7
2.4 Suppliers' characteristics 8
2.5 Best practices 10
2.6 Proposals 11
3. Summaries by country 12
3.1 Germany 13
3.2 Greece 18
3.3 Ireland 22
3.4 Italy 26
3.5 Sweden 32
4. Preliminary interpretation and suggested actions 37

4.1 Why this market is important 37
4.2 Why do SMEs need services 38
4.3 Main problems 39
- Phase 1: searching a provider and awarding the assignment 39
- Phase 2: service delivery 40
- Phase 3: Evaluation of the performance of the delivered service 40
4.4 Specific highlights on service quality 40
4.5 Specific highlights on visibility 41
4.6 The role of public vs private providers 44
4.7 Recommendations, conclusions and suggested actions 45
4.8 Specific details about one of the most important
recommendations 48
Appendices
1. Analysis of the Market of Support Services with the View of Improving its
Efficiency in the Context of the Working Group on the Visibility and Quality
of Support Services
2. Proposal for a classification of support services (excerpt from the Interim
Report to the Steering Group - Concerted Actions n. 2 & 3 – Brussels,
2.12.1999)
0. Executive summary
This report represents the final step of the “synthesis” phase of a pilot project 1 sponsored by the
European Commission within the framework of the Concerted Action Working Group on the
Visibility and Quality of Support Services aimed at identifying common methodologies for the
realisation of a better matching between demand and supply of quality services to SMEs.
Concerted Actions is based on a methodology where the Member States and the Commission
together identify and promote the exchange of best practice. It has looked at several different
areas, one of which is the visibility and quality of support services.
The report has the objective of summarising, interpreting and reconciling the findings, conclusions
and recommendations made in different research reports on the current status of the “market of
support services to SMEs”, produced by five European countries (Germany, Greece, Ireland,
Italy, Sweden).
All the research studies described in these reports were conducted with different approaches and
methodologies (sample sizes, information collection methods, etc.), from very different market
and cultural perspectives, and obviously suggest relatively different conclusions and
recommendations that are all very meaningful within their respective contexts but can not be all
implemented in the same way on a European basis.
The recommendations presented here therefore represent a compromise and attempt to interpret
and reconcile the various views in order to identify some priorities and common guidelines for
action. They are classified in the following three major categories:
1. measures aimed at improving the conditions for a better service delivery
2. measures aimed at improving the ex post evaluation of the quality of the delivered services
3. measures aimed at improving the outcomes and results of the support service initiatives in
the follow-up phase.
It is also suggested that the implementation of most of these measures should be:
• introduced selectively and according to specific priorities, depending on the relative

attractiveness and potential of the targeted industries and firms
• standardised, at least to a significant extent, across countries
• supported by the use of advanced information technology tools
• supported in various ways by the public sector.
1
The project was one of the outcomes of the Concerted Actions 2 & 3 (“Measures aimed at supporting firms: the
creation and the assistance to new firms”, Madrid, 16-17.11.1995, and “Increasing the visibility and effectiveness
of real services to SMEs”, Dublin, 18-19.11.1996) and of an international conference on “Identification of
suppliers of quality services to SMEs” (Rome, 4-5.2.1988 – proceedings collected in the Unioncamere publication
“Collana Profili n. 59). As a result of this conference, a European Working Group was created c/o the European
Commission.
Market of Support Services – Final Report – 2000
Page 1 of 49
In particular, it is suggested that one of the major prerequisites for the identification of priorities
agreed upon by all the interested countries and parties, and for the creation of the conditions for a
better service delivery, would be a systematic classification of services and segmentation of target
users, in order to assess the attractiveness and convenience of alternative ways of allocating
resources (especially, public funds) among segments.

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1. Background, characteristics and expected contribution of this report
1.1 Background
The preliminary phase of the project, conducted by five European countries (Germany, Greece,
Ireland, Italy, Sweden), consisted in the collection of data 2 and information about the current
status of the “market of support services to SMEs” in each country (the original reports
describing the various research surveys are made available separately 3).
The participating organisations were the following: Deutsche Ausgleichsbank (DtA) and
Deutscher Industrie und Handelstag for Germany, Eommex for Greece, Enterprise Ireland for
Ireland, Unioncamere for Italy, Swedish National Board for Industrial and Technical
Development (NUTEK) for Sweden.
Based on the analysis and a preliminary interpretation of the country reports’ findings (derived
from data collected with different methodologies and according to different research criteria by
the various countries), combined with the interpretation of the most relevant research literature
on the subject and of previous reports and experiences, the report provides a series of tentative
conclusions and recommendations.
1.2 Characteristics and expected contribution of this report
The characteristics and the expected contribution of this report can be evaluated from two major
perspectives:
• as a summary of other reports, and apart from our own weaknesses, this report inevitably
suffers some of the limitations of those reports, that we briefly summarise here:
• the findings contained in the reports are only related to the information collection
activities conducted for this specific project 4, and do not take into consideration a very
significant amount of other potential contributions to the issues of interest (in particular,
reports produced by the Commission in previous years, experts’ opinions, reports
produced by qualified research institutions and all the relevant academic and managerial
literature on services to SMEs)
• in order to compare the various reports’ findings (which was one of the major objectives
of our assignment) we had to significantly rely on our own judgement (that can obviously
be biased), since the reports were, in fact, not comparable (lack of homogeneity in terms
of structure, type and dimension of the samples of respondents, ways in which the
information was collected, manipulated, analysed and presented and, in particular,
measurement scales adopted – or not adopted); this was a result of the fact that although
2
The specifications for the phase of information collection are presented in Appendix 1.
3
These reports will also be accessible via the Enterprise DG’s website concerning Concerted Actions:
http://europa.eu.int/comm/enterprise/entrepreneurship/concerted_actions/index.htm
4
Apart from one report, that mainly refers to a research project conducted before the beginning of our project.
Page 3 of 49
a common methodology was agreed by the working group, the studies in fact responded
to the different situations in the different countries and consequently developed different
approaches.
§ as an account of a process in which a co-operation among different countries was attempted,

and as a memorandum of potential methodological solutions for the future, we think that the
report submits to the attention of the Commission and of all the interested parties some
potentially interesting issues and proposals.
Overall, we believe that the experience and the process that originated this report were very
stimulating and fruitful, especially in view of future initiatives aimed at:
• providing SMEs and all the interested parties with effective and applicable solutions
• using in the most efficient way the resources made available by the Commission.

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2. Comparisons among countries, following the country reports’structure
In this chapter we attempt a comparison among countries, with reference to each major issue
addressed in the reports. The limitations mentioned in the previous chapter (in particular, lack of
homogeneity in the various reports’ structure) suggested to limit our comments to a concise
description of the most evident aspects: each country’s picture will be covered in more detail in
the next chapter and, in any event, it would have been redundant to replicate the exhaustiveness of
the individual country reports, that are selectively accessible by all the interested parties.
2.1 General overview
It is clear that the countries of interest have their own economic background and context that
affects positively or negatively their performance in delivering services to SMEs.
While Germany has a consolidated economy and a leading position in the European consulting
industry, the young economy of Ireland is relatively more open, dynamic and subject, to some
extent, to the other economies’fluctuations.
Another case is Greece that, after having experienced a difficult economic period, has
undoubtedly improved its position in the European context; other peculiar characteristics of its
context are the high concentration of the most important industry sectors in the Athens and
Thessaloniki area and a shortage of specialisation in information technologies.
Italy, Germany and Sweden have quite stable economies, significantly developed in the service
area. In particular, Sweden has a well organised public sector, that parallels equally dynamic
private initiatives.
The overall picture that emerges from all the reports shows a significant growth of the services
sector, both in terms of number of new companies and in terms of new jobs: statistics from some
reports (i.e. Germany, Ireland and Italy) confirm that revenues and turnover have been
increasing over the last four years.

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2.2 Demand structure and behaviour
Support services were considered both from the point of view of the supply of services and the
perception by the users (demand).
A relatively common demand characteristic that emerges from all the reports is a lack of
managerial attitudes and skills, normally balanced by a strong entrepreneurial drive that, however,
needs to be supported, especially during the start-up phases (public agencies, especially in Sweden
and Germany often perform this “tutoring” role).
The most common “conscious” reason why firms ask for help is a lack of specific know-how in
the different areas of management but, on the other side, firms are quite sensitive to the price of
services: the ratio price/quality is perceived to be too high in most countries (notably in Greece,
Ireland and Italy).
This is probably due, to some extent, to the fact that the value of services is not adequately
perceived in these countries, while in Germany and Sweden firms tend to appreciate this value
more easily.
An underlying cause of the inability to appreciate the value of services could be represented by a
poor visibility of the service providers: SMEs often face difficulties in the identification of
suppliers that can satisfy their needs, both in terms of skills and in terms of willingness to provide
the services in the required way: this finding is particularly evident in the Irish and Greek reports.
More frequently, in all the interested countries, the interaction between SMEs and providers is
triggered by traditional (but very effective) factors such as word-of-mouth. On the contrary, other
communication tools like traditional advertising and Internet have a marginal impact (in some
countries like Italy, this could also depend on the fact that professional organisations in most
sectors are not allowed to advertise themselves).
Another obstacle to a mutually beneficial interaction between SMEs and service providers is
represented by the fact that firms do not have any assurance about the characteristics and quality
of services, nor they can use relatively objective criteria for assessing them: this aspect is
mentioned in all the reports, except for the Swedish one.

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2.3 Most (and least) required services
In the figure on the following page we tried to summarise and compare the information and data
contained in the various reports, with specific reference to the type of services required by the
potential users 5.
The information about this figure is based on questions that vary slightly from country to country.
On a common ground, the questions are:
• What are the services needed by your enterprise?
• How often do you use these services?
The services most in demand are those related to the financial, accounting and legal sectors, that
are perceived as (and normally are) vital for the firms, and often are compulsory 6.
It is relatively strange to see that “training and education” services 7 are not very popular, taking
into account the fact that firms claim that the lack of specific know-how is one of the main
reasons why they ask for assistance.
It is more difficult to interpret the “performance” of other services. Obviously, the choice of
services depends both on the firms’ characteristics and the economic context in the different
countries (including suppliers’ structure), but taking into account the lack of homogeneity in the
collection, manipulation and presentation of the original data, any interpretation from our part of
the reasons why some services are more or less in demand would be very arbitrary.
We therefore leave this task to the originators of the data, who know their country situation much
better than us, and we limit our contribution, as far as this aspect is concerned 8, to a simple
description of the histograms 9:
• in Germany there is a significant demand for most services, with the exception of training and
export assistance
• in Greece, the demand seems to be particularly relevant for marketing/sales and financial/legal
services
• in Ireland, the demand seems to be, overall, relatively smaller, except for technical services
and export assistance (in addition to financial and legal services, which are very popular
everywhere)
5
As already mentioned, the information presented in the reports was not very homogeneous, also in terms of
statistical reliability (please see, for example, the very small sample of firms surveyed in Ireland). We therefore had
to compromise from various standpoints, in order to make data comparable: classification of services (number and
type of aggregations), adopted scales and scores assigned to the various countries on the various service categories.
In some reports some data were missing, and therefore could not be considered: this does not mean that the related
services were not requested or offered.
6
Please refer also to the classification we had suggested in the interim report of 2 December 1999, that however
could not be adopted in this summary.
7
Please refer also to the proposed classification presented in Annex 2.
8
Our comments and interpretations will be mainly included in the 4th chapter.
9
We do not comment the “other” category, since it includes various types of services.
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Fig. 2.1 – Most (and least) required services
6
7:most required
4
1: least required -
Germany
3 Greece
Ireland
2 Italy
Sweden
1
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• in Italy and Sweden firms seem to require similar services, except for sales (higher demand in
Italy) and export assistance (higher in Sweden).
Overall, the reports point out that a better specialisation, accessibility, reliability and efficiency of
suppliers would probably facilitate a higher demand growth.
2.4 Suppliers’characteristics
The role played by the public and semi-public sector versus the private one is variable depending
on the country considered.
Sweden seems to be the best organised country from this perspective, with a quite wide range of
support services provided at both national and regional levels. In Ireland the public agencies play
a crucial role in assisting firms in the various stages of their development.
Other countries like Germany and Italy have more diversified public structures, probably due to
the relevant complexity and limited homogeneity of their economic systems (please refer also to
the next chapter): overall, the public sector has the advantage of a more homogeneous geographic
distribution of services than the private one. In Greece, as mentioned above, the highest
concentration of support service provided by the private sector is in the Athens area. In Italy, in
Milan and Turin area.

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All the countries promote, especially with public initiatives and structures, projects aimed at
helping firms’ development (both SMEs and providers): for example, in Italy there are several
projects aimed at favouring the creation and development of new entities in the tertiary sector all
around the country (this sector represents about 70% of the national employment).
Different strategies are used by firms, agencies and/or institutions to make themselves visible.
Generally speaking, the public sector has more institutional communication channels with their
potential and actual customers, the use of Internet is nearly absent or marginal, with the exception
of some cases (again Sweden).
Private suppliers use more personal and traditional methods for stimulating the demand: seminars,
exhibitions, direct marketing, etc.
The respondents to the questionnaires in the five countries complained about the lack of personal
contacts both in the start-up and in the follow-up phases of their development.
As far as the important issue of EU quality standards is concerned, the reports present divergent
opinions. In Ireland, Greece and Germany respondents believe that a precise and measurable
standard in service delivery would benefit suppliers in terms of visibility and better perceived
value.
In other countries like Sweden and Italy, quality standards are not considered strategically
important for the creation and stimulation of the demand.
The German report suggests that standards should be set and managed by the interested
categories (within their industry sectors), following some general guidelines established at EU
level.
In any event, in nearly all countries it seems that there are self regulated codes that guarantee the
ethics and professionalism of the persons or companies that carry out the services, and sometimes
also minimum standard of quality (which, however, are not precisely defined in the reports).

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2.5 Best practices
The willingness to help and assist new SMEs, especially in their start-up phase, is mentioned in all
the reports: clearly, as said above, these initiatives are especially carried out by public entities.
As far as the visibility and promotion of suppliers are concerned, Eommex in Greece and
Unioncamere in Italy seem particularly active:
• Eommex created a co-operation network between the public and private sectors, and hosts
suppliers on its web site, in order to facilitate their visibility and accessibility
• Unioncamere created and maintains an electronic directory (“Repertorio”) of suppliers on its

web site.
Other Italian programs favour the creation of SMEs on a national scale:
• the SEPRI (Servizi Promozionali per le Imprese)Project is co-financed by the European

Union with the aim of assisting 1000 firms in the start-up and consolidation phases
• the LETE (Lecce-Teramo)Project aims at favouring technological innovation and processes

and at improving the SMEs financial management skills.
In Germany, in addition to the national programs that support and assist the youngest firms, the
DtA/DIHT (Deutscher Industrie und Handelstag) sponsorship model seems to be particularly
innovative: it is a sort of “voluntary organisation” of tutors or coaches to new firms that want to
improve their competitive position (the organisation is made of professional consultants who are
available to freely help SMEs that require their assistance).
Ireland too has interesting national programs aimed at supporting SMEs.
In particular, Enterprise Ireland is a new development agency with the specific purpose of
providing a “one-stop-shop-service” addressed to some key managerial functions of the assisted
firms: strategic planning, manufacturing processes and marketing.
Sweden is among the countries with the highest ratio of per-capita investments in technology, and
is planning the realisation of new programs in this area.
The country aims at reducing the importance of public intervention in the service sector and
promotes the development of clearly defined professional services (including the specification of
the time needed to perform the services), in order to optimise the use of firms’resources.

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2.6 Proposals
Even though each country differs from the others in terms of socio-economic and political
context, all the reports seem to share the opinion that the development of the service sector
deserves a rational and systematic attention 10.
The major issues discussed under this chapter are the following (please see more details in the
following chapters):
• the improvement of the visibility of services

• a better territorial distribution of services
• the definition of quality standards or, at least, of common guidelines for the assessment of
service quality and performance
• the creation of research forums
• the definition of national fiscal and/or financial policies aimed at favouring the development
and the consolidation of the service sector.
The German report suggests the creation of a “forum” on a EU scale, with the purpose of
conducting research projects on the current and projected market situations. It also suggests the
creation of a Commission of experts who would have the task of discussing and addressing, at the
EU level, new economic policies and market strategies. Furthermore, Germany proposes to make
available to the other partners its experience and the efficiency of some of its agencies (such as the
“voluntary assistance” to firms).
The Greek report emphasises the importance of improving the visibility and the quality of services
(and therefore, of the skills and competencies of service providers), in order to improve the
competitiveness of the SMEs system. It suggests the definition of quality standards that could
contribute to a more homogeneous market structure.
The Italian report suggests the creation of a communication network among EU countries in
order to make the service sector more “European”11. It also points out the need for a better
national organisation of this sector, that would also address a better homogeneity of the
territorial presence of suppliers, in order to make services more accessible to the SMEs.
Finally, the “forum” project is also sponsored by the Swedish report, that also promotes a better
sharing of know-how among the various economic actors in the different countries: it would be
useful to launch a research project sponsored by the EU, specifically addressed to a better
exploitation of information technologies (and, particularly, of the new media) for improving the
sector’s performance and competitiveness.
10
As a matter of fact, this opinion reinforces our conviction that research programs in this area should also be
conducted according to systematic and homogeneous methodological approaches.
11
Some experiences already exist in this area: please see, in particular, the Netprise project, designed and managed
by an Italian consulting firm and sponsored by several Italian and German Chambers of Commerce (we are adding
this piece of information, not contained in the Italian report).
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3. Summaries by country
In this chapter we present a detailed summary of the information contained in the various reports,
arranged by country and, within each country, by subject.
The classification of subjects corresponds only in part to the reports’ structure 12 and the
information is presented in tables, in order to facilitate comparisons and an overview of each
report in few pages 13.
12
For analytical purposes we found useful to classify the information, both for the supply and the demand, in the
following categories (often used for designing and interpreting research frameworks – including questionnaires):
structure, behaviour and dynamics, performances (for the supply) and degree of satisfaction (for the demand).
13
However, especially in this chapter, we tried to be as objective as possible in summarising the comments and
conclusions of the five reports, limiting our own comments only to some cases in which the reports’ findings could
sound contradictory: also the language and the style reflect this choice, and therefore could seem, in some
instances, rather inconsistent with those adopted in the other chapters.
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3.1 Germany
Germany: Supply side
Structure
Kind of Type of • The industry of management consulting is extremely
suppliers and providers 14 heterogeneous in terms of structure and size of firms. Apart
services from the independent consultants, there are medium-size
supplied consulting firms as well as large consulting companies.
• The structure of the consulting industry is characterised by a
large number of young enterprises
Characteristi Public and private sectors are both effective and organised.
c of the The private sector has a leading position in Europe for commercial
market management consulting.
(public/priv.) The public sector consists of:
• Chambers of Handicrafts and associations of the craft sector

• Deutsche Ausgleichsbank.
• “Kreditanstalt für Wiederaufbau (KfW)”
In the semi-public sector:
• Chambers of Industry and Commerce,
• Euro-Info-centres;
• Reorganisation and Innovation Centre of the German
Economy.
There are other support institution such as:
• Federal Agency for Information about Export;
• Industry Associations;
• Credit Institutes;
• Local technology and start up centres;
• Municipal economic development agencies.
Geographic Presence on Providers are dispersed over the entire territory of the Federal
profile the territory Republic of Germany, but there are clusters in the metropolitan
areas.
Size and Total 18.8 billion DM (referring only to the private providers).
importance turnover
of the
service’s
sector
Percentage of
GDP
Number of
Employees
Size of firms Average
turnover in
EURO
Average
number of
Employees
Legal issues Special In Germany there are no barriers to entry in the consulting
regulations industry. No prerequisites are needed for practising a consulting
15
activity. There are no legally recognised professional standards.
Every provider can use the qualification of “Management
Consultant” regardless his experience and/or qualification.
14
Individual consultants, small firms, etc. providing a single or few kinds of services vs. a huge range of different
services.
15
Grants and/or other incentives, included special agencies set up for that purpose.
Page 13 of 49
Germany: Supply side (continued - 2)
Behaviour and
dynamics
Methods • means of direct communication such as recommendations,
used by references, personal contacts, seminars, etc. are used rather
suppliers to regularly
make • means such as presentations on the internet and expert
themselves conferences, direct mailing, etc. are used rather sporadically
visible • more generic means of advertising (newspapers, phone books,
etc.) are practically never used
These choices reflect what consultants think about the effectiveness
of each way of communicating.
The survey shows that consultants seldom advertise individual
services in particular.
Relationships • The majority of consulting firms surveyed delivers services
and co- both on call of their customers and based on appointments
operation clearly contractually set ex ante
between the • Usually the location of service delivery is the business location
parts of the enterprise seeking advice
Transparenc • Most consultants stick to the common practices in the
y (price… ) consulting industry. About one third of the firms surveyed
arranges prices depending on individual preferences.
• Most consultants deliver the service personally (the support of
other parties is often seen by customers as a probable increase
of costs)
Need for EU • It is a largely shared opinion that precise and measurable
standards quality standards would lead to an expansion of the demand
for consulting services.
• The majority of suppliers (53.8 %) of management consulting
services thinks that introducing minimal standards of quality
on a European level is a reasonable approach, particularly in
the areas of advising and training.
• the suppliers consider trademarks and quality standards as the
most effective means toward a better information about the
quality of consulting services.
Performances
Main It is almost impossible for providers to make the value of services
problems visible to potential customers before its concrete delivery.
Visibility Although the situation is not dramatic, the visibility of providers
seems to be one of the main problems (firms point out difficulties
in finding a suitable provider for the service they are asking for)
Ability to • Some customers complain about a mismatch between the
meet service they would have needed and had asked for and the one
customers’ they got.
requirements • Suppliers emphasize the importance of professionalism in
their dealings with customers and maintaining flexibility when
changes in the tasks performed become necessary during
service delivery.
• Overall performance is generally judged as somewhere
between good and satisfactory
Presence of With reference to quality standards, the sample considered shows
self regulated that almost 60% of consulting firms use criteria developed only for
code of ethic their own firms. Half of the consulting firms complies with the
or standards norms customary in the industry. ISO 9000 has a very low
importance, relatively speaking. An important issue is the
membership in the BDU. Please refer to par. 4.1.2.1 of the German
report.

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Germany: Demand side
Structure
Sector (mix)
Presence on
the territory
Size of the Total
demand turnover
sector
Percentage of
GDP
Number of
employees
turnover in
EURO
Avg. number
of employees
Behaviour and
dynamics
Reasons for • Consulting services are typically acquired when significant
looking for changes have to be managed or have to be coped with.
external From the survey, the main reasons seem to be:
support • Lack of know how (74.1%)
• No resources (quantitatively) (70.5%)
• External services are less expensive (30.7%)
• Quality and speed advantages ( lower percentages)
Methods The users in the survey usually search actively for their providers.
used to look In this search, they pay particular attention to recommendations
for a service of other people.
provider When looking for suitable consulting firms, users do not react very
frequently to marketing.
Firms (especially small and medium-sized ones) have a certain
preference for obtaining the services they need from a provider
located in the same area (region or Bundesland), but real
differences emerge between services obtained in Germany and
those obtained abroad.
Need for a • It is a largely shared opinion that precise and measurable
EU quality quality standards would lead to an expansion of the demand
standard for consulting services.
system • The majority of users (54.9 %) of management consulting
services thinks that introducing minimal standards of quality
on a European level is a reasonable approach, particularly in
the areas of advising and training.
• Users emphasize the opportunity of a clear definition of costs
and benefits

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Germany: Demand side (continued - 2)
Satisfaction
Main • Part of the (potential) needs for consulting services does not
16
problems materialize into actual demand. This is to a large extent a
consequence of the fact that consumers have great difficulties
in finding suitable suppliers (particularly in consideration of
time and cost restrictions)
• There are significant information asymmetries before
contracts are written.
How services The firms in the sample are largely satisfied with the consulting
are perceived services they obtained.
by demand • External assistance in filing tax returns and dealing with
17
audits scores highest, followed by advice in legal and contract-
related questions.
• Most services provided by management consultants, including
services in their core business, are judged as “fully”
satisfactory.
• The supply of services by management consultants is
considered to be relatively well adjusted to the needs of the
consumers.
• There is not a significant gap between firms of different sizes
in the evaluation of suppliers.
16
E.g., do they find the range of services they want?
17
Is the service valuable? Does the service meet the real requirements of the firm?
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Germany: Recommendations
Best • Voluntary control by means of membership in professional
practices associations
• Federal Association of German Management Consultants
(BDU)
• Federal Association of Management Consultants (BVW)
The two associations above guarantee the qualification of
consultants in terms of experience, reliability, credits, etc.
• Certification according to ISO 9000 ff
• The DtA consulting agency: arranges contacts between SMEs
and competent and experienced consultants on a nation-wide
scale. The quality is ensured by means of two measures:
• the control ex-ante of the qualification of the provider
• the control over the process of consulting
Proposals • Only market solutions will be feasible
• Further research is necessary to define which are the best
instruments for quality control
• Action plan in three points:
1. Diffusing information: Create a forum for all member
states of the EU, in which the current situation of the
market for consulting services can be analyzed. In order
to generate a uniform starting situation, the results of this
analysis should ideally be widely publicized and
discussed in the EU.
2. Defining policies: In the steering committee of the
Concerted Actions, examine the possibility of appointing
an expert-group on the EU-level for the purpose of
discussing the implementation of market-oriented
solutions.
3. Diffusing best practices: some of the best practices of
each state could be extended to other member states of
the EU. The diffusion of “best practices” throughout the
EU should be supported in this way.
Actions • Several public financed support programmes both at Federal
and Bundesland level with:
• clearly defined goals
• focused recipients (target)
• clearly identified providers.

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3.2 Greece
Greece: Supply side
Structure
Kind of Type of Three broad categories:
suppliers and providers 1. Large, exclusively consulting companies
services 2. Companies of Certified Accountants / Auditors which also
supplied provide consulting services
3. Small/medium size Service Rendering Bodies
It is worth noting that, in practice, there are no medium size firms
(with a turnover between 1.5 and 3 billion EURO).
Firms in the first two categories have an annual revenue of more
than 3 million EURO.
Market The public providers consist of:

character. • Regional administrations
(public vs. • Local Government Organisations
private) • Development Companies
• Chambers of Industry and Commerce
• Business Innovation Centre;
• Exporters Association;
• EOMMEX, concerned with the development of Handicrafts
and Carpet Manufacturers and the provision of technical-
financial consultant services to SMEs. Now offers financial
credit services, too.
The private sector is characterised by a large fragmentation and
the general level of competence is not yet suited to the demand or
is too expensive. It consists of:
• Industry associations
• Exporters associations
• Private consultants.
Public providers are mainly used to supply information, while
private providers are normally preferred for other services.
Geographic Presence on Like the SMEs, providers are mainly concentrated in the areas of
profile the territory Athens and Thessaloniki.
Size and Total It was approximately 50 million EURO in 1996 and 77 million
importance turnover EURO in 1997
of the
service’s
sector
Percentage of
GDP
Number of About 1,200 employees in approximately 100 companies and many
Employees freelance consultants. Today it is estimated that consulting
companies exceed 1,500 units.
Size of firms Average 837,000 Euro in 1997, with an average annual increase of 29% in
turnover in the period 1990-1997
EURO
Average 13.2 employees, with an average annual increase of 4% in the
number of period 1990-1997
Employees
Legal Issues Special The profession of Business Consultant is not safeguarded. If an
Regulations individual has the qualification of a University degree or even a
College degree and applies for a professional licence to the Tax
Revenue Service, is allowed to practice as business consultant.

Page 18 of 49
Greece: Supply side (continued - 2)
Behaviour and
dynamics
Methods In general, the tendency is to attract clients through personal
used by contacts or through the already existing clients; to a lesser degree
suppliers to modern advertising and promotional methods are adopted.
make In particular, generic advertising is practically not in use.
themselves The use of Internet and Web sites is a new promotional tool, but
visible still at an infancy level.
Relationships Consulting firms provide their services to SMEs mainly on
and co- request by the same SMEs.
operation Usually, the meetings between users and consultants take place at
between the the users’ premises.
parts Personal contacts and exchange of information between providers
and customers is a broadly diffused practice.
In general, services are personally provided by consultants.
Transparenc The pricing policy is usually based upon mutual agreement
y (price… ..) The methods used for pricing are ranked below:
1. mixed system of fixed fees and commissions depending on
results (33.9%)
2. fixed amount (22.0%)
3. list price for the various types of services (18.6%)
4. per occupational hour of the Service Body (10.2%)
Need for EU The large majority of providers consider the introduction of an EU
standards code of ethics a desirable approach.
Performances
Main • Consultants act without clear aims or direction. This means
problems that transparency does not exist. Everybody claims that he
can offer qualitative services with concrete results, but does
not specifically mention what those results could be or how
they could be measured.
• The providers do not perform any systematic promotional or
communication activity.
• Suppliers are very fragmented; smaller providers and
individual consultants do not adopt any systematic method for
making their level of qualification recognisable.
Visibility The absence of a satisfactory degree of visibility of providers and
available services (including information about publicly financed
programs) is one of the main problems.
Ability to It seems to be quite low (but it could depend on the little awareness
meet that SMEs have of their own needs)
customers’
requirements
Presence of The quality standards applied by consulting firms in the provision
self regulated of their services are ranked below:
code of ethic • Standards developed by the consulting firm itself (58.5%).
or standards • Standards established by the professional association of
Service Companies (22.6%)
• ISO standards (13.2%)
• Other standards (5.7%).

Page 19 of 49
Greece: Demand Side
Structure
Sector (mix)
Presence on The largest number of potential users is concentrated in the areas
the territory of Athens and Thessaloniki (52.1%), except for the Trade Sector,
in which most SMEs are located in the periphery of the country.
Size of the Total
demand turnover
sector
Percentage of
GDP
Number of
employees
Size of the Average
firms turnover in
EURO
Average n. of
employees
Behaviour and
dynamics
Reasons for The report does not contain this specific information, but the lack
looking for of know how and resources seems to be the main reason
external
support
Methods SMEs usually find the provider they need through personal
used to look recommendations and direct contacts.
for a service At the local level, public bodies are used to collect information
provider about regional, country or European support programmes
Need for a The large majority of SMEs considers the introduction of EU
EU quality quality standards a desirable approach
standards
Satisfaction
Main • Due to a significant lack of visibility, it is often very difficult
Problems for SMEs to find an appropriate provider for the service they
need.
• Lack of resources (in terms of necessary capital) for using
support services.
• Lack of knowledge and goals (planning): SMEs are often
not able to see the value of services (as well as their
usefulness) because they do not know what they really need.
• The small size of Greek businesses
How the The SMEs generally consider that the level of services provided to
service is them is low.
perceived by The study shows that, in the opinion of SMEs, consultants do not
the demand understand their true needs.

Page 20 of 49
Greece: Recommendations
Best • ISO certification for the internal organisation
practices • Continuous update on developments, seminars, conferences
and other relevant events
Proposals
Actions 1. Information – Dissemination – Promotion
• Dissemination of the results of the research on providers
located in the various Regions .
• Publishing in the Daily Financial Press of the conclusions
of the Research.
• Organising meetings to inform SMEs about suppliers at a
Regional level.
2. Common European Policy
• Defining European quality standards for all types of
services provided.
• Defining, at least tentatively, a common price list for the
services provided.
• Designing an European program for assisting firms
(SMEs and Micros) in accordance with the criteria of the
research, in order to facilitate the access to the services
rendered by providers.
3. Joint advertising and promotion of the services rendered
by service firms at a regional level
• EOMMEX will take the initiative, in co-operation with
the collective bodies of providers, to draw up a Code of
Ethics.
• EOMMEX will restructure and enrich the providers
registry.
• Availability of the Registry on the Web and creation of
pages in Greek and in English.
• Creation of a database at EOMMEX that will contain
information material necessary to the providers. The
Database will be linked with a common European
Database.
4. Common One Stop Shop Information and Service Units
• Examination of the possibility of a linkage among the
existing European One Stop Information and Service
Units.
• Informing and training the staff of these units for
improving the level of services and the exchange of best
practices.
5. Comparative evaluation of best practices
• Best practices for SMEs
• Best practice for providers
• Comparative evaluation for SMEs
• Comparative evaluation for providers
6. Within the framework of the National Conference for SMEs,
organised by EOMMEX, the level of co-operation between
SMEs and providers should be examined, as well as the
prospects for a qualitative improvement of their co-operation.

Page 21 of 49
3.3 Ireland
Ireland: Supply side
Structure
Type of • The report mainly focuses its attention on public support
providers agencies and their services.
• Historically, Chambers of Commerce never had a strong role
• The Public Agencies are:
1. Enterprise Ireland that provides support and service to
the key strategic functions of the firm: strategy assessment
and formulation, research, development and design,
production and operations, marketing, human resources
Kind of and finance.
suppliers and 2. City/County Enterprise boards. Established in 1993,
services these agencies provide a wide range of financial
offered assistance involving a mixture of capital, employment and
feasibility study grants.
3. FÁS (Training and Employment Authority): another
agency that undertakes initiatives targeted to small
business. Some of these initiatives are Diagnostic
Programme, Co-operative Development Unit and
Shannon Development exclusively designed for the
Shannon area.
Character. of Based on the report, we can break down the suppliers according to
the market the answers provided by firms with reference to their use of
(public vs. different types of consultants (even though these data do not
private) provide the actual breakdown of the various typologies):
38% of firms interviewed use public institutions
12% semi-public institutions
25% private companies
25% private individual consultants
Geographic Presence on There are no specific data on this point: however, the report states
profile the territory that firms look for providers practically everywhere:
1) in the same country
2) in the same region
3) in other regions
4) in foreign countries
(differences can not be considered significant, due to the small size
of the sample)
Size and Total
importance turnover
of the service Percentage of
sector GDP
Number of The data available is the number of small firms and VAT
Employees registrations over the past five years, without a breakdown for the
service sector. Overall, there is a sustained upward trend in the
number of small businesses.

Page 22 of 49
Ireland: Supply side (Continued - 2)
turnover in
EURO
Average
number of
Employees
Legal issues Special There are a lot of public agencies for the service support of the
regulations SMEs at the national and regional level (please see above).
Behaviour and
dynamics
Methods Direct contacts resulted to be the most used method; press
used by publications (magazines) are used occasionally and the TV only
suppliers to rarely. Other methods considered by suppliers highly effective are:
make 1. Incentives to customers to recommend the services
themselves 2. Sponsoring of non profit activities..
visible In any case, the majority of suppliers (63%) provides services
based on customers’ request.
Relationship SMEs complain about the fact that there is a lack of co-operation.
and co- The majority of SMEs discusses the project with service providers
operations upon completion of the project, but little emphasis is placed on
between the assessing the overall “service performance”.
parts
Transparenc 63% of providers do not have a specific fixed pricing policy: prices
y (price… ..) are normally determined on a per hour basis. This is in contrast to
the requirements of SMEs which would prefer a fixed price
quotation.
Performances
Main Some of the problems service providers encounter include:
problems • SMEs do not realise the usefulness of support services
• SMEs do not have the necessary funds to afford support
services
• SMEs are too small to understand the services provided
• The supply is considered too generic and not targeted to the
firms’ needs.
70% of service providers indicate that quality standards for
services are desirable.
In particular, they would welcome quality standards in the training
and technological area.
Visibility The most used mean of communication is direct contact, but
suppliers also sponsor non profit activities.
Government promotional publications have significant dispersion
losses.
Capability of Among the actual users (contrary to the expectations of non users –
meeting the see above), the opinion is that the service provided matches fairly
customer well the customers needs. 60 % of small business interviewed said
requirements that the service “sufficiently” matched their needs.
Presence of
Based on the report, there is not a set of self regulated code.
self regulated
However, there are quality standards that service providers apply
code of ethic
like the “compliance with ISO9001 regulations” and “self
developed standards”.

Page 23 of 49
Ireland: Demand Side
Structure
Sector (mix) The services most required are (from the questionnaire, in order of
importance):
1) Loan Grants and Subsidies
2) Trade Fairs
3) Export Markets
4) Promotion of Networks
5) Conferences & Seminars
6) Market Exploitation
7) Technical Information
8) Information Packages
9) Supply Chain Development
10) Technical information
11) Business Planning
Existence on
the territory
Total
Size of the turnover
demand Percentage of
sector the GDP
Number of The only data available is that 235,000 new jobs were created since
employees 1996. This figure includes the service sector too, since the report
does not distinguish it separately.
Overall, the trend is an ever increasing number of new employees
every year.
Average
Size of the turnover in
firms EURO
Average n. of
employees
Behaviour and Dynamics
Reasons for The main reasons are:
looking for 1. Lack of know how
external 2. Lack of capabilities
support 3. Lack of time
4. expectation of higher quality services with the use of external
resources
Methods SMEs carry out active search for providers, and recommendations
used to look by third parties and “word of mouth” are the most used methods
for a service Only few businesses identify the providers through advertising.
provider
Need for a It is strongly felt that a EU quality standard can contribute to the
EU quality improvement of the perception of quality and, consequently,
standard expand the demand for services especially in the areas of training,
system technology and logistics

Page 24 of 49
Ireland: Demand side (continued - 2)
Satisfaction
Main SMEs require a professional, timely and effective approach, but
problems half of the businesses investigated say that the main problem is
“the definition of the quality required in the provision of the
services”.
Another big issue is the “identification of a suitable provider”. Last
but not least, many firms “do not have the necessary funds to hire
providers”, “do not know where to find them” and a portion of the
sample “do not consider them reliable”.
How The service is considered valuable (again, by the actual users).
suppliers are Moreover, relative to the quality level the cost of the service is
perceived by considered “fair” by 70% of the business and “high” by 30% of
the demand them.
Ireland: Recommendations
Best It is recommended that a forum of EU members should be
practices established in order to assess the feasibility and implications of
introducing a European Quality Standard for Service Providers.
Proposals • Since the main findings of this report are the difficulty in the
“definition of the quality required in the provision of
services”, the “identification of the suitable service providers”
and “the “professionalism of the service provider in
communicating with the customer” (SMEs say that they would
increase their use of consultants if they could be assured of the
benefits), the report suggests the need for a pre-set definition
of quality measures, together with a pre-defined pricing
system.
• The results of the study should be disseminated through the
Enterprise Ireland (Technology Ireland) publication, in order
to increase the awareness of the findings.
Actions In particular, the results of the findings should be made available
to the ‘Development Agencies’ e.g. Enterprise Ireland, IDA,
Shannon Development, Udaras Na Gaeltachta, also in order to
define the Irish position in the development of a pan European
Initiative on Quality Standards.

Page 25 of 49
3.4 Italy
Italy: Supply side
Kind of Type of In 1998, the professional service sector grew to take on 100,000
suppliers and providers new employees. In 1999 business grew 9%. The service sector
services makes up 74% of the total (2.5 million units) and employs 68% of
delivered the total workforce (4.4 million workers ). The laws are inadequate
for the sector’s improvement and the taxation is particularly
severe.
Kind of Characterist. The market is characterised by a high fragmentation in the private
suppliers and of the market sector that is compensated by a significant and articulated presence
services (public/priv.) of public agencies.
delivered Public
1) Chambers of Commerce whose principal activities are:
• Information (registering enterprises, etc.)
• Vocational training aimed at entrepreneurs, managers,
commercial agents
• Employment and enterprise creation
• Financing
• Innovation
• Environment
• International relations
• Regional development for weak areas
2) Service Centres promoted by local administrators, Chamber of
Commerce and entrepreneurial associations. BICs are a good
example of this category. The main support activities are:
• Basic information, data banks and promotional activities
• Legislation, technical and market information
• Business planning, advice on functional area and
development of business contacts
• SMEs management, start-ups and targeted training
• Promotion of networking, internationalisation
3) Entrepreneurs associations as
• Confindustria whose activities are basic information,
professional information, consulting, vocational training,
financing.
• National Confederation of Artisans, Small and Medium
Sized Enterprises.
• Italian Confederation of Small and Medium Size
Enterprises
Private Consultants
As said earlier, the private sector is highly fragmented: 654,000
out of 668,000 enterprises have less than 10 employees with an
average number of 1.6 employees per business. It is interesting to
notice that large private consulting firms hold a large percentage
of the market. The kind of services offered depends on the size of
the business.
Banks
The services offered are:
• Fee consulting
• Management of exchange risks
• Factoring and leasing
The relationship with the SMEs is fragmented. A single business
uses three or four different Banks.
Underwriting syndicates
Export consortia

Page 26 of 49
Italy: Supply side (continued - 2)
Geographic Presence on Also for this dimension it is convenient to make the distinction
profile the territory between Public and Private.
Public
The Chambers of Commerce are located in every single province;
the problem is that the ratio between the number of firms and the
Chambers is different from province to province due to the various
development stages of the areas considered.
As far as the service centres are considered, things are slightly
different, since their concentration is quite higher in the north than
in the centre and the south/islands. Anyway there is at least one of
them in every region.
Private
The data regarding the geographical distribution of the service
companies does not tell us anything new, that is, the main
concentration is in the more developed provinces of the north
(Milan, Turin, Bologna, Modena, Vicenza, Brescia, Vicenza,
Bergamo, Padova, Florence) and the centre (Rome).
The dynamic data about the variation in service companies over
the last eight years show that many southern (and island)
provinces are at the top of the list (Potenza, Caserta, Agrigento,
Nuoro), but this is not enough to compensate for the unbalance in
the concentration of the services accumulated so far. The
geographic concentration of supply shows a distinct mismatch with
the distribution of the demand expressed by SMEs.
Size and Total There are 2,500,000 business registered in this sector. Total
importance turnover turnover of 70 billions of EURO. The trend is increasing.
of the service
sector
Percentage of
GDP
Number of The number of employees in 1999 is 6,500,000. The trend is
Employees increasing.
Size of the Average
firms turnover in
EURO
Average The average size is just 1.8 employees per company if we consider
number of the service sector as a whole. The same fragmentation is found in
Employees the support service sector with an average of 1.6 employees.
Legal issues Special There are many regulations at national and regional levels that
regulations give incentives to SMEs for the acquisition of the promoted
services, the certification and the improvement of quality, the
increase in productivity, the diffusion of technology and
innovation, the improvement of safety in the workplace, etc.
Contributions can amount up to 50% of the cost of specific
services.

Page 27 of 49
Italy: Supply side (continued - 3)
Behaviour and
dynamics
Methods Chambers of Commerce and Trade Associations pursue the
used by visibility objective through the assistance of special intermediary
suppliers to entities, which connect the productive sector to the institutional
make organs.
themselves Similarly, the underwriting syndicates use agents.
visible Banks count on direct relationships with clients and also on direct
marketing and press advertisements.
Private firms do not have an adequate strategy: they mostly count
on direct relationships with customers and word of mouth amongst
clients. This can be explained by the small size of most firms.
Relationships It is evident from the report that when the service is provided by
and co- the Chambers of Commerce or other public institutions there is a
operation lack of personalisation. On the contrary, the private service sectors
between the have the advantages of a fairly personalised service, consequently
parts the relationship with businesses tends to be less problematic.
Transparenc The most used system to price services is a “mixture of fixed
y (price… ..) remuneration and commission on results”. From the survey, “lump
sums” and “per hour rates” prove to be widely used as well.
Performances
Main The main problem from the supply side is the presence of “natural
problems monopolies” (because of laws and other regulations) for accessing
state subsidies, and this does not make the relationship between
demand and supply very easy.
The problem can be summarised by this recurring description:
“the consultant is seen as somebody who is able to secure a
contribution rather than a professional who can solve the firm’s
problems”.
Visibility A real strategy directly aimed at improving the visibility of
services offered is practically absent. This is partially due to the
overlaps between public and private provision and partially to the
absence of quality standards.
As a result, the service offered by consultants, Service Centres and
Chambers of Commerce are “little known”.
Ability to The services offered fail in terms of adaptability to the specific
meet needs of the customers.
customers’
requirements
Presence of
self regulated
code of
ethics

Page 28 of 49
Italy: Demand side
Structure
Sector (mix) In the report there is an in-depth description of the manufacturing
sector, that is the most important one.
Presence on The North West is the geographical region with the greatest
the territory number of companies (more than 1,000,000) and number of
employees (4,900,000).
The North East and the Centre have similar characteristics both in
terms of companies and in terms of employees. The North East
make up 21% of the total workforce of 3,300,000.
The South is the second in terms of number of companies (994,000
entities 28%) but last in terms of employees (2,500,000).
Size of the Total Interesting to notice that 7,000 medium size firms are
demand turnover implementing changes in terms of rationalisation, in order to
sector compete internationally. Moreover, 1,000,000 small businesses are
organising themselves in networks and districts, also in view of
sharing the costs of consulting services.
Percentage of
GDP
Number of
employees
Size of the Average .
firms turnover in
EURO
Average n. of From the demand side it is estimated that there are 6.5 employees
employees per company. 88% of the businesses have less than 10 employees.
Behaviour and
dynamics
Reasons for Not directly explained in the report. We can draw an assumption
looking for by following the general classification borrowed in the report from
external M. Porter:
support • support services (financial, training, standardisation and
technical services).
• activities defined “transversal” (company organisation,
strategic planning, telecommunication systems).
• services connected to primary activities (organisation of
production, logistics, marketing).
The smallest companies show a low demand for services and when
they need them they try to internalise their provision. Similar
behaviour is observed within medium-size firms (more than 50
employees) even though they use some transversal services.
Companies with 10-50 employees make more frequent use of
services than the other categories mentioned above.
Another classification of the needs for certain kind of services is
based on the stage of the development of the firms. At the start-up
and growth stages firms make little use of primary services but
require post-sales assistance, planning and design; at the maturity
stage they demand management training, strategic planning and
organisation.

Page 29 of 49
Italy: Demand side (Continued - 2)
Behaviour and
dynamics (Continued)
Methods Word of mouth is still the most used method for SMEs.
used to look
for a service
provider
Need for a The report emphasises the difficulties in finding general
EU quality parameters that suit every support service. Consumer satisfaction
standard and conformity to standards are considered as the bare operational
system minimum. The SMEs interviewed said that standards do not really
matter for the development of their sector. The problem stressed is
that these standards must not go in the direction of creating hard
rules that define procedures: more attention should be paid on
structural aspects of the system (i.e. checking that every company
is part of a network, makes regular use of services and professional
training programmes, shares the culture and the ethics of the
service sector).
Satisfaction
Main Private providers are considered too costly but the service is
problems considered satisfactory compared to the expectations. It was found
that it is difficult for SMEs to find the very specialised service they
need, especially when the service requires a high level of
technology and know how.
Conversely, for the public service providers the main problems are
the lack of information on services performed, lack of
personalisation and unpleasantness in personal relationships.
How services The companies interviewed have perceive that the quality level of
are perceived services is middle-low.
by the It is clear that the respondents:
demand • are not aware of the usefulness of a consultant
• consider them unnecessary
• do not have the necessary funds to hire them
• consider services too expensive
• do not consider them reliable
• do not know where to find providers.
Such attitude depends on a negative perception of the “return on
investments” in the purchase of consulting services, on mistrust of
external provision structures (especially the “institutional, public
and associative” ones; while Chambers of Commerce have a
“credit for competency”) and on the low level of strategic
complexity, which reduces the need for specialised services.

Page 30 of 49
Italy: Recommendations
Best SEPRI (Servizi promozionali per l’impresa – Promotional services
practices for the firm) is a support programme for SMEs run by ASSEFOR
Its aim is to facilitate the access to information and consulting
services in the areas of finance, control, marketing and company
organisation.
In view of improving the visibility of suppliers a Directory of
professionals and firms that offer consulting and training to
companies was created: the directory is freely accessible on a
national level.
Proposals • Service companies should connect themselves to an
international network which controls the flow of information
as much as possible. It is believed that the quality of services
will tend to increase in direct proportion with the possibility of
accessing a communication system that facilitates the
exchange of information and the competition among suppliers.
The network will act as a leveller in the quality of service
supply, through the spontaneous interaction of service
companies and consultants.
• On the other hand, the definition of standards in relation to
specific services is to be avoided, in favour of more creativity
and personalisation of services.
• Investments in infrastructures and communication (especially
for data and information transmission) should facilitate
marketing activities.
Actions An important parameter that should be taken into consideration is

the geographical location of users, since the services required in
underdeveloped area are different from those in the more
developed ones.
The analysis of the mismatch between supply and demand shows a
number of critical areas, especially where the entrepreneurial spirit
is strong and the needs of companies exceed the availability of
qualified providers.
In order to improve the visibility and quality of services a
communication network must be made available so that firms
could know where and how to access the needed services. This
network should have the same operational standards across
Europe, its own name and marketing activities. Moreover, this
network should comply with quality procedures, in order to make
sure that the information is reliable and exhaustive.
The access to information about services should be free, in order to
raise the level of exchange and contribute to the improvement of
the system more rapidly.

Page 31 of 49
3.5 Sweden
Sweden: Supply side
Structure
Kind of Type of Accounting firms, organisation and information consultants,
suppliers and providers technical consultants, PR-firms, staffing services, law firms, book-
services keeping agencies, translation services, conference organisers etc.
supplied Characteristi Public
c of the 1) Nutek and Swedish Trade Council that are mainly concerned
market with regional policy implementation, technology project
(public vs. initiation and programme co-ordination. The activity is mainly
private) advisory on trade relations, export processes and customs
regulations. In the survey 86% of interviewed firms never
contacted these agencies.
2) Almi Business Partner and County Administrative Board that
has a wide range of services such as advisory services,
counselling and programmes for business and market
development, growth and financial support. 77% of
interviewed firms never contacted Almi.
3) The Employment Service Agency and the municipality
providers. Many firms contact these agencies due to the past
strict regulations in the labour market.
4) Universities and Science Parks. Useful for business advisory
matters and R & D programmes. 77% of the firms never had
contacts with these institutions.
Private
1) Banks for advisory services, regarding mostly the financial
products: 20% of firms in the survey had several contacts over
the last three years.
2) Auditor/legal advisors: very much used as well. 70% of firms
have regular contacts.
3) Business associations at national level are used frequently. It
is not the same at the local level.
4) Chambers of commerce rarely used.
5) Euro Info Centre, established in Sweden to inform and
support small firms and carry out specific programmes. 95%
of the surveyed companies had never had contacts with the
EICs.
It was mostly exporting companies that had had contacts with
the EICs.
Geographic Presence on 1. at the national level: Nutek and the Trade Council
profile the territory 2. at the regional level: ALMI and County Administration
Board, the Universities and Science Parks
3. at the local level: Employment Agencies and Municipalities.
Size and Total The total turnover is about 180 Million Euro for the public sector
importance turnover only. There was an increase of private firms over the last 4 years.
of the Percentage of
service’s GDP
sector Number of 3,000 people are employed in the public sector. In addition, there
Employees are other 2000 people working at the industry research institute.
Size of the Average
firms turnover in
EURO
Average
number of
Employees
Legal issues Special Public grants and the structural funds are managed by the public
regulations sector agencies mentioned above.

Page 32 of 49
Sweden: Supply side (continued - 2)
Behaviour and
dynamics
Methods The methods used are different and depend on the sector. Almi, for
used by instance, prints and distributes via the regional offices and other
suppliers to channels general information material about the activities and
make specific programmes and financial opportunities. Open door days
themselves are organised with speeches and debates about business policies.
visible The municipalities put a lot of marketing efforts on local
newspapers, information leaflets.
The private sector uses various tools to keep a closer contact with
current and potential customers: participation in business
activities, local projects, seminars, etc. Overall, personal contacts
are often used.
Worth mentioning is that all providers have a web site where one
can find general information about them.
Relationship The Growth Agreements are cited as an example of co-operation
and co- between SMEs and service providers. Although all parties
operations participated in the process of forming the plan/agreement, the
between the widespread opinion is that the final draft for agreements are so
parts general that it is hard to identify the various contributions.
Several providers mentioned the importance of co-ordination and
co-operation between organisations.
Several support service companies have contacts with the
customers 24 hours a day via e-mail.
Transparenc
y (price… ..)
Performance
Main There is a need for a more precise definition of the role of public
problems providers.
Publicly financed information and/or counselling systems seldom
are used. One conclusion is that providers should be located close
to their customers.
Visibility One of the main findings of this report is that it is easy to find the
appropriate support provider and/or information. The only problem
encountered with some firms was the access to the services.
Ability to Most service companies use questionnaires to find out what the
meet companies think about the service. Respondents said that they do
customers’ not use quality standard because customers do not ask for them,
requirements they are satisfied of the current quality of services.
Presence of The associations have their own code of conducts, which regulates
self regulated the work of lawyer and accountants. Other trades have similar
code of ethic codes, even if not that rigorous.

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Sweden: Demand side
Structure
Sector (mix) The manufacturing companies in the sample are the 39%; the
service-oriented firms are 61%. This is the only classification
available. A further classification shows that the services required
by the manufacturing and service sector are:
1) Auditing
2) Education
3) Book-Keeping
4) Technical Support
5) Marketing
6) Sales
7) Strategic Planning
Presence on The report splits Sweden into three regions:
the territory 1) Stockholm
2) Örebro
3) Västernorrland
these regions were chosen in order to represent the different types
of regional situations in Sweden.
The number of companies are equally distributed on the territory
according to the above said classification. However SMEs know
the regional and local providers and their services/programmes
better than national ones.
Total From a study quoted in the report, it is clear that the demand trend
Size of the turnover is upward.
demand Percentage of
sector GDP
Number of The report does not provide precise figures and considers only the
employees companies with 1-49 employees. Two sub samples are considered:
1. 1-19 employees (52% of the total)
2. 20-49 employees, (48%)
Average The average turnover for the SMEs involved in the survey is
Size of firms turnover in around 4.8 Million EURO. This figure varies depending on the
EURO region considered, the company size ad the industry. NOTE: the
survey considered only firms with less than 50 employees.
Avg. number
of employees
Behaviour and
dynamics
Reasons for The report shows that services like auditing and book-keeping tend
looking for to be internalised as the size of the firms increases. Indirectly it is
external evident that one of the reasons for acquiring the service is the lack
support of necessary competence within the firms.
Methods The methods used by companies are:
used to look 1) Recommendations from other companies (80% of SMEs use
for a service this strategy to find the service they need)
provider 2) Advertisements (65%)
3) Other information material
4) Databases
5) Internet and direct contacts

Page 34 of 49
Sweden: Demand side (continued - 2)
Behaviour and
dynamics
Need for a Only 31% of companies said that there is a great need for EU
EU quality standards. 44% said that there is no need. This is quite in line with
standard the general satisfaction and perception of the services offered
system (please see below).
Interesting to note that none of the service providers interviewed
complies with quality standards.
Satisfaction
Main 90% of companies have no problems in finding a suitable service
problems provider.
From the survey, however, it is evident that some problems occur.
Mainly, some services seem to be:
1) More expensive than planned (mentioned by one third of the
sample).
2) Below expectations;
3) Not professional enough (15% of the sample)
4) Of low quality (13% of the sample)
How the The questionnaire asked companies to distinguish between the
service is private and the public sector. On average both the services offered
perceived by by the public agencies and that offered by the private ones is
the demand considered valuable and useful. Only 20% of the sample perceive
the service not useful at all.

Page 35 of 49
Sweden: Recommendations
Best 1. The Swedish Commission for Small Business (a temporary
practices organisation), was created with the aim of identifying
problems and suggesting measures to create incentives for
SMEs to grow and make easier the creation of new businesses.
2. The Regional Growth Business is the main instrument for co-
ordinating and adjusting the policies and exploring new
approaches to the promotion of regional and local industrial
development.
3. Universities not only carry out research and educate, but have
the "third task" of co-operating with the society and inform
about their work. In this way, there is a greater exchange
between companies and academy than before.
4. A gateway (internet portal) called "Answer Direct" was
created by seven main public authorities. In this website SMEs
can find useful information and useful links. Another good
practice is the SMELINK, especially designed for SMEs to
give them an overview of the market and more specific
information to make them stronger compared to larger
companies. Another example is the "Finance Database"
especially useful for firms interested in financial aid and those
that are in the start up phase of their life.
Proposals 1. Clarify the role of public providers to avoid overlapping.
2. Adjust service supply to service demand and increase the
knowledge of services.
3. Services concerning core functions like strategic planning,
marketing and sales must be process oriented and specifically
designed for every company.
4. More effort must be made to match supply and demand of
information, possibly using databases and internet to increase
the knowledge of the existing service supply.
5. Utilise the positive SMEs’ experiences with public providers.
6. Increase the efforts to facilitate the evaluation of results.
Actions • Establish a forum for analysis and research of small business
policies. This forum should work as a hub for activities such
as theoretical development, distribution of research findings,
policy evaluations, methodological development, workshops,
benchmarking projects, etc.
• Take advantage from the internet: the EU should start a
project with the main purpose of studying and developing IT-
technologies aimed at linking support services to SMEs’
needs. Most important in such project would be the activities
of database management and database construction.
• Set up a project with the purpose of overcoming the barriers
between public and private support sectors and distributing
knowledge and experiences concerning how certain industries
have developed internal professional standards of conduct,
quality and membership.

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4. Preliminary interpretation and suggested actions 18
4.1 Why this market is important
The European market of support services to SMEs is quite heterogeneous, in terms of both
dimensions and characteristics, in the five nations investigated by the research studies.
However, one important common trend seems to emerge: the market is significantly growing,
both in quantitative and qualitative terms:
• quantitatively, the number, frequency and variety of the activities outsourced by firms are
increasing
• qualitatively, it is more and more frequent, especially in the most industrially developed
countries, the outsourcing of potentially high value added services.
Relatively speaking, the rate of growth is obviously higher in the countries in which the market is
currently less developed.
The economic developments of the last decade (in particular, the increasing globalisation),
combined with the characteristics of a manufacturing sector largely based on SMEs, seem to be
one of the main reasons of this growth.
Taking into account the SMEs major characteristics:
• lack of (financial and managerial) resources and significant difficulties in obtaining them
• a way of doing business that is much more entrepreneurial than managerial
• in particular, a strategic vision that does not go beyond the short-medium term
• on the other side, an extraordinary ability of seizing opportunities
• and, more recently, the willingness to create and/or being part of networks and alliances in
order to better face the increasing need for critical mass in the global markets,
the growth of support services seems to be one of the best ways of overcoming the current
weaknesses and facilitating the creation and consolidation of networks.
18
These notes are almost exclusively based on the findings presented in the research reports provided by the 5
member States and only take in minimal consideration other research sources such as the “classical” studies on
service and service quality (Normann, The strategic management of services; Zeithaml, Parasuraman & Berry,
Delivering quality service, etc.). However, contrary to the approach adopted in the previous two chapters, here we
try to provide also our own integrated view from an overall perspective.
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4.2 Why do SMEs need services
The identification of the “actual” reasons why firms look for external help is obviously important:
the comparison between the typical and actual situations in which firms look for external help and
the reasons mentioned by the owners and managers of the same firms when interviewed, can
allow a better estimate of the extent to which firms are aware of their needs.
We see that situations that would command a significant planning activity (especially in order to
reduce uncertainties) are frequently addressed as emergencies.
Furthermore, we see that the lack of consistency between “expected” and “delivered” service is
one of the most frequent problems in all the interested countries, and we can reasonably assume
that the gap is largely attributable to a lack of needs’awareness.
Understanding the typical situations in which firms use external providers of service allows a
better identification of:
• firms which are likely to need help

• services which are more appropriate for satisfying their specific needs
• suppliers who are best qualified for delivering these services
• communication and marketing tools that are best suited for promoting the services.
The basic reasons why firms need and/or ask for external support are roughly the same across
countries 19:
• lack of specific know-how

• in general, lack of resources 20
Significantly less important are other reasons such as:
• expected benefits in terms of savings

• expected benefits in terms of effectiveness
• expected benefits in terms of speed.
It seems worth noting that the first two reasons (the most frequently mentioned by firms) identify
situations in which it is “necessary” to look for external help, frequently due to contingencies,
emergencies and unexpected events.
The other three reasons (the least frequently mentioned), on the contrary, can only be identified as
a result of a systematic planning activity.
The fact that the first two reasons are much more frequently mentioned than the others could
seem strange (emergencies and unexpected events should represent the exception, not the rule),
but this is a significant symptom of the SMEs scarce willingness and ability to plan.
Some of the reports identify “moments” in which the external help is mostly sought:
19
Evidently, we are not considering here the supporting activities which are compulsory by law.
20
Either because they do not exist at all, or because they are not currently available.
Page 38 of 49
• the start-up phase
• the initial approaches to exporting and internationalisation
• during technological transitions
• more in general, all the situations in which the rate of change and the degree of uncertainty
are high and require significant investments.
4.3 Main problems
For the purpose of summarising the research findings we can split the process of providing a
service into at least three distinct major phases (and related sub-phases):
1. from the initial awareness of the need for service to the awarding of the assignment to the
external provider
2. delivery of service
3. evaluation of the delivered service.
Apparently, each of these phases presents problems.
Phase 1: searching a provider and awarding the assignment
• Need identification: even though the lack of adequate need identification does not explicitly
emerge from all the research reports, we believe that the absence of this important
prerequisite of a successful service delivery is one of the most critical aspects in the European
SMEs behaviour: a precise need identification directly affects the choice of the appropriate
supplier, the definition of the specific kind of service required, the assessment of the
consistency between the service required and the service actually delivered, the evaluation of
the service value, etc. It also seems obvious that an adequate planning activity is the major
prerequisite of an appropriate need identification.
• Choice of outsourcing the services: the research reports seem to agree that the decision of
outsourcing the services looks much more like a constraint or an obligation than an actual
choice.
• Search of a provider: this is the activity in which the SMEs of all the investigated countries
(except, to a significant extent, Sweden), without significant differences in relation to the
degree of market development, seem to consciously face the major problems, due to the
following major causes:
• scarce visibility of suppliers

• imprecise definition of needs and, consequently, inadequate identification of the kind of
service required to satisfy the needs
• lack of information: this aspect is directly related to the visibility, but also refers to the
difficulty of a preliminary evaluation of the suppliers’characteristics and quality
• lack of resources: from one side, the gap between the available (or “perceived” as
available) resources and the estimated costs of the assistance is significant, from the other

Page 39 of 49
side firms seem to be very price sensitive, due to the difficulties in estimating the value
added by the needed service, which distorts the perception of its price/value ratio 21.
Phase 2: service delivery
Here we face (or could face) other problems:
• Costs: firms often complain that the costs actually incurred are higher than those initially
agreed upon
• Timeliness: delivery deadlines are frequently unmet
• Co-operation and integration: the degree of co-operation and integration between firms and
consultants is not perceived as problematic, but is considered important for a successful
completion of the assignments.
From the various research reports an inverse relationship between the importance of the above
mentioned problems and the degree of market development is evident.
Phase 3: evaluation of the performance of the delivered service
22
As far as the evaluation of the delivered services is concerned, the reports highlight some
contradictory findings:
• from one side, and quite surprisingly 23, most service users (firms which have actually used
the services) express a relatively high degree of satisfaction
• from the other side, it is quite frequent to find a significant asymmetry between the type and
quality of the delivered service and the actual needs of the firms.
Therefore, it seems quite important to analyse the major dimensions of “quality” normally
perceived by firms.
4.4 Specific highlights on service quality
The reports agree that SMEs adopt the following major criteria for assessing the quality of
services:
1. degree of “match” and consistency between “requested” and “delivered” service

2. meeting the agreed upon budget
3. meeting the agreed upon deadlines
4. degree of “match” and consistency between the “delivered” service and the “actual needs”
of the firms 24
21
Again, this ratio is superficially perceived as “not measurable”, but it could be, most often, just “not measured”,
due to the total absence of an adequate analysis and planning activity.
22
With the partial exception of the Greek one.
23
Considering all the problems mentioned by firms.
24
If the gap between the needs and the delivered service (4th criterion) is perceived as different from the gap
between the requested and the delivered service (1st criterion) it could mean that firms do not know exactly which
Page 40 of 49
The first three criteria seem to be related to the technical contents of the services and the
contractual agreements between users and suppliers: especially the 2nd and the 3rd look more like
indicators of suppliers’ reliability than indicators of service performance. The last criterion, on the
contrary, seems to refer more directly to the actual “value added” provided by the service.
A possible key for interpreting the apparent contradiction between the relatively high degree of
satisfaction and the problems encountered could be the “nature” of the services:
there are services for which the relative importance of the technical and contractual aspects is
lower compared to the importance of other parameters such as the ability to address the real
needs and to identify opportunities, the degree of co-operation, etc.
Another interesting key could be the “time” (or “process”) perspective, that is, the moment in
which the quality of service is assessed (this key parallels the framework suggested above):
1. before the assignment: quality is mainly related to the information and communication
dimensions (could we call it “contact quality”?)
2. during the assignment (i.e. the delivery of service): degree of co-operation25 (“relationship
quality”?)
3. after the assignment: the actual outcome (“output quality”?) 26.
All the reports agree that firms complain about a low level of quality in the first period (before the
assignment) 27 and this could contribute to the explanation of the above mentioned contradiction
(the degree of development of the market does not make any difference from this point of view):
SMEs find “searching” particularly difficult, and tend to award the assignments only when they
reasonably feel that the supplier is sufficiently reliable and able to deliver results: in fact, the
degree of satisfaction is relatively high only with firms that have experienced the entire service
delivery process (the degree of satisfaction cannot obviously be measured with firms which did
not experience the service because they could not find an adequate provider).
In any event, we believe that the initiatives aimed at improving the quality should be selectively
focused on the above mentioned facets, which address significantly different issues and problems.
4.5 Specific highlights on visibility
We could “measure” the visibility of a given service provider in terms of percentage of firms, in
his/her market, that:
kind of service they should request (again, lack of planning) and they only perceive the discrepancies ex post. As
far as we know, even the famous “gurus” on service do not make this important distinction: the Parasuraman’s
model assumes that the “expected” service is affected by needs, word-of-mouth and past experience, but does not
distinguish between actual and perceived need, nor between “expected” and “requested” service.
25
Includes: way of interacting, discretion, professionalism, timeliness, accuracy, quality of information provided
(depending on the kind of service), etc.
26
Here also the actual meaning of “output” is very variable, depending on the type of service.
27
This is understandable, if we consider the nature of “experiential goods” of the support services: however, we
should not forget the problems of visibility and transparency, which will be further addressed below.
Page 41 of 49
• know about his/her existence
• know the type of services that he/she is able to supply.
We would have perfect visibility if all the firms knew all the potential providers for any kind of
services and, obviously, the degree of visibility is inversely correlated to the difficulties
encountered by firms in finding suppliers.
The lack of visibility of service providers is one of the most common characteristics of the five
countries (except, perhaps, for Sweden).
This problem is even more significant if we consider that some of the interested markets
“function” very well from many points of view: i.e. the problem of visibility seems relatively
unrelated to the market dimension and its degree of development.
The reports highlight the following aspects:
From the firms’ standpoint
The provider selection process is mainly based on word-of-mouth, references and direct contacts,
due to the difficulty of a preliminary and systematic evaluation of the supplier’s quality
(established assessment criteria do not exist).
More than a weakness to overcome, this fact should be taken into consideration for the
identification of measures that could improve the visibility.
On the other hand, we already observed that firms ask for help especially to face emergencies and
unexpected events: this suggests that the same firms are not very alert and sensitive to the
providers’marketing initiatives 28.
Again, the lack of an adequate planning activity seems to be one of the major underlying causes
of the problems encountered in this market.
From the providers’ standpoint
In general, the market is characterised by a small number of medium-large organisations (public or

private) and many small firms or individual consultants, who are SMEs themselves and suffer the
same problems faced by their prospective clients (lack of resources and very limited planning
activity).
From one side, the high fragmentation of supply (found in most countries, at least in the private
sector) is by itself a major obstacle to visibility, from the other side the small service providers do
28
All the reports confirm that firms react only rarely to the communication activities undertaken by the suppliers:
they actively search a supplier only when they suddenly feel the urgency of receiving some help.
Page 42 of 49
not normally perform any systematic promotional activity, except for some direct contacts
supported by previous clients’references29.
When promotional activities are undertaken, they are often rather inadequate.
Even in the most developed and competitive markets, firms lack sufficient information about
suppliers and seem to welcome all the initiatives aimed at addressing the problem (obviously
when, as suggested in the note above, they suddenly feel the urgency of being helped).
All the initiatives aimed at improving the visibility therefore seem to be very promising at least
in terms of potential improvement of the market efficiency (less efforts from the firms’side, other
things equal), if not in terms of effectiveness (better results).
In fact, three dimensions of visibility that could affect the quality of services emerge from the
reports:
1. The accessibility of services:
an improvement in visibility directly affects both the number of choices available to firms and
the possibility of actually accessing the services.
2. The transparency of services:
Ex-post (i.e. after the completion of the service delivery process), transparency can be
defined as the degree of correspondence between the “promised” service and the service
actually delivered, both in quantitative (costs and timing) and in qualitative (kind of activities
performed) terms 30.
Ex ante (i.e. before the delivery process), transparency means the possibility, for the
customer, of knowing the scheduling of the planned activities, who is going to perform the
activities, the related costs, etc., and therefore is an important factor which directly affects the
ability of evaluating and controlling the entire delivery process and the supplier’s
performance.
We could also assume that an improvement in visibility would create a more competitive
environment and that transparency would become an important key success factor.
3. The quality of the output
It is evident that there is a direct relationship between product (and service) quality and
market competitiveness: more visibility would mean less opportunities, for the “bad
suppliers”, of hiding themselves!.
In any event, since firms consider accessibility and transparency as important supplier
selection factors, the visibility directly becomes a major component of the service perceived
value 31.
29
This finding is consistent with that about the choice criteria adopted by firms in selecting a supplier.
30
We see that transparency does not necessarily imply effectiveness (obtained results).
31
We already mentioned that firms complain about the lack of adequate information: all the factors that can
improve the information quality immediately add value to the service.
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4.6 The role of public vs. private providers
In the figure on the following page we tried to compare in a synoptic table the relative roles of
public and private organisations in providing support services: significant differences among
countries are evident (please see details in chapter 3) 32.
32
The recurring and inevitable problem with this type of summaries (which, on the other side, have the advantage
of conciseness, compactness and immediateness of comparisons) is that the information contained in the various
reports is presented in different formats and with different approaches: the classifications that we are suggesting
(both for the categories of services and for the scale adopted in assessing the relevance of public bodies’ role) is
therefore to a large extent arbitrary and represents our interpretation of the data (this is the reason why we did not
include this synoptic table in chapter 2).
Page 44 of 49
Fig. 4.1: relative role of public versus private bodies in the five Countries, depending on
type of service provided
Germany Greece Ireland Italy Sweden

public private public private public private public private public private
financial sources and markets

Information
market & partnering opportunities

service providers and consultants
fiscal, financial
consulting
management
information technologies
technological, industrial n.a. n.a.
management education & training
operational facilities & equipment
support
promotions, missions
financing
critical visible significant marginal
4.7 Recommendations, conclusions and suggested actions
We propose to classify the recommendations contained in the reports, or emerging from the
comparisons of the reports findings (please refer also to chapter 3) and integrated by the
interpretations outlined above, from the “process” perspective already adopted:
• measures aimed at improving the pre-conditions for a better development of the market
(before the delivery of services):
1. creation and diffusion of a better managerial culture among SMEs in order to improve
their ability to identify and define their actual needs, through various initiatives, aimed at
developing favourable attitudes (through PR campaigns, seminars, etc.) but also
knowledge and skills (information, management education on strategic planning, etc.)
2. development of tools that could facilitate a more systematic and precise identification of
the same needs at competitive costs (such as strategic and organisational semi-
automated check-up systems delivered by certified junior consultants)
3. systematic classification of services and segmentation of needs and potential users in

order to identify the most promising market segments and services, especially in terms of
their potential contribution to the firms and to the economy as a whole
4. development and promotion of networks, directories, registries and data bases,

organised according to the accepted classifications, that could facilitate the visibility of
accredited and certified service providers

Page 45 of 49
5. dissemination of the results of the current research project among all the interested
constituencies and organisations (including universities and management schools) that
could facilitate a better awareness of importance of support services for SMEs
• measures aimed at improving the conditions for a better service delivery:
6. financial aids to assist firms that qualify on the basis of specific characteristics 33
7. development of training and education initiatives aimed at improving the quality of

the service providers, especially with reference to the most promising services (this
confirms the need for a selective identification of services, and this aspect could also be
directly related to the certification of the same providers) 34
8. design and development of policies, methodologies, benchmarks, best practices and

tools (such as small expert systems 35, business planning automated software systems and
more traditional software packages) that could support the service providers in their
activity and allow a reduction of costs (examples of “virtual consulting” systems already
exist, but they are mainly focused on information and technical advice, less on strategic
aspects)
• measures aimed at improving the ex post evaluation of the quality of the delivered services, in
order to facilitate the identification of the best providers and continuously improve
transparency and qualified visibility:
9. development of questionnaires for the verification of the degree of customer

satisfaction
10. design of incentives that could facilitate the participation of SMEs in the collection of
research data about the services delivered (please see the Swedish experience)
• measures aimed at improving the outcomes and results of the support service initiatives in the
follow-up phase:
11. venture capital: assuming that the service delivery phase has identified, for example
through the development of a business plan, promising market potentials, the same
business plan could be submitted to specific financial institutions that would provide
financing with the role of firms’shareholders (and not as a loan)
12. temporary management: expert managers lent to the firms for limited periods of time
33
Financing aimed at facilitating the access to the services: we are referring to the users of services, that could, in
this way, have an easier access to the same services (but they should accurately comply with specific and stringent
requirements, such as the willingness to make management time available for the development of an appropriate
business plan).
34
This aspect could also be considered as a pre-condition, but we included it in this category because the
development of the providers’ quality assumes a preliminary identification of the most promising industry sectors
and services.
35
Software packages that emulate the behaviour of experts, since they contain their specific knowledge base
(normally built into databases that can be updated and complemented over time and depending on the interactions
with the users) and a certain set of rules (which resemble, at least to some extent, to decision trees).
Page 46 of 49
13. promotional support: for example, participation to export missions, conferences,
exhibitions, joint communication programs, etc.
It must be noted that the implementation of most of the above mentioned measures could (and
should) be:
• introduced selectively and according to specific priorities, depending on the relative

attractiveness of the targeted industries and firms
• standardised, at least to a significant extent, across countries
• supported by the use of advanced information technology tools
• and, last but not least, supported in various ways by the public sector.
The reports, according to the specifications provided by the Commission, have described the
current situation in the interested countries.
However, most of the actions suggested by the same reports take and will need to take into
account even more in the near future some important economic and technological
developments such as those directly related to the dramatic growth of electronic business 36.
36
Descriptions normally refer to the past, but “prescriptions” and recommendations are inevitably focused on the
future.
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In particular, one of the research institutions most respected world-wide (Forrester Research)
confirms that Internet and the Web are completely changing or will completely change very soon,
the way business and transactions of any type are conducted:
• the Internet makes actual supply and demand more apparent (and therefore, visible)
• prices naturally fall to their lowest competitive point and vary more as demand shifts
(therefore, making products and services more competitive and more accessible).
These changes are going to be even more dramatic in the “business to business” sector (such as
the one of support services to SMEs) which is, currently, at least ten times larger than the
consumer sector and continuously growing 37.
We therefore think that the first “action” to put in place after this phase of the project should be
the creation of a commission of SMEs and IT experts (please see also the recommendations
contained in the research reports and summarised in chapter 3) who, based on the reports’
findings and the priorities indicated by the various countries and this summary, and other
complementary research sources, could develop a plan and a feasibility study for the
implementation of selected and specific initiatives.
4.8 Specific details about one of the most important recommendations
As a conclusion and as we just said, most of the thirteen recommendations listed above, in order
to be concretely implemented, would require specific feasibility studies, and the objectives and
structure of these studies would depend a lot on specific decisions about “what” (the priorities,
both in terms of services and in terms of industry sectors), “who” (the promoters/sponsors and the
implementers), “when” (the timing), “where” (in which countries) and “how” (with which type
and amount of resources, the degree of standardisation across countries, the extent to which
information technologies should be used, the extent to which resources should be allocated during
the design and set-up stage and/or along the life cycle of the projects, etc.).
Furthermore, most recommendations are strictly and operationally interrelated and could only be
implemented in practice after appropriate decisions will be made about the above mentioned
points.
37
Please see, in particular, Mary Modahl, Now or never: how companies must change today to win the battle for
Internet consumers, Harper Business, New York, 2000. This book focuses the attention on consumers, but many
other Forrester Research studies confirm these projections.
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Evidently, none of the country reports summarised here could go much in depth in these
directions, and our task (of “summarisers” and interpreters) can not be that of filling that gap in
such a huge undertaking.
However, we think that we can be sufficiently specific and detailed with reference to the
recommendation N. 3 (please see above: “systematic classification of services and segmentation of
needs and potential users”), which advocates the realisation of one of the most important
prerequisites for the implementation of – practically – all the other recommendations (38)
The technical and methodological aspects are described in Appendix 2. Here, for the sake of
clarity and completeness, we only list the main reasons why we believe that the identification and
distinction of specific and relatively homogeneous service/market combinations is crucial for the
success of any undertaking in the area of services to SMEs:
• identifying different categories of potential clients (type, characteristics, needs and

motivations, sensitivity to value and price, buyer and user behaviour) who could be satisfied,
at least in principle, in different ways (the same firm can be attracted by different services for
different reasons, and have different ways of assessing the suppliers depending on its needs
and the type of service; on the other side, the same service can attract different users and
provide different “values” to each of them, and therefore allow the suppliers different market
positions and different economic and competitive profiles)
• estimating which could be the most appropriate strategies and tactics to satisfy them
• assessing which suppliers/competitors (if any) and in which ways could be able to implement
these strategies and tactics
• estimating the competitive, economic and financial impact of the projected strategies and
tactics (resource allocation among different marketing tools: for example, communication,
quality development, enforcement of quality standards, etc.), within each segment
• assessing the attractiveness and convenience of alternative ways of allocating resources

(especially, public funds) among segments.
(38 ) A specific proposal on the subject of “service classification”, that paralleled the study conducted on the Italian
market, was discussed in the framework of the Working Group on Visibility of Suppliers’ Services of the
Concerted Actions, and this is the reason why we think appropriate, apart from the potential usefulness of the
suggestions, to briefly address the issue in this report.

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Appendix 1
Market of support services – Final Report – Appendices

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Appendix 2
Support Services to SMEs
Proposal for a classification of Support Services

(Excerpts from the Interim Report to the Working Group (WG) – Brussels, 2.12.99)
3.1 CLASSIFICATION FRAMEWORK
In consideration of the project objectives, we believe that it would be useful to adopt a classification
framework that could facilitate:
· a systematic and coherent synthesis of the various contributions from the member States;
· the identification of priorities, in terms of both additional information needs and concrete action
plans.
Our view is that, after the completion of the analytical and exhaustive description of the market profiles in
the various interested countries (extremely diversified, complex and hardly homogeneous), it will be
necessary to selectively focus our attention and efforts on specific aspects and issues.
Fig. 2
Support Services to SMEs: proposed classification framework
classes or levels of service (a)

medium- medium-
high high
medium
low
low
demand triggers (b) A B C D E F G
autonomous
& I
unregulated spontaneous
stimulated II
constrained III
regulated
compulsory IV
(a) Please see the Appendix - Examples:

A: consulting on strategy, entrepr. & managerial development, venture capital B: technical training
C: promotional support & missions F: basic information services G: premises & facilities, equipment
(b) Legend/examples:
I: generated by user firms, with or without solicitation by suppliers II: incentives offered by a public institution
III: access to services subject to compliance to regulations IV: access to services mandatory (e.g. certification)

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In our view, the intersection of these two dimensions can greatly facilitate the identification of market
segments that present significantly different characteristics, at least from the following standpoints:
· demand profile (in particular, user behaviour and price elasticity);
· suppliers’ profile and value chain configuration (in particular: suppliers’ “ideal” profiles, number of
suppliers, geographical concentration, delivery systems);
· minimum quality standards and benchmarks, best practices, performance measures and metrics;
· visibility requirements and promotional policies.
Obviously, other segmentation parameters (such as industry sector, company size and geographical area)
could fruitfully complement these dimensions and facilitate the identification of priorities, within the
most relevant intersections of the matrix above.
4. TENTATIVE IDEAS AND PROPOSALS ABOUT PRIORITIES,

FUTURE RESEARCH DIRECTIONS AND ACTION PLANS
Here also we provide few examples of suggestions that could emerge from the interpretation of a future
integrated “map” of the situation in the interested countries.
General proposals (by country and/or overall)
Focus public policies on areas (classes of support services, industry sectors, etc.) which present to a
significant extent most of the following characteristics:
· high potential effectiveness of the services in terms of competitiveness growth in the short-medium
term;
· possibility of overcoming the inadequacy of the SMEs’ available resources (technical and
organisational feasibility);
· opportunities for cost reductions in the delivery of services through partial standardisation and
automation of some phases of the service delivery processes (efficiency and economic feasibility);
· …………………………
In order to better identify such areas, we believe it would be useful to complement the statistical and
quantitative data already collected (or to be collected) with qualitative surveys (already partially realised
in some countries: e.g. Delphi, longitudinal case histories which could represent benchmarks or best
practices, etc.).
Specific proposals (by country and/or overall, and according to the scheme suggested in figure 2 above)
Services of class A: consulting on strategic planning and organisation1
1
Assuming that, as we believe, this is a critical area for an improvement in competitiveness.

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……….
Support the planning activity of firms through the development of operational and educational expert
systems (with the possibility of customising the basic applications according to the specific target users
needs) that could be used as a “tool” by certified consultants (this approach could also facilitate the
development of minimum methodological standards)
………………….
Development of Web applications and “virtual consulting” systems (already realised in some European
countries), with the possibility of integrating the applications with automated diagnostic systems (see
above)
………………………….
Services of class A: venture capital for technological and organisational innovation
…an example of support service could be represented by brokerage systems (through the Web): certified
brokers could analyse the applicants’ business plans and identify suitable and interested venture
capitalists
….public or private policies and incentives in this area could easily be integrated with those described
above……
……………………….
Services of class E: information networks that allow a better matching between demand and supply
..a European communication network, supported by the EU, with its own brand name, procedural
standards and marketing systems, could represent the trait d’unionbetween firms and consultants….

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Support Services to SMEs
Appendix to the Draft Interim Report to the Working Group

As indicated in the report, we submit to your attention a classification of service levels (one of the two
dimensions described in the classification framework) based on the following sub-dimensions:
· value added (expected/potential contribution to the users): the expected value added, provided it is
perceived by the users 2, can have a significant impact on the price elasticity of demand (which seems
to be high in several countries, especially with reference to the most “brain intensive” services)
· degree of qualification required from the part of the service providers: this aspect has obviously a
significant impact on the economic profile (especially the cost) of the service.
The combination of these two dimensions gives the following 3x3 matrix, in which we have grouped 4
intersections in order to reduce the number of classes from 9 to 7 (please refer also to Fig. 2 in the report).
Fig. A
Levels and classes of support services
qualification
of
providers
value
added
7 classes: A,B,C,D,E,F,G
In the attached Excel file we reproduced the list of support services contained in the project specifications
(Annex C): we would be grateful if you could assign each service (preferably with a “1” in the
2
The possible discrepancy between the intrinsic potential value of the service and the perception of this
value by the target users could suggest promotional activities.

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appropriate cell), based on your judgement, to one of the nine columns that represent the nine
intersections of the matrix above.

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We easily realise that this classification exercise is quite subjective and could produce different results
depending on your interpretation of the meaning of each item and the specific market situation in your
country. However, if you share our opinion about the meaningfulness of the dimensions and the need for
an integrating framework, we will try to produce, based on everybody’s suggestions, a reasonable
compromise 3 that could help us in summarising the different contributions of the WG.
3
For example, we will try to assess the opportunity of adding new items to the list, maintaining the nine
basic classes or reducing their number to seven (as suggested above) or less.

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ATTACHMENT TO THE DRAFT INTERIM REPORT: PROPOSED CLASSIFICATION OF SUPPORT SERVICES
(2 December 1999)
classes/levels----> high medium-high medium mediuM-low low
A B B C D E F F G
value added----> 3 3 2 3 1 2 2 1 1
qualification of providers----> 3 2 3 1 3 2 1 2 1
n. Categories Typologies of services classification
1 Reception, Facilities First-Stop-shops
2 and Basic InformationOfficial registration and documentation
3 Referral Distribution of pubblication, information packages
4 Promotional activities
5 Provision of facilities (e.g. meeting and office facilities, video-conferencing)
6 Initial diagnosis
7 Signposting
8 Professional Legislation
9 Information Services Market Information (including export markets and public procurement)
10 Company & Financial
11 Technical: standards & certification
12 Technical: patent & copyright
13 Technical: specific areas (e.g. environmental)
14 Advice & Direct SuppBusiness planning
15 Advice on function areas of business activity - (marketing, design, finance, production etc.)
16 Follow-up and accompanying measures
17 Mentoring
18 Consultancy (general management, quality, health & safety, etc.)
19 Devpmt of business contacts (assist. with business co-operation, comm. agents, distributors, jo
20 Schemes to provide direct experience (e.g. of foreign markets and business practices)
21 SME specific training SME Management
22 Start-up
23 Growth & Development
24 Conversion courses
25 Targeted training (women enterepreneurs, ethnic minorities, etc.)
26 Finance Equity finance
27 Loans
28 Direct loan guarantees
29 Mutual loan guarantees
30 Grants & subsidies (e.g. participation in trade missions, assistance to unemployed)
31 Premises & EnvironmIncubation units
32 Business units
33 Technology Parks
34 SME Specific Conferences & Seminars
35 Strategic Measures Trade Fairs
36 Buyers' Exhibition
37 Trade Missions
38 Promotion of Networking
39 Supply Chain Development
40 Cluster Promotion
41 Other suggested items *:
42
43
44
45
* In particular, Internet-based services.

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Support Services To SMEs in Germany, Greece, Ireland, Italy and Sweden - A Comparative Study

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Support Services to SMEs in

Germany, Greece, Ireland, Italy

1. Background, characteristics and expected contribution of

2. Comparisons among countries, following the country

4. Preliminary interpretation and suggested actions 37

1. measures aimed at improving the conditions for a better service delivery

• introduced selectively and according to specific priorities, depending on the relative

• standardised, at least to a significant extent, across countries

• supported by the use of advanced information technology tools

• supported in various ways by the public sector.

Market of Support Services – Final Report – 2000

1.2 Characteristics and expected contribution of this report

§ as an account of a process in which a co-operation among different countries was attempted,

Market of Support Services – Final Report – 2000

2.1 General overview

Market of Support Services – Final Report – 2000

Market of Support Services – Final Report – 2000

Market of Support Services – Final Report – 2000

Market of Support Services – Final Report – 2000

• Unioncamere created and maintains an electronic directory (“Repertorio”) of suppliers on its

Other Italian programs favour the creation of SMEs on a national scale:

• the SEPRI (Servizi Promozionali per le Imprese)Project is co-financed by the European

• the LETE (Lecce-Teramo)Project aims at favouring technological innovation and processes

Ireland too has interesting national programs aimed at supporting SMEs.

Market of Support Services – Final Report – 2000

• the improvement of the visibility of services

• Chambers of Handicrafts and associations of the craft sector

Market of Support Services – Final Report – 2000

Market of Support Services – Final Report – 2000

Market of Support Services – Final Report – 2000

Market The public providers consist of:

Market of Support Services – Final Report – 2000

Market of Support Services – Final Report – 2000

Market of Support Services – Final Report – 2000

Market of Support Services – Final Report – 2000

Market of Support Services – Final Report – 2000

Market of Support Services – Final Report – 2000

Market of Support Services – Final Report – 2000

Market of Support Services – Final Report – 2000

Market of Support Services – Final Report – 2000

Market of Support Services – Final Report – 2000

Market of Support Services – Final Report – 2000

Market of Support Services – Final Report – 2000

Market of Support Services – Final Report – 2000

Actions An important parameter that should be taken into consideration is

Market of Support Services – Final Report – 2000

Market of Support Services – Final Report – 2000

Market of Support Services – Final Report – 2000

Market of Support Services – Final Report – 2000

Market of Support Services – Final Report – 2000

Market of Support Services – Final Report – 2000

4.1 Why this market is important

Taking into account the SMEs major characteristics:

• firms which are likely to need help

• lack of specific know-how

Significantly less important are other reasons such as:

• expected benefits in terms of savings

4.3 Main problems

Apparently, each of these phases presents problems.

Phase 1: searching a provider and awarding the assignment

• scarce visibility of suppliers

Market of Support Services – Final Report – 2000

Phase 2: service delivery