ERC - ResPap112 Policy Briefing Advice and SMEs Who Takes it and What Happens Thereafter Brown Cowling Sun

To address this important research question we draw upon the Longitudinal Small Business Survey (LSBS) undertaken by the UK’s Department of Business and Trade, to provide new insights into the benefits of different kinds of business advice and how this affects the levels of innovative and productivity within UK SMEs. [...] Often advice is treated as a universal offering in the literature, but our distinction enables us to categorise and assess the impact of different types of advice on firm performance. [...] On average, around a quarter (27%) of the firms in our sample engaged in some form of external advice and they are most inclined to use advice related to day-to-day operations. [...] While taking a combination of both day- to-day and strategic advice enhanced productivity, it appears that for the most “radical” innovators the pursuance of strategic advice was the critical factor enhancing performance. [...] To increase productivity across the SME population as a whole, promoting the benefits of these services to firms together with enabling greater access to more strategic sources of business advice seem legitimate and desirable policy objectives.