Many countries are aware of the importance of SMEs (Small-Medium Enterprises) competency in terms of their long-term competitiveness. The government has been directly or indirectly supporting their growth, which is reflected through demands from the i...
Many countries are aware of the importance of SMEs (Small-Medium Enterprises) competency in terms of their long-term competitiveness. The government has been directly or indirectly supporting their growth, which is reflected through demands from the industrial level, technologic level and regional level. In order to foster the more strong SMEs, many countries deploy various political efforts. Especially, enhancing the competitiveness of SMEs has been recognized as a driving force in the national economy and industrial growth. The policy for SMEs under the process of globalization focuses on enhancing their competitiveness. This policy must support ways to improve competency of the SMEs in a fast-paced environment. The Korean government has also been deploying various support policies for SMEs for many years. On the supply side, the government has been deploying various business policies for SMEs, but SMEs are perceived to lack in-formation about the business support policy. Therefore government authorities should develop a more effective policy approach by responding to their demands. SMEs support policies are important in terms of job creation and enhancing industrial competitiveness, as well as a promoting a high proportion of SMEs within an industrial structure. A high proportion of me-dium-sized enterprises in the national economy is essential for progress to a sophisticated industrial structure. At the national level, it is very important for small, medium, and large companies to form an evenly com-posed, interconnected industrial integration. The growth patterns of companies have important implications for industrial growth. As a small company grows into a medium-size company, a medium-sized company grows into a large company. The political effort to strengthen the competitiveness of SMEs is required. Business policy should be fo-cused on needs of industrial field rather than the supply side. The business policy must excavate by the multi-dimensional analysis in terms of industry, technology (an initial technical, commercial technology), region (strategic industry, traditional industry) and firm characteristics (stage of growth, firm size, etc.). According to previous research, the growth factor in the each growth stage is different according to the characteristics of the company, technology innovation strategy, resources, and management factors. The per-formance of innovative activities will be created through company competency (R&D, sales and marketing). Because these innovative activities will be created by the company resources and corporate culture, they de-pend on each growth stage. Based on previous research and these research objectives, we set up hypotheses as follows: Hypothesis 1: The innovation competency of SMEs will be different by growth stages. The government has been deploying various business policies for SMEs. But, because the management sit-uation of SMEs is different, their policy demands will be different. SMEs need a different strategy for solving each problem, so the SMEs business policy demands will be different. Hypothesis 2: The demand of business policy in each growth stage will be different. In this study, we have tried to find the policy direction to improve innovation competency in the growth stage of SMEs. We suggested discriminatory approach methods about the business support policy by growth stages. To achieve the objectives of this research, we surveyed and analyzed by statistic methods companies in the Chungnam area. Based on this research purpose, we surveyed 243 companies in Chungnam area. The target companies for survey participated in this program in order to foster local industry in the Chungnam area. We sent the ques-tionnaires and welcomed any request for help. We received their responses bye-mail or fax. By cooperating with related organizations, we made a list of 280 companies from the target group. Then we gathered the re-sponses from 250 companies. The rate of response was 88.66%. The empirical analysis of growth stages fol-lowed the two-step process for grouping and identification of stages and difference between the groups. In the first step we grouped the sample group by variables of selected growth stage. In the second step, we used the analysis of variance (ANOV A) in order to find the difference of innovation competency and the demand of business policy among growth stages. The main analysis results are as follows. First, by comparing the innovation competencies with growth stages, we found significant differences in relationship assets, corporate culture, and research and development. Secondly, by comparing the demand level for business support policies with growth stages, we found significant differences in research and development, marketing, and exchange of information. The detailed results by growth stages are as follows: First, in the product development stage after start-up (Stage 1), innovation competency is lower in the R&D sector and asset of relationship. So a support program to improve competency is necessary. In this stage, the level of policy demand about R&D, marketing, and information exchange was higher than in other stages. Second, in the initial production and marketing stage (Stage 2), the innovation competency about corporate culture was lower than other stages. The policy de-mands about R&D and information exchange was lower than other stages. Third, to ensure a stable market stage (Stage 3), the innovation competency on asset of relationships was higher than other stages. There is no uniqueness of the relative difference between the policy demands. Fourth, in the expansion of market for subsequent product development (Stage 4), the innovation competency in R&D was higher than other stages. The policy demands on marketing and information exchange were higher than other stages. As a result, the corporate resources and capabilities are lacking in the early stages of growth. The support for various types of policies should be pursued. In the mature stage, SMEs had increased their R&D capabilities and the marketing demand was relatively high. The exchange of information is high in the early and maturity stage. As a result, we were able to identify the differences and improvement elements on innovation competency of SMEs by growth stages. Consequently, we proposed the necessity of differentiating policies by growth stages of SMEs, because there are different business support policy demands by growth stages of SMEs. Based on the results of these studies, we expect to increase the efficiency of business support policy, by finding customized policies with the industry demand.