This is the fifth and final of the Enablers of Enterprise detailed in the report, and I believe it's the most important in unlocking the latent potential of the existing entrepreneurial businesses in the UK, let alone encouraging the growth of future firms.

Too many UK firms start up, and then just chug along quite happy with just the founder, or at a fairly small level. In the US the growth rates are much higher.

Part of this can be solved by improving the Culture of Enterprise as I posted about earlier - because the kind of people making new innovations (in universities etc) often think enterprise is a dodgy area to be avoided. As a result Britain is actually quite good at innovating - but our innovations are commercialised abroad. There has been a lot of work to try to get universities and businesses to work together, but it seems to have had limited success. On the other hand US universities are the catalysts for the creation of companies like SUN, Google, etc.

Also, deficiencies in our enterprise culture mean that many businesses owners are scared of 'betting the ranch' on a new innovation, or on growth at all, and would rather just keep doing what they're doing, kidding themselves that customers will always want just the same thing.

The report sets out lots of initiatives that I won't go into detail about here. There's lots of government activity in this field - it was Gordon Brown's pet subject when he was chancellor. However it's all a bit confusing, and just as I said that entrepreneurs simply ignore confusing regulation (in my post on that subject), I'm afraid they simply ignore confusing help too.

The problem here is not whether there are any schemes available to encourage innovation - the problem is no entrepreneur has the foggiest they exist or how to access them.

So I think the priority is to improve the enterprise culture, and then a desire for innovation and growth will follow more naturally.

Aside from this the government seems to be providing the right kind of support here, just not making it very easy.

Business innovation: key new policy proposals

The white paper sets out the following policies:

This Government’s vision is for an environment in the UK in which innovation can flourish where many more businesses identify and capture the benefits of their innovation. The measures proposed will strengthen the productive relationships between universities, businesses and government:

    Government to investigate the role that innovation vouchers can have in encouraging firms to innovate.
    Refocused Small Business Research Initiative (SBRI).
    3-month trial period for new firms registering on supply2gov.uk Government will do more to encourage public sector buyers to register and post opportunities on the site.
    National Council for Graduate Entrepreneurship to establish university enterprise networks.
    Independent review of broadband led by Francesco Caio looking at the possible barriers to any new models of investment.
    Innovation in Services project to understand the barriers to innovation and determine how Government can stimulate and support innovation. Reporting Spring 2008.
    Intellectual Property training programme for all Business Link and UKTI advisers.