Leveraging untapped potential
German SMEs stand out for their expertise and innovativeness. However, German SMEs are traditionally reticent to engage with non-German innovation offerings and do not participate in the international exchange of knowledge. Major German and international companies have acknowledged the need for international R&D and have already established centers in Israel in order to leverage its innovation potential. "While looking for potential business partners and technologies in Israel over an 18 month period, I was introduced to more innovation opportunities for the pharmaceutical industry there than I have in two years in Germany," reports Dr. John-Edward Butler-Ransohoff from Global External Innovation & Alliances Group at Bayer.
As the study shows, German SMEs are beginning to acknowledge this potential as well. Indeed, the findings point to a strong interest in forming business partnerships with Israeli firms, although only a handful of these SMEs have actually taken steps to do so.
Networking with Israeli businesses is very cost-effective. The country supports innovation processes in businesses through centralized R&D support that is offered by the Innovation Authority and features a deep pool of STEM talent. Israel also offers an engaged network of government and non-government innovation stakeholders on the ground, which helps in navigating and reducing the time and money invested in bureaucratic procedures.
A large number of startups in Israel's automotive, electronics, Industry 4.0, Internet of Things, renewable energies and cyber sectors in particular are interested in cooperating with German SMEs. In addition, attitudes among stakeholders in both countries complement each other: