Strategies of the Development of Entrepreneurship and SME

individuals, rather than well structured mechanisms. In other words, VP/PE need to be extendedand their effectiveness need to be increased. It is clear that capacity and sources of existing VP/PEfirms are insufficient. While Turkey is trying to upgrade its prerequisite for long-termcompetitiveness, it faces with vicious circle due to low input innovation drivers and limitedmarket expectations. Therefore, new business development is limited and mostly not in hightech areas, whereas VC is not developed due to the low numbers of highly profitable eligibleinvestments.6.2.4. Tasks for improvement and future development of the Turkish SME sectorKnow-how in SMEs, mechanisms and institutions supporting the commercialization ofresearch results and the start-up of innovative businesses are not sufficient, relatedmeasurement should be taken to overcome these bottlenecks in front of Turkey in gainingadequate benefits from international market.Companies need additional measures to encourage the creation of VC, PE etc, funds andfinancing the commercialization of R&D results. Also combined effects of scarcity of capital indomestic market, FDI, venture and PE capital funds, not only make difficult to start up, but alsohamper access to international export markets, together with slowly developing internationalnetworks.Due to the low level of awareness of investment in R&D, of innovation in the privatesector and of the implementation conditions of the measures, responsiveness of the respectivetarget groups to the support measures is quite low. As a result, low technological levels ofSMEs constitute the most important obstacle in front of their international competitiveness.Alternative ways should be developed to strengthen programs aimed at promoting technologydissemination towards SMEs and keeping them up with best practices at home orinternationally.Governments should adopt user-friendly administrative documents, public authoritiesshould be urged to increase their electronic communication with the SMEs, which is faster andcheaper, and on-line access to information and services should be improved.Although the diffusion of ICT is among the priorities of the Turkish government, thebroadband penetration rate and overall ICT diffusion in Turkey is low. Thus, measures shouldbe improved to provide the dissemination of ICTs in SMEs.Although Turkey shows relatively good performance in business financed university R&Dand recent efforts to stimulate cooperation between firms and universities have demonstratedpositive results, there is a need to encourage the improvement of university-industrycollaboration through the establishment of technological support and development centers,techno-parks and technology institutes as well as cluster development and networking amongfirms.Creation or initiation of the so called GREEN mutual fund instrument, which helpsenterprises dealing with ecological products and policies and operations, shall be developed.The driving force behind growth of Turkey has been relative cost advantages of itsSMEs. However, some countries, especially China and India are achieving and sustaining amuch better cost position. Changing the sources of competitive advantage from such nonmanagerialfactors as cheap labor and raw materials to such managerial competencies as goodmanagement practices, flexible and clever organizations, knowledge management, etc. shouldbe taken into consideration immediately.134