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The Role of KOSGEB Supporting Small Business Development in the Province of Manisa, Turkey: The Role of KOSGEB Supporting Small Business Development in the Province of Manisa, Turkey: The Role of KOSGEB Case study prepared by the OECD Local Economic and Employment Development Programme BUILDING CAPACITY TO DESIGN LOCAL DEVELOPMENT STRATEGIES: THE ROLE OF KOSGEB IN SUPPORTING BUSINESS DEVELOPMENT, TURKEY© OECD 2013 This work is published on the responsibility of the Secretary-General of the OECD. The opinions expressed and arguments employed herein do not necessarily reflect the official views of the Organisation or of the governments of its member countries. This document and any map included herein are without prejudice to the status of or sovereignty over any territory, to the delimitation of international frontiers and boundaries and to the name of any territory, city or area. The statistical data for Israel are supplied by and under the responsibility of the relevant Israeli authorities. The use of such data by the OECD is without prejudice to the status of the Golan Heights, East Jerusalem and Israeli settlements in the West Bank under the terms of international law. Cover prepared by François Iglesias (OECD/LEED) © OECD 2013 You can copy, download or print OECD content for your own use, and you can include excerpts from OECD publications, databases and multimedia products in your own documents, presentations, blogs, websites and teaching materials, provided that suitable acknowledgment of the source and copyright owner is given. All requests for public or commercial use and translation rights should be submitted to [email protected]. Requests for permission to photocopy portions of this material for public or commercial use shall be addressed directly to the Copyright Clearance Center (CCC) at [email protected] or the Centre français d'exploitation du droit de copie (CFC) at [email protected]. PREFACE – 3 Foreword The success of a country’s economic development largely depends on whether it succeeds on a local and regional scale. There is a great need to create a collaborative environment for joined up working of all the local, regional and institutional actors. Delegation and strengthening local activities at the national level not only increases the effectiveness of central policies but promotes democracy and creates equal opportunities for social cohesion as well. Local and regional governments, local agencies and other local actors are therefore key elements in ensuring economic and social development. Local development policies and local initiatives should be strongly integrated into national strategies. The OECD Local Economic and Employment Development (LEED) is carrying out research in many countries to identify best practices of local development. Turkey’s decision to participate in the LEED project “Building Capacity to Design Local Development Strategies” is paving the way for similar research and application in many of its provinces, beginning with Manisa, where the project has been implemented. KOSGEB (Small and Medium Enterprises Development Organizaton) is one of the local actors in Manisa Province. KOSGEB’s mission is to increase the share of SMEs involved in economic and social development by providing qualified service and support so as to improve SMEs’ competitive power and disseminate a culture of entrepreneurship. Under this new approach, and in parallel to its extended mandate and coverage, KOSGEB has entered into an important period of change. The New Supports Programs within KOSGEB’s new vision have been designed with a participative approach, in which the opinions, needs, demands and expectations of SMEs and sectoral organisations have been considered every step of the way. Through its support programmes, KOSGEB plays an important role in the local development of the provinces. We believe that the findings and recommendations in this report will bring a new perspective to SME-related policies in Turkey for creating new local development strategies and contribute to the targets set for 2023, the 100th anniversary of Turkey. Mustafa Kaplan President Small and Medium Enterprises Development Organizaton (KOSGEB) Ministry of Science, Industry and Technology BUILDING CAPACITY TO DESIGN LOCAL DEVELOPMENT STRATEGIES: THE ROLE OF KOSGEB IN SUPPORTING BUSINESS DEVELOPMENT, TURKEY© OECD 2013 ACKNOWLEDGEMENTS – 5 Acknowledgements This case study reviews the role of KOSGEB (Small and Medium Enterprises Development Organization, Turkey) Service Centre in Manisa Province in supporting business and entrepreneurship development as part of the region’s wider economic development strategy. The review took place in the context of the enlarged mandate of KOSGEB, whose responsibility is no longer limited to providing support to SMEs in the manufacturing sector, but covers other economic sectors as well. A field visit to Manisa Province took place at the end of 2010 with the objective of interviewing key local stakeholders, those responsible for SME and entrepreneurship development, as well as those from the business community. The findings of this report also draw on a background report provided by a local expert prior to the field mission. In addition, a quick assessment of the implementation of the EU Small Business Act for Europe was conducted in Manisa Province in 2011. This report was prepared under the co-ordination of Ekaterina Travkina and Andrea- Rosalinde Hofer, Policy Analysts, OECD LEED Programme. Murat Demirez, Director, Regional and Local Development Unit, KOSGEB and Fatih Büyükfidan, SME Expert, Regional and Local Development Unit, KOSGEB, co-ordinated the work on this project in Turkey and provided valuable background information and comments on the report. We are particularly grateful to Recep Özçevik, Director of KOSGEB Manisa Service Center for his valuable contribution during the field visit. The main contributors to this report are Neil MacCallum, independent consultant, former Head of Appraisal and Evaluation at Scottish Enterprise and Head of Strategy and Policy with the Scottish Chambers of Commerce; Friederike Welter, Managing Director Institute for SME Research, IfM Bonn, Germany; and Aykut Lenger, Associate Professor, Department of Economics, at Ege University, Izmir, Turkey. Thanks also go to François Iglesias OECD LEED who designed the cover and Jennifer Allan who formatted and edited the report. BUILDING CAPACITY TO DESIGN LOCAL DEVELOPMENT STRATEGIES: THE ROLE OF KOSGEB IN SUPPORTING BUSINESS DEVELOPMENT, TURKEY© OECD 2013 TABLE OF CONTENTS – 7 Table of contents Acronyms and abbreviations ...................................................................................................... 9 Executive summary ................................................................................................................... 11 Chapter 1 Socio-economic and SME policy context in Manisa Province ............................. 19 Industry .................................................................................................................................... 20 Technological change and innovation ..................................................................................... 21 Human capital .......................................................................................................................... 23 Regional development and SME policy institutional framework ............................................ 25 Governor’s Office in Manisa, Provincial Directorate of Planning and Co-ordination ............ 25 References ................................................................................................................................ 31 Chapter 2 Financial assistance to SMEs ................................................................................. 33 The importance of access to finance for SMEs ........................................................................ 34 Assessment of KOSGEB’s activities and achievements in Manisa ......................................... 35 Lessons from other countries ................................................................................................... 37 Conclusions and recommendations .......................................................................................... 44 Chapter 3 Skills for business development and growth ......................................................... 51 The importance of skills for business development and growth .............................................. 52 Assessment of the current situation ......................................................................................... 53 Lessons from other countries ................................................................................................... 59 Conclusions and recommendations .......................................................................................... 60 References ................................................................................................................................ 63 Chapter 4 KOSGEB's programme evaluation and impact assessment ................................ 65 The importance of setting up an evaluation framework .......................................................... 66 Developing a planned approach ............................................................................................... 68 An evaluation approach for KOSGEB: Recommendations ..................................................... 70 Lessons from other countries ..................................................................................................
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