Funding competition Business Basics 3: SME technology use (non-business led trials EoI)

Organisations can apply for a share of up to £2 million to run trials in England to test ways to encourage SMEs to adopt existing productivity-boosting technologies.

Competition opens: Wednesday 2 October 2019
Competition closes: Wednesday 4 December 2019 12:00pm

This competition is now closed.

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Description

The Department for Business, Energy and Industrial Strategy (BEIS) will work with Innovate UK, part of UK Research and Innovation, to invest up to £2 million in projects.

In this competition we will fund trials which test different approaches to encouraging micro, small and medium-sized enterprises (SMEs) to adopt existing technologies. These must support business and administrative functions, such as payment practices, accountancy and human resources.

This first phase is for expressions of interest (EoI). EoI submissions will be assessed by a panel consisting of BEIS, the Innovation Growth Lab (IGL) based at Nesta, and Innovate UK.

If your EoI is successful, you will be invited to submit an application for the full phase.

This EoI competition closes at midday 12pm UK time on the deadline stated.

Funding type

Grant

Project size

Your project’s total eligible costs can be up to £400,000.

Who can apply

Lead organisation

To lead a project or work alone, your organisation must:

be a UK registered public sector organisation, university or research and technology organisation (RTO), charity or not for profit company
claim funding

Find out which definition your organisation falls into.

If your organisation is a for-profit business, see the Business Basics 3 SME technology use (business led trials EoI) competition.

Project team

We welcome projects involving diverse organisations. To work with the lead organisation and receive funding you must:

be a UK registered business, academic institution, charity, not for profit company, public sector organisation or RTO
have a legal entity

Find out which definition your organisation falls into.

Your project

Your project can include partners that do not receive any of this competition’s funding, for example non-UK businesses. Their costs will count towards the total eligible project costs.

Your project’s total eligible costs can be up to £400,000.

You must carry out your project work in England only.

Projects must start on 1 June 2020 and end by 28 February 2022 and can last up to 20 months. Your final report must be submitted before the end of your project. You must share project data with BEIS at the end of your project so it can carry out evaluation activity, such as an evaluation of the longer-term impact.

Your commitments

EoI applications will be shortlisted according to how well they meet the scope and aims of this competition. If you are successful in this phase you must attend a trial development workshop before submitting an application to the full phase. The workshop will help you develop and refine your full phase proposals particularly in relation to evaluation.

If you are invited to apply for the full phase you are required to work with our independent expert advisors at IGL, to refine the design of your evaluation plans. This guidance and support is free of charge.

If you are successful in receiving funding in the full phase competition you must agree at the start of your project to undertake a start-up period of up to 3 months. This will be to carry out activities such as completing:-

a registered protocol and getting it agreed and signed off by IGL and BEIS
an SME recruitment plan
baseline data activities

You must:

have an independent evaluation partner in place before the start of the project, and ideally before applying for this EoI
follow the principles outlined in the BEIS Business Support Evaluation Framework
agree to have your project’s results independently evaluated and published

State aid

Any organisation claiming funding must be eligible to receive state aid at the time we confirm you will be awarded funding or must explain why this is not applicable. If you are unsure, please take legal advice. For further information please see our general guidance.

De minimis

If you are carrying out economic activity in the project, you must be eligible to receive de minimis funding and each partner must complete the de minimis declaration. Please see the funding section for further information.

Multiple applications

Any organisation can be involved in any number of applications.

Previous applications

Resubmissions

You can use a resubmission to apply for this competition. A resubmission is a proposal Innovate UK judges as not materially different from one you've submitted before. It can be updated based on the assessors' feedback.

If you submit a new proposal this time you will be able to use it in no more than one future competition that allows resubmissions.

Previous projects

Under the terms of Innovate UK funding, you are required to submit an independent accountant’s report (IAR) with your final claim. If you or any organisation in your consortium failed to submit an IAR on a previous project, we will not award funding to you in this or any other competition until we have received the documents.

Funding

We have allocated up to £2 million to fund projects in this competition.

You can apply for a total of up to £400,000 grant funding for a project.

You can receive funding of 100% of your eligible project costs. For universities, this equates to 80% of full economic costs (FEC).

All activities must be in line with state aid rules. In this competition we will accept applications for grants:

Where the applicant is not acting as an undertaking and therefore the grant is not considered to be state aid. This means you do not intend to engage in economic activity as the result of your proposed project. You must provide a legally binding statement to this effect if we offer you a grant.
Which would be provided under the “de minimis” level of state aid. This is defined as a single undertaking funded less than 200,000 euros over 3 consecutive fiscal years. See pages 20 to 21 of the state aid manual for further guidance. Successful applicants who are claiming de minimis funding will need to complete a self-declaration form confirming their eligibility to receive de minimis funding.

If you choose either the non-state aid option or the de minimis option you will be responsible for ensuring you are, and remain, eligible to receive funding. If you are later found to be ineligible, you will be liable to full recovery of grant by Innovate UK, potentially with interest charges.

You must clearly specify in your application how your proposal meets state-aid funding rules, including the conditions above. Each project partner must use the option appropriate for them.

We are not authorised to provide advice on state aid, and you should seek independent guidance.

Further details will be provided in the briefing events.

Your proposal

The aim of the Business Basics Fund is to test the most effective ways of encouraging SMEs to adopt existing technologies that are proven to boost productivity.

In this competition we will fund trials which test different approaches to encouraging SMEs to adopt existing technologies that are associated with productivity improvements.

Your proposal must focus on technologies which support business and administrative functions, such as payment practices, accountancy and human resources. Examples of the types of technologies in scope include one or more of the following:

accountancy software
e-commerce transactions?
payment technologies, such as e-invoicing
cloud based computing?
customer relationship management (CRM) software?
supply chain management (SCM) software?
HR management systems (HRM) software?
enterprise resource planning (ERP) software (which can include CRM, SCM, HRM, finance, purchasing and so on)?

Your proposal must demonstrate:

how your approach intends encourage more SMEs to use the technologies
that your project has potential to be effectively scaled
that your project is innovative and will add to the evidence base

We are looking to fund a portfolio of projects, across a variety of technologies, markets, technological maturities and research categories.

Evaluation expectations

You must evaluate your project and demonstrate that the approaches you are testing have the potential to deliver the required outcomes and impacts.

Your project must use one of the following methods for evaluation:

randomised controlled trial (RCT), which randomises participants into treatment and control groups, collecting data before and after the intervention for both the treatment and control groups, and achieving 5 on the Maryland Scientific Methods Scale (SMS)
quasi-experimental methods, such as regression discontinuity design (RDD), where randomisation is not possible, and achieving 4 on the Maryland SCS)

See the BEIS Evaluation Framework for further details on acceptable methods to use.

Data collection and sharing

Project results will be independently evaluated and published. In applying for this competition, you agree to share all data collected as part of the trial with BEIS (the data controller), including permitting BEIS to share with any potential appointed contractor. This is for further research and evaluation purposes. You must act in accordance with the GDPR and ensure the appropriate data privacy notice is given prior to any data collection.

Specific themes

We welcome proposals that focus one or more of the following:

adoption of technologies to tackle late payments
improving awareness of relevant technologies
employee engagement to build firms’ confidence of how technology can be applied in their business, such as digital skills
management practices as enablers in encouraging technology adoption
facilitation of advice and ways to encourage adoption through trusted advisors, supply chains, informal peer-to-peer networks and so on
comparison of lower cost interventions can deliver similar benefits to more intensive support, particularly current business support activities
exploring issues facing firms with specific characteristics, such as family run firms

Projects we will not fund

We will not fund projects that:

focus on developing new technology or software
do not focus on areas that are applicable to the majority of SMEs
do not address the target audience of mid to low productivity SMEs
do not generate robust evidence
do not align with the Business Basics Fund objectives

2 October 2019: Competition opens
22 October 2019: London briefing event
29 October 2019: Online briefing and evaluation webinar recording
4 December 2019 12:00pm: Competition closes
18 December 2019: Invitation to submit full application
18 December 2019: Applicants notified

Before you start

You must read the general guidance for applicants before you start.

Pre-scope assessment

For advice on whether your proposal is likely to be in scope, bidders may send an outline (one page maximum) to Clair.Bowman@beis.gov.uk and Natalia.Davie@beis.gov.uk.

Full phase trial development workshop

IGL Nesta will run a workshop to help applicants develop the evaluation elements of their trial, ahead of submitting a full application. Attendance on either 17 January or 24 January in central London is a mandatory requirement so please provisionally hold both of these dates.

What we will ask you

The application is split into 2 sections:

Project details.
Application questions.

1. Project details

This section sets the scene for the assessors and is not scored.

Application team

Invite colleagues to contribute to your application and other organisations to collaborate on your project.

Application details

The lead applicant must complete this section. Give your project’s title, start date, duration and say if the application is a resubmission.

Project summary

In up to 600 words, describe your organisation, partners and project. You must clearly state:

who will deliver the project, including the lead applicant, funded and non-funded partners, giving:

Organisation name
Type of organisation (for example business, LEP, trade association, charity, etc)
Their role in the project
Websites

the types of technologies you will be focusing on increasing the adoption of, and the rationale for your choice
the planned methods/approaches to improving adoption you will be comparing
the size, sector and geographical locale of the firms that you are targeting in England
the anticipated number of SMEs to be sampled, how you will recruit them and justification for sample size
a description of how your project is innovative
a high-level description of the evaluation, including how you will measure the impact of your different approaches and how they relate to productivity.

Scope

Describe how your project fits the scope of the competition as outlined in the scope section. If your project is not in scope it will be immediately rejected and will not be sent for assessment. We will give you feedback on why.

Your answer can be up to 400 words long.

2. Application questions

For this EoI, BEIS, the IGL based at Nesta and Innovate UK will assess your project based on your answers to the application questions. Your application will not be scored but you will receive a summary of the feedback.

Your answer to each question can be up to 500 words long. Do not include any URLs in your answers.

Question 1. Barriers to SME adoption

What barriers and/or opportunities will you address relating to the adoption of productivity-boosting technology or technologies by SMEs?

Describe:

which specific existing technologies listed in the scope your project will focus on
the evidence that these technologies can increase SME productivity, including references to any supporting information such as other research, or your own information
the specific barriers to adoption that you will be focusing on, and the evidence of these barriers, such as time, capacity or skills
which stage of the adoption process the project will tackle, such as increasing awareness, changing attitudes, increasing ability to introduce change, adopting and/or implementing or a combination,
why you are focusing on this stage of the adoption process
who your target audience of SMEs is, such as sector, geographical location, or size
why and how your target audience will be affected if the barrier is removed

Question 2. Solution and approach

What is your idea for addressing these barriers and/or taking these opportunities, and why do you think it will be successful?

Describe:

the interventions approaches or solutions you are proposing
why do you think this approach will work
whether you have you developed and tested your idea, what you have done and what further work is needed to develop your approach
whether this approach links to your existing strategy and activities and whether it represents a new programme, an addition or a change to an existing one?
what is innovative about your proposal

Question 3. Evaluation approach

How do you plan to evaluate your project and why have you chosen this approach?

Your approach should follow the principles outlined in the BEIS Business Support Evaluation Framework.

We encourage a ‘mixed method’ approach, where qualitative evidence is used to improve the understanding of the context and cause and effect, alongside the quantitative approaches.

Please set out:

your research questions and the primary focus of your evaluation. For example: does offering 30 hours of free business coaching and a grant to SMEs lead to greater uptake of technology by those SMEs, compared to providing a grant only?
the primary outcome you are trying to change and measure (this can be demonstrated in a logic model)
the methodology you are using to measure the impact of the interventions you are testing
how you will recruit SMEs as part of the study and what would be your approximate sample size, and why
sources of data and data collection methods (quantitative and qualitative)

You can submit an appendix as a PDF of up to 2 pages long to support your answer. The font must be legible at 100% zoom.

Question 4. Project delivery and key risks

How will you deliver your project successfully?

Describe:

who you will need to work with to deliver the project, including partners and stakeholders, and describe their knowledge, skills and experience
the process and estimated timelines for recruiting the target group of SMEs to the trial
the main risks to the successful implementation of the proposal including the technical, commercial and managerial risks
any mitigation approaches to the main risks

See the supporting information of this competition brief for help on finding an evaluation partner. You must submit one appendix describing the skills and experience of the main people working on the project to support your answer. It must be a PDF and can be up to 4 pages long. The font must be legible at 100% zoom.

Question 5. Value for money

How much will the project cost and how does it represent value for money for the taxpayer?

Describe:

the total or estimates on the project cost and the grant being requested in terms of the project goals
the basis for the costs and an explanation of how the costs were determined, such as previous trials, day rates and so on
your estimate of the level of benefit for each individual SME, such as the nominal value or cost of support received
whether the SMEs will be expected to provide some form of contribution
how this project represents value for money for the taxpayer and how it compares to what you would spend your money on otherwise.

Interviews (full phase)

If your written application for the EoI is successful and you are also successful in the full phase, you will be invited to attend an interview, where you must give a presentation. We will give details in the full phase competition brief.

Background and further information

Background to Business Basics

The government’s Industrial Strategy set out our aim to create an economy that boosts productivity and earning power throughout the UK.

The purpose of the Business Basics Programme is to identify and test the most effective, scalable interventions which encourage SMEs to adopt existing technology and management practices that drive productivity improvements.

The objectives of the Business Basics Fund are to:

1. Raise the productivity of small to medium-sized enterprises (SMEs) by:

identifying and testing the most effective, scalable interventions which encourage SMEs to adopt productivity boosting existing technology and modern business practices
testing which interventions have the most impact on SME productivity

2. Drive innovation by:

sourcing new ideas from traditional and non-traditional sources
taking a dynamic, experimental approach in order to learn and develop as the project develops
supporting new initiatives and leaving a legacy of quality data and evaluation to inform future research

3. Enable better investment decisions at a local and national level by:

providing a new, robust evidence base for those interventions which are the most effective in raising productivity
taking an inclusive approach such as by involving SMEs from different areas and different sectors, and focusing on the transferability and scalability of interventions

The programme is funded by the Department for Business, Energy and Industrial Strategy (BEIS). The fund is administered by Innovate UK on behalf of BEIS.

Evaluation

The Business Support Evaluation Framework sets out the quality standards that are expected for impact evaluations of BEIS-funded business support programmes. The framework will also enable comparison of the effectiveness of different policies and programmes. It is designed to assist policymakers, evaluators and delivery bodies in generating robust evidence of what works, so BEIS can make better informed decisions of current and future policies.

Partnering

You do not have to have an evaluation partner in place at this EoI stage but is recommended. If you do not have a partner when invited to the full-stage competition, IGL may be able to help you find a suitable partner. We will provide further details will be if you are invited to the full-stage competition.

Scope and evaluation webinar

We will run a webinar covering the scope of the competition evaluation requirements and how to apply on 29 October.

Live event

A live briefing event is listed in the dates tab of this competition brief. There you can learn more about the scope of Business Basics, meet potential partners, ask the BEIS team questions and understand the competition process.

Further sources of guidance and information

For background and guidance, including details of projects funded under previous rounds, see the Business Basics programme page on GOV.UK.

On the 19 June, the UK government announced its response to Creating a responsible payment culture: a call for evidence on tackling late payments, setting out measures for tackling late payments including Business Basics funding of up to £1 million, to encourage businesses to use technology to simplify invoicing, payment, credit management and so on.

Extra help

For more information about submitting your application, email us at support@innovateuk.ukri.org or call the competition helpline on 0300 321 4357 between 9am and 5:30pm, Monday to Friday.

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