To develop new cross-sectoral industrial value chains across the EU, by building upon the innovation potential of SMEs. The EU needs to support the development of emerging industries, which will provide the growth and employment of the future. The reindustrialisation of the EU's industrial base has to focus on the development of long-term internationally competitive goods and services that require combining different competences and innovative solutions. The development of new industrial value chains calls for the collaboration and integration of different innovation actors, including large enterprises and especially SMEs, across different sectors towards the implementation of a joint vision.

SMEs need help to generate, take up and better capitalise on all forms of knowledge, creativity, craftsmanship and innovation - including for the application of existing cross­cutting or emerging technologies, advanced manufacturing, ICT, eco-innovative and resource- efficient solutions, new business models, service innovation and design. The potential of clusters - that represent favourable ecosystems for innovation and entrepreneurship - need to be better exploited in this respect.

Cross-border and cross-sectoral collaboration, innovation and entrepreneurship across different regions and value chains shall be promoted. The coordination and facilitation shall be led by cluster organisations and other intermediary organisations, by following a systemic approach that combines different resources, tools and instruments. Innovation actors, especially SMEs with mutually reinforcing competences, shall be supported in view of creating new industrial value chains that foster the development of emerging industries in Europe.

To this end, proposals shall outline a strategic vision for building new industrial value chains across the EU Member States and Associated Countries. They shall specifically focus on integrating and supporting groups of SMEs in collaboration with other innovation actors in addressing specific problems and challenges. Cluster organisations or other SME intermediaries shall be invited to set up collaboration and networking activities for SMEs and create a favourable "open space" for cross-sectoral fertilisation and value chain innovation to take place. Each proposal should demonstrate the capacity to:

1. validate ideas for structured innovation projects driven by SMEs from different sectors and countries in collaboration with other innovation actors and facilitate the coordination towards new industrial value chains through this collaboration space.
2. support innovation activities and/or channel a mix of different targeted entrepreneurial and innovation support measures (such as mentoring, coaching, innovation and technical assistance vouchers, etc.) directly to the innovation actors of the validated innovation projects to further support their development, integration and large-scale demonstration in a strategic manner. At least 75% of the total proposed budget shall be allocated to support innovation in SMEs directly, whereby the SMEs benefit by either participating in the consortium or by receiving financial and/or other support as a third party (enterprise) in line with the conditions set out in General Annex K of the work programme.

Background information and guidance on the systemic approach and strategic focus to be envisaged is provided to applicants at the EU Cluster Portal^[1] and in the background note^[2] being part of this call. Synergies will be sought with other measures that are supporting such large-scale demonstration projects, in particular under the European Structural and Investment Funds (ESI Funds) and COSME. This includes the thematic Smart Specialisation Platforms^[3]- notably the one on Industrial Modernisation, European Strategic Cluster Partnerships^[4], the European Cluster Collaboration Platform^[5] and the European Observatory for Clusters and Industrial Change^[6] as well as partnerships under the pilot action for interregional partnerships for innovative projects^[7]. These synergies will be actively encouraged in the applicants' project partnership building and project implementation, notably through the engaged SME intermediaries. “Large-scale” does not necessarily refer to the amount of financial support provided for a particular project but to the extent of the roll-out of a staged process of experimentation and implementation with accompanying support that reaches out to groups of mutually reinforcing SMEs. This approach aims at “demonstrating at large scale” the potential impact of innovative solutions to specific challenges, rather than supporting isolated projects or SMEs.

For the first stage of the submission procedure, applicants should provide a concept note (of max. 10 pages), which should include a clear description of the ideas and objectives for an innovation action towards the development of new industrial value chains as well as an explanation of the main activities, implementation modalities (including for financial support to third parties, if applicable, and how to achieve the target of allocating at least 75% of the total proposed budget to support innovation in SMEs directly) and expected results foreseen (please refer to the grant conditions for this topic).

The concept note should further describe how the proposed systemic approach and strategic focus promises significant impact on economic growth and job; demonstrates a European dimension and added value; and has the potential to act as a catalyst by contributing to and/or leveraging other activities supported, for instance, under the European Structural and Investment Funds, e.g. in the context of smart specialisation strategies.

An estimate of the total costs of the proposed action and contribution to be requested from the Commission shall also be provided. Only proposals that pass the evaluation threshold for the first stage will be invited to a second stage of submission for a full proposal with a detailed description of the budget and activities planned to be undertaken.

The Commission considers that proposals requesting a contribution from the EU of between EUR 2.5 and 5 million would allow this specific challenge to be addressed appropriately. Nonetheless, this does not preclude submission and selection of proposals requesting other amounts.

• Strengthen industrial leadership in the EU Member States and Associated Countries by reinforcing value chains that integrate innovative solutions in SMEs, along and across existing value chains.
• Stimulate the creation of new globally competitive industrial value chains across the EU Member States and Associated Countries to accelerate the development of emerging industries, which will boost industrial competitiveness and underpin future economic growth, jobs, and progress towards a resource-efficient economy.
• Further leverage and complement support for innovation in SMEs and other funding, which may be provided by national or regional authorities (including under the European Structural and Investment Funds) and/or by private investors (upfront or as follow-up investments), including in relation to the European Fund for Strategic Investments.
• Contribute to the implementation of regional and national research and innovation strategies for smart specialisation strategies (RIS3), modern cluster policies as well as of strategic inter-regional collaboration under thematic Smart Specialisation Platforms and cluster partnerships supported by the European Cluster Collaboration Platform and the European Observatory for Clusters and Industrial Change by capitalising upon concentrated and complementary competences for the development of new industrial value chains and emerging industries with a clear EU added-value.
• Provide a clear and measurable contribution to the innovation performance of the supported SMEs in the short-term - as revealed by indicators such as numbers of new or significantly improved products (goods and/or services), processes, new marketing methods, or new organisational methods -, and to its impact on resource efficiency and/or turnover. A wider impact is also expected in the medium-term.
• Improve the business environment of the supported SMEs by establishing open collaboration spaces that can involve innovation actors from different sectors and countries. This will lead to the creation of new ideas for innovation and new collaboration partnerships, which will be subject of further development and with the potential for further impact on business turnover.

[1]http://ec.europa.eu/growth/industry/policy/cluster

[2]This Background Note provides explanations about the context, concepts, systemic approach and strategic focus. It also offers some lessons learnt with examples from the first generations of INNOSUP-01 projects. See: http://ec.europa.eu/research/participants/data/ref/h2020/other/guides_for_applicants/h2020-guide-note-innosup-1-18-20_en.pdf

[3]http://s3platform.jrc.ec.europa.eu/s3-thematic-platforms

[4]https://www.clustercollaboration.eu/eu-cluster-partnerships

[5]https://www.clustercollaboration.eu/

[6]https://ec.europa.eu/growth/industry/policy/cluster/observatory

[7]See: http://europa.eu/rapid/attachment/IP-17-1995/en/SmartSpecialisation_PilotActions.pdf