Latest findings from Intuit and Emergent Research on Defining Small Business Innovation indicate, among many things, that key characteristics play a role in truly innovative companies:

• Small business owners are born (natural) innovators and their inspiration or motivation is driven by three needs: necessity, opportunity and ingenuity.

• Six innovation enablers that allow small businesses to more readily identify opportunities, quickly react to changing conditions and remain competitive. They include personal passion, customer connection, agility and adaptation, experimentation and improvisation, resource limitations, information sharing and collaboration.

• A small business’ ability to innovate is also amplified by use of technology, access to capital, fostering a culture that values experimentation and building market knowledge. Government regulation can also spur or rein in innovation.

What happens when small businesses innovate? It not only improves the business and lifestyles of small business workers, it can also alter the overall marketplace through two types of outcomes:

1. Market-sustaining -- improvements to existing products or business processes
2. Market-changing -- shift in competitive landscape

Our friends and colleagues over at Emergent Research write these reports with support from Intuit and the research is filled with insightful ideas.

Read the latest Intuit Future of Small Business Report (part of an ongoing series) here. And we can't help but mention in our Global Small Business Trends 2009 report that "disruptive innovation" will be both the coolest and hottest new growth strategy in 2009 because it will transcend all boundaries and transform businesses.

In case you missed this (I was in France the day of posting), Matthew Bandyk over at US News and World Report wrote an interesting piece called "Best Small Business to Start: Going-Global Firms."

He mentions two very good reports that you might want to back track on:

1. UPS Business Monitor Report (Global, Americas, Europe and Asia -- I am sure they will update soon to reflect our current global economic environment).

2. Intuit Future of Small Business Report (all three report segments are featured and offer a beacon to the future).

And we are always delighted when our blog is mentioned (hat tip to Matthew even if we are a little late!).