The National Systems of Innovation (NSI) approach is a young but successful approach to help to understand how innovation and interactive learning evolve in national economies and how they propel economic prosperity and international competitiveness. The NSI approach has been embraced by policy makers all around the world, because this approach offers them the potential to derive more appropriate leads for innovation policy. In the Netherlands too, the drafting of innovation policy is increasingly based on the NSI concept. The main aim of this study is to add to the understanding of the NSI approach. The research questions addressed in this study include: What are the main concepts, value added and shortcom-ings of the approach? And: How does the NSI approach offer policy makers the potential to derive more appropriate leads for innovation policy towards SMEs?