Innovation is an important driver of economic growth. However, little is known about learning mechanisms by which innovation is created in firms with few formal research-and-development-structures, as is typical of small and medium-sized firms (SMEs). This dissertation aims to provide a detailed understanding of how innovation processes in SMEs are organized and how regional innovation policy in Germany might learn from these insights to better support innovation activities at their specific region. To achieve this overall goal, four research questions are guiding through this cumulative dissertation. First, it is asked what hinders combinatorial knowledge dynamics and second, which mechanisms are used to integrate STI-processes into DUI-mode learning routines. The third question includes which configuration of learning mechanisms leads to high innovativeness and, forth, how CEOs do influence innovation processes in SMEs.