"Never walk into an environment and assume you understand it better than the people who live there." Mr. Kofi A. Annan" , The Secretary-General of United NationsInnovative challenges of SME's and kaleidoscope thinkingRegardless of the size of a small or medium-sized (SME) firm, the spectrum of innovation challenges remains the same. Similarly, the management responses must be timely, flexible and make optimal utilization of all resources - financial, human and technical. What is different in an SME is the strengths enjoyed by start-up and medium-scale operations that incite imagination, energy, timely responses to the marketplace, intimate customer interface, and the cohesion established in working toward shared vision and common goals. The kaleidoscopic dynamics of the knowledge economy are providing unprecedented opportunities for the smaller players. Their entrepreneurial leadership is heralding in an branded of collaborative advantage. This requires a fundamental understanding of new knowledge performance indicators, networked structures, knowledge roles and skills, innovation processes and collaborative technologies. All paves the way for a foundation of knowledge cities, knowledge regions and a knowledge-based world. All will be seen through the window of small business enterprises and their potential leadership positioning. Since we know that most economies thrive on the success of entrepreneurial initiative - usually in the form of SME's. These collections of expertise, often operating as consortia, would find it difficult - if not impossible - unless consultants like K.K. Consulting, Inc. , India assited them and guided them about local market conditions.