This research extends the body of knowledge on SME IT innovation by identifying practical, locally-delivered interventions to assist SMEs to innovate with IT. The research was conducted in two phases over a two and a half year period employing an action research methodology. The diagnostic phase, which has been reported on previously, explored IT adoption factors and provided recommendations to assist SMEs in this area. The local council subsequently delivered a series of workshops and mentoring programs. The therapeutic phase of the research, being reported on here, evaluates these initiatives and provides further recommendations for local interventions. A typology depicting the different phases of IT use by SMEs was developed. Recommendations for local council are presented for each of the phases in the typology. The findings from this study indicate that a tailored approach recognising industry-specific factors is required to facilitate SME IT innovation. The findings also suggest that there is significant scope for local government interventions assisting SMEs with basic IT use and using IT for improving efficiency. However, the area with the greatest potential for benefits through local level interventions is assisting SMEs with IT innovation in terms of developing new products or services and/or different business models.