May
17
2010
Build it and they will come…?
In several previous posts, I have touched up on the cluster creation vs. cluster activation approach.
In short, with Cluster Activation I am referring to a “bottom up” approach, where the foundation and growth strategy is based upon the local/regional assets, industry and how this can best serve the demand in the market. Basically, the government and local policy makers role is to act as a catalyst and help remove bottlenecks and growth hurdles for local industry and R&D sector.
On the other hand, with a Cluster Creation approach, I am refereeing to a situation where through a “top down” approach, government or policy makers are creating an industry or a cluster presence by investing and in many cases building from “scratch”. Both approaches may be successful, but there is no doubt that the latter (Cluster Creation) will also carry more risk and likely demand a significant investment.
In a recent article published at Businessweek.com , Vivek Wadhwa shares his thoughts and insights about the challenge of “engineering or creating clusters” using a top-down approach. Interesting read indeed.
1 Comment • Categories: Uncategorized
Nov
09
2009
Cluster Activation vs. Cluster Creation
When I am interacting with cluster stakeholders, either through project work or presentations, there is always a significant interest on the issue of cluster activation vs. cluster creation when planning and launching a cluster initiative.
The vast majority of clusters are a result of an activation effort – or more specifically the government or policy makers have taken on the role as a catalyst and enabler in a collaborative process to engage stakeholders and activate a cluster around the resources, strengths and assets native to the region. Leaning on the industry and existing asset base, this approach will typically have a strong market pull. In other words, the need of industry and the market will define the cluster.
On the other hand, there are also examples of how policymakers attempt (and succeed) in creating a cluster around a technology sector industry that is not significant or perhaps native to the region. Hence these economic development efforts will typically be a “push” effort, where economic incentives, investments and asset creation from the government will be important ingredients.
When a cluster activation approach is executed, the government and policy makers will focus on removing the most serious bottlenecks and hurdles for higher productivity, improved collaboration and innovation within a cluster by mobilizing the capacity of a cluster and participants to act jointly.
One will see cluster development efforts by changing the business environment, and by creating institutional structures that help to speed up the process of cluster evolution over time. This approach can obviously be applied to any industry, but will perhaps be most applicable to a sector that has critical mass by numbers and activities. Further on, there are many motivations to launch such an effort. It can be the need to better coordinate efforts and assets in a growing industry (life sciences) or perhaps used as a tool to rejuvenate industry sectors that has reached more of a mature level with regards to innovation and entrepreneurship (food and agriculture).
Cluster creation on the other hand, is typically found within emerging sectors (one example could be the effort of creating a solar energy cluster in New York) or where there is a policy decision in place to create new set of assets or a skill base within a jurisdiction/region.
Another example of a cluster creation effort could be the effort to attract The Scripps Research Ins
Scripps Florida
titute to the Jupiter campus of Florida Atlantic University in 2004. Authorities committed at the time US $310 million in state
incentives, opened a 40,000 square foot research facility on the campus. An analysis by Florida economists predicted that Scripps would generate about $1.6 billion in additional income and boost the state’s GDP by $3.2 billion in 15 years.
Both cluster activation and creation are feasible approaches – each building on different policies and commitments. Both will have a fairly similar end-objective, economic development through increased commercialization, entrepreneurship and inward investment.
2 Comments • Categories: Uncategorized
17 2010
Build it and they will come…?
In several previous posts, I have touched up on the cluster creation vs. cluster activation approach.
In short, with Cluster Activation I am referring to a “bottom up” approach, where the foundation and growth strategy is based upon the local/regional assets, industry and how this can best serve the demand in the market. Basically, the government and local policy makers role is to act as a catalyst and help remove bottlenecks and growth hurdles for local industry and R&D sector.
On the other hand, with a Cluster Creation approach, I am refereeing to a situation where through a “top down” approach, government or policy makers are creating an industry or a cluster presence by investing and in many cases building from “scratch”. Both approaches may be successful, but there is no doubt that the latter (Cluster Creation) will also carry more risk and likely demand a significant investment.
In a recent article published at Businessweek.com , Vivek Wadhwa shares his thoughts and insights about the challenge of “engineering or creating clusters” using a top-down approach. Interesting read indeed.
09 2009
Cluster Activation vs. Cluster Creation
When I am interacting with cluster stakeholders, either through project work or presentations, there is always a significant interest on the issue of cluster activation vs. cluster creation when planning and launching a cluster initiative.
The vast majority of clusters are a result of an activation effort – or more specifically the government or policy makers have taken on the role as a catalyst and enabler in a collaborative process to engage stakeholders and activate a cluster around the resources, strengths and assets native to the region. Leaning on the industry and existing asset base, this approach will typically have a strong market pull. In other words, the need of industry and the market will define the cluster.
On the other hand, there are also examples of how policymakers attempt (and succeed) in creating a cluster around a technology sector industry that is not significant or perhaps native to the region. Hence these economic development efforts will typically be a “push” effort, where economic incentives, investments and asset creation from the government will be important ingredients.
When a cluster activation approach is executed, the government and policy makers will focus on removing the most serious bottlenecks and hurdles for higher productivity, improved collaboration and innovation within a cluster by mobilizing the capacity of a cluster and participants to act jointly.
One will see cluster development efforts by changing the business environment, and by creating institutional structures that help to speed up the process of cluster evolution over time. This approach can obviously be applied to any industry, but will perhaps be most applicable to a sector that has critical mass by numbers and activities. Further on, there are many motivations to launch such an effort. It can be the need to better coordinate efforts and assets in a growing industry (life sciences) or perhaps used as a tool to rejuvenate industry sectors that has reached more of a mature level with regards to innovation and entrepreneurship (food and agriculture).
Cluster creation on the other hand, is typically found within emerging sectors (one example could be the effort of creating a solar energy cluster in New York) or where there is a policy decision in place to create new set of assets or a skill base within a jurisdiction/region.
Another example of a cluster creation effort could be the effort to attract The Scripps Research Ins
Scripps Florida
titute to the Jupiter campus of Florida Atlantic University in 2004. Authorities committed at the time US $310 million in state
incentives, opened a 40,000 square foot research facility on the campus. An analysis by Florida economists predicted that Scripps would generate about $1.6 billion in additional income and boost the state’s GDP by $3.2 billion in 15 years.
Both cluster activation and creation are feasible approaches – each building on different policies and commitments. Both will have a fairly similar end-objective, economic development through increased commercialization, entrepreneurship and inward investment.
