Presentation on business clusters at the North sea region conference 12 june 2013. Opening Up

2. Clusters & how to make it work:
Toolkit for cluster strategy
Anu Manickam
Halmstad, 12 June 2013

3. Presentation
• Clusters – why?
• Cluster Gearbox
• Toolkits from the Gearbox:
•
•
•
•
Wicked problems – complex (eco) systems
Drivers of change
Relevance of history, geography, culture
Emerging developments
• EU cluster policy & the challenges ahead

4. Clusters…
• are innovation hubs (Silicon Valley), they
• attract talent, businesses and finance
• focus on collaborations, interactions and offer of integrated products
and services (across sectors)
• create „mass‟ and economies of scales when needed
• offer cross-boundary, cross-disciplinary, cross-level, holistic concept
• are smart specializations
• are relevant as they reflect
• interconnected and interdependent nature of globalization, business
and social realities
• need for complex and combined value chain solutions
• need for accelerated knowledge development and diffusion
put people and networks central

5. Integrated cluster approach
Clusters as people-based interactions (microlevel) creating innovative, adaptive cluster
developments (emergent systems) responding to
changes in context…
Dynamics)of)Complex)Adap3ve)Systems)
Emergent)paBerns)
agent)
Context)
agent)
Organiza3on)
agent)
Group)
Sensemaking)and)
transforma3ve)
interac3ons)
agent)
Significant)
differences)of)
agents)and)
strategy)
Individual)
agent)
Whole systems approach

6. Cluster Gearbox
•Complex problems & drivers of
change
Cluster
Context
•Past, current and future factors
influencing stakeholder
interactions and capabilities
Cluster
Conditions
Cluster
Dynamics
•Emergent patterns of
interaction and developments
•Transforming interactions (where
differences are leveraged) &
organizing processes (topdown/bottom-up)
Cluster
Performance
12

7. Integrated
cluster approach
•
•
•
•
Puts enterprise, innovation and policy into
context
Gains deeper insights on cluster dynamics
and drivers of change
Helps policy adopt a frame of reference that
Guides, coerces and influences cluster
developments collectively

8. Tool kit 1:
Identifying wicked problems
“Wicked problems” are…
• Complex
• Unpredictable
• Many versions of the problem
• Many solutions
• No right or wrong answer
• No end point
• Solutions create…
new problems

9. Wicked problems
… otherwise defined
“Every problems interacts with other problems
and is therefore part of a set of interrelated
problems, a system of problems… I choose to
call such a system a mess.”
Ackhoff, 1974

10. Wicked Problem
Dominance of Paper & Pulp
industry – affecting
expectations, self-sufficiency
drives, etc. Lock-in patterns of
interactions
Cluster
members
demand more
for money
Local government
want more efficiency
from clusters
Karlstad between giants –
Stockholm, Gothenburg, Oslo – urban pull depleting
talent, money
Government focus on Capital city; funding to
academic universities generous
‘Equality’ as principle – don‟t discriminate in policy
Academic university = fundamental research &
publication
Industry needs applied research & other skills
School curricula not serving industry needs
Confidence of industry of future and slow reaction to
global competition
„Innovation value of paper mills not recognized‟
Citizens complaining of „ugly‟ mills and property
degradation
Case: Karlstad & Vårmland Region: Paper & Pulp
EU policy – build
on
strong, excellent
clusters
Technology centre
to solve need for
industry related skills

11. Wicked problems
• What is the problem?
• Are we talking about the same elephant?
• Is there a common goal? vision?
• Where are we looking for solutions?

12. Drivers of change
- local
- Need to collaborate to vie for complex tenders &
projects
- Demands of local government of Karlstad to increase
efficiency
- Consumer demands for sustainability – ‘green products’
- New opportunities due to technology innovation and
spin-offs from paper mills
- Growth opportunities sought in adjacent areas of
business
- Shortage of technical personnel in future
Technology
and knowledge
abundance
(bio-medicines)
Resource
protection
(sustainable
forest practice)
Case: Karlstad & Vårmland Region: Paper & Pulp
Industry

13. Drivers of change
- global
OECD Region
Report 2007
Double loop
sustainability
of forest and
business
Strategic forum
resulted in MOU
10 Professors
Programme
2010-2014
- Environmental regulation
- Competition from Brazil & emerging
markets – need for more efficiency
- Sustainability agenda – sustainable fiber
flow concept; bio-economy as an
opportunity
- Trend towards demand driven – PP
industry needs to be more ‘open’
- EU policy stimulating ‘bigger, multisectoral, high-tech, excellent clusters’
- Expansion and focus of metropolis in
region
Case: Karlstad & Vårmland Region: Paper & Pulp
Industry
Key Actor
Program
Vinnova
(2008-2015)

14. Relevance of history,
geography & culture
Limits to
networking
Paper mills: dominance and traditional caretaker’s
role in region for more than 3 centuries: “still in the
„genes‟ of people”; “male dominated industry” – care
taker role strengthened;
Dependence on mills suppressing entrepreneurial
drive to new industries? Complacency?
Big industry with high investment base – slow to
change
Industry was ‘closed, inward-looking and selfsufficient – tendency to not to „open-up‟ and learn from
others
Presence of river and lake linked forests to mills –
essential factor in past growth,
Rural communities – history of trust and
collaborations – limited to opportunistic collaborations
(instead of strategic collaborations) Latent potential for
deeper collaborations
Case: Karlstad & Vårmland Region: Paper & Pulp
Equality
principle
suppressing
excellence?
Success of
cluster history
a hindrance?

15. Cluster performance:
emerging developments
The Paper
Province
acknowledged
as excellent
cluster
Strategic relationship established through MOU
between university, local/regional government and
clusters
- Connected through 10 professorships working jointly
on research strength, industry needs and expertise
(establishment of „cluster room‟)
- Linked to national research fund distribution model
- Working towards collective Värmlandmodel 2.0 lead
by Region Värmland
- University expanding its scope to include contribution
to regional development as a key strategy
- Increased co-operation by cluster firms with
university (83%, was 78% and increased willingness to
co-operate (97%, was 94%)
- New PhDs that are rewarded for knowledge
valorisation (utilization)
- Service innovation and social innovation focus as
new drivers of growth
OECD review follow-up
PURE 2010
Recognition of Region
Värmland’s progress
Case: Karlstad & Vårmland Region: Paper & Pulp
Change in funding
of cluster
organizations

16. EU Cluster Policy
• cross-sectoral innovation (ICT and health, energy
and health)
• smart specializations
• cluster to cluster collaboration
(internationalization)
• knowledge transfer and diversity accelerator
• linking industry competence needs with education
• user-driven innovation
• pushing ICT and high-technology to SMEs

17. EU Cluster Policy
 Innovation policy – is broad, often national
(not local) capacity building
 Cluster policy – is strengthening regional
economics
 Horizon 2020 & Smart Specialization
Strategy
 clusters are specializations
 strengthen existing clusters
 excellent clusters

18. Challenges in
cluster development
• How do you push for deeper level
collaborations?
• How do you create higher level „trust‟
activities and environments?
• How do you break traditional boundaries of
institutions, policy, political and government
levels, disciplines, sectors, business
models, policy directions, etc. ?
• Who will lead the transformation? Where are
the seeds of change?

19. Understanding cluster dynamics
& drivers of change
•Complex problems & drivers of
change
Cluster
Context
•Past, current and future factors
influencing stakeholder
interactions and capabilities
Cluster
Conditions
Cluster
Dynamics
•Emergent patterns of
interaction and developments
•Transforming interactions (where
differences are leveraged) &
organizing processes (topdown/bottom-up)
Cluster
Performance
Input for strategy
development

20. Based on research on cluster dynamics
and drivers of change
Anu Manickam, with contributions from Karel van Berkel
Hanze University of Applied Sciences, Groningen
a.r.s.manickam@pl.hanze.nl