Why clusters and cluster development? by Lars Albæk Baltic Sea Cluster Development Centre

Clusters vs. Cluster Initiatives Clusters are (Michael E. Porter, On Competition, 1998): Geographic concentrations of interconnected companies, specialized suppliers, service providers, firms in related industries, and associated institutions in particular fields that compete but also cooperate. => so clusters are not necessarily organized but can occur spontaneously A cluster initiative is (So lvell et al, The Cluster Initiative Greenbook, 2003): Cluster initiatives are organised efforts to increase the growth and competitiveness of clusters within a region, involving cluster firms, government and/or the research community.

Cluster development in rural areas: Bornholm

Clusters, examples 1 Savile Row, Central London, England The Golden Mile Of Tailoring 30 custom houses Among the worlds best in 200 years One street Market Place

Clusters, examples 2 Arjeplog, northern Sweden (The Winter TestCenter) Began in 1973 with a runway for planes 1.800 inhabitants 6 companies BOSCH: 250 employees is posted in Arjeplog 1.000 Jobs 53 M Euro Turnover Natural Resources

Clusters, examples 3 Champagne, northeast France 46 big wineries Many small ones 350 villages 340 mill. bottles/year One district/region Competencies

Clusters, examples 4 Da Fen, Shenzhen, southern China The Oil Painting Village Est. 1998 300 inhabitants 622 Galleries 5.000+ painters 5+ mio. products/year Market Place

Clusters, examples 5 Antwerpen, northern Belgium 4 Diamond Exchanges 4 Diamonds Banks 300 Diamond Factories 1.500 Diamond Companies Diamant Universities 27.000 Jobs 80% of the worlds rough diamonds 50% of the worlds cut diamonds 40% of the industrial diamonds 1 square mile (2,5 km 2 ) Market Place

Why cluster development? A concentration of co-located related businesses and supporting institutions : - Increasing productivity (improved use of production inputs) - Accelerate innovation (cooperative research, technology transfer, policies) - Increase business formation (sub-contracting, specialization, filling niches) all of which leads to job creation and economic growth.!! Clusters can and will emerge and develop spontaneously with a cluster initiative the objective is to realize cluster benefits more quickly

The complexity of cluster development! 1/3

The complexity of cluster development! 2/3 Networks intra/extra

The complexity of cluster development! 3/3 and translating this complexity into business development services?!

A number of benefits from cross-cluster collaboration Within a region clusters can benefit from working together on: Exchange of cluster management experiences and learning improved cluster tools and services Joint training on generic issues Cross-industry linkages (improve regional value chains) Gaining scale for policy actions ( cluster movement ) Beyond a region clusters can benefit from working together on: Exchange of cluster management experiences and learning improved cluster tools and services Avoid regional lock-in, benchmarking against peers Business linkages to enhance sourcing, contracting, joint ventures bridges for business-to-business cooperation and trade (incl. export promotion and investment attraction). Access to information (market developments, trends, technologies etc.) And engaging abroad is strengthening cluster community at home!

Areas of co-operation between regions/clusters 1. Conference and seminar activities - also in cooperation with others (global, macro-regional, national, local) 2. Training activities - cluster development mobilization - cluster management / facilitation / service delivery 3. Cluster research/intelligence - mapping to energize - skills and trend scouting - aligning value chains - 4. Internationalisation and trade? - Market info exchange - Matchmaking - Business roaming - Joint efforts towards new/emerging markets

Baltic Sea Region 9 countries 85 million people NORWAY SWEDEN FINLAND RUSSIA 15 million people within 10 km of the coast Shared cultural heritage ESTONIA LATVIA DENMARK LITHUANIA BELARUS GERMANY POLAND BORNHOLM

Bornholm, Denmark 588 km2 area 158 km2 coast line 39.800 inhabitants DENMARK BORNHOLM 500.000 visitors annually 37 km to Sweden 180 km to Copenhagen 88 km to Germany 90 km to Poland

BUILDING & CONSTR. Business Clusters on Bornholm TOURISM MECH. ENGINEERING ARTS & CRAFT FOOD AGRICULTURE Bornholm A Green Technology and Test Lab Bright Green Test Island: Cleantech, renewable energy, building & construction Bornholm An Adventure Tourism Island Bornholm.info, Enjoybornholm.dk nature, outdoor (kayak, mountainbiking, climbing), wellness, arts & craft, medieval history and culture, music & sports events Bornholm A Food Island Gourmet Bornholm/ food producers, farmers, restaurants, chefs, canteens, wholesalers, distributors, retailers ENERGY

Models of Cluster development used on Bornholm? Top-down model based on specifically selected industries ( pick the winner -strategy.. Bright Green Laundry Technology: Localization of the island's commercial locomotives (Jensen Denmark) and focus on creating local spin-offs and innovation on the basis of their business. Gourmet Bornholm and Steel Tech Solutions: Cooperation between actors in the same industry on joint sales and marketing to ensure greater access to markets outside the island. Experience Universe Bornholm: Interdisciplinary cooperation in the Tourism sector on joint local coordination / planning of events and adventure activities as a precondition for national / international marketing and sales. Green building demonstration / training: Collaboration between business and education, to ensure attention outside the island and local spin-off opportunities. 20

Catalysing collaborative actions requires a change agent, a facilitator Herding cats much easier than clustering

Group work 19/4 - questions: Identify and discuss selected areas, topics and industries within your region, where you could/should be collaborating even more between businesses, government/ngo s and education (triple helix) and with the purpose of strengthening the regions competitiveness? Identify and discuss how to organize the above identified areas of more potential collaboration between business, government/ngo s and education (triple helix) and thereby creating a better basis for cluster development (through eventually cluster organizations) in your region? 22