IRE Electronic Newsletter

Title: IRE Working Group conclusions on role of clusters in innovation support

Industrial clusters are considered to be a key element for driving innovation and thereby for strengthening European competitiveness. This is reflected in the increasing attention national and regional innovation policy makers pay to developing and implementing cluster policies. After two years of studying cluster-related themes, the IRE Working Group - “Regional clustering and networking as innovation drivers” has delivered its final report with conclusions and recommendations that can be used by other regional innovation policy makers and practitioners.

The Working Group on regional clustering and networking was set up in autumn 2006 bringing together representatives from 15 IRE member regions: Tartu and South Estonia, East Finland, Aquitaine, Provence-Alpes-Côte d’Azur, Stuttgart, Western Greece, South Great Plain, Veneto, Gaeltacht, East Lombardy, Silesia, Alentejo, Aragon, Galicia and Scotland. The mission of the group was to facilitate the exchange of experience and the development of knowledge that will enhance the promotion of cluster initiatives in European regions. The group’s conclusions are presented in a final report, which provides many concrete examples of cluster experiences and initiatives from European regions.

Cluster policies and measurements

Significant developments in the way that cluster policies are designed and delivered have taken place since the mid-1990s when such policies started to be applied by European regions. An overall change is the way that public policy has shifted from focusing on analysing and understanding clusters to proactive support for cluster management. This has been caused by rapid changes in the global economy as well as by a better understanding of how cluster mechanisms work and how public policy can support them. The organisation of clusters has also changed over the years evolving from ad hoc organisations lead by intermediary organisations to clusters as independent legal entities including also R&D institutions and large companies.

Policy makers of course want to know whether their efforts to improve cluster performance have achieved the intended goals or if not, why they have not been successful. This information can help policy makers to identify if a particular policy approach is effective, efficient and appropriate. Understanding cluster performance is also an important step in identifying where clusters are strong or weak and where subsequent intervention might be appropriate. It is therefore necessary to establish a set of measurements that are able to track the performance of clusters over time. At present most of the measurements and models focus on the economic performance of clusters while soft indicators like human capital, organisational culture or external relationships remain elusive.

It is difficult to make any concrete recommendations for the development and application of cluster measurements as the conditions in every region are very different, however some basic advice from the group is:

Copy existing indicator models but adapt them to the regional context.
Measure the right things – do not design the basket of indicators according to what can be measured but rather what should be measured.
Try to include “soft measures” in the model.

Upgrading companies’ skills and competence

Most cluster initiatives strive to promote innovation in the member companies. This effort can take many different forms and address all types of innovation activities. Such initiatives can include support for companies in the integration of new technologies, establishment of new innovation-based companies, development of joint laboratories or initiatives aiming to support mobility of people.

The Working Group has explored the issue that while cluster organisations can play a major role in improving the integration of companies’ technology and skills by providing an efficient interface between companies and research institutions, public organisations are important as providers of financial resources and auxiliary services such as incubator space, strategic planning and technology and market observation services and legitimacy.

Cluster foresight and internationalisation

Foresight at regional or sector level can play a catalytic role in the establishment of initiatives and framework conditions conducive to innovation in the broadest sense. This means not only industrial innovation but also social renewal in terms of how society is organised or its relationship with government and industry. The value of foresight activity resides not only in the perspectives it produces but also in the general process, which involves wide participation by major actors including industry, government, social partners, R&D institutions and so on. According to the experiences of Working Group members there is no single blueprint for success, but a competent coordinator, the involvement of industry and conformity with mainstream policy plans are some crucial factors for a successful foresight exercise.

The internationalisation of clusters should be understood as more than mere export promotion, the report says. The concept includes e.g. joint venture support, staff recruitment, R&D and innovation activities etc. Three types of internationalisation activities are usually supported by current cluster policies: access to international markets, participation in international projects and networking of different clusters.

The final report of the IRE Working Group “Regional clustering and networking as innovation drivers” is available on the IRE website. Hard copies can be obtained from the IRE Secretariat (please contact Ms Nathalie Brahim: ).

References

Date of publication	16/12/2008
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