Emiliano Duch - RFCD Conference @ Arthur Lok Jack GSB - November 2011

1. Options for National Development
Cluster development as a Tool for Economic
Development and Transformation
Emiliano Duch
CEO, Competitiveness.com
Coordinator, Cluster-Excellence.EU
Port of Spain, November 9th, 2011

2. Options for National Development
The first steps in development: health
and education
And for economic development?
Who should decide?
What should it be decided?
How should it be implemented?
2 15 November 2011

3. Options for National Development
The first steps in development: health
and education
And for economic development?
Who should decide?
What should it be decided?
How should it be implemented?
Can cluster based development
help better governance?
3 15 November 2011

4. The first steps in development
Health
Education
Political rights
Every body wants them,
everybody deserves them.
4 15 November 2011

5. And for economic development?
Infrastructure
– Roads
– To where? For what?
Specialized education
– Vocational facilities
– On what?
Research Institutions
– For what?
5 15 November 2011

6. Research Institutions?
Evolution of CTM’s Income and
CTM Manresa (Spain) Source of Income
Microsoft Innovation Center Source: Local SPPD, World Bank
Every body wants them, everybody DOES
NOT deserves them.
New Competitiveness/World Bank study on
Local Sector Public Private Dialogue
6 15 November 2011

7. Infrastructure?
Access road to
Sassuolo (Italy)
ceramic tiles
cluster.
30% world
production
60% world
exports
Single lane
bridge
7 15 November 2011

8. Infrastructure?
Access road to
Sassuolo (Italy)
ceramic tiles
cluster.
30% world
production
60% world
exports
Single lane
bridge
8 15 November 2011

9. Porter Diamond
CONDITIONS
FOR FIRM • Integrated Sales
STRATEGY, Distribution
STRUCTURE • Address new strategic
GOV. AND RIVALRY segment
• Establish intercluster
alliances
FACTOR DEMAND
CONDITIONS CONDITIONS
• Foster specialized training • Serve more sophisticated
programs customers
• R+D in cluster related • Upgrading encouraging
technologies regulation
• Cluster specific information tools RELATED
• Cluster oriented certification
AND
SUPPORT
INDUSTRIES
• Supplier improvement programs
• Cluster participants forae
• Specialized cluster infrastructure

10. Options for National Development
The first steps in development: health
and education
And for economic development?
Who should decide?
What should it be decided?
How should it be implemented?
Can cluster based development
help better governance?
10 15 November 2011

11. Who should decide?
The Food and Drink “cluster” in Yorkshire?
Sect or Companies Jobs M ajor Companies
M eat & Poult ry 68 20,000 2 Sist ers Premier Division, F.W.
Farnsw ort h, Farmers Boy, Grampian
Count ry Food
Fruit & Veg 42 12,000 Del M ont e, Axgro, Daniels Chilled
f oods, Gordon Jopling
Seaf ood 120 10,000 Young’s, Seachill, Sealord
Conf ect ionery 21 7,000 Nest le, Dunhills (Haribo)
Beer 31 5,000 Carlsberg, Theakst ons, Black Sheep,
HB Clark
Wat er/ Sof t Drinks 18 4,500 M ajor Companies: Cot t Beverages,
Benjamin Shaw , Nest le Wat ers
Pow w ow , Coca Cola
Et hnic 10 1,500 Kw oks, King Asia, M umt az Food
Indust ries
Ice cream 15
Tea 7 Limit ed dat a available
11 15 November 2011

12. Who should decide?
The Humber seafood “sub-cluster”?
Equipment Prof essional
Packaging Nesco Weighing services
Logist ics
Humberside Airport , Nor-Cargo, Samskip, Eimskip
Raw mat erials Fish mongers
suppliers
Agent s and Processors
Fishgat e
M erchant s Coldw at er Ret ailers
Grimsby Fish M arket
Glenrose
overland ASDA
Boyd Line Nort hern Foods
M orrison’s
D.R. Seaf oods Sealord
Smales
Young’s Bluecrest
Ot her suppliers, St orage Bird’s Eye Walls Food Services
Direct Import s AJK, ACS&T, Keyst ore
Inst it ut ions f or Government Training &
collaborat ion agencies research
Local councils inst it ut ions
Grimsby FM A, Hull Food
Alliance, Humber Forum, Seaf ish Aut horit y Grimsby College (HIFF)
Humber Seaf ood Group Yorkshire Forw ard Universit y of Hull
9 24 August 2007
12 15 November 2011

13. Who should decide?
The Humber Seafood Group?
Equipment Prof essional
Packaging
The Humber Seafood Group.
Nesco Weighing services
The “Cluster organization”?
Logist ics
Humberside Airport , Nor-Cargo, Samskip, Eimskip
Raw mat erials Fish mongers
suppliers
Agent s and Processors
Fishgat e
M erchant s Coldw at er Ret ailers
Grimsby Fish M arket
Glenrose
overland ASDA
Boyd Line Nort hern Foods
M orrison’s
D.R. Seaf oods Sealord
Smales
Young’s Bluecrest
Ot her suppliers, St orage Bird’s Eye Walls Food Services
Direct Import s AJK, ACS&T, Keyst ore
Inst it ut ions f or Government Training &
collaborat ion agencies research
Local councils inst it ut ions
Grimsby FM A, Hull Food
Alliance, Humber Forum, Seaf ish Aut horit y Grimsby College (HIFF)
Humber Seaf ood Group Yorkshire Forw ard Universit y of Hull
9 24 August 2007
13 15 November 2011

14. What should be decided?
Setting the strategy (the CRI)
5-8 months
Defining a Structuring
Setting the
sustainable actions to
future
competitive build the new
challenges
advantage value chain
First meeting Second meeting Third meeting
Interviews with Benchmarking trips Action lines task
companies and Buyer interviews groups
institutions Strategy meetings

15. How should it be implemented?
The CRI workflow

16. Who, what and how: The Competitiveness
Reinforcement Initiative in a cluster
6-8 months
WHO WHAT HOW
1st Public 2nd Public 3rd Public
Meeting Meeting Meeting
 Interviews with  International  Definition and
cluster agents Benchmarking launching of
 Documents and  BPC actions
past study analysis  Strategy groups

17. The CRI evolution
1993 2001 2006 2008 2009 2010 2011

18. The CRI evolution
2001 2006 2008 2009 2010 2011
1993
Initial Years: Spain
From theory to practice:
applying Porter’s theories
and learning by doing
Execution through own
teams of top-level
consultants
Building the Consulting
Manual: a collection of
errors

19. The CRI evolution
1993 2001 2008 2009 2010 2011
2006
Triangle Region (Denmark)
First experiences with
methodology transfer:
– CRI execution by new local
+ teams, hired by the client
– Improvement of On-line
methodology tutorial
Feedback to policy through local
Steering Committee

20. The CRI evolution
1993 2001 2008 2009 2010 2011
2006
… at the
same time
in Latin
America…

21. The CRI evolution
1993 2001 2006 2009 2010 2011
2008
7 Northern Regions (Chile)
21 CRIs in two years
Large scale methodology transfer:
– Joint Training Sessions (3) to
benefit from economies of
scale
– Intensive tutoring combines
virtual and on-site support
– Execution by existing local
teams
1 policy seminar with limited
client involvement and follow up

22. The CRI evolution
1993 2001 2006 2008 2010 2011
2009-2010
Sao Paulo (Brazil)
14 CRIs in parallel in 1 year
Proves scalability of the
Chilean experience:
– Joint Training Sessions
(7) to increase sharing
of experiences
– Intensive involvement
of client teams
Continuous Policy Feedback

23. The CRI evolution
1993 2001 2006 2008 2010 2011
2011-12
European Union
Standardized
training materials
Open source
6 weeks in class
1 parallel CRI with
tutors (8 m)
2nd CRI (8 m)
Certification

24. Cluster-Excellence.EU training materials (I)
Knowledge area Concepts /tools Cases studies and materials
CLUSTER Location theory Finland and Nokia (HBS)
ECONOMICS Industrial Districts Singapore (HBS)
Clusters New York (HBS)
Innovation Systems California Wine (HBS)
CLUSTER Statistical cluster mapping Cluster Initiative Selection
INITIATIVES (econometric foundations, Note(REGX)
SCREENINGS statistical analysis) Screening in Yorkshire (IESE)
Cluster initiative selection (industry Screening in Vastra Gotaland (IESE)
analysis and segmentation, value
chain and system)
INDUSTRY Industry analysis (5 forces) Cirque du Soleil IINSEAD)
ANALYSIS AND Strategic segmentation Montreal Circus Cluster (IESE)
SEGMENTATION Avocado Valparaiso (Competitiveness)
VALUE CHAIN Value chain ZARA and Catalan Textile (HBS/IESE)
ANALYSIS Local value system Antombel (HBS/IESE)
Global value system
BENCHMARKING Advanced Buyer Purchase Criteria Seafood in Humber (IESE)
Key Success Factors Ventilation in Boras (IESE)
Value Chain Activity benchmarking

25. Cluster-Excellence.EU training materials (II)
Knowledge area Concepts /tools Cases and materials
CHANGE Individual behavioral change Estonia in Transition (HBS)
MANAGEMENT Group change IT in Estonia (BIA)
Communication strategies Geothermal Cluster in Iceland (IESE)
Presentation skills
CLUSTER Organizational structures Oill drilling in Soderlandet (Innovation
ORGANIZATION Non-profit organization management Norway)
MANAGEMENT Pattern identification
PROJECT Project planning Clusterland Upper Austria (IIESE)
MANAGEMENT Project monitoring SEBRAE MG (Competitiveness)
Project evaluation
CONTINUOS Policy review Cluster Policy in Catalonia (GC)
POLICY INPUT Diamond analysis Policy implications of ITC Cluster in
Nationals and supranational Aalborg (REGX)
competitiveness framework
CLUSTER POLICY Cluster management evaluation Cluster Policy Evaluation in Norway
EVALUATION Cluster policy monitoring (Innovation Norway)
Impact analysis

26. Why methodology transfer?
Strategic change is a long term process: local
teams are best positioned to ensure cluster
assimilation of the strategy
– Long term interaction with local companies and
institutions, with regular strategic updates
– Ensures implementation of the action lines that
result from the CRIs
Builds local capacity to incorporate CRI tool
into longer term regional development
programs

27. Results: Example of feedback from Brazil
“For SEBRAE-Minas Gerais, this new
methodology allowed us to change
the way we relate to our clients,
achieving a more intelligent dialogue
about their strategic needs.
That in turn, allowed us to start
changing our own structure in
SEBRAE-MG, to contribute to our
clients being more competitive in the
long term , turning ourselves in to a Lina Volpini
source of knowledge and analysis.” Manager Intl. Markets
SEBRAE MG - Brazil

28. Thank you for listening!
Emiliano Duch
– Emiliano.duch@competitiveness.com
– Educh@iese.edu
– www.competitiveness.com
– www.cluster-excellence.eu
28 15 November 2011