From Networks to Clusters and Back Again

Since the mid-1990s, trade promotion and regional development policy in New Zealand has aimed to promote business growth by encouraging various forms of interfirm cooperation. This chapter reviews the case for public policy intervention in cluster formation and highlights policy insight, drawing on the author’s evaluations of the ways that New Zealand policymakers have sought to encourage business cooperation through networks, alliances, and clusters. The chapter makes a case for cluster intervention but cautions against too much optimism in the contribution that clusters can make to business development. By explaining the particular influences behind successful projects in New Zealand, it is hoped that researchers and policymakers can obtain a better understanding of the conditions needed for effective cluster-based cooperation.

Regional Clusters

This chapter examines the application of cluster theory to small groups of collocated wine and tourism enterprises. It explores how traditional notions of cluster theory apply in the microcontext and whether such interpretations can be used as a valid tool for understanding how collocated regional businesses interact. The chapter describes three case studies of regional wine- and tourism-related businesses to illustrate how these microclusters might be identified and to determine the significance of interrelationships within and between collocated clusters. Such findings provide evidence of the strength or otherwise of these clusters. The chapter suggests that at the microscale, collocated clusters share some complementarity or overlap with each other through geography, resources, and levels of activity, which may be a factor that propels these clusters forward or sparks new cluster development.

Indusrty Clusters in Peripheral Regions

This chapter examines a nascent biotechnology cluster in a city that lies outside Canada’s industrial heartland. The purpose of the study was to focus attention on the nature of cluster development in peripheral regions. The research findings reveal that many support services are provided to Halifax-based biotechnology companies and made use of by companies. However, barriers to development still exist, and support organizations and companies are not certain that a cluster truly exists in Halifax at this time. What results is a case study of a cluster at an early stage in its development cycle and in a peripheral region. The authors encourage other researchers to examine cluster development outside of major industrial centers.

Uppsala BIO- The Life Science Initative

Numerous regions around the globe are implementing initiatives designed to improve their competitiveness by promoting interaction and innovation among their regional organizations. This chapter presents one such initiative, Uppsala BIO–The Life Science Initiative, that was created by local representatives from government, industry, and academia in Uppsala, Sweden. The purpose of this chapter is to describe Uppsala BIO’s activities during its first 18 months, to present some reflections on the organization that were gathered through a longitudinal study, and to discuss the initiative’s impact on the region. Thus, this chapter is relevant to both practitioners and policymakers involved in regional initiatives as well as researchers working to understand the dynamics of such initiatives.

E-Business Standardization in the Automotive Sector

Successful cooperation between large manufacturers and their suppliers is a crucial aspect, especially in the automotive industry. Such mutually beneficial cooperation requires at least a certain level of integration and interoperation of the partners’ IT and e-business systems. This chapter looks at two approaches in order to achieve this goal: sector-specific harmonization (in the form of electronic marketplaces) and international, committee-based standardization. This chapter shows that SMEs are facing a severe disadvantage in both cases. This is, however, less pronounced in a formal standards setting, in which capabilities of the individual representatives are more important, at least at the working level.

Cluster Development

Over the years, industry clusters have been touted to have economic and strategic advantages and have been used to develop embryonic industries. The cluster development process/methodology generally has taken two distinct approaches: laissez-faire, or economic system-driven; or planned/sponsored, or driven by government policy and intent. This chapter looks at two biotech clusters that are representative of each of these methodologies—the San Francisco Bay Area (California, U.S.) cluster and the Hsinchu (Taiwan) cluster—to identify the evolution and success of these two methodologies. The chapter also identifies and discusses key success factors that impact the development and growth of business clusters.

Italian Industrial Districts

The high performance levels gained by firms of Italian industrial districts raised both the international economic and managerial scientific communities’ interest and stimulated the production of a series of research studies concerning the micro as well as the macro level of analysis. This chapter aims to identify, describe, and interpret the phenomenon of Italian industrial districts with a specific focus on the analysis of the sources and the forms of value creation in light of the last 30 years of scientific research

Leveraging the Benefits of Small Business Clusters

In terms of managing the cluster, emphasis is given to how the diverging and converging interests of members can be managed. A stakeholder framework is used as a means of theoretically unifying the common interests of group members, which at the same time recognizes that they are independent entities. In terms of marketing the cluster, a key issue addressed in this chapter is branding. Many clusters are obscure with limited awareness. We take the view that precincts of small business clusters need to be branded properly, and we develop a framework in order for this to be done. Branding principles guide this work. The chapter also explores how multiple clusters can be comarketed in one region, generally through e-commerce and specifically through e-malls.

Clustering, Collaboritive Networks, Collaborative Networks, and Small and Medium Enterprises

Information technology (IT), which underpins the information society, has brought with it a number of changes that have far-reaching consequences for business, especially small and medium enterprises (SMEs). One such change is IT-facilitated collaboration and the sharing of information by organizations, which has implications for the processes within and among those organizations. The focus here is on collaborative networks of SMEs and collaboration around IT. Of particular interest is collaborative commerce (c-commerce). The relationship among collaborative networks, including c-commerce and clustering, is explored, and factors necessary for c-commerce adoption by SMEs are outlined. Finally, an overview of the results of a Delphi study, the first phase in a longitudinal study into the adoption of c-commerce by Australian SMEs, is provided.

Small Business Clustering Across Disciplines

The literature on clusters is vast and growing rapidly. Moreover, it is truly multidisciplinary with researchers from all perspectives borrowing heavily from each other’s works. This chapter summarizes the theoretical approaches that have defined the concepts and relationships used in the applied cluster analyses that follow. The perceived benefits from participating in clusters are now well established at a theoretical level. It is argued that this theoretical basis was developed within regional economics by using the concepts of agglomeration economies, which originated with Marshall (1890); industrial input-output analysis, since developed by Porter (1990), and social networks based on the works of Williamson (1985) and Saxenian (1994). As technological change has become more important, ideas related to regional innovation systems also have been incorporated into cluster analysis. Now the challenge is to put these ideas into practice.