The U.S. Cluster Mapping Project: Tools for Regional ... · Source: Prof. Michael E. Porter, Cluster Mapping Project, Institute for Strategy and Competitiveness, Harvard Business

1 Copyright 2012 © Professor Michael E. Porter

Rich Bryden

Director of Information Products

Institute for Strategy and Competitiveness

Harvard Business School

www.isc.hbs.edu

The U.S. Cluster Mapping Project:

Tools for Regional Economic Competitiveness

Hubert H. Humphrey School of Public Affairs

University of Minnesota

Tuesday, September 25, 2012

http://www.isc.hbs.edu/


EDA Cluster Mapping

Project Partners


Macroeconomic Competitiveness

Microeconomic Competitiveness

Sophistication

of Company

Operations and

Strategy

Quality of the

National

Business

Environment

Macroeconomic

Policies

Social

Infrastructure

and Political

Institutions

State of Cluster

Development

Endowments

A critical mass of

interconnected firms and

associated institutions in

particular fields, linked by

commonalities and

complementarities.

Social

Infrastructure

and Political

Institutions

Macroeconomic

Policies

What Determines Competitiveness?

4 Copyright 2012 © Professor Michael E. Porter 20120602 – Michigan State Competitiveness – Rich Bryden

Massachusetts Medical Devices Cluster

5 Copyright 2011 © Professor Michael E. Porter 2011 – State Competitiveness – Rich Bryden

The Evolution of Regional Economies San Diego

U.S.

Military

Communications

Equipment

Sporting

Equipment

Analytical Instruments

Power Generation

Aerospace Vehicles

and Defense

Transportation

and Logistics

Information Technology

1910 1930 1950 1990 1970

Bioscience

Research

Centers

Climate

and

Geography

Hospitality and Tourism

Medical Devices

Biotech / Pharmaceuticals

Education and

Knowledge Creation


Quality of the Business Environment

Context for Firm

Strategy and Rivalry

Related and Supporting Industries

Factor (Input)

Conditions

Demand Conditions

• Sophisticated and demanding local

customers and needs – e.g., Strict quality, safety, and

environmental standards

– Consumer protection laws

• Many things matter for competitiveness

• Successful economic development is a process of successive upgrading, in which the business environment improves to enable increasingly sophisticated ways of competing

• Local rules and incentives that

encourage investment and productivity – e.g. salaries, incentives for capital

investments, intellectual property

protection, corporate governance

standards

• Open and vigorous local competition – Openness to foreign competition

– Competition laws

• Access to high quality business

inputs – Human resources

– Capital availability

– Physical infrastructure

– Administrative and information

infrastructure (e.g., registration,

permitting, transparency)

– Scientific and technological

infrastructure

– Efficient access to natural

endowments

• Availability of suppliers and supporting

industries

7 NGA 2011 – Wisconsin – Rich Bryden Copyright © 2011 Professor Michael E. Porter

Composition of Regional Economies, United States

Local Clusters

• Serve almost

exclusively the

local market

• Not exposed to

cross-regional

competition for

employment

71.7% of

employment

61.8% of income

3.5% of patents

27.4% of

employment

37.3% of income

96.4% of patents

Traded Clusters

• Serve markets in other

regions and countries

• Free to choose location

• Exposed to competition

from other regions

Source: Michael E. Porter, Economic Performance of Regions, Regional Studies (2003); Updated

via Cluster Mapping Project, Institute for Strategy and Competitiveness, Harvard Business School

(2008)

Resource-based Clusters

• Location determined by

resource availability

• <1% of income,

employment, and patents in

the U.S.


Specialization of Regional Economies Leading Clusters by U.S. Economic Area

Boston, MA-NH


Education and Knowledge Creation

Medical Devices

Financial Services

Los Angeles, CA

Entertainment

Apparel

Distribution Services


San Jose-San Francisco, CA

Business Services


Agricultural Products

Communications Equipment

Biopharmaceuticals

New York, NY-NJ-CT-PA

Financial Services

Biopharmaceuticals

Jewelry and Precious Metals

Publishing and Printing

Seattle, WA

Aerospace Vehicles and Defense


Entertainment

Fishing and Fishing Products

San Diego, CA

Medical Devices




Chicago, IL-IN-WI

Metal Manufacturing

Lighting and Electrical Equipment

Production Technology

Plastics

Denver, CO

Business Services

Medical Devices

Entertainment

Oil and Gas Products and

Services

Raleigh-Durham, NC


Biopharmaceuticals

Communications Equipment

Textiles

Atlanta, GA

Transportation and Logistics

Textiles

Motor Driven Products

Construction Materials

Dallas

Aerospace Vehicles and Defense


Services



Source: Prof. Michael E. Porter, Cluster Mapping Project, Institute for Strategy and Competitiveness, Harvard Business School; Richard

Bryden, Project Director.

Houston, TX


Services

Chemical Products

Heavy Construction Services


Pittsburgh, PA


Metal Manufacturing

Chemical Products

Power Generation and

Transmission


Furniture Building

Fixtures,

Equipment &

Services

Fishing &

Fishing

Products

Hospitality

& Tourism Agricultural

Products

Transportation

& Logistics

Composition of the Economy Linkages Across Clusters

Plastics

Oil &

Gas

Chemical

Products

Biopharma-

ceuticals

Power

Generation

Aerospace

Vehicles &

Defense

Lightning &

Electrical

Equipment

Financial

Services

Publishing

& Printing

Entertainment

Information

Tech.

Communi-

cations

Equipment

Aerospace

Engines

Business

Services

Distribution

Services

Forest

Products

Heavy

Construction

Services

Construction

Materials

Prefabricated

Enclosures

Heavy

Machinery

Sporting

& Recreation

Goods

Automotive

Production

Technology Motor Driven

Products

Mining & Metal

Manufacturing

Jewelry &

Precious

Metals

Textiles

Footwear

Processed

Food

Tobacco

Medical

Devices

Analytical

Instruments Education &

Knowledge

Creation

Note: Clusters with overlapping borders or identical shading have at least 20% overlap

(by number of industries) in both directions.

Apparel

Leather &

Related

Products



12 Copyright 2012 © Professor Michael E. Porter 20120602 – Michigan State Competitiveness – Rich Bryden

Clusters and Regional Prosperity Recent Findings

Drivers of Regional Job Growth, Wages, Patenting, New Business Formation, and Success of Startups

• Specialization in strong clusters

• Breadth of position within each cluster

• Positions in related clusters

• Presence of a region‘s clusters in neighboring regions

Not significant

• Positions in “high-tech“ versus other clusters

Source: Porter, The Economic Performance of Regions, Regional Studies, 2003; Delgado/Porter/Stern, Clusters and Entrepreneurship, Journal of Economic Geography,

2010; Delgado/Porter/Stern, Clusters, Convergence, and Economic Performance, mimeo., 2010.

13 Copyright © 2011 Professor Michael E. Porter 20111024 – Ecuador Competitiveness Presentation – FINAL – Prepared by RA Jem Hudson.ppt

Clusters as a Tool For Economic Policy

• A forum for collaboration between the private sector, trade

associations, government, educational, and research institutions

• Brings together firms of all sizes, including SME’s

• Creates a mechanism for constructive business-government dialog

• A tool to identify problems and action recommendations

• A vehicle for investments that strengthen multiple firms/institutions

simultaneously

• Fosters greater competition rather than distorting the market


Cluster Mapping Research and Publication

• Understand interaction of business environment quality and clusters

• Measure cluster Initiative performance

The Practice of Cluster-Based Economic Development

• Learn from the successes and struggles of cluster efforts in four regions

• Assemble a toolkit of accumulated learnings

Outreach

• Support professional development for cluster practitioners

New Website

• Engage new and experienced practitioners

• Make connections and build learning community among practitioners

• Extend data, regional coverage and analytics


www.clustermapping.us

Documents

The U.S. Cluster Mapping Project: Tools for Regional ... · Source: Prof. Michael E. Porter, Cluster Mapping Project, Institute for Strategy and Competitiveness, Harvard Business