Grow Your Regional Economic Development Cluster

Many economic developers are excited about the potential of industry clusters to spur growth in their communities, regions and states. Rightfully so, clusters have a great deal to offer in stimulating economic growth. I wonder how many economic developers have considered the application of the "cluster concept" to their own work. In this sense, an "Economic Development Cluster" exists in most regions.

The strategic focus, size, complexity and resource strength of economic development clusters are likely to vary across geographic regions. What am I really saying? Simply that over time geographic areas evolve networks of organizations that work either separately or together in furthering the economic interests of an area. Going back to my organizational behavior training, ED clusters are "inter-organizational networks," comprised of a multitude of relationships that EDO's form to accomplish their work.

What are some functional networks that already exist in economic development?

- Capital networks: provide access to local and external financial resources to support economic development.
- Marketing networks: provide information and knowledge within and outside the region about economic opportunities.
- Technological innovation networks: provide support to researchers, businesses and others working to advance new technology or provide commercial applications of technology.
- Target industry and industry cluster networks: provide information and services to foster the growth of specific growth industries or clusters.
- Real estate networks: provide access to sites and buildings as locations for new business activities.
- Business assistance networks: provide access to technical assistance, information and training to firms that want to grow and develop.
- Human resource networks: provide access to people and workforce development resources important for business growth.
- International trade networks: provide access to trade development resources helping firms to grow international markets.

These are just some of the many networks that exist in many regions.

In most cases, there are many EDO's--both local and non-local--working in these networks. In some cases, lead organizations exist. In others, they are guided by leadership teams. Typically, when we prepare economic development strategies for organizations, we prepare an inventory of all EDO's serving the area. Strategic planning provides an effective context to define how organizations work together. Increasingly, the emphasis is placed on improving the coordination and collaboration between and among EDO's within an area's ED cluster. Most regions seek to increase their "collaborative advantage."

Last August, I wrote an article in the Cleveland Plain Dealer that suggested EDO's in Northeast Ohio expand their organizational and interorganizational reach to form national and international partnerships. Why do this? Because in many cases, geographic areas in different parts of the U.S. or even worldwide, are interdependent. To increase effectiveness in overcoming major common threats and in developing common opportunities, EDO's should form national and international partnerships.

Can this be done? Yes. In fact, many industry cluster organizations, research universities and other groups are already doing this. The Israeli bioscience entrepreneurs visiting Greater Cleveland last month were jointly supported by local EDO's in Greater Cleveland and various Israeli resources, including the BIRD Foundation. Clusters in different countries in Europe have already forged new collaborative ties. More are in the works, as I listen in on what the OECD is doing.

All this boils down to your ability to collaborate in a strategic fashion with others locally and globally that share your values, vision, mission and goals.

It's worth a try. Think about your Economic Development Cluster and how to grow it nationally and globally.

I would like to acknowledge the recent contributions to my thinking on this topic by George Nemeth and Valdis Krebs. We have been thinking together about how to sharpen and tighten up NE Ohio's ED system.