A case study of a successful cluster policy. Learnings for ... · PDF fileA case study of a...

A case study of a successful cluster policy. Learnings for the Icelandic geothermal cluster.

Emiliano DuchCEO of Competitiveness and Director of the Barcelona Clusters Summer School at IESEReykjavík, 16:55-17:25 November 1st 2010

Porter‟s model for local competitiveness

2

Macroeconomic, Political, Legal and Social context

Microeconomic Competitiveness

Source: Michael Porter

Company operations

and strategy

State of cluster

development

Quality of business

environment

3




Company operations

and strategy

State of cluster

development

Quality of business

environment


4




Company operations

and strategy

State of cluster

development

Quality of business

environment


But, how do you improve your state of cluster development?

In the last 20 years hundreds of countries and regions have tried.

Can we learn anything from those experiences?

Example: Cluster development in the UK

5

PRESS RELEASE: 24 March 2010 20:30

Department for Business, Innovation and Skills (National)

Minister for Business, Ian Lucas, tonight presented the

UK’s first-ever "Cluster Marks"- a new award recognising

the best of Britain’s manufacturing clusters and their

valuable contribution to the country’s economic growth.

….


6

The winners were chosen by an Independent Judging Panel, chaired by Ian Lucas and made up of representatives from industry and academia. Cluster Marks were awarded to the best four clusters out of 15 nominees from across Britain. …

XXXX was named Best Overall Cluster for its exceptional entrepreneurial dynamism, innovation, skills base and level of internationalisation.

Cluster Marks were also awarded to the North West Aerospace Cluster, North West Biomedical Cluster and the East of England Health & Life Sciences Cluster.


7

Who was the Best Overall Cluster ?


8

Representing the judging panel, Minister for Business, Ian Lucas said:

"It was not our intention to have an overall winner of this competition but the strength of support from the panel for the Humber Seafood Processing Cluster was so strong that we wanted to reflect this. So I‟m very pleased to name it „Best in Show‟ at these inaugural Cluster Mark Awards."

Yorkshire Forward‟s original “clusters”

9


10

1.Advanced Engineering and Metals

2.Bioscience3.Chemicals4.Digital5.Food and Drink


11

1.Advanced Engineering and Metals

2.Bioscience3.Chemicals4.Digital5.Food and Drink

18

No

ve

12

Young’s, Seachill , Sealord10,000120Seafood

Carlsberg, Theakstons, Black Sheep,

HB Clark

5,00031Beer

Major Companies: Cot t Beverages,

Benjamin Shaw , Nest le Waters

Pow w ow , Coca Cola

4,50018Water/Sof t Drinks

Major CompaniesJobsCompaniesSector

7Tea Limited data available

15Ice cream

Kw oks, King Asia, Mumtaz Food

Industries

1,50010Ethnic

Nest le, Dunhills (Haribo)7,00021Confect ionery

Del Monte, Axgro, Daniels Chilled

foods, Gordon Jopling

12,00042Fruit & Veg

2 Sisters Premier Division, F.W.

Farnsw orth, Farmers Boy, Grampian

Country Food

20,00068Meat & Poult ry

Young’s, Seachill, Sealord10,000120Seafood

Carlsberg, Theakstons, Black Sheep,

HB Clark

5,00031Beer

Major Companies: Cot t Beverages,

Benjamin Shaw , Nest le Waters

Pow w ow , Coca Cola

4,50018Water/Sof t Drinks

Major CompaniesJobsCompaniesSector

7Tea Limited data available

15Ice cream

Kw oks, King Asia, Mumtaz Food

Industries

1,50010Ethnic

Nest le, Dunhills (Haribo)7,00021Confect ionery

Del Monte, Axgro, Daniels Chilled

foods, Gordon Jopling

12,00042Fruit & Veg

2 Sisters Premier Division, F.W.

Farnsw orth, Farmers Boy, Grampian

Country Food

20,00068Meat & Poult ry

The original Food and Drink “cluster”

18

No

ve

13

The Humber seafood “sub-cluster”

24 August 20079

Storage

AJK, ACS&T, Keystore

Processors

Coldw ater

Glenrose

Northern Foods

Sealord

Smales

Young ’s Bluecrest

Bird ’s Eye Walls

Fish mongers

EquipmentNesco Weighing

Professional

services

Raw materials

suppliers

Fishgate

Grimsby Fish Market

overland

Other suppliers,

Direct Imports

Training &

research

inst itut ions

Grimsby College (HIFF)

University of Hull

Inst itut ions for

collaborat ion

Grimsby FMA, Hull Food

Alliance, Humber Forum,

Humber Seafood Group

Government

agencies

Local councils

Seaf ish Authority

Yorkshire Forw ard

Packaging

Retailers

ASDA

Morrison ’s

Food Services

Agents and

Merchants

Boyd Line

D.R. Seafoods

Logist icsHumberside Airport , Nor-Cargo, Samskip, Eimskip

The seafood industry in the Humber estuary processed 70% of the seafood eaten in the UK, fresh mostly imported from the North Atlantic

and frozen from all the world.

18

No

ve

14

The Humber seafood “sub-cluster”

24 August 20079

Storage

AJK, ACS&T, Keystore

Processors

Coldw ater

Glenrose

Northern Foods

Sealord

Smales

Young ’s Bluecrest

Bird ’s Eye Walls

Fish mongers

EquipmentNesco Weighing

Professional

services

Raw materials

suppliers

Fishgate

Grimsby Fish Market

overland

Other suppliers,

Direct Imports

Training &

research

inst itut ions

Grimsby College (HIFF)

University of Hull

Inst itut ions for

collaborat ion

Grimsby FMA, Hull Food

Alliance, Humber Forum,

Humber Seafood Group

Government

agencies

Local councils

Seaf ish Authority

Yorkshire Forw ard

Packaging

Retailers

ASDA

Morrison ’s

Food Services

Agents and

Merchants

Boyd Line

D.R. Seafoods

Logist icsHumberside Airport , Nor-Cargo, Samskip, Eimskip

The seafood industry in the Humber estuary processed 70% of the seafood eaten in the UK, fresh mostly imported from the North Atlantic

and frozen from all the world.

The Humber Seafood Group.The “Cluster organization”?

Defining a sustainable competitive advantage

Structuring actions to

build the new value chain

Setting the future

challenges

5-8 months

First meeting

Interviews with companies and

institutions

Second meeting

Benchmarking tripsBuyer interviews

Strategy meetings

Third meeting

Action lines task groups

Setting the strategy (the CRI)

How to do it?

Example: The Humber seafood

What How

1 Analyze why their margins were lower

5 forces industry analysis

2 Identify business with higher margins

Strategic segmentation

3 Learn from more advanced buyers

Advanced BPC and value chain

4 Build sustainable barriers to competition

Local cluster diamond

16

17


Margins squeezed by:Asian new entrantsEuropean industry overcapacityLow cost substitute protein

Weak postioning:Price sensitivityPowerful retailers concentrating furtherLimited suppliers

Attractiveness: FrozenHigh volume/low margin business

Margins Positioning


What How









18

19


Higher margins:Logistics act as barrier to entry“Local” competitionFew substitutes for healthy protein

Stronger positioning:Consumer demand for freshnessTraceability increases supplier partnering

Attractiveness: Fresh Ready MealsHigher margin large niche business

Margins Positioning


What How









20

21

Identification of H-E-B, leading fresh retail chain in 2003!


22

Based in Houston, Texas“Retail Excellence Award” by “Supermarket News”, prestigious US food industry trade publication

Outstanding Seafood Departmentfast growing department in the retail chain for the last 8 years (10% per year)

Responsible: Mr Catanzarointernationally recognised: International Ground Fish Forum (Barcelona, Oct. 03)


H-E-B, leader fresh food retail chain

18

No

ve

23

Wide selection: offering more than 120 species

HEB Seafood department

Flown freshdisplaying the catching place and the transport method


18

No

ve

25

Relevance of further prepared– Fresh, – Filleted, cleaned…– Breaded,– Coated,– Pre-cooked,– Ready-meal,– Ready to eat (take

away)


18

No

ve

26

Providing educational information...


27

... and offering in-store demontrations and cooking lessons



What How









28


Inbound logistics:

Operations:

Product Development (R+D)

Outboun

d logistics:

Marketing and

sales:

Afsales:

General Administration

Procurement

Present Value Chain:

Frozen fish sold to large supermarkets according to their specs.


Inbound logistics: Operations:


Outbound logistics:

Marketing and sales:

After s


Procurement

Value Chain needed for the new strategy:

Fresh Ready meals developed for the UK and abroad

31

HUMBER: READY MEAL DEVELOPMENT

ICELAND: FISHING AND PRIMARY PROCESSING

HOLLAND: PERISHABLE DISTRIBUTION


32

8000 producers

1500 wholesalers/exporters

AuctionsGrimsby Fishgate

Catching

Processing

Dutch flower cluster Proposed Humber Seafood Exchange


Humber Seafood Exchange


Inbound logistics:

Operations:


Outboun

d logistics:

Marketing and

sales:

Af sales:


Procurement

Inbound logistics: Operations:


Outbound logistics:

Marketing and sales:

After sale service:


Procurement

Air

po

rtfr

esh

hu

b

Seaf

oo

dEx

chan

ge

New

pro

du

ctd

evel

op

men

t

Market ?

Hull Logistics Institute


34

Seafood heroes scoop top awardFriday, March 26, 2010, 06:30

…

It beat off aerospace, biomedical, automotive and health and life sciences nominations from the North West, West Midlands and East Anglia.

At a gala ceremony at London's Lancaster House, leaders of the sector Wynne Griffiths CBE and Simon Dwyer picked up the award.


35

Grimsby is the major concentration of the Humber processers, having been left a fantastic legacy from the fishing industry, echoed on a smaller scale in Hull. That is now built on with a knowledge base that has seen supply chain infrastructure, sustainability and productivity reach best-in-class.

It has moved on from simply trading volumes to take in health and nutrition, shelf-life advancement and even by-product opportunities, with business working closely with Grimsby Institute and other key partners.

Scunthorpe InquirerFriday, March 26, 2010,

Changebusiness?

Not enough with cluster collaboration

How to do it?

First move up to better business, then collaborate

X

How to do it?

But, how?

How to do it?

X

ATTITUDE BELIEF BEHAVIOUR

t

MO

TIV

ATI

ON

By psichological group dynamic process at cluster level

How to do it?

Defining a sustainable competitive advantage

Structuring actions to

build the new value chain

Setting the future

challenges

5-8 months

First meeting

Interviews with companies and

institutions

Second meeting

Benchmarking tripsBuyer interviews

Strategy meetings

Third meeting

Action lines task groups

Setting the strategy (the CRI)

How to do it?

How?

18/

11/

20

42

Proven methodology codified and tested by local teams all over the world, in more than

200 cases along 18 years

The response from Europe

43

The response from Europe

44

Thank you for listening!

[email protected]@competitiveness.com

mailto:[email protected]

mailto:[email protected]

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