Innovation Cluster and its Development Strategy · Deok Soon Yim, CEO, Ph.D. International...

Innovation Cluster and its Development Strategy

Innovation Cluster Management

Innovation Cluster Management

High GrowthHigh Growth

Lee Won Il, Professor, Ph.D. Hanbat National UniversityDeok Soon Yim, CEO, Ph.D. International Innopolis Research Center

This research focused on the development Strategy of innovation clusters in GyeonggiProvince. In Gyeonggi Province, there are three major innovation clusters; GwanggyoTechnovalley, Pangyo Technovalley and Ansan Science Valley. In Gyeonggi province, the innovation cluster policy was launched ambitiously. However, there are many issues to be solved for them to be the Global R&D Hub. In this reason, the study was performed based on both theoretical study and related qualitative study approaches. Particularly, scenario planning method was used for the strategy formulation of the innovation clusters in Gyeonggi Province. The major determinants for the success of the formation of the innovation clusters in Gyeonggi Province can be summarized as follows; the establishment of S&T based host institution, the gradual enlargement of the role of host institution and the balancing the operational strategy on Hardware and Software of innovation clusters. In terms of the needs of times, this study regarding the strategy for the formation of the innovation clusters is anticipated to be a good reference for the R&D organizations and technology cluster participants in coming years.

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103

2013 Proceedings of PICMET '13: Technology Management for Emerging Technologies.

1. Introduction2. The Theoretical backgrounds of the Innovation Cluster

- Concept of cluster and innovation cluster - Importance of Cluster policy- Evolution of the Cluster

3. Example of Innovation Cluster Management

4. The Strategy for an activation of the Innovation Cluster - Innovation cluster policy of Gyeonggi province

- ‘Gwanggyo, Pangyo & Ansan Technovalley as an innovation cluster- Foresight of the innovation cluster as using a scenario planning method - Strategy of an activation of the innovation cluster for achieving a future vision

5. Summary - Hardware and Software Management for an activation of the Innovation Cluster

Contents

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1. Introduction

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Introduction

In this hyper-competition environments, many nations around the world try to formulate innovation cluster and manage it successfully as an infrastructure for the innovation

This paper studies the major determinants for the success of the innovation cluster using the qualitative study (case analysis method) of the innovation clusters.

As a global R&D hub, the preferred future of the innovation cluster of the Gyeonggi province will be studied.

the strategy for achieving for the desired future of innovation cluster and the execution of the strategy will be also presented

- Hardware and Software Management for an activation of the Innovation Cluster

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2. The Theoretical backgrounds of the Innovation Cluster

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Concept of Cluster / Industrial Cluster

Cluster : Organic networks, closely connected organizations - OECD(1999, 2001) defined clusters as a network of the independent firms,

knowledge providers such as universities, research institution and customers.(1)(2)

Industrial cluster is a network of firms, knowledge brokerage, service provider and universities in a specific industry(3),(4)

- the participants of industrial cluster compete and cooperate within cluster

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Concept of the Innovation Cluster

Innovation Cluster is somewhat different from the cluster(industrial cluster) in that point its purpose is only for the (technological) innovation

- Innovation Cluster is an organic network in which all the participants (innovaton nodes) are closed linked and within its embeddness innovation occurs spontaneously.

- Science Parks, Techno Parks are the example of the innovation clusters- All the innovation process, from Idea to technological commercialization can be occurred within the innovation clusters (1) (2)

Source: Young Ja Bae, Wi jin Song, Deok Soon Yim(2002)

From system formative Pperiodto system Developmental Period

Global Innovation System

Changes in Technologyenvironment

Changes in Social environment

National Innovation System

Regionnal Innovation Cluster

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Component of the Innovation Cluster

Innovation Cluster comprises of ………………. (1) (2)- Innovation nodes(firm, university, research institute) and its network and relationship- Innovation Input(support, personnel, information)- Innovation Process(input, process, output)- Interaction of the innovation nodes- Innovation Culture(Individually, Collectively) - Hardware Infrastructure etc…..

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Evolution of the Innovation Cluster

At the expansion cluster stage, the expansion of the innovation cluster are very fast.

- Innovation supports such as the fund, human resources, consulting for technology commercialization are important for the innovation cluster

Management of the innovation clusters at all levels is important for success

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3. Example of Innovation Cluster Management

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Example of Innovation Cluster Management

In this hyper-competition environments, many nations around the world try to formulate and manage innovation cluster successfully as an infrastructure for the innovation

Cluster Name Summary Hosting Institution

Tsukuba (Japan)

· 330 organizations (research institution, firms etc) · Academia-Research / Regional government Cooperation

Tsukuba Corporation Host institution

Olu (Finland)

· Nokia, IBM (high-tech firms), University, Research Institution · Best Model in 65 innovation clusters in Scandinavia

Since 1982, host instution has been running Manangement of H/W and S/W

RTP (US) · Benchmarking model of the Korea Doeduck Innopoils

Research Triangle Foundation and Partnership Dual Management

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Tsukuba Innovation Cluster (Japan)

28,000 ha, 330 organizations (research institution, firms etc) Networks of the National Labs Research and Education Academia-Research / Regional government Cooperation

Host Institution- Tsukuba Corporation Host institution

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Olu Innovation Cluster (Finland)

Nokia, IBM (high-tech firms), University, Research Institution Best Model in 65 innovation clusters in Scandinavia

Host Institution- Technoplice Plc- Since 1982, hosting instution has been running the Management of H/W and S/W

Land Firms Employee

403,600m2 1,150 15,500

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Research Triangle Park (RTP) (US)

One of the oldest and largest science parks in North America The Research Triangle Park (RTP) is a 7,000 acre development that is home to

more than 170 companies employing over 42,000 full-time knowledge workers and an estimated 10,000 contract employees.

Host Institution- Research Triangle Foundation and Partnership Dual Management

Land Firms Employee

2,757,000m2 136 37,000

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Success factors for the innovation cluster

Management of the innovation clusters at all levels is important for success

innovation service support(Software aspect) is necessary for technology development and technology commercialization in addition to construction of the infrastructure of the innovation cluster(Hardware Aspect)

(8) GSTEP(2010), Gyeonggi province and pangyotechnovalley Presentation Material

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4. The Strategy of the Innovation Cluster

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Innovation Environment of Gyeonggi Province

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Gyeonggi Province

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R&D Environment of Gyeonggi Province

The highest R&D expenditure The best R&D environment in the Korea The best region of Corporate R&D activities

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Distinctive Feature of R&D Investment (1)

Corporate R&D investment is higher than those of the university and public research institution.

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Corporate R&D is the highest in Korea. But majority of SMEs do not invest in R&D.

SMEs are more than 7 times in number, but less than 1/10 in R&D investment

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The majority of the R&D institution is situated in the southern part of the Gyeonggi Province.

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Innovation Policy of Gyeonggi Province

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Regional Innovation System

(8) GSTEP(2010), Gyeonggi province and pangyotechnovalley Presentation Material / (6), (7)

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STI Policy Governance of Gyeonggi province

Regional Government (Province, City) vs. Central Government

Innovation Actors (Industry, University, Research Institute)

Branches of Central government supported research institute

Gyeonggi Institute of Science and Technology Promotion(GSTEP)

Gwanggyo Technovalley, Pangyo Technovalley, Ansan Science Valley


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STI Policy Direction

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STI Policy Direction

STI infrastructureManagement

Gwanggyo TechnovalleyPangyo Technovalley Ansan Science Valley

R&D budget support

Innovation Networks

Planning, management, evaluationAnalysis of the R&D investment

IICC(Industry Cluster Innovation Committee)

From Hardware Oriented to Software Oriented

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GSTEP(Gyenggi Institute of S&T Promotion)

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30 km

20 km

10 km

Ca. 6% of GwangGyoNew City(11.3 km

2)

⇒ designated asGwangGyo T.V.

Ca. 7% of PanGyoNew City(9.3 km2)⇒ designated as

PanGyo T.V.

GwangGyo, PanGyo & Ansan Techno Valleys

Around Banweol-Sihwa Ind. Complex(31.9 km2)⇒ designated as

Ansan S.V.

Three Major Innovation Clusters

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‘Gwanggyo Technovalley’as an innovation cluster

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Location Yeongtong-gu, Suwon, Gyeonggi Province, Korea

Size 5 main centers / building site : 269,404㎡/ Land : 221,532㎡

Construction Period Jun. 2004 ~ Feb. 2008 (3 years and 9 months)

Total Building Cost $ 571.5 mill. (1$=1,000 Krw)

Company About 200 companies

Main Goal Convergence of technologies (IT, BT, NT)Development of technology and commercializationDevelopment of human resource on science and technology

Gwanggyo Technovalley

(9) http://www.ggtv.or.kr

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Gwanggyo Technovalley


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‘Pangyo Technovalley’ as an innovation cluster

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Pangyo Technovalley

The Gyeonggi Province is the core area of Korea not only in terms of population, politics and culture but also in manufacturing and industrial technologies. All the major IT companies and auto makers are headquarterd in Gyeonggi Province. Recently, it has started to invest at science and technology in various areas to enhance its technological competitiveness.

The Pangyo Techno Valley development project is a huge Gyeonggi-do project to strengthen national competitiveness and the self-sufficiency of Pangyo New City through the establishment of a knowledge industry base for the development of national growth engines related to IT, BT, NT, CT and advanced convergence technology. It is a Gyeonggi-do strategic project to create a state-of-the art technology complex. (8) (10)

(10) http://www.pangyotechnovalley.org

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Vision of Pangyo Technovalley

As the center of advanced global technology, Pangyo Techno Valley will secure self-sufficiency for Pangyo New City and develop a specialized Global Cluster converging Research, Information and Technology.

Its goal is to implement a trial model for ubiquitous technology and create a stage for state-of-the art technology and products from around the world (8) (10)


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Location of Pangyo Technovalley

Pangyo TechnoValley has geographical benefits of being located within the huge consumer market of the capital region along with close proximity to adjacent clusters such as Gwangyo Technovalley, AnSan Science Valley.

This geographical advantage allows Pangyo TechnoValley to stand at the center of Korea’s IT, BT, CT, NT and advanced convergence Technology Belt. (8) (10)


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Residing Businesses (8), (10)- 4T, 294 (’10.7)- Samsung TechWin, SK Chemical, Ann Lab, NHN etc.- High Tech Venture

Residing Businesses

Total IT BT CT NT etc

294 177(60%)

38(13%)

35(12%)

3(1%)

41(14%)

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Innovation Support Centers (host institution)

Global R&D Centers Industry-academia co-research centers Public R&D Support Centers (8), (10)

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‘Ansan Science Valley’ as an innovation cluster

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Banweol-Sihwa Industrial Complex

No. of Factories(Employees) : Ca 8,000 (210,000) Production : 48 Billion US $ Area : 31.9 k㎡

Ansan Science Valley

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LG Research CenterKorea Testing LaboratoryKorea Institute ofIndustrial Technology

Gyeonggi Technopark

Hanyang Univ. (Ansan)


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Scenario planning & Strategy formulation of the innovation cluster of the Gyeonggi province

2020 foresight (5), (8), (10)- Horizontal Axis : Network Capability with other clusters- Vertical Axis : Cluster Management Capability (hosting instution)

Foresight of the innovation cluster

Network Capability with other clusters

Cluster Management

Capability (hosting

institution)

HighLow

Direction of Strategy & Management

Preferred future

Business as usualScenario

Worst CaseScenario

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Preferred Future of the innovation cluster of the Gyeonggi province

Pangyo Techno Valley

IT/BT

Global Innovation Clusters

Silicon Valley

RTP

Seoul


Gangyo Techno Valley

GwaChon

IT/BT

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Host Institution for Innovation Cluster Management

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5. SummaryHardware and Software

Management for an activation of the Innovation Cluster

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Policy Issues

No Master Plan

Weak Advertisement

Weak Marketing

Management of H/W including buildings and common facilities

No Management Body

Ambiguous specialization

Small to reach Critical Mass

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Prospect and Possibilities

Comprehensive Master Plan including S/W sides

Strengthening Global/Domestic Marketing

Introduction of semi-public Management Body

Selection of specialization ?

Growth of GTV with new companies ?

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Starbucks: Knowledge Place + Linking + Culture

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Pangyo Techno Valley

IT/BT

Global Innovation Clusters

Silicon Valley

RTP

Seoul


Gwanggyo Techno Valley

GwaChon

Globally locally connected innovation cluster

Not only S&T but innovation

Value oriented STI policy?

Governance and management are important

Have to wait.

Ride the wave of globalization opportunity

So, what we learned from Gyeonggi experience?

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Thank You

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References

(1) OECD(1999), Boosting Innovation: The Cluster Approach

(2) OECD(2001), Innovative Clusters : Driver's of National Innovation Systems

(3) Porter. M. E(2001), "From Economic Development Theory to Action: The Process of Cluster Upgrading“

(4) Porter. M. E(1998), Clusters and the new economic of competition, Harvard Business Review, November-December, 77-90

(5) Ron Jonston(2006), Scenario Planning, Strategic Foresight in Modern Management, Foresight Course, PREST, University of Manchester, 2006

(6) Cook et al. (1997), “Regional Innovation Systems : International and Organizational Dimension”, Research Policy, Vol.25

(7) SRI International (1999), Clustering as a Tool for Regional Economic Competitiveness




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Innovation Cluster and its Development Strategy · Deok Soon Yim, CEO, Ph.D. International...

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