Industrial Cluster

Table of contents 1. What is cluster and history 2. Merit and demerit of cluster 3. Current issues and solutions 4. Case model A 5. Case model B

What is cluster and history Cluster is a geographic concentration of inter-

connected businesses, suppliers, and associated institutions in a particular field.(Michael E. Porter)

A cluster is different from the classic definition of industry sectors　 because it represents the entire value chain of a broadly defined industry from suppliers to end products, including supporting services and specialized infrastructure.

What is cluster and history Two most impressive industry clusters in the

history of the United States are the semiconductor industry in Silicon Valley and the automobile industry in Detroit. An industry cluster can start in a number of

ways.

Development ExampleGeographical cluster

Silicon Valley and Hollywood

Sectoral clusters Marine (south east England)Photonics (Aston Science Park, Birmingham)

Horizontal cluster Knowledge managementVertical cluster Supply chain cluster

2. Merit of clusterEnhance productivity

① Access to resource 　　　　　　　　　　 (Investment and employee)② Access to dedicated information③ Access to Institutions and Public

Goods④ Access to customer need and

technology⑤ Low transaction cost

2. Demerit of clusterHomogeneousnessBecause of long and fixed relationship among cluster, innovation is 　 getting to be restrainedMonopolizationLess completion makes inefficiency of technology High business cost Area centralization causes the bottle neck of establishing plant and high logistic cost

3. Current issues and solutions

A lack ofgood cyclegood liquidity

Because ofCompany

closureGovernment

support shortage

Inno vation

Universities

Companies

Start-ups

Institutions

Governmen

t

Knowledge

Incubation

SupportCapacity

3. Current issues and solutionsSolutions

Strong leadership of government and companies

Open Innovatio

n

Start-ups

Companies

Universities

Institutions

Government

Government support

Invitation

4.Case1 Tsukuba science city1963: The cabinet approved construction of thenational project,“ Tsukuba Science City” 1980; The 43 research and educational instituteswere relocated or newly built.

Population in Tsukuba Science City; 213,135(As of February, 2010)

This includes 7,517 foreign residents (approximately 3.5%)

Research institute; approximately 300This means approximately 30% (31 institutes) of Japan’s public research and education institutes areconcentrated in Tsukuba.

Tsukuba International strategy zone ‘SOGO TOKKU’

Tsukuba is one of seven ‘International strategy zones’.4 Projects are on going.They are trying to achieve the visible goal within 5 years.

industry-government-academiaMATCHING

Life Innovation Green Innovation

Personal Care Robot

Algal Bio Mass

Tsukuba Innovation area for nano-technology

Residents Life and Environment of areain Tsukuba research city

Main characteristics of this area;Research city → high intelligence researchers and their families are living inOver 7000 Foreigners → cross cultural environmentMost ‘Cutting edge’ research institutes → needs of specific safety management

feeling of loneliness

Maladaptation

to ‘TSUKUBA’ &

‘IBABEN’

Re-born to Neon-lighted city

Around 1980

2005-

5. Case 2 Silicon Valley

It grew up around Stanford University– Stanford’s dean of

engineering and provost Frederick Terman • During 1940s-50s:

encouraged faculty and graduates to start their own companies.

• after WW2: proposed leasing of Stanford’s lands for use as an office park. -> now it is called Stanford Research Park

• Found venture capital for civilian technology start-ups

Human resource, money, technology and legal solutions are all there

Silicon

Valley

University

Law Firm

Semiconductor

Industry

Computer

IndustryProgramming/ Service

Industry

Internet/Software Industry

Venture

Capital

Thank you