Good Advice on Developing Clusters

The Initiative for a Competitive Inner City recently published “Accelerating Cluster Growth: A Playbook for  City Leaders” (PDF). The report offers practical guidance and case studies on growing industry clusters, including six practices all cluster strategies should follow.

  1. Identify your region’s competitive assets. Trying to mechanically replicate another city’s success is ill-advised. A cluster growth strategy must be true to regional assets and capabilities.
  1. Engage diverse stakeholders. Cluster initiatives may generate within the private or public sector; what’s important is that all actors are on the same page.
  1. Develop strong public-private partnership organizations to lead cluster initiatives. Cluster partnerships can take many different forms. Many are organized by EDOs but can also be directed by independent nonprofits and university-based centers.
  1. Utilize cluster diagnostics to define cluster growth strategies. Growth strategies should be comprehensive and have the ability to identify and address weaknesses.
  1. Use cluster initiatives to replace scattered, disconnected approaches to economic growth. Cluster-focused growth strategies can unite disparate economic development initiatives under an overarching apparatus and maximize impact.
  1. Move cluster initiatives to self-sufficiency. Public funding often covers the first year of operation, but cluster initiatives must develop a sustainable business model with funding security for long-term viability.

Also: EMSI recently profiled Dayton, Ohio’s BRE program, which uses a data-driven scorecard to identify high-impact and at-risk companies within its clusters. The scorecard first looks at demand for jobs, significance to the local economy, and the presence of a champion (e.g., a trade association or business advocate) to evaluate cluster strengths. It then looks at the cluster’s career pathways, such as job-multiplier potential and level of wages. Finally, the scorecard assesses immediacy of demand and whether there are workforce gaps its partners can help fill.

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