Resources on cluster development

As part of the preparation for a talk at the Japanese Cluster Conference 2010, I came across several interesting websites providing data on policies to support cluster formation, cluster / open innovation activities, and sites with slightly more tenuous - but potentially relevant - content. In case these might be of interest to others, I have grouped links to them below. Also the slides used at the conference can be downloaded from here.

Policies for clusters:
UK Department for Business, Innovation and Skills cluster strategy
French Pôles de Compétitivité
European Commission's view on the importance of 'Powerful Clusters'

Everyone wants to be Silicon Valley
Examples of 'Silicon + {geographic feature}'

Open innovation
IfM report on 'How to implement open innovation'
Examples of idea submission websites: P&G and 3M
Examples of open innovation intermediaries: Innocentive and NineSigma.

Corporate R&D and clusters
Examples of companies locating innovation activities within clusters: Nokia and Microsoft
Examples of companies seeking to develop clusters around their R&D facilities: Unilever@Colworth and Philips@Eindhoven

Examples of cluster strategies
Local = Cambridge; Regional = East of England Enterprise Hubs; Cross-border = Eindhoven-Leuven-Aachen Triangle (ELAT)

Networks within the Cambridge cluster
Cambridge Network
ERBI
University of Cambridge Enterprise Network

What's the future for Silicon Fen?

This article appeared in the 'finalword' section of Cambridge Business magazine, Q4, 2009

Tim Minshall, Institute for Manufacturing and St John's Innovation Centre

Trying to work out how the high-tech cluster in Cambridge is performing is very frustrating. You end up having a lot of sympathy for Harry S Truman’s famous quote: “Give me a one-handed economist! All my economists say, 'on the one hand...on the other”. You get a flavour of this scanning headlines over recent months: “Abcam reaches new heights with record interims”, “Bankruptcy levels reach record high [..]”, “Recession is over, let's get back to business”, "3i to shut Cambridge office", "University of Cambridge portfolio companies raise more than £30 million [..]", “Life sciences cluster takes further blow”, and so on.

Whatever the often contradictory headlines say, the Technopole – or ‘Silicon Fen’ – seems to be reaching an important point in its evolution. Since the 1970s, Cambridge has been one of the leaders in the development of support for new technology-based ventures. It has not been the biggest, or the most successful (Cambridge is, as some have observed, a seagull compared to Silicon Valley’s Jumbo Jet), but it has created a particular model of value creation that has delivered significant value to the UK economy and to global investors.

However, almost every developed nation has recognised the potential economic benefits of technology-based entrepreneurship and has sought to create their own version of Silicon Valley. The result is that Cambridge has found it harder to attract international investment, and domestically there has been rapid growth in regional competition. In addition three other factors bring in to focus the challenges – and opportunities – facing Cambridge: the effect of the global economic downturn; the reaching of major milestones for key Cambridge organisations; and changes in several key organisations within the cluster coupled with the launch of many new initiatives.

The credit crunch has clearly had a significant impact on Cambridge companies, but this impact has both a negative and positive side. For some companies, the financial crisis resulted in problems accessing debt and equity finance, and in much harsher market conditions as customers reined-in their spending. However, other companies have found opportunities to grow in the downturn – such as the enterprise search company Autonomy – and yet others have been able to raise significant investment – such as Light Blue Optics. The downturn has also led to the departure of some big names from Cambridge such as Kodak, but also seen the arrival of new ones in the shape of electronics giant Philips which opened a research centre in the city.

Cambridge is the birthplace of many remarkable organisations that have played key roles in the Cambridge Phenomenon. Some of these organisations are approaching significant milestones, such as Cambridge Consultants (a pioneer in the field of technology and innovation consultancy) approaching its 50th birthday, and the Cambridge Science Park (at the vanguard of science park developments since the 1970s) its 40th. But how do we build upon the achievements of these and similar organisations? Which organisations will be the ones to raise Cambridge’s game to the next level and keep us at the forefront of activities to create and capture value from innovation?

As well as remarkable organisations, Cambridge has many outstanding individuals. What has been interesting to observe is the number of recent leadership handovers at key organisations including the Cambridge Network, ERBI and St John’s Innovation Centre. There has also been a regular sprouting of new, exciting initiatives such as the Hauser Forum, Women 4 Technology, and Cambridge Tech Demo nights.

Taking all of these issues together, Cambridge has some great opportunities ahead but must also overcome some substantial challenges. But which of these we should address, and how, is completely up in the air. I believe there are three areas where work is needed

First of all, we need to be better at reaching out internationally. Cambridge has a golden opportunity to help multinational corporations implement the increasingly popular strategy of ‘open innovation’ (i.e., combining internal and external ideas to create new value). It is fantastic to see companies such as Philips, Nokia and Unilever explicitly linking their open innovation strategies to activities at Cambridge. But we must help such firms ensure that they really benefit from being in Cambridge. And it’s not easy, as the departure of Kodak shows.

Secondly, there is great potential to do more to link activities and capabilities within Cambridge to those across the region to deliver value to new and existing businesses. The establishment of the Hauser Forum at West Cambridge as an EEDA-funded Regional Centre for Enterprise and Open Innovation, and the development of the Regional Technopole activities under the stewardship of Walter Herriot will both help support more regional collaborations. But creating and capturing value from innovation activities at a regional level brings its own challenges. Regional activities need to focus on complementarity rather than competition. Without this, there is a risk of duplication of effort and a dilution of resources across too many similar initiatives. Also, sharing experience and transferring skills between centres within the region takes time, money and sustained effort.

Finally, with so much happening within Cambridge, there is a real risk of initiatives treading on each other’s toes, and opportunities falling between gaps. Now here is a real challenge: Cambridge has, thankfully, never done ‘command and control’. Much of its strength is the result of highly individualistic, anti-authoritarian, entrepreneurial behaviour, and we don’t want to lose that. But we do need to improve internal links. As I write this, I am in Japan hearing how Japanese science cities (yes, cities, not parks) struggle to build links and foster collaborations to support the ‘soft’ infrastructure of innovation. Cambridge is in many ways well ahead of the game with its active business networking, free flow of students and researchers between university departments and companies, and numerous business support activities. But there is definitely more that could be done.

If we could build upon some of the excellent networks and collaborations that are already in place, and do even more to integrate new and old, technology and arts, university and business, it could really make a difference. One senior manager of a multinational highlighted this gap. He pointed out that while his company had benefitted from many of the networks and collaborations in Cambridge, he felt it was still very fragmented and this was likely to impact future investments. As he put it “It’s simple: if you want to attract more companies like us, you’ve got to join things up better!”.

Cambridge has weathered storms before. It could be that this storm is actually the trigger for the acceleration of the development of Cambridge as a globally leading source of solutions to tomorrow’s problems.

How to track new activities in the Technopole?

Viewpoint from Tim Minshall, Institute for Manufacturing and St John's Innovation Centre.

"So, which innovation activities should we get involved in?"

I asked a manager of one of the large firms that have moved to Cambridge as part of an 'open innovation' strategy whether he thought his organisation was sufficiently engaged with the numerous entrepreneurship and innovation activities within the cluster. He turned the question back to me by asking me which ones I thought they ought to be involved in. I started listing the obvious long-standing ones (such as Cambridge Network events, CfEL Enterprise Tuesday, etc) and some of the newer high profile ones (such as Silicon Valley Comes to Cambridge) but it occured to me that there are proably many more events and activities that I didn't know about. Contacting a few of my younger (i.e, those in their 20s and 30s) colleagues revealed, to my shame, a plethora of initiatives of which I was either completely unaware or only dimly aware. They highlighted activities including Cambridge Geek Day, Cambridge Tech Meetup, Super-Happy Dev Club, Women 4 Technology, BarCamp, Refresh Cambridge, Business Leaders' Network, beginspace, Cambridge Leaders' Academy, and more.

It was interesting to note who are running these events and activities. Some are 'old' organisations delivering new things, some are run by people who have been around Cambridge for a while and are now trying new things, and some are organised by people who are new to Cambridge and who see a gap in current provison of support and networking.

But, this left me with two simple questions: How can anyone in Cambridge keep track of all these new activities? How do you work out which ones are useful for what purpose? I am in the processs of updating the Cambridge Technopole website and report and so that it gives a more up-to-date reflection of what is going on within the cluster. Any comments or ideas on how to track what is going on would be most welcome ...

The Lost Generation? Part 2

Viewpoint from Amy Mokady, Strategy Consultant, Director of i-Teams)

Recently I have found myself stating to a lot of people that Cambridge has the most talented and highly-qualified pool of unemployed that I have ever seen. The listener usually laughs and agrees when I explain that these are the mothers of young children who used to have high-flying careers, and who in many cases never return to full-time work.

They are the people like me, women who have been brought up and trained to do demanding jobs, and who have built successful careers pre-children, who loved working and saw their job as a key part of who they were. Most of us never expected to stop, but having stopped many expect never to go back. The reasons and circumstances are all different and varied. A few examples. Women who do return to work part-time only to leave because they "never see their children". Women who choose to return to work at a more junior level so that they can be genuinely part-time and not feel the responsibility to fight fires at other times. Women who return to work successfully part-time at their existing employer, only to discover how limited their options are when they look for a new part-time role elsewhere. And the counter example, which is fortunately now very well-accepted - women who return to work full-time leaving their partner to be the non-worker and primary parent.

This is not intended to be a tale of doom and gloom. Many parents find entirely new careers as a result, often in creative customer-facing businesses, and often self-employed. Others become school governors, NCT counsellors, and much-needed volunteers. In Cambridge two of our largest employers, Cambridge University and Addenbrookes, both have large numbers of part-time workers, and are able to manage this very successfully. And yet, even in this city, there are many many highly-skilled and experienced women who would love to work, if only the work could fit comfortably with their family responsibilities. The few organisations I know that are willing to work in this way are rewarded with loyal and talented staff, and frequently find it beneficial that those staff are working unusual hours such as evenings and weekends.

So this is a question and a plea. Why are commercial businesses, especially high-tech and high-growth businesses, not looking to make use of this incredibly-valuable resource? Why can we not develop management methods which allow staff to work more flexibly, both in terms of physical locations and times of working? With the internet and mobile phones, the technology is there. What seems to be lacking is the will and the motivation.

The Lost Generation? Part 1

Viewpoint from Amy Mokady, Strategy Consultant, Director of i-Teams

As the students returned en masse to Cambridge University this week, the recent media coverage of a "Lost Generation" of students comes to mind. Are these students doomed to a lifetime blighted by a long unproductive search for their first job in the midst of a recession? Or are they still the world's Bright Young Things who will leave Cambridge without a second glance and head off to glittering careers in bigger, shinier places? In particular, will any of them stay and work here in Cambridge after they graduate, and help us maintain and invigorate the Cambridge Cluster.

Only time will tell, but in recent years the most common beliefs that I have heard stated are that graduates are only interested in going to work in the City, and that no-one stays in Cambridge on graduation because house prices are too high. Followed by the caveat that we clearly cannot address either of those problems so cannot do anything to retain more students on graduation, and ignoring the obvious contradiction between the two views (surely London's house prices are still higher than Cambridge's).

The situation is one that matters for the Cluster's mid-term future. So far the Cambridge Cluster has thrived on its culture of a succession of new start-ups, and people usually found new businesses in the place that they live or work already, with people that they already know. If our students view Cambridge only as a University, and not as a place to do business, then as a community we are wasting one of our most valuable sources of intellectual capital.

With this in mind, I set up a discussion group of recent graduates (both BAs and PhDs) to try to find out what was really going on. The results proved to be both interesting and helpful.

Firstly, we quickly erased the house price argument. All the people in the discussion had found a job first, and only then started to think about where they might live, and how much it might cost. Of more concern was where their friends would be planning to live and work, since generally they had moved into some form of shared housing.

Secondly, and more concerningly, none of them had actually intended to work in Cambridge after graduation, but had generally assumed that they would end up working in London. They had no visibility or exposure to the city outside the University, nor any interest in working here. Those that had accepted jobs in Cambridge had usually fallen into them accidentally, or had personal reasons for wanting to stay here. Their fellow graduates did not see Cambridge as somewhere to work, just as somewhere that they studied.

In our current highly mobile world, it is unlikely that any new graduates will settle in one location and stay there for their whole careers. If they stay in Cambridge after graduation, they may then move to London or New York or Berlin for their second or third job. If they leave Cambridge for their first job, then similarly they might well come back one day. However, they are unlikely to come back if they know nothing about the dynamism and excitement of Cambridge as a place to work, and the easiest time to make them aware of this must be while they are still here.

Fortunately this is a problem that can be solved, and will hopefully be a small step towards preserving the Technopole's long-term dynamism and growth. The EPSRC has sponsored a new group of 'Enterprise College Reps', undergraduates who will be tasked with telling their college compatriots about the Enterprise activities available to them, and also with forging closer links between the student community and local businesses. The first such College Reps are being recruited this week. Watch this space...

Convergence? Edges coming together in Cambridge......

Viewpoint from Juliette Morgan, Cluster Development Consultant

At dinner the other night, I was struck by a comment from an über-connected Cambridgian.....who posed the question: 'Why is it that all the people at the Enterprise Tuesday lecture are not the same people at the sustainability lectures? Are the innovators not interested in the future of the planet?'. Now those are pretty good questions, but even more so when you consider that there are whole communities of ‘creatives’ in this city who also are not attending either of those forums. The dinner conversation moved on to talk about silos, distributed conversations, etc.

Yet it's pretty flippin' interesting then when a University of Cambridge professor (Nicola Clayton) has been working with the Rambert Ballet company to inspire a ballet based on the work of Charles Darwin. More so, when ballet companies are entitling their work as E=MC2. The creatives are looking to science for inspiration, but are the technologists/sciences looking to the creatives?

If innovation happens at the edges or overlaps, then surely we should be acting to cross-pollinate creatives, with tech, with sustainability. That means as individuals we have to step out of our own silos and attend things for the good of ourselves and the good of the city. Take Paul Smith's Cam Creative's group - how interesting to cross pollinate them with i-teams or CUE, or better still Cam Tech Demo night (probably the coolest event in town these days, which it took an outsider to start!). Apple does this brilliantly - excellent software coupled with excellent product design and marketing. By definition, great companies need marketing and design to be able to touch consumers by reaching them with a great products made by the technologists. So we need to get these groups together.

It was also said that creatives find picturing the future much easier than technologists. The upshot is that we need them on the team, with their fresh perspectives, ability to make us question, and ability to communicate complex ideas.

And frankly, it would just be more interesting. We're a small city, and finding these people and groups won't be hard. There doesn't need to be some big initiative - just a few people inviting arty people to tech demo nights and vice versa. How much more interesting would it be to hot-house start-ups in artists' studios to form a culture of creativity and competitiveness. After all, a huge proportion of UK economic output comes from the arts, and frankly, we need to sort the planet so if Cambridge is a microcosm of that, then we should be overlapping these groups and interests.

There are lots of publicly funded initiatives in this city to promote enterprise, but I think the model needs a shake up. Lets chuck artists, video makers, digital media guys, tech teams and eco entrepreneurs in the same space to do something together in an informal way to stimulate each other in whatever realm they are working on......this isn't new. Singapore was a small island state thirty years ago with a mission to become a world class innovation cluster. Through planning it is putting its artist quarter next to its digital media quarter, which is beside IT and Healthcare. Now I'm not suggesting that Cambridge is a small island state, but life isn't disconnected anymore, so nor should Cambridge be. We need to start overlapping at the edges, which in reality is just people going out of their way to learn more and network differently.

I'm looking forward to being invited to whoever puts on the event that has Nicholas Juett (Cambridge artist) discussing with Nokia how he uses phone technology to make his art, and teach us all to look at the world from a new perspective.

What future for young companies?

Viewpoint from Dr Anne Dobrée, Investment Business Manager, Cambridge Enterprise Seed Funds

With the selling of 3i’s portfolio and much depression in the venture capital industry one has to ask how young companies are going to raise that critical seed capital. Although our portfolio companies are still successful at raising follow-on funding – we have a great x45 leverage that we like to quote as much as possible – it is the seed and pre-A round finance that is proving so difficult to find. With University Challenge Funds almost fully invested, longer and longer timescales till exit, and fewer and fewer early stage VCs it is increasingly left to angels to fill the gap. But as we know, funding a high cost, long timescale technology start-up is not always the right investment for an angel since they will have to follow significantly to avoid being crushed by preference rights in later rounds.

There’s a rainbow outside my window as I write this (seriously!) but unfortunately no pot of gold. Although the University of Cambridge is raising a donated fund to support fledgling companies, not everyone can use this approach. Unless some of the new UK Innovation Investment Fund finds its way to very early stage start-ups, life for the high technology start-up is going to be very difficult indeed.