BUSINESS GOES TO CLUSTERS, Orjan Solvell

Rossiyskaya Business-Gazeta (Moscow), January 21, 2014

 

BUSINESS GOES TO CLUSTERS, Orjan Solvell 

Merge of enterprises cuts the production costs
Point of view
Orjan Solvell, director of the center for strategy and competitiveness of Stockholm School of Economics

In the economy year 2013 passed under the sign of expectations. People expected decrease of oil prices and dollar depreciation but failed to see this, they expected the final victory of shale revolution but did not see this and they finally expected bankruptcy of Greece but did not see it too. Along with this, among all these expectations one was especially persistent. This was expectation of a new round of economic crisis. Like the end of the world in 2012, economic crisis was forecasted throughout the whole year since January until December. It was predicted in various forms and expressions always but the forecasters meant the same content, namely its inevitability. It was logical that after people failed to see crisis in the previous year its expectation organically moved to the new one.
If there is expectation of a crisis an adequate response should be prepared. Clusters in the economy may play this role. First of all, cluster is optimization of the effort taken, this is interaction of various companies and organizations that act in a certain area and supplement each other mutually. This means that cluster is actually "mutually beneficial helping each other" based on close cooperation of the state, business, science and society.
There exist various principles of building of clusters combinations of which may become the basis of an efficient cluster strategy. One of the key principles that shape the future cluster is its direction, vertical or horizontal. In the first case the matter will be about presence of adjacent stages of production in clusters. In the second case the matter will be about merge of some industries into one cluster that will synthesize their strong and weak points. Other important principles are lateral (big-scale merger of various sectors that becomes beneficial for all participants), technological (merger of sectors according to the principle of use of certain related technologies in them) and focus one (merger of production facilities around a certain technological center – research institute or higher educational institution). With regard to choice of these principles it is important not to make a mistake: most likely, synthesis of several of them will be the most efficient solution. Nonetheless, in case of building of efficient clusters in the economy the first stage, laying down of foundation of a future cluster, is usually the most difficult. The degree of its efficiency is determined at this very stage in many aspects because there it is necessary to combine the interests and the needs of a group of independent subjects. However, with regard to this Russia has an advantage in comparison to other capitalist countries of Europe: presence of the state in the economy here is slightly bigger. That is why it is simply necessary to use this presence for the benefit: Russian state may become a conductor, a connecting link for many companies that accept the "rules of the game" making sure that the new scheme may be not only productive but also stable, which is always important for business. Along with this, the state should not undertake the main role in such cluster, otherwise it will automatically "suppress" the other participants of the process that should be equal for everyone. At this point the state should act in the role of guarantor of strength of the future project, in the role of its inspirer but not soloist. Figuratively speaking, a role of producer is allocated to the state in such cluster: it gathers everyone into a team, develops a project but does not smile from posters and does not receive Oscar.
Such distribution of roles will enable the business and the society to manifest itself. Energy potential (not in the field of natural resources but in the field of human resources) is huge in Russia today. Business strives for growth and activity, as well as society. It is necessary only to gather them into one cluster and to let them play the main roles having set a task preliminarily. In such case a "five-year plan" will be fulfilled in three years in the best sense. It will not even be important then if a cluster is created in a green field like the Silicon Valley in the past or is grouped around the already existing science-intensive "cores" where there are preconditions for concentration of companies. An idea will become the basis of the project and the idea is above the place of its own application.
Thus there will appear a possibility of creation of a number of serious advantages including improvement of the economy's health. A cluster like litmus paper helps revealing strong and weak points of every sector of the economy that form it. Besides, cluster approach increases potential and efficiency of small businesses significantly, cuts the production costs and barriers for entrance into the product sales markets. There also appear opportunities for more successful entrance into foreign markets. These are not all "bonuses" achievement of which may be facilitated by consistent well-considered "cluster approach" if it is used in sequence manner. 

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