Feeling the Cluster Funk?

by Dan Robles on 06/08/2011

clusterfunkfeb2 Cluster FunkI recently attended another one of those economic development summits where a bunch of people with long titles gets a chance to speak on a panel touting the mysterious benefits of a mysterious innovation clusters that create mysterious wealth that can only be realized if their mysterious department is funded.

Nearly every speaker concluded with the following paraphrase: “if only government would fund this or that, everything will be fine”, or, “if only corporations would fund this or that, then we’ll all be better off”

Uhmmm…sorry to break the news, it ain’t gunna happen.

Innovation clusters are all the rage in regional economic development circles. Actually, they are “industrial clusters” because several companies in similar industries collocate in the same geographical area. The industrial cluster then attracts supporting industry and often causes the migration of educated and motivated people to the prospect of jobs. I suspect the ‘innovation’ moniker comes from the notion that new ideas will somehow result from similarity of ideals and purpose.

Group Think Tanks

There are, however, a few drawbacks to industry clusters; they are vulnerable to stagnation, silos, and external shocks. As companies become organized and technologies mature, patents and trade secrets take hold. As they ‘go public’, SEC regulation effectively places a gag order on everyone and sharing slows while stagnation sets in.

Soon after, dozens of nimble companies consolidate into a single giant to achieve economies of scale. Finally, silos form under the weight of multiple layers of management while jobs are mechanized or outsourced.

Then, something somewhere happens to shock the cluster; the end of the cold war leveled the So Cal aerospace cluster. 9/11 busted the Seattle Aerospace cluster. The dot.com bomb stunted Seattle, Silicon Valley, and Route 128. Hurricanes and environmental disasters hit the petroleum cluster, stem cell and genetic engineering legislation stalled biotechnology, and corruption continues to shock financial institutions. At the end of the cycle, companies divest, people defect and a new planet starts to form someplace else.

Remember “scrubbing bubbles”?

While occasional cleansing, in a Schumpeterian sense, is good for industries, the extreme volatility takes a horrendous toll on that invisible turbine of the economic engine – social fabric. Families, friendships, professional networks are strained or collapse and those who dedicate their life to a career path – the pure innovator themselves – can be left marginalized by obsolescence.

The term “Innovation Clusters” makes for a good soundbite for politicians because it fits on the “Jobs R Us” banner they can stand in front of (thumbs up) for the next election cycle.   The term keeps funds flowing to organizations to publish studies that conclude that more studies are needed. Maybe these summits ought to be renamed to Cluster Funks because that is largely what they actually promote.

{ 22 comments }

Alex Hall June 22, 2010 at 8:25 pm

This is good: Feeling the Cluster Funk? – http://www.relationship-economy.com/?p=10867 #socialmedia

Alex Hall June 22, 2010 at 9:26 am

Interesting read: Feeling the Cluster Funk? – http://www.relationship-economy.com/?p=10867

Allen Howell June 19, 2010 at 2:05 pm

RT @prblogs: RelationshipEcon: Feeling the Cluster Funk?: Maybe these summits ought to be renamed to Cluster Funks http://bit.ly/bHBxTS

JDeragon June 19, 2010 at 9:49 am

Consider: Feeling the Cluster Funk? http://bit.ly/9JFkcg

smconnection June 19, 2010 at 7:30 am

Feeling the Cluster Funk?: Maybe these summits ought to be renamed to Cluster Funks because that is largely what t… http://bit.ly/bHBxTS

Joe Grasso June 19, 2010 at 7:30 am

Feeling the Cluster Funk?: Maybe these summits ought to be renamed to Cluster Funks because that is lar… http://bit.ly/cBfdQI [email protected]

JobShoots June 19, 2010 at 6:31 am

Feeling the Cluster Funk? http://bit.ly/c76IhI #news #socialmedia

JobShoots June 19, 2010 at 6:31 am

Feeling the Cluster Funk? http://bit.ly/c76IhI #news #socialmedia

Alltop June 19, 2010 at 6:31 am

Feeling the Cluster Funk? http://bit.ly/dsEUd1 Social-Media.alltop

StarGazon June 19, 2010 at 5:01 am

Feeling the Cluster Funk? via The Relationship Economy – I recently attended another one of those economic … http://tinyurl.com/2ce8xsk

Achievers Network June 19, 2010 at 4:53 am

Feeling the Cluster Funk?: Maybe these summits ought to be renamed to Cluster Funks because that is largely what t… http://bit.ly/bHBxTS

Achievers Network June 19, 2010 at 4:53 am

Feeling the Cluster Funk?: Maybe these summits ought to be renamed to Cluster Funks because that is largely what t… http://bit.ly/bHBxTS

Aron Stevenson June 19, 2010 at 4:53 am

Feeling the Cluster Funk? http://bit.ly/cBfdQI #socialmedia

Aron Stevenson June 19, 2010 at 4:53 am

Feeling the Cluster Funk? http://bit.ly/cBfdQI #socialmedia

prblogs June 19, 2010 at 4:53 am

RelationshipEcon: Feeling the Cluster Funk?: Maybe these summits ought to be renamed to Cluster Funks because that… http://bit.ly/bHBxTS

prblogs June 19, 2010 at 4:53 am

RelationshipEcon: Feeling the Cluster Funk?: Maybe these summits ought to be renamed to Cluster Funks because that… http://bit.ly/bHBxTS

Angela Suddarth June 19, 2010 at 4:50 am

[email protected] Feeling the Cluster Funk?:
I recently attended another one of those economic development summits wh… http://bit.ly/dDs6CE

The Social CEO June 19, 2010 at 4:50 am

The Social CEO Feeling the Cluster Funk?:
I recently attended another one of those economic development summits … http://bit.ly/dDs6CE

Angela Suddarth June 19, 2010 at 4:50 am

[email protected] Feeling the Cluster Funk?:
I recently attended another one of those economic development summits wh… http://bit.ly/dDs6CE

The Social CEO June 19, 2010 at 4:50 am

The Social CEO Feeling the Cluster Funk?:
I recently attended another one of those economic development summits … http://bit.ly/dDs6CE

JDeragon June 19, 2010 at 4:49 am

Consider: Feeling the Cluster Funk? http://bit.ly/9JFkcg

JDeragon June 19, 2010 at 4:49 am

Consider: Feeling the Cluster Funk? http://bit.ly/9JFkcg

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