RE-THINKING COMPETITION , CLUSTERS AND COLLABORATION
Dr Allan O ’ Connor , Centre for Enterprise Dynamics in Global Economies , University of South Australia
For a little while now I have been researching entrepreneurial ecosystems . In doing so , I have been forced to ask myself why it is that an ecosystem viewpoint matters , and does it offer something more than the concepts such as clusters and smart specialisation strategies for regional and economic development ? The intent of this article is to share what this re-thinking might mean for how we approach the three ‘ Cs ’, Competition , Clusters , and Collaboration in Australia and suggest what an ecosystems approach might offer to a national agenda for industrial and socioeconomic development .
IS COMPETITION REDUNDANT ? This may seem like a strange question . However , if you pause for a moment , you may have noticed some changes in language over the last couple of decades or more . Terms like ‘ co-opetition ’ ( cooperating while competing at the same time ), ‘ open innovation ’, and ‘ open strategy ’, are increasingly appearing in the lexicon of business strategists . These approaches suggest that the essence of success is vested in the ability to work with others . Does this mean competition is superseded and we should abandon competing ? I don ’ t think so .
Competition serves a purpose . For a business , winning in the face of competition means attracting more customers than those who sell a similar product / service solution . If well managed ( a big IF here ), then in principle , revenues will be greater , and again , if well managed , then profits should be greater . Competing sharpens your game , keeps you focused , finetunes your operations , and draws your attention to staying ahead or keeping up with market demands . In this way , competition is a good thing .
Competition also benefits customers by providing choice in the market and generally keeping prices lower and / or relevant to the target market . For these reasons , competition is not bad or dead , but how we compete is taking new shape and form . The collective approach to competition is becoming a greater imperative .
WHAT DOES THIS MEAN FOR RE- THINKING CLUSTERS ? The idea of competing firms collaborating can be traced back to the concept of industrial clusters . In a competition sense , the focus shifted from being a game among individual businesses to a team sport of cooperating businesses competing on the world stage . Industry clusters , commonly referred to as just clusters , highlighted the advantages of co-location . The success of any one firm was recognised as interdependent with the network of firms , academic and research institutions , businesses in related industries , and government interests .
The advances in cluster thinking have centred , not on how to replicate the cluster outcome , but instead , upon the kinds of initiatives that give rise to the conditions whereby clusters may evolve . This focus invites defining a place-based project that participants and stakeholders have a vested interest in sharing . The project becomes the responsibility of those within the ecosystem to bring to fruition . Despite the competition and conflict inevitable among stakeholders with different views , opinions , needs , or objectives , the overarching factor is the shared interest in the prosperity of those within the defined place . What may emerge from this context could be something akin to a cluster 1 .
A place that shares in socioeconomic prosperity , due to its socio-industrial organisation , we may call a cluster of one form or another , but it is not an end game . These cluster initiatives or projects are part of a constant line of activity shared by all people utilising the physical attributes and resources provisioned by place . The objective is to improve , or at worst , to not deteriorate , the quality and standing of the social and economic prosperity of those within or reliant on a place .
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