There is one reality pundits, economists, Monday morning quarterbacks and other experts from all inclinations and schools of thought seem to unequivocally agree on: We are entering a long term era of tight liquidity, increasing credit risk aversion and more arduous access to finance. Cluster competitiveness efforts are not immune from this new and evolving set of economic circumstances.
Mainstream cluster development initiatives have mainly concentrated on the horizontal and/or vertical integration of value chain components that naturally or enticingly (through incentives) bring enterprises to collaborate in order to ameliorate their respective bottom line, pool their resources whenever possible and secure market shares, all under the sacrosanct trinity of Enterprise- Academia/Innovation- Government. This trilogy otherwise dearly known as the Competitiveness Triple Helix, while an intuitive and extremely appealing concept, ignores a fundamentally central and inexorable actor in the enterprise creation and development universe: the Financial Sector. Recognizing the role of financial institutions and including their logics and strategies in the cluster competitiveness equation would make for a solid and realistic competitiveness model that can better weather cycles and respond to crisis situations.
A possible explanation for this omission finds its roots in the fact that the triple helix model was developed in Europe and the US at a time of plentiful cheap liquidity and easier access to finance. Those days are, unfortunately or thankfully, bygone. While most of us understandably have a beef with fat bankers and juvenile financial wizards these days (don't forget those wise economists too), continuing to ignore the financial sector in cluster development comes at a significant cost. It behooves cluster professionals to educate the financial sector on cluster development and to lobby for the development of products and services that are adapted to the needs of enterprise clusters.
It is crucial for the competitiveness community to incorporate the financial sector as an integral part of the cluster thought leadership in order for tangible and innovative solutions tailored for cluster development needs to be designed and adopted and to enhance the quality and volume of financial products and services offered. Several usable solutions were suggested during the 2009 TCI Conference in Finland allowing Enterprises within a cluster to tremendously benefit from leveraging on their numbers and resources to negotiate more favorable terms and conditions with the financial sector.
These solutions ranged from developing bank credit risk assessment models taking into consideration that enterprises belonging to a cluster present a less risky profile than stand alone enterprises in general to selecting a unique cluster partner bank that would house accounts of all enterprise within a cluster to negotiate advantageous loan terms in concert as a collective or to boldly create cluster banks following a credit union model.
While trying to define cluster competitiveness is an elusive exercise as the concept means different things to different people depending on personal experiences, on economic and social conditions in their home and regional environments and, also sometimes, on "dogmatic" and near religious theoretical positions, Finance given its vital importance to enterprise development should not fall victim to current debates and exchanges. Let's embrace finance as a key component of cluster competitiveness and use it as an efficient tool for cluster development and growth.
Samy Nadifi
IBI International
snadifi(at)ibi-usa.com; Nadifi(at)aol.com
Link:
23 March 2010
