Changing Shape of Clustering

As global value chains become more and more important to businesses, the clustering of industry sectors remains the single, surest method of facilitating success within those chains and supporting investment. But as new sectors, like renewable energy and nanotechnology, emerge and businesses diversify more widely, is it still clear where businesses fit? Who remains in your sector - do you belong to more than one?

As BIS (formerly BERR) points out: “Success in global value chains is based on specialisation”, So as specialised firms benefit from sharing services, resources and knowledge between themselves, the role of clustering is to support specialisation. As BIS also points out: “[This creates…] critical mass to attract investors and purchasers” - which all sounds like good news.

But things are changing. With the rapid development of new technologies, a growing trend toward niche manufacturing and the transition to a low carbon economy, the old cluster models are under pressure to adapt. Likewise, new clusters themselves are beginning to emerge. For example, whilst still in its infancy, the NW is now home to the UKs first photonics cluster.

With an eye to the future and the global value chain, it’s becoming increasingly important for businesses to consider collaboration both within and outside its sector. But how? Are clusters still best equipped to support collaboration and what about the rapidly expanding sectors falling outside the current cluster set ups?