South Africa’s design ‘learnerships’

Thekwini Further Education and Training College in Durban, the commercial and cultural hub of Kwa Zulu Natal Province, offers artistic community and diploma level craft and design programs.

They target existing artists, and focus on entrepreneurship, marketing development, and product improvement. Beginners can enroll in “Learnerships,” a holistic approach leading to National Qualification Certificates at various levels.  

The college also works on community projects. The Thekwini Cato Manor skills development centre is partnering with Sukuma, a local community organization, on various cultural industry initiatives, including arts & crafts.

At diploma level, they have design programs in Arts, Fashion & Industry. 

Source: CraftNet – an international network of community colleges devising innovative ways through partnerships to develop artisan-based strengths. Projects integrate design, production, technology, marketing, collaboration, and business management skills.

Go to www.rtsinc.org/craftnet/index.html 

Growing regional economies

A new US paper provides a roadmap for how regional economies can grow by cultivating new firms rather than chasing after existing ones.

The new challenge centers on what policies can encourage the formation of entrepreneurial business clusters.

The research supports streamlining local regulatory approvals and discouraging progressive taxation at the state/local levels.

The least attractive options involve policies that target spending on research programs or particular industries or firms – because localities rarely have the requisite expertise to make good decisions in this area.

The report addresses government policies that affect entrepreneurial activity e.g. education; local policies toward crime & amenities; physical infrastructure spending; legal infrastructure; general and targeted aspects of the tax code; targeted spending on entrepreneurial activities.

Go to “Entrepreneurship and Urban Success: Toward a Policy Consensus.”

Source: NDOE. 

BOTTOM LINE – Worth a read, although we don’t necessarily agree with their least attractive option – targeting of industries is possible if it involves strategic positioning. 

Competition drives Humber Seafood Gateway (BEST PRACTICE)

Plans for an International Seafood Gateway in the Humber were unveiled to an international audience at the North Atlantic Seafood Conference in Oslo on 4 March. The Seafood Gateway proposal involves:

§          Humber Seafood Institute, to support the industry and promote international collaboration on innovation and sustainability – opening April 2008.
§          Perishables Hub based at Humberside airport, a new purposed built temperature controlled facility for the efficient handling of air freighted cargo – opening summer 2008. §          Humber Seafood Exchange, a state of the art international/chilled seafood logistics hub, distribution centre, auction and processing facility – construction work will start early in 2009. 

Food producers around the Humber are responsible for 70% of UK seafood consumption. The distribution hub to be built on the Europarc estate near Immingham allows the region to compete with France’s leading port, Boulogne-sur-Mer, where a major investment is being made in a similar facility. 

Project backers say without the development the fish processing industry on the Humber will go into a slow decline. However, it will almost inevitably lead to closure of both Grimsby and Hull fish markets. Indeed, the CEO of Grimsby Fish Dock Enterprises says “We are in limbo. We are neither for nor against. We haven’t been offered any deal or proposal that satisfies the board.”  

BOTTOM LINE – competition from the French always did galvanise the Brits. Worth tracking progress.  

Corporate Philanthropy – what works

The Kauffman Foundation in the US has referred us to a survey by McKinsey & Co. in respect to global corporate philanthropy.

MCKinsey says the aims are of most corporations involved in philanthropy are similar – to enhance the corporate image and brand, build employee leadership, enhance employee recruitment and retention.

The most effective corporate efforts align their philanthropy with social/political trends relevant to their business. Top-quality programs also emphasize collaboration with other corporate partners, other philanthropists, community groups etc.

(The corporate sector in A/NZ is notoriously stingy. Anyone know the reasons? Less advantageous tax treatment? No Bill Gates role models?  - Editor)

Go to “The State of Corporate Philanthropy.”

Victoria’s investment hubs

Regional development agencies in Europe and the USA are flat-out selling their regions. But here, we leave it to the states. Not smart.

In recent months we have identified 12 major investment hubs in Queensland and 20 in NSW that would provide the core of a national investment attraction framework.    

Victoria is well-positioned to attract foreign investment in high-end activities – track record in science, and Australia’s best transport, leisure and knowledge infrastructure. Also compact – its regional cities provide an effective spatial framework. Along with Queensland, it’s the most progressive in terms of industry/regional development. We reckon Victoria has 11 primary investment hubs, from which 30-35 spokes could radiate.  

Inner Melbourne (CBD plus Southbank, Docklands, Carlton, Parkville) – array of biotech, ICT, financial services, small businesses, plus fashion, tourism, retail operators competing and collaborating within a true milieu.   And metropolitan Melbourne has four strong development corridors. Hume/Whittlesea – transport & logistics; automotive industries; consumer goods. Pakenham-Berwick - food manufacturing and light engineering. Western Melbourne – transport & logistics; heavy engineering. Monash Precinct – Australia’s most progressive university, Monash Medical School, sychronometer, research labs, numerous high technology start-ups and multinationals at Caribbean Gardens, Dandenong Rd, Mulgrave Rd.  

Geelong – deep sea port, gateway to the south-west, very good infrastructure, lifestyle attributes and critical mass (200,000 population). Hub angles – automotive, textiles; logistics.  

Ballarat - classy city with some distinctive civic assets. 90,000 population. Hub angles – ICT including video games; education; food processing; historical tourism. 

Bendigo – a serious centre of manufacturing. 100,000 population. Hub angles – textiles & clothing; food processing; building products & furniture; heavy engineering. 

Wodonga - covered last month as part of the Albury-Wodonga hub, but not forgetting the new, sizeable industrial park on its outskirts. 

Shepparton – nice city with sunny winter days. Population nudging 65,000 and 2% growth. Hub angles – fruit & vegetables, transport; water equipment & technology.

 Latrobe Valley – an under-appreciated string of cities. Declare Traralgon as the regional centre! Hub angles – proximity to surf, snow, water, forests; cheap energy (if prices reflected true costs); engineering capability; dairying; forest products.    

Victoria also has strong second tier cities (e.g. Wangaratta, Mildura, Horsham, Warrnambool, Portland) and bigger towns with good infrastructure (e.g. Swan Hill, Maryborough, Echuca, Warragul-Drouin, Bairnsdale). 

Contributed by Local Government Focus (‘Good Oil’ column) 

If you are looking to invest in Victoria, contact us at apd@orac.net.au!

US expert predicted Mitsubishi’s exit in Australia

Professor Oded Shenkar was the Ford Foundation Professor of Global Business Strategy at Ohio State University in 2001. From our archives, we have idenitifed some very prescient comments he made at a series of talks in Australia as part of the Smartlink project .

Shenkar has a longstanding expertise re engagement with China, globalisation, multinationals, SME development, innovation and auto industry adjustment. Comments included:

• Globalisation is on everyone’s mind – and the Conference Board (the key think tank in the US) has identified globalisation and alliances as the two critical issues.
• Australia feels threatened by takeovers and, while MNEs might provide jobs, they may not be a ‘thinking’ workforce.
• In Australia, there will not be four auto manufacturers within five years (i.e. currently Ford, GM, Mitsubishi, Toyota). The future of Mitsubishi will hinge on how well Chrysler does in the US – where it is losing $US500m per quarter at present – people in SA should be praying for Chrysler)
•  Virtually all nations want foreign investment, and there is tremendous competition. But 85% of FDI is via mergers and acquisitions, and global M&A is now greater than domestic M&A. MNEs are trying to consolidate and not replicate – countries looking to maximise the contributions of MNEs should concentrate on knowledge-based activities – not capital for its own sake – go for back-office activities, education and training, design and tooling etc. that can build value chains. The need is to leverage off MNEs’ requirements.
• One-third of global trade is internal transfer between the affiliates of the one company – and 60% of MNEs do not pay a cent in corporate tax.
• SMEs are flourishing despite the growth of globalisation – they drive innovation. MNEs need them to capture innovation – this is why Cisco has bought 70 companies in the last two years. The share of US exports represented by SMEs has grown from 20 to 30% in recent years.
• How should SMEs respond? – take opportunities as they arise, piggy-back off MNEs, push on exports because ‘if you don’t venture out, someone else will come and eat your lunch’ (i.e. off-shore competitors will encroach in  your domestic market).
• Re US investor perceptions of Australia – while at pains to emphasise this was his first trip, Prof. Shenkar indicated that from his perspective, Australia is not on the screen – the leisure image works against Australia, and Hawaii suffers the same problem. Australia is seen as downunder and far away – Americans do not realise that Sydney is closer than Hong Kong in flying time. Australia really doesn’t have identifiable brands or specialisation like Sweden – furniture, Germany – cars. Interestingly, Subaru uses Paul Hogan and kangaroos in its 4WD ads in the US, and a fair proportion of Americans probably think the vehicles are made in Australia (and not Thailand etc.)
• Alliances could help Australia overcome its lack of scale – bilateral alliances are one possibility whereby different aspects of a supply chain could be coordinated – but it requires a different perception of things and a creative government on both sides – need to see it as a value chain.
• Sometimes we need to be physically close – it is important, and part of human nature. Governments need to recognise this. 

Mauritius view of global issues

Mr. Nikhil Treebhoohun, now with the Commonwealth Secretariat we believe, is a very agreeable chap who was a keen participant in clustering initiatives when he was the CEO of the National Productivity & Competitiveness Council in Mauritius.

A few years back he wrote a very good thought piece based on his attendance at the World Cluster Congress in Paris. His take included the following.

• The Congress was organised jointly by OECD and the French government and the assistance was quite impressive both in terms of the number attending (some 1,000) and the quality of the participants. The Congress was opened by the French minister for spatial planning and the environment, who stressed the need to take on board the social dimensions of development. One important element was her commitment to build alliances with countries of the Zone de Solidarité Prioritaire so as to ensure that developing countries are not further left behind by the movement towards globalisation.  
• The case of local clusters is notable not just because of the economic benefits for the performance of firms but also because it draws our attention to the presence of a different entrepreneurial and local culture. 
• This is based on a higher degree of inter-relation between economic and social ties.  The fact that enterprises are located together in the local territory helps to generate trust and a willingness to co-operate, which makes for a qualitative difference between networking locally and networking at a distance.
• Secondly, there are trust relations among enterprises.  The case of transition countries shows how vital trust is to any form of coordination, which was often destroyed during years of undemocratic rule.
• Thirdly, there is the notion of partnerships between private and public actors.
• Fourthly, there is enhanced visibility of local actors and of the civil society. This is demonstrated for instance by the increased visibility of networks of women entrepreneurs at a local level.
• Fifthly, stronger representations of collective local interests is important. This also involves closer links to the authorities.
• Sixthly, agencies need to think about a new approach, where the actor is a group of enterprises, rather than an enterprise as an isolated economic actor.
• Last, a new relationship between territorial proximity and the use of new technology is warranted. 

Some of the ideas and lessons that were discussed at the conference include:

• The SPL (systèmes productifs locaux) is a concept being promoted by the French as their own variant of the Anglophone clusters and the Italians industrial district. The main difference between the cluster and SPL is that the French see SPL as encompassing social issues – i.e. the SPL are clusters aimed primarily at community development as a means to combat unemployment.
• There was total consensus among all participants that there is no blueprint for cluster development.
• Whereas at TCI Glasgow the general feeling was that a cluster could not be built from scratch, at least one dissenting voice was heard in Paris which mentioned how, starting from an idea to develop sport fishing, Chile ended with an aquaculture cluster employing 30,000.
• France is going to help LDCs set up clusters.
• Clusters are built on trust -managerial and knowledge resources are needed – clusters need to be embedded in the social and community model – clustering is a means for empowering local entrepreneurs – must move from firm to industry thinking – need for a local delivery mechanism and an anchor institution – information flows must be freely available and accessible e.g. US government has no copyright on information it produces.                                                             

Clusters as Learning Systems – Rosenfeld

A few years back, Stu Rosenfeld of Regional Technology Strategies, Inc. presented a paper ‘Backing into clusters – retrofitting public policy’ at the John F. Kennedy School Symposium (Harvard University, March 2001). His insights (below) are specially relevant today.

An area of interest in clusters in the U.S. comes from those who believe that economic growth depends on technology diffusion and knowledge spillover.  Research shows that clusters facilitate the transmission of knowledge – particularly tacit knowledge, which is embedded in the minds of individuals and the routines of organizations and therefore cannot move as freely or easily from place to place as codified knowledge (Cortright, 2000). 

Ideas about the importance of creating structures that support and accelerate learning have been translated in the context of the new economy in the form of strategies to create “learning cities” and “learning regions” (OECD, 2001). 

Within clustered economies, there invariably is more inter-firm mobility and thus more active transfer of information and knowledge among firms and workers.  In the US, learning is gaining more acceptance as a factor in economic development – but most often as a marketing device for regional recruitment strategies, not with any clear ideas about how to stimulate or accelerate learning.  Those policies that do promote learning tend to focus on codified knowledge that rely on educational institutions, not tacit knowledge and informal means. 

Application of policy

 To apply clusters to policy, one must believe that they are the rule rather than the exception.  The highly specialized industrial districts that Marshall studied, and that still exist in some parts of Europe and in many less developed countries, are not very common in the United States or in northern Europe.  Therefore, the boundaries of clusters have to be expanded to meet the realities of more diversified economies. 

Diversified regions, however, often still have degrees of specialization.  These are home to industries that, because of historical accident or geographic peculiarities, are much more concentrated than others, and thus the region has a greater stake in their competitive health.   

Two of the first states to officially embrace clusters were Arizona and Oregon…the early reports from Arizona named key areas for actions, which included industrial synergies and entrepreneurial wellsprings. A  decade later, the councils for the nine clusters initially selected, less mining but plus software and senior living, are still organized.  In many respects, the clusters operate as networks, with membership requirements and objectives that match the objectives of network programs: co-learn, co-market, co-purchase, co-produce, and co-build economic foundations.

Mussels from Brussels

 

ONE OF OUR TOP 10 ARTICLES.

Rob Owen, is a regional development consultant living with is wife, Bron, on a beautiful farm at Candelo on the Far South Coast of NSW (Australia). He is also a marketing expert (ex-Austrade and the the private sector), a B&B owner and beef producer, and a general bon vivante and good bloke. The following is an extract from a marvellous article in ‘Eden Magnet’ newspaper .

Throughout Northern Europe two restaurant chains proliferate. They are Leon de Bruxelles (established 1893) and Belgo. They both specialise in mussels. French tourists flock to the Brittany coastlines to enjoy fresh mussels, oysters, crabs, langoustines and a dazzling array of fish species. The markets in Brittany’s towns always include dedicated seafood stalls.  

The mussel menu from Leon’s includes moules (mussels) speciales, moules a la creme, moules au vin blanc, moules au curry, moules a la provencale, moules au balsilic, moules a la moutarde, moules a l’ardennaise, moules au roquefort, moules au gratin, moules a l’escargot, moules escargot gratinees, moules cote sud, moules en friture, moules poulette – all with pommes frites (chips) that would leave Macca’s version for dead.  

 

There is of course, also a mussel salad Leon. The Belgo chain has a cook book on how to do it.

Let’s do it, come on Eden, get your tourists in to enjoy mussels. We have eaten plenty of the French version. They, and the Kiwi brand are good, but Eden mussels are the best we have tasted. 

The Brittany oyster from Cancale is big – some are the biggest I’ve ever seen. Cancale and Belon both host oyster museums. Oysters encourage crowds to visit the coastline too, and eager consumers attack rows of oyster stalls in Rennes, Brittany’s capital, each Saturday.

We could do this here too with 250,000 consumers in Canberra, many of whom would surely love to have a regular seafood market direct from Eden. Imagine a Seafood Festival – possibly linked with the existing fishing tackle exhibition and fishing competition hosted in April by the Eden Fishermen’s’ Recreation Club. The people that come and enjoy fresh seafood in Eden will look for the product when they return home. That has been the philosophy behind the Heritage Centre at Bega Cheese, which attracts about 260,000 visitors annually.

The Eden Whale Festival could upgrade the seafood eating part of their excellent event. Imagine – thinking wider – a coastal chain of Bega Turf and Eden Surf eat-in and fast food outlets – with branded meat supplied from our local beef farms to accompany the local seafood. Fresh tasty beef burgers and steaks from the clean green pastures of the Bega and Towamba Valleys. Just like the clean, green Bega Cheese. Let’s capitalise on the nationally-recognised Bega name.

Imagine a showcase of timber products – from factory cut furniture blanks shipped direct from the Eden multipurpose wharf to custom made kitchens with slab tops from the Blue Ridge Hardwood timber mill,  to timber design products created by artisans. And, of course, a Timber Town tourist attraction established with help from the timber contractors, woodchippers and sawmillers of the Eden region. 

Who will benefit from all this? Everyone. Tourist accommodation outlets will have more bed nights. The shops will develop. Old and tired owners will gladly sell out to the benefit of their retirement funds, to be replaced by young, enthusiastic retailers with new ideas of product ranges and opening hours. Restaurants will have signature seafood dishes, cafes will serve real coffee with their tasty snacks, and both will have more bums on seats. 

In France, every town and suburb has at least one weekly market for fresh produce. The flower markets in springtime Rennes were a sight to behold. The daily markets in Versailles were mind-boggling with chooks as big as turkeys…the roasted poultry stall with duck, three types of chook and other fowl at the Libourne Sunday markets attracted a never ending queue of Sunday lunchers, and the twice weekly markets in the Dordogne capital of Perigueux made our mouths water. 

Here in Candelo, where I live, we have the monthly Candelo markets, which in my opinion have degenerated into a hodge-podge of goods and fast food. There is no thought to the organisation of these markets, the content of the stalls and how they can attract more people more regularly. In France,  the local tourism association promotes tourism hand in glove with the local chamber of commerce.  

Phone 02 – 6493 2410 or ppr@acr.net.au 

Spilling the beans…says Stu Rosenfeld

Dr. Stuart Rosenfeld, of RTS Inc. in the USA, is the author of one of the best, most readable book on clusters – ‘Industrial-strength strategies: regional clusters and public policy’. There may still be copies available.

Stuart has published more than 100 books and articles, on topics such as:
·        Competitive manufacturing: new strategies for regional development.
·        Smart firms in small towns.
·        Exploring the potential for manufacturing networks
·       Overachievers – business clusters that work
·        Skills for an Information Economy. 

Stuart Rosenfeld argues that the most common advantage in locational decisions is access to intelligence – companies can source inputs from anywhere, but they need intelligence. Governments don’t give much attention to clusters in the context of labour markets, but they should because the development of clusters addresses all aspects of an industry.

The dynamics of clusters can be appreciated in terms of:

·          the flow of information – better knowledge of markets, labour markets, technology.
Clusters lead to people ‘spilling the beans’ (a brilliant insight!)
·          ideas – the diffusion of innovation.
·          people – especially increased experience. ‘People meet in taverns’.
·          goods – the strengthening of value chains.
·          services – expanded expertise.
·          capital – support for plant modernisation and start-ups. 

The mapping of information and skills can be a valuable way of identifying the source of ideas, learning of opportunities, finding how to get assistance to address problems, and generally knowing who to call. 

Contact Stuart at www.rtsinc.org.