How an Innovative Region Can Help Grow Your Business
By leveraging the innovative assets within your region or in others, you can deliver greater value and opportunities for innovation within your own company.
The End Game
Innovation has been and should remain the end game, since it is truly how companies are driving and sustaining growth in today's economy. And innovation is not just defined through the building of new products; it is also the creation and transformation of knowledge and new processes and services that meet a market need. It's about new ways to partner, and innovative interactions, entertainment forms, and ways of communicating and collaborating. Innovation truly distinguishes the leaders in today's economy.
With these great goals in mind for growth, you begin to dig deep into the existing Rolodex. You will often take another look at the product plans that were scrapped in previous years to see if there are "morsels" to pick back up in internal product meetings. You may attempt to breathe some fresh life into business leads and angles within your industry or supply chain that were not there before, but held outside promise. Or, you attend trade shows and events that have also yielded contacts and roads to explore in the past. To be sure, these are all proven methods, but let's think about opportunities from a location perspective that may generate a diverse point of view.
There has been much study of location-based economic development that enables innovation and commercialization, whether the location is defined as a county, metropolitan area, state, or region. In today's global knowledge economy - where value is derived from creating, evaluating, and trading intellectual products - we can sometimes neglect to think about the composition of the very economies in which we live and work. The fact of the matter is that many of you live in innovative regions. These locations today are often filled with innovation-based assets that can be leveraged for the growth of your business.
So, how do you make innovative assets within your region benefit you and your company's goals? And, what do you look for to see what your location has to offer?
A framework commonly used when describing regional assets is industry cluster. Clusters have been used frequently in the practice of modern economic development strategy by leading practitioners, including the U.S. Economic Development Administration (EDA) and the U.S. Council on Competitiveness, as a method to characterize innovative concentrations of industry and formation of spin-offs. As noted on the EDA's website, "RICs (regional innovation clusters) are a geographically-bounded, active networks of similar, synergistic, or complementary organizations, which leverage their region's unique competitive strengths to create jobs and broader prosperity."
Further study and observation have delved into the inner workings of the cluster to see the factors driving the opportunities for innovation and growth. Cluster analysis recognizes that collaboration among small and large businesses, universities, and research parks is essential for innovation and commercialization. Often found in clusters are new institutions to connect assets within clusters, regional partnerships to bring new products and services to market, and incentives that are increasingly important to support collaboration and foster innovation.
It is these components of the innovative region or cluster that really make a difference for potential business opportunities. Today, there are vibrant cluster organizations (what I often call innovation intermediaries) that are working to spark entrepreneurship to fuel regional connectivity, encourage risk-taking on technologies that can take startups to maturity, and lead to job and economic growth for that region. A focus on supporting and promoting entrepreneurship is typically found as a primary unit of measurement that indicates the willingness to start, grow, and succeed in a location. The ability for these attitudes to come together is the ultimate reassurance of the attractiveness of locations for healthy business lifecycles.
Leveraging Innovative Resources
Bringing together this knowledge of clusters and cluster organizations, the United States today has more identifiable traditional and emerging clusters of industry, technologies, and other niche expertise. Some of these include the life sciences in Boston, semiconductors in Silicon Valley, electronics throughout Texas, aerospace in Los Angeles, cleantech in Denver, information technology in Seattle, and many advanced manufacturing specializations across the Midwest. The concentrations of knowledge in U.S. business and industry are common knowledge, but there are ways to look at the unique assets within the clusters to leverage the inherent innovation.
For instance, networking opportunities through regional industry innovative clusters are a meaningful regular exercise to understand local development. Legacy and emerging industries have deep sets of knowledge in specific functions, technologies, and processes, and have the preponderance of specific sets of knowledge workers that can be used for business and innovation outcomes. Expected strategies follow, and organizations within clusters tend to continue to promote various programs and opportunities to exploit these core competencies.
As an example, during the down years in the automotive industry over the past couple of decades, many engineers and industrial designers were underemployed but continued to be connected throughout local industry and university activities, as well as through public-private partnerships that sprouted, including Automation Alley and TechTown at Wayne State University in Detroit. In the recent comeback of the auto industry, the region has demonstrated that the embedded knowledge base has always been in Detroit. This knowledge is again filling the pipeline for manufacturing companies in Detroit.
Simultaneously, Clemson University in South Carolina was building a critical mass around its own research park, skilled work force, and economic incentives for the automotive industry. This helped fuel a major investment from BMW into Clemson's International Center for Automotive Research to leverage university know-how for its business growth and expansion. Other initiatives have layered onto this momentum to enable the auto industry to open source opportunities and move at a faster pace with high-technology companies.
Initiatives called AutoHarvest, the Network of Automotive Excellence, and the AutoVenture Forum have taken shape recently as open source movements, but most have been grounded or influenced by economic development and location experts.
In Detroit and South Carolina provide examples of technical know-how affiliated with innovative regions. But another great enabler for growth is the business and financial acumen affiliated with these industries. Sand Hill Road in Silicon Valley, with its rows of investment firms, has achieved the great reputation of owning the knowledge to fund the next set of groundbreaking technology companies. Access to risk capital from proof of concept to seed, early-stage, and venture capital is a priority for innovative regions. There are often innovation intermediaries that get involved with mentoring startups in your region, which facilitate networking with the funding community.
Unique assets within innovative regions can include academic strengths like cutting-edge university research, advanced facilities and research parks, savvy technology-transfer professionals, and concentrations of younger workers. The university assets provide a great opportunity for you to become involved and network within the university centers of excellence, research facilities, entrepreneurial events, and business plan competitions. Teaching in a business or technical school will provide access to professors that could help in your business, or to researchers and scientists with whom you could partner to create next-generation technology. Also, there is typically great talent available in terms of student interns who can considerably benefit your company through knowledge transfer of new advances within academia.
Everyone should think about becoming involved with the local chamber of commerce, the local innovation intermediary, university center of excellence, or work with a start-up. In one way or another, these groups will get you connected with the innovative assets within your region. If you do strike out gaining access to local resources, then the open innovation movement is yielding results for leading companies like IBM, Nokia, GlaxoSmithKline, and Procter & Gamble, which are all supporting successful open innovation platforms. However, as mentioned, many of these efforts are starting with local knowledge and support from the economic development community.
Programs, Incentives, and Tools
Naturally, the concept of location-based assets has led to a proliferation of competition between U.S and global regions, which has led to the development of new programs and incentives from risk capital funding to tax credits. One way to judge the competitiveness of regions is to see what is offered in terms of economic development assistance to help your business grow. You may find research and development or job training and hiring tax credits of which you were unaware, or even funding to enhance research labs, and facilities to foster industry partnerships. In some locations you will also find import and export assistance to help your company form global partnerships, or incubation facilities and research parks that industry can leverage.
If you would like to review benchmarking on regional attributes, there are a number of tools and regional indexes that assess how certain states, cities, regions, and/or clusters rank against one another. The U.S. Chamber of Commerce monitored state performance in a number of measures - including entrepreneurship and innovation, work force development, and incentives - in a 2010 report called Enterprising States. The Milken Institute has done similar analysis in the past and also benchmarked the United States against global locations. Other locations perform their own benchmarking using measures within industries and clusters that can provide leads on where you need to be connecting. These types of indices benchmark geographic research spending, patent filings, venture capital investments, start-up formation, and concentrations of advanced education.
One way or another, you are in the position to access the innovative assets within your region or in others to deliver greater value and opportunities for innovation within your company. Be proactive in addressing the opportunities, but also provide your voice to gaps that may exist to become an innovation leader in your region.
Japan-Based Bridgestone Rubber-BSA Opens Biorubber Process Research Center In Mesa, Arizona
Prysmian Group Plans $8.2 Million Expansion At Abbeville County, South Carolina, Manufacturing Center
2020 Gold & Silver Shovel Awards Recognize State and Local Economic Development Efforts
How are Uncertain Times Altering Company Location Strategies?
2019 Top States for Doing Business: Georgia Ranks #1 Sixth Year in a Row
Infrastructure Investment as an Economic Stimulus Tool
34th Annual Corporate Survey & the 16th Annual Consultants Survey
Site Selection 2020: The Importance of “Regional Depth” with Global Reach