Hardly any European region has missed out on focusing part of its economic policy on cluster formation. While the numerous cluster initiatives in the CENTROPE area differ with regard to their thematic orientation, structures or funding sources, the objectives are the same – to set up networks with partners from economy, research and administration in order to concentrate and evolve existing assets of the region.

“Cluster promotion” is tantamount to the networking of enterprises, research and training facilities as well as public administration around one specific thematic area or industry. Co-operatively, small and medium-sized companies can thus acquire information and develop ventures they could not tap or handle on their own due to a lack of time or funds. Research institutions gain access to enterprises for application-oriented research projects; large-scale corporations connect with suitable regional suppliers; the demand for training programmes and their availability are fine-tuned conjointly with the public administration – these are the objectives and expectations. A closer look at CENTROPE discloses different approaches to cluster initiative structuring and financing.

Clusters as an economic policy instrument

Cluster initiatives contribute to the (further) development of regional specialisations. To be able to prevail in the global competitive situation, it is important to build larger, cross-border strengths. With the PRO INNO Europe initiative, the European Commission thus supports networks of cluster regions – called “INNO Nets” –, where regional or national cluster policies are fine-tuned and jointly developed on a cross-border basis. With the exception of Vienna and Burgenland, the CENTROPE sub-regions are represented in the CEE-ClusterNetwork and e.g. prepare joint activities for the improved networking of research and economy or the marketing for third markets.

Some clusters are financed through public funds, others are not. Additional funding sources may be membership fees paid by cluster partners, sponsorship contributions or funds from regional, national or European funding pools. For example, projects for the development and management of clusters promoting specific regional or local assets are publicly tendered in the Czech Republic. Groups of at least 15 enterprises, research and development agencies as well as regional development organisations thus had to join forces to submit a bid. Action plans must be developed, a cluster manager appointed, and a joint office set up by June 2008. The Czech model demands serious commitment and above all a strong sense of initiative from the enterprises involved. Cluster management costs are publicly financed to the tune of 75% in the first year; 65%, in the second year; and 55%, in the third year.

Conversely, cluster management units in Lower Austria form part of the business agency of this federal province and act as hubs for their 80 to 190 partners from the fields of economy and science on the one hand and the different provincial authorities on the other hand. Here, too, financing is limited, although there is less of a focus on achieving the highest possible self-financing ratio. Enterprises are strategically and technically involved in the programme by means of regularly organised advisory board meetings.

Currently, there are 22 cluster initiatives in CENTROPE, with the main focus on automotive industries/mechatronics/plastics, sustainable construction and housing technologies/timber/renewable energies/environment and health/life sciences/wellbeing/health tourism, but also on cross-sector industries, such as information and communication technologies (IKT) or design.

The pioneers …

The first of its kind in the CENTROPE region was the Pannon Automotive Cluster (PANAC) set up in West Hungary in 2001. The automotive sector is one of the most important industries of Hungary. Already in the COMECON era, Győr was a centre of bus production; after the political turnabout, the availability of well-trained specialised workers and relatively low wage costs attracted such automotive giants as Opel or Audi, which continue to dominate this sector (although the number of innovative small and medium-sized enterprises is growing). Through its Regional University Knowledge Centre of Vehicle Industry, Győr’s Szechényi University likewise aims for co-operation between economy and research. It is the task of PANAC – in whose development large-scale national and international enterprises were involved right from the beginning – to integrate the Hungarian automotive market, i.e. to fine-tune the needs of international corporations with the goods and services provided by national suppliers by means of qualification and benchmarking activities.

PANAC moreover shares its experience with the automotive cluster CENTROPE, a cross-border automotive and logistics platform for the entire CENTROPE region.

... and “automotive newcomers” in CENTROPE.

Over the past 15 years, the Slovak automotive industry has experienced an unprecedented boom. In 2006, 744,600 motor vehicles were produced here. According to the Slovak financial paper Hospodárske Noviny, the annual production of private cars in Slovakia will exceed the record threshold of 1.000,000 units in 2008. This makes Slovakia a leading country with respect to the number of cars produced per capita. The first international group to invest in Slovakia was Volkswagen in 1991, followed by Peugeot and KIA in 2006.

The ongoing development of the Automotive Cluster Western Slovakia – the first Slovak cluster initiative – is to bring regional automotive suppliers closer to large-scale corporations and to gradually strengthen their competitive edge in Slovakia and internationally. The networking of companies facilitates the joint use of distribution channels and infrastructure but also the canvassing of workers and the tapping of new technologies and research findings. Moreover, the division of tasks and the specialisation of the individual enterprises contribute towards cost reduction.

The Automotive Cluster Western Slovakia was networked across borders right from the beginning. The first development phase was financed through an INTERREG IIIA project. The co-operation with the Automotive Cluster Vienna Region dating from that time as well as the exchange of experience within CENTROPE and all of Europe will be further intensified in the future.

Clusters focus existing strengths …

“You cannot tie a knot with just one hand.” This Mongolian proverb also holds true for providers of modern technologies and services in the information and telecommunications industry (ICT). In recent years, Vienna has become the ICT capital of Central Europe, as the city was chosen as company headquarters for activities in the Central and Eastern European markets by numerous multinational corporations. Roughly three fourths of the total turnover of the ICT industry in Austria are generated by companies domiciled in the federal capital. More than 8,000 enterprises active in the ICT sector have settled in Vienna. The overwhelming majority are SMEs, which were able to establish themselves in interesting niches, sometimes attaining notable market shares. Although small and medium-sized enterprises, due to their dimensions, can often move more flexibly and quickly, they are faced with numerous disadvantages regarding e.g. internationalisation, marketing and distribution. The solution lies in co-operation – and this also goes for enterprises in the ICT sector, the industry of “lone rangers”.

The Viennese ICT network Vienna IT Enterprises (VITE) enables enterprises as well as research, development and training facilities to enter into efficient co-operation ventures and puts a wide array of services at the disposal of its members. It is the prime objective of VITE to initiate innovative projects, network existing competences and strengthen the innovative clout and competitiveness of individual members. Today, the VITE network comprises 130 partners from all fields of the ICT sector. The majority of partner companies are SMEs, but global players like Microsoft and Seibersdorf Research, too, have joined the network.

VITE has also taken initial steps to promote international co-operation in the ICT sector with Austria’s immediate neighbours. ICT technologies are still assigned varying degrees of importance and are used with varying intensity within the CENTROPE region. The IT CENTROPE network is to promote the transfer of know-how and technology, more intense general economic co-operation, co-operation in tenders and projects, the tapping of new labour markets as well as common research and development activities.

… can be flexibly evolved …

The constantly changing demands on the economy call for the flexible adjustment of cluster focuses. The Green Building Cluster of Lower Austria shows ways and means in which a cluster initiative can thus grow and evolve. This cluster initiative was effectively repositioned in 2007 by combining the Timber Cluster and the original Green Building Cluster of Lower Austria. Today, the Green Building Cluster of Lower Austria covers the entire range of sustainable construction and housing.

With 190 partners, the Green Building Cluster of Lower Austria is the biggest of its kind in the CENTROPE region. The focus of its work is on the rehabilitation of old buildings, passive-energy homes and housing comfort. Activities are being gradually expanded to include renewable energy sources and ecological technologies. Since 2001, approx. 150 projects have been or are being implemented within the context of the Green Building Cluster and its two predecessors.

… or stay true to old traditions.

In developing a cluster of Czech furniture production in Brno, recourse was made to an old Czech tradition – the furniture industry. The first factories were established in the 19th century – above all in Brno, Koryčany and Bystřice pod Hostýnem – and in part have survived to this day. After the Second World War until the late 1980s, furniture for all of Eastern Europe was in fact produced in today’s Czech Republic. When the old markets collapsed, it proved very difficult to find an alternative to cheaply manufactured mass items. A large pool of highly skilled workers paid relatively low wages as well as a slow catching-up process due to technical modernisation of the production companies were the consequence.

To this day, Moravia has remained the hub of furniture production in the Czech Republic – 40% of all furniture manufactured in this country come from here. With 35 partners, the Brno Furniture Cluster is one of the biggest of its kind on the newfangled Czech cluster scene. In addition to the often proclaimed objectives of economic development, innovation and job creation, this cluster also contributes explicitly towards reducing environmental pollution by adopting eco-friendly technologies. A prime goal of the cluster lies in increasing the quota of exports, above all to Canada, Russia, Ukraine and the German-speaking countries. Marketing strategies and instruments such as a multilingual product catalogue or a joint e-shopping system are already in the pipeline.

Related links
PRO INNO Europe
Pannon Automotive Cluster (PANAC)
Automotive Cluster CENTROPE
Automotive Cluster Vienna Region (ACVR)
Vienna IT Enterprises (VITE)
Green Building Cluster of Lower Austria
Brno Furniture Cluster


Pictures:
© ecoplus / Christian Holzheu
© JUG_06
© Cluster of Czech Furniture Manufacturers
© WWFF


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