Focusing on Regional Competitive Advantage Module Three

Producing a High Quality Plan: The Essential Components Evidence- Based Focused on Regional Economic Development Aligned with Vision & Goals Broadly Supported Practical Team’s Regional Plan

Overview of Module Three Investigate the region’s economic advantage Explore regional data to identify regional industrial clusters Deliverable: Select industry clusters for further exploration HQP: Draft a rationale for industries selected

EXPLORING COMPETITIVE ADVANTAGE

Competitive Advantage Business shapes the economic value of a region, but places can help shape, nourish, and sustain local enterprises and industry.

Exploring Competitive Advantage Demand Conditions Factor Conditions Firm Strategy, Structure, and Rivalry Related and Supporting Industry Competitive Advantage Elements Based on Porter’s Diamond Theory – Porter, M. (1990)

Demand Conditions What conditions influence demand for goods or services produced in the region? Demand Conditions Factor Conditions Firm Strategy, Structure, and Rivalry Related and Supporting Industry Competitive Advantage Elements

Factor Conditions Infrastructure Resources & Materials Skilled Workforce Demand Conditions Factor Conditions Firm Strategy, Structure, and Rivalry Related and Supporting Industry Competitive Advantage Elements

Firm Strategy, Rivalry, Composition Region’s portfolio of businesses Entrepreneurship activity and support Mix of industries Demand Conditions Factor Conditions Firm Strategy, Structure, and Rivalry Related and Supporting Industry Competitive Advantage Elements

Business and Industry INSERT YOUR REGION’S CHART LIKE THIS EXAMPLE HERE

Related and Supporting Industry Do industries buy and sell from each other regionally? Do any strong value chains exist in the region? Demand Conditions Factor Conditions Firm Strategy, Structure, and Rivalry Related and Supporting Industry Competitive Advantage Elements

Value Chain Example Grape Stock Fertilizers, Pesticides, Herbicides Grape Harvesting Equipment Irrigation Technology Specialized Publications Public Relations & Advertising Labels Caps & Corks Bottles Barrels Winemaking Equipment Educational, Research & Trade Organizations Growers/ Vineyards Growers/ Vineyards Wineries/ Processing Facilities Wineries/ Processing Facilities State Government Agencies California Agricultural Cluster Tourism Cluster Tourism Cluster Food Cluster Food Cluster Source: California Department of Food and Agriculture

OVERVIEW OF INDUSTRY CLUSTERS

Industry Clusters Defined Similar and related firms in a defined geographic area that share: Common markets Technologies Worker skill needs Buyer-seller relationships

Two Types of Clusters Value chains (Vertical clusters): working together toward a common product Competing (horizontal clusters): drawing from the same raw materials, infrastructure, labor force Auto Industry Software Industry

Overview of Clusters in Your Region

Understanding Changes Moving Up or Down Change in Percentage of Jobs in Industry over Time Growing Declining

Understanding Changes Moving Left or Right Relative Concentration of Industry in the Region Compared to the Nation Less More

Understanding Changes Location Quotient: Measure of Concentration of Industry Percent Change in Jobs over Time

Regional Clusters: INSERT YOUR REGION’S CHART LIKE THIS EXAMPLE HERE

Regional Clusters: INSERT YOUR REGION’S CHART LIKE THIS EXAMPLE HERE

Behind the Bubble Chart Location Quotient more than 1 = Concentration INSERT YOUR REGION’S CHART LIKE THIS EXAMPLE – Move line to divide 1+ LQ

Behind the Bubble Chart Industries with Greatest Percentage Growth INSERT YOUR REGION’S CHART LIKE THIS EXAMPLE – Adjust red circles to top 5

Examining the Leaky Bucket The Regional Economy Goods or Services Purchased outside the Region $

Looking at Regional Expenditures INSERT YOUR REGION’S CHART LIKE THIS EXAMPLE

Regional Industrial Clusters: Digging Deeper Identify the industries within the cluster Determine if growing or declining Evaluate regional capacity Identify potential leakages & opportunities Determine potential strengthening strategies

Cluster Choices Advanced Materials Agribusiness, Food Processing & Technology Apparel & Textiles Arts, Entertainment, Recreation & Visitor Industries Biomedical/Biotechnical (Life Sciences) Business & Financial Services Chemicals & Chemical Based Products Computer & Electronic Product Manufacturing Defense & Security Education & Knowledge Creation Electrical Equipment, Appliance & Component Manufacturing Energy (Fossil & Renewable) Fabricated Metal Product Manufacturing Forest & Wood Products Glass & Ceramics Information Technology & Telecommunications Machinery Manufacturing Mining Primary Metal Manufacturing Printing & Publishing Transportation & Logistics Transportation Equipment Manufacturing

Examining Clusters in the Region What industries: Seem worth exploring further? Should the region avoid investing for the future? May be viable future regional industries? Are declining but may be worth reviving?

Looking Ahead to Module Four Identify the economic leaks in the region Explore basic avenues for strengthening clusters Consider specific strategies within each avenue Select potential directions for the region to explore

Preparing for Module Four Draft summary of why industries selected (HQP – evidence based) Read the “C.A.R.E. for the Region” flow chart

Final Reflections  What topics did you find most helpful?  What did you find confusing?  What other data do you need?  Other items you want to mention?