Regional innovation clusters represent open innovation networks that transform regional economies by accelerating innovation. Clusters are defined by relationships, not memberships, and these relationships evolve as members of the clusters interact. Clusters form through identifiable stages of strategy development.

Conversation shifts.

Clusters begin to form with conversations among companies that share a similar “competitive space”. These conversations typically focus on either 1) common problems, such as not having enough skilled labor; or 2) opportunities that could emerge by linking and leveraging assets.  

Network emerges. Core Team forms. 

As more companies join these conversations, the connections among these firms become stronger. Participants become aware of an emerging network within the region. A handful of firms emerge to form a Core Team that start to concentrate shared assets within the cluster. The Core Team can also include representatives from government, education and non-profits. However, successful clusters are privately-led, and publicly supported, not the other way around. 

Strategic agenda emerges. 

Members of the emerging cluster begin to focus on a strategic agenda. They move the network strategically to focus on specific outcomes. The strategic discipline to guide an open, loosely joined network is called strategic doing. The cluster achieves greater alignment through "link and leverage" strategies generated with strategic doing. Higher education institutions become active in supporting the cluster with knowledge transfer: training, research, and so on.

Cluster organization forms. Anchor investments made. 

Members translate their strategic agenda into action: a portfolio of investments to strengthen competitive firms in the cluster. The portfolio includes larger scale shared “anchor investments”. The portfolio ranges from investments in talent; entrepreneurship and innovation supports; marketing and branding; and physical facilities like incubators and research centers. The cluster formalizes its organization and governance. 

Cluster continues to invest, adapt and expand. 

Connections within the network become more dense and spontaneous. New anchor investments build out the infrastructure of the cluster. In addition, new clusters emerge and connect as "boundary spanning" firms connect with other firms and markets and opportunities.

Source: Ed Morrison and Strategy-Nets. Distributed through a Creative Commons 3.0 Attribution License