September 9, 2013
1
SPM9539: Economy, Ecology and Technology of Networked Industrial Complexes
Week 1 – course 1: course introduction
From Analysis to Shaping Industrial Clusters
Dr.ir. Gerard P.J. Dijkema Associate Professor
TBM a.3.260
g.p.j.dijkema@tudelft.nl
Source: http://www.wereldhavendagen.nl/programma/bekijk-160-000-km-pijpleiding/
The object of this course
• Understanding / shaping industrial networks
• Using a variety of perspectives
• Core perspective: industrial or business cluster
• What is it?
“A business cluster is a geographic concentration of
interconnected businesses, suppliers, and associated institutions in a particular field.”
http://en.wikipedia.org/wiki/Business_cluster
Source: http://www.incontext.indiana.edu/2004/sep-oct04/news.asp/
Course objectives
Students learn to:
1. Understand and apply system theory and system analysis tools on the performance, evolution, dynamics and development of large-scale industrial complexes or business clusters
2. Understand and apply theories on innovation, economics and ecology of global business and their implications for specific industrial markets, industrial sites and transition.
3. Analyse and understand the role of various stakeholders involved in the transition management, and to synthesize and
operationalise economic, technology and policy-oriented theories, methods and tools.
Course agenda
• Lectures (subject to change)
• Literature and Assignments
• each week 2-3 scientific papers to read and digest
• each week an individual assignment to be completed
Week Subject Case-examples
1 Introduction: cluster views Various
2 Cluster Economy and Typology Westland
3 Location Factors & Site selection Rotterdam 4 Industrial Parks and Eco-Industrial Parks in China TEDA, DDA
5 Stakeholders, Institutions & Regulatory Regimes Westland vs. CostaDue 6 Industrial Ecology - Bringing Clusters into Being Kalundborg vs. Dinteloord 7 Action-Oriented Industrial Ecology MVII and CostaDue
8 Transition management Paper and Board
The assignments during the course
During this course you will complete one assignment
each week; together, these will provide a basis for the final written report. These assignments will help you:
• Understand the implications of theories discussed.
• Formulate a personal view on networked industrial development.
• Understand the problems that are encountered when various viewpoints ‘collide’.
• Find viewpoints other than those discussed in class in the available, reputable literature.
Assignment 1
• Choose a particular ‘type’ of industry or cluster and a ‘locale’.
• Do you have access to sufficient information on this industry/locale??
• Create a first image/ systemic description of your cluster by answering these questions
• What kind of companies are part of this cluster (construction, production, research & development, engineering & consultancy services, transport, financing, marketing etc.)
• What are the characteristics of this industry? (physical, economic, technological, knowledge, other)
• What phase is this cluster in (initial, booming, mature, decline)?
• Boundary of your cluster (geographic, activity, other)
Assignment 1 (continued)
• Choose a particular ‘type’ of industry or cluster and a ‘locale’.
• Find three distinct definitions of a cluster in the scientific literature (beyond the definition cited from Wikipedia) and make a choice for the ‘best’ definition for your particular chosen industry. Could you improve the definition for your industry of choice?
• What characteristics of the chosen industry/locale are interesting with respect to options for (regional) clustering?
Industrial clusters / locales
Examples
• Agro-Food Industry – NL
• Food Valley – Wageningen NL
• Flower Sector Greenhouse horticulture- NL
• Flower Sector Greenhouse horticulture- NL
• Sake Industry, Japan
• Offshore Industry – NL
• Container Transhipment – R’dam
• High Tech (electronics?) – Eindhoven NL
• Lindholm Science Park – Goteborg, SE
• Leiden Bioscience Park, NL
• Petrochemicals – R’dam,Singapore, Norway
• Biomass/Bioproducts Eemsdelta – NL
• EnergyValley – NL
• Natural Gas Industry – NL
• Renewable Energy Cluster – Colorado, US
• Solar Energy – Spain, NL
• Wind Energy – NL, DK
• Waste & Recycling sector, NL
Industrial clusters / locales 2012
• Motorcycle Industry, Catalonia, Spain
• Coffee Industry Daklak, Vietnam
• Agro-Food Industry, Gelderland, NL
• Offshore Industry – Singapore, Indonesia
• Maritime Cluster, NL
• Rotterdam Container Port – NL
• Groningen Seaports, NL
• Fibre reinforced composites, NL
• Technopolis, Delft, NL
• Leiden Bioscience Park, NL (2)
• New Anglia Partnership, UK
• Petrochemicals – R’dam (2)
• Cubatao Industrial Cluster, Brazil
• Houston Oil and Gas, US
• Houston Petroleum, US
• Petrochemical Cluster Part, Iran
• Chemical Complex Tarragona, Spain
• Paper and Board Industry, Norway
• Bioethanol clustrer, Brazil
• Wood pellet, Ontario, Canada
• Biogas cluster – NL
• Shanghai Baoshan Industrial Zone, China
• CSP in the US
• Solar Valley Mittel-Deutschland
• Wind Energy – DK
Clusters, complexes – why care?
Source:
http://www.muscogeemoms.com/2013/04/24/quiz- bowl-activ8-camp/question-mark/
Clusters, complexes – why care?
Source: http://www.icic.org/ee_uploads/images/industrial_employment.jpg
Clusters, complexes – why care?
http://www.youtube.com/watch?v=UzTWiqF5bYI
Production factors are local, competition is global Survival, prosperity requires
leveraging the combination of
local resources, infrastructure
knowledge
System analysis in networks
• Current Performance:
Input/output analysis:
• Mass balance.
• Energy balance.
• Money input / output.
• Human resources.
• Current Structure
• Participants, roles
• Network structure
• Types of relationships
• Formal and informal power / authority
• Character and Culture
Surroundings System
A chemical Cluster Feedstock
Products Investment & Operating Cost Revenues Salaries
Emissions
Skilled Labour
Utilities
WasteKnow-how
G.P.J. Dijkema, Process System Innovation by Design, 2004
Designing or shaping networks?
• Design / Development / Shaping / Evolution
Attention for:
• Design of what?
• How to change structure and content
• Strategies for growth and competitiveness?
• Path dependence and lock-in effects.
• (Im)possibilities for future development.
• Possible supply chain integration &
extension.
Theoretical background
Development, management and evolution of industrial regions can be viewed from various perspectives:
• Regional economics.
• Industrial ecology.
• ‘Traditional’ cluster perspective (Porter).
• Location theory (Witlox).
• Clusters as Socio-Technical Systems (Complex Adaptive Systems)
• Business Economics perspective (individual companies).
These points will be discussed throughout the course. You will be asked to read articles and comment on them!
Stakeholder background
• WHO play a role in the development of networked industries?
• WHAT are the positions of the various identifiable actor positions?
• HOW can this be used to influence the structure or
design, development or operational management of
networked industries?
Industrial region interaction
Companies:
Investments, Jobs, …
Universities:
Research, …
Policy interaction:
National Legislature, European Union, Trade agreements (GATT, WTO) etc.
Industrial Region
Industrial region interaction
Types of industrial regions:
• Pure agglomeration (The average company park).
• Industrial complex (Chemical industry in Rotterdam).
• Social network (Silicon valley).
Companies:
Investments, Jobs, …
Universities:
Research, …
Policy interaction:
National Legislature, European Union, Trade agreements (GATT, WTO)
Industrial Region
Industrial region interaction
Key characteristics (dominant internal relationships):
• Pure agglomeration : none.
• Industrial complex : materials
• Social network : information.
Industrial region: structure
• Industrial facilities
Company A
Company B
Company C
Industrial Region
Industrial region: structure
Company A
Company B
Company C
Industrial Region
Company D
• Industrial facilities
• Connected by physical infrastructure
Industrial region: Socio-Technic View
Physical Network Actor Network
Socio-Technical Network
Physical Network Actor Network
• Industrial / Production facilities
• Connected by physical infrastructure
• Evolves because of DECISIONS made by actors
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Industrial region: Socio-Technic View
Economic Environment Ecologic Environment
Physical Network Actor Network
Socio-Technical Network
Physical Network Actor Network
• Evolves because of DECISIONS made by actors
• Actors respond to external change
everything is connected
G.P.J. Dijkema, IEEE SoSE, 2007; Adapted from I. Bouwmans
September 9, 2013 27
Industrial region: Socio-Technic View
Economic Environment Ecologic Environment
Physical Network Actor Network
Socio-Technical Network
Physical Network Actor Network
• Evolves because of DECISIONS made
• In response external change
everything is connected
Regulatory Environment
Institutions
September 9, 2013 28
Industrial region: Socio-Technic View
Economic Environment Ecologic Environment
Physical Network Actor Network
Socio-Technical Network
Physical Network Actor Network
• Evolves because of DECISIONS made
• In response external change
everything is connected
Regulatory Environment
G.P.J. Dijkema, IEEE SoSE, 2007; Adapted from I. Bouwmans
Institutions Technology Options
Innovation
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socio-technical systems view
External World
Technical Network Social Network Material / Energy /
Data Exchange
Social & Economic Transactions
Operation Ownership Development
Culture <Institutions> Regulatory Regime
Decisions on:
Industrial region: structure
Industrial Region
Internal aspects that may influence structure:
• (Size and number of) existing companies:
• Is there one large company?
• Are they aware of the cluster?
• Do they care?
• Physical geography (geographic characteristics):
• Near river / sea?
• Flat or mountainous?
Importance of networked industries
In Technical and Social Network
• Regional importance:
• Reinforces regional economy?
• More jobs?
• Attractive investment climate?
• Comparative advantages?
• Business importance:
• Exchange of by-products, energy, waste
• Increased (sustainable) competitive advantage?
• Faster product development & innovation?
• More sustainable production?
Networked industries perspective
Different approaches:
• Types of clusters.
• Stakeholders.
• Regulatory regimes.
• Theories.
Course focus by:
• Pre-selecting cluster types.
• 2 stakeholders perspectives.
• “Dutch” regulatory regime
• Selection of applied theories.
Perspectives: Regional
Development Agency (RDA)
• Concerned with (long term) prosperity of the region.
• Should focus on issues as:
• Regional competitiveness
• Job security
• Environmental issues
• Infrastructure investments
• Implements the regulatory framework
• Could be in charge of attracting new industry…
Perspectives: Company
• Primarily concerned with long term continuity of it’s (economic) activities.
• Focuses on getting a sustainable competitive advantage:
• Chooses the best (geographical) location to invest.
• Searches for an environment that enhances innovation.
• Can have the means to invest in a region, thereby
enhances the economy of that region.
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Company perspective
Interaction: 3 Layer Model
Long term
investment decision product / capacity
portfolio
Short term supply/demand feedstock / product
markets
product delivery plant operation
Cluster = a network
• Links
• What is exchanged?
• What types of links?
• Nodes
• What (type) of activities
• or What roles
Cluster = a network
• Links
• What is exchanged?
• tangible: materials, goods, energy, money
• intangible: services, information, knowledge, money
• What types of links?
• physical
• social (contractual, membership, your ‘network’
• Nodes
• What (type) of activities
• an ecosystem with niches!
• primary producers, secondary, service companies, market
• or What roles
• producer, knowledge provider, decision-maker, service company, machine manufacturer, EPC company,
infrastructure etc.
Distinct types of clusters
• Pure agglomeration.
• Company park.
• Shopping mall.
• Industrial complex.
• Base (petro) chemical production sites (Rotterdam, Delfzijl, DSM).
• Industrial steel producers (Hoogovens, metal park Delfzijl).
• Social network.
• Bioscience park (Leiden).
• Electronics development (Philips labs High Tech Campus).
Example of chemical cluster
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Example of metals cluster
Source: http://www.antheus.nl
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Specific characteristics of clusters
Source: IBR 11 (2002), p. 650