At the EDA Seattle Region 2010 Western Regional Conference, Duane Roth, CEO of CONNECT, kicked off the opening plenary by discussing industry cluster development and what he sees as the emerging types of cluster models.  CONNECT was formed 25 years ago to assist in the commercialization of research in the San Diego area, which was uniquely positioned to develop a research and technology-based cluster, based on three initial institutions: the Scripps Research Institute, UC San Diego and the Salk Institute.  Defense and security was the initial industry cluster, followed by IT and wireless industries.  The life science and biotech industry also emerged as a major industry.  Additionally, energy /environmental as well as sports innovators have emerged as key industries.

Roth sees the concept of clusters as emerging “beyond clusters,” stating that “the products of today and tomorrow will be increasingly more sophisticated and require multiple types of technology.”  For example, he described the convergence of multiple industries by explaining the emerging relationship between the wireless industry and health care/life sciences, which has led to a new cluster, the Wireless Life Science Alliance.  Roth said, “Health care delivery in the future will be delivered via your cell phone.  More people today have cell phones than have shoes.”  The challenges will be to determine the complications involved in convergent clusters, and how to address those challenges.

Roth described the evolving models of innovation clusters.  Up through the 1970s, the “Fully-Integrated Model” saw the top innovations taking place at large corporations.  As leadership of corporations shifted from engineers and scientists to business and management professionals, innovation and risk-taking became more difficult.  By 1980, the “Co-Partner Model” saw research institutions able to own their research and write patents for their work.  In this model, research institutions were able to take more risks and start-up companies developed as partners.  This model has become less viable, and a new model is emerging.  According to Roth, the next phase will see the “Distributed Partner Model”, wherein multiple investors can spread the risk and production involved in developing new products, creating a production cluster.  Instead of everything being done in one facility with one staff, this model represents the convergence of multiple products and technologies together, which will allow developers to create many more products at a much faster pace.

The second speaker at the opening plenary session was Rohit Shukla, CEO of the Larta Institute.  Larta is an LA-based non-profit organization whose mission is to grow creative and productive communities through innovation.  Larta has evolved since its inception in 1993 from an innovation hub focused on Southern California to an organization that operates globally.  By developing and managing commercialization assistance strategies for companies in the early stages of development, Larta has created a global network of strong partners in research and innovation.  Here are a few of Shukla’s key points:

• Global Imperative: We have to operate in a global context, and need to understand the impact of what we are doing on job creation and wealth creation globally.
• Science and Engineering: There is a diminished interest in inquiry-based work.  We need to look at immigration policy reform and address the lack of engagement: “We cannot guarantee our communities’ future prosperity if we ignore the importance of science and engineering.”
• Talent: There is mobility of talent, and talent can be brought in from anywhere in the world.
• Assets: Consider a community’s assets and think of those in terms of global relevance.  Partner relentlessly and globally.
• Entrepreneurship: Maintain a roadmap of opportunities, and know that everyone should have an entrepreneurial bent in their economic development strategy.
• Commercialization of Research: We as a country have deviated from commercialization of innovation and research, and everyone needs to understand the challenges.
• University Centers: Universities also need to be relentless in forming global partnerships.  They play a critical role in the process of discovering, but tend to be insular.
• International Attention Deficit Disorder (IADD): We are constantly consuming bits of information but may fail to see the larger patterns.
• Trust: Trust is established between and inside networks, and cultivating these networks is extremely important.

Finally, Shukla also mentioned the Small Business Innovation Research(SBIR) program, a little-known research program.  It is the only federal program funding research at small companies.  It is managed by U.S. Small Business Administration, but each agency maintains its own SBIR program.

Authored by Kathy Nothstine of the NADO Research Foundation