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What is the purpose of French competitiveness clusters?

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On Tuesday, December 4, 2012, a closed-door meeting was held in Bercy between the government and representatives of the competitiveness clusters, on the occasion of the 11th day dedicated to these ecosystems.

What is the purpose of these French versions of American clusters? Good question, we have often been asked in the world of start-ups, without a hint of bitterness!

Created in 2004 with the aim of supporting French growth, they geographically group together companies, universities and state-supported research institutes. The idea at the time was to make a definitive break with the major post-war industrial programmes, defined and steered by the State, which were content to imitate "business models" - particularly American ones - in order to catch up. 

The competitiveness clusters policy has been implemented to meet the challenges of growth through innovation. From the outset, they have been oriented towards "upstream" innovation (fundamental and applied R&D) rather than "downstream" issues (which concern issues as varied as design, business models, marketing, etc.). 

The recommendations of the Welsh report, the report of the association "L'institut de l'entreprise", Act III of decentralisation and the launch of phase III of the clusters put the competitiveness clusters back in the spotlight

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As of 2005, the establishment of competitiveness clusters was a welcome change in French economic policies, which had hitherto been based on major industrial programs managed at the national level. This traditional approach, relevant in the post-war context, was no longer valid in an internationalized economy whose performance now largely depends on its ability to innovate. In the current context, a strategy to support "clusters", to which the competitiveness cluster policy corresponds, becomes essential.

money1These poles have received approximately 4.5 billion of public funding between 2005 and 2011. The latest evaluation report, commissioned by the State services, shows the limits of the exercise: the clusters produced only 1.5 % of French patents, accounted for only 4.5 % of R&D spending and created only 5 % of so-called "innovative" companies. As a result, only one project out of four leads to an innovation as such. Deplorable findings: too many poles and thus an excessive dispersion of State support; a lack of orientation towards swallowing innovation; too little involvement of companies, especially large groups. (Source: Christian Blanc's report "For an ecosystem of growth")

The Enterprise Institute recommends, in the framework of its " Agenda 2020 of croissance ", to consolidate the policy of competitiveness clusters by three key measures: (1) reducing the current number of clusters and concentrating their efforts on the most prometteurs  sectors; (2) strengthening their capacity to support innovations and their marketing; (3) involving large companies more closely.

solutionsThe key measures:

1/ Reduce the number of clusters and concentrate them on sectors with greater potential

There are seventy-one competitiveness clusters (compared with fifteen clusters of excellence in Germany, six in Finland and seven in England), of which sixty-two share 50 % of the funding. Moreover, the clusters have a poor match with the sectors with the greatest potential. According to the evaluation carried out, out of eighty-five technologies of the future, only thirteen are adequately covered by the clusters, including wireless networking technologies, electric motors and robotics.

Faced with the logic of spreading the poles to a number between ten and fifteen, to enable them to reach a critical size, and to concentrate them on the sectors with the greatest potential is therefore a matter of common sense.

2/ Reinforce the capacity of the clusters to support innovation and the marketing of projects.

Today, competitiveness clusters are still heavily state-led, with an excessive focus on "upstream" innovation. They are in fact designed on the model of high education clusters (1), focused on the development of new technologies, and favour support for R&D programmes with a strong public component. However, France's weaknesses are more at the "downstream" level than at the "upstream" level. Thus, according to the OECD, while French R&D spending is in line with the average for developed countries, only 23 % of French companies have recourse to non-technological innovation (compared to 47% in Germany). The clusters must strengthen their capacity to offer services targeting these weaknesses: marketing, design, implementation of new business models - levers on which French companies are often less efficient than their foreign competitors.

(1) High education clusters are structured around a university or research centre. They are therefore primarily oriented towards research and technology.

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3/ Increasing the involvement of large companies / Transfer of skills

Today, major French companies are key players in strengthening France's international projection capacity. However, from the outset, the clusters, which were designed to focus on R&D rather than marketing, were not designed to maximize the involvement of large groups. While they represent 62 % of French R&D (INSEE figures), large companies have benefited from the cluster policy only to the extent of approximately 10%, whereas they account for 62 % of French R&D and 53 % of the country's exports.

For them to become real vectors of development for competitiveness clusters, they must be more closely integrated into the systems, based on a service offer adapted to their needs and their strong international orientation.  

laurelsClusters in search of competitiveness

Another report evaluating the performance of competitiveness clusters between 2008 and 2011 (2) came out at the end of summer 2012 and gave the following figures: among the 71 clusters, there are the good students and the others. 20 clusters were judged to be "very successful", 35 successful and 16 "less successful".

The top of the class are mainly located in the Paris region and in the Rhône-Alpes region. The structures often honoured are Cap Digital - digital in Ile-de-France -, Aerospace Valley for aeronautics in the Toulouse region or Minalogic, the microelectronics cluster in Grenoble.

The study also highlights the good performance of the poles in the middle of the ranking, which are the most numerous. However, 16 entities are listed as "less performing". Such as the equine industry cluster in Normandy, Hippolia, the Medicen pharmaceutical cluster in Paris, or Qualitropic, overseas, a specialist in tropical natural resources. (Source: Le monde.fr / Nov 2012)

(2) BearingPoint /Technopolis /Erdyn Report

What are the links between the technologies of the future and the competitiveness clusters?

The report examined eighty-five key medium-term technologies identified by the Department of Industry, located in seven different sectors: (1) chemicals, materials, processes; (2) information and communication technologies; (3) environment, energy; (4) transport; (5) building; (6) health, agriculture and agri-food. In each of these sectors, technologies have been identified which meet three criteria: an existing market which is already large, a high growth potential and a reasonable level of competitive intensity. On the basis of this analysis, fifty attractive technologies have been identified a priori, which appear to be very diverse. Then, the competitive intensity of the technologies considered was assessed, resulting in thirty-five technologies on which French public and private R&D is positioned. 

The next step was to identify which of these technologies had real potential for industrialization. Beyond R&D work, the challenge is to transform scientific discoveries into products that can be marketed. The last step consisted more specifically in studying the link between the technologies of the future and the competitiveness clusters.

Thirteen technologies supported by clusters really seem to correspond to the primary vocation of competitiveness clusters: to be places of economic growth, through the cooperation of research and industrial players.

Conversely, some global clusters, which nevertheless possess the variety of players required to make such synergies possible, focus on areas where the market opportunities for France, given its R&D system and business fabric, are medium (Medicen, Secure Communicating Solutions, etc.).

As for global or national clusters, their size only allows them to specialize in specific sectors, often focused on upstream research, which is necessary in the long term but has no medium-term economic impact (Cancer-Bio-Health, Qualitropic, Trade Industries, etc.).

Read the full report of the Enterprise Institute

About the Business Institute

Created in 1975, the Institut de l'entreprise is a think tank independent of any trade union or political mandate. Deeply rooted in economic reality, it focuses its réflexion on the relationship between the company and its environment and draws on a vast network of experts to carry out its studies. As a meeting place and training centre, the Institute also develops a vision of the company open to the world and society.  www.institut-entreprise.fr

 

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