Clusters as a platform of “Innovation with Cooperation”

perblog 2World is changing rapidly, faster than ever before. Technological developments are almost beyond an average person’s capability to absorb and exploit. The way of living changes, what we need, how we use things, why we need things, when and where we need things all change. Perceptions change, and things may change several times in a day and they change all around the world at the very same second, which we hardly experienced in the old days.

Today, it’s a matter of seconds, billions of people learn a breakthrough technological innovation, or a simple result of a world cup match, or smallest things that happen as a result of a political instability, or even how many people likes or dislikes a pop song, at that very moment, even second.

In this continuously changing environment, it is extremely difficult for enterprises to be competitive and stay alive. Innovation is the key word to be competitive, but not enough in so many cases. There is another magical word which brings both the best solution and combination, which is, cooperation. Maybe we can better say “innovation with cooperation” to summarize the whole idea. This can also be called as “clustering” where enterprises and entrepreneurs in a sector and in a region cooperate with each other to fight against common challenges and seize the opportunities. This challenging cooperative environment brings the need to work closely with the government institutions, NGOs, financial institutions, universities and R&D institutions. All actors in the cluster environment provide some kind of a benefit or assets for the development of the cluster, whether financial support, lobbying power, scientific research to feed innovation, networking capability, etc.

Business world is like a huge jungle, and if a company is alone in the middle of this jungle, even with all survival skills, capabilities and endurance, it is not easy to survive. If a company, with all its capabilities, skills and willingness to survive and achieve the best, cooperates with its competitors, suppliers, customers, then there is a clear possibility for innovation and success.

Two examples:

1. Kahramanmaraş Turkey, Textile and Ready Made Garments Cluster

The city of Kahramanmaraş is located in the south east of Turkey, mountainous area with beautiful surroundings and an easy outlet to Mediterranean sea which is only 2 hours drive to the south. City is small, mainly agricultural, with industries of agricultural food products, metal kitchenware, textiles and ready made garments.

In the textile and ready made garments industry, there are about 200 small, medium and large companies. Mainly yarn and fabric producers, dyeing and finishing companies, and several small scale ready made garment manufacturers.

A UNIDO (United Nation Industrial Development Organization) cluster development project targeting 4 provinces in the region included Kahramanmaraş between 2011-2013. After a comprehensive diagnostic study, a network of 15 small ready made garment producing companies established a network organization and started to work on joint activities with the support of a Cluster Development Agent (Cluster Manager) and guidance under the UNIDO methodology to increase their quality standards, exploit opportunities in export markets, apply to government funds, and organize a platform to closely work with the Kahramanmaraş University for design and engineering projects.

Within 2 years, excellent results achieved in terms of:

  • Establishing a cooperation platform with the University to support the design needs of the companies, printing capability in the region;
  • Export know-how and capacity increased in the companies;
  • 5 companies merged and established a bigger company and moved into modern facilities and started to export;
  • 14 companies formed a Consortium and applied to Ministry of Economy and accepted into an Export Consortia program and will receive approximately 2 million USD grant for their export strategy implementation including training, consulting, marketing, outbound and inbound missions.

2. Bar and Ulcinj, Montenegro, Olive Oil Cluster

Montenegro is one of the “untouched” countries in Europe with exceptional natural beauty. Economy is not strong, main sectors are agricultural products and tourism.

Olives and olive oil is one of the main products in the coastal area, steep hills are covered with olive trees, and there are about 10.000 old olive trees in the country with ages believed to be more than 1.000 years old.

A UNIDO project, funded by the EU, and Ministry of Economy of Montenegro as the beneficiary, targeting to develop clusters in Montenegro (Metal works, Fresh water fish production, Olive oil, Wine producers) where olive oil sector from the coastal regions with approximately 1.000 olive growers and 20 olive oil producers from the Municipalities of Bar and Ulcinj will play a significant role among others.

As the total number of trees and total production are very small and obviously Montenegro can not play a significant role in Olive oil production in the world, a new and challenging strategy is prepared for the Montenegrin Olive Oil Cluster; to build the marketing strategy on 2.000 year old monumental trees. These are the ancient trees as old as Jesus Christ. This is a distinctive competitive advantage that some people around the world will be highly interested, provided that there needs to be a scientific proof. A joint project, where growers cooperate with each other and with Montenegrin and Turkish Universities of Forestry, a study is currently carried out to identify the ages of old trees with scientific methods, and a genuine and aggressive marketing plan for Montenegrin Olive Oil products positioning in competitive markets.

Both of these projects involve innovative ideas, both as a concept within the region and at marketing level as well. Therefore, it is essential that the producers, municipalities, government, and universities work in the best possible cooperative way with disruptive ideas; and this we can call, “innovation with cooperation”.

Vedat Kunt

Mr. Vedat Kunt is a partner at VEGO Consulting (INSME Board Member), a professional consulting company based in Turkey, specialized in knowledge based consultancy and technical assistance to private institutions, SME’s to enterprises and public institutions, to local administrations, municipalities, international agencies and institutions. He is a UNIDO Senior Cluster Development and Business Linkages expert, involved in various projects in Turkey, Kuwait and Montenegro. He is also a Lecturer at the Faculty of Economics and Business Administration at the Izmir University of Economics teaching “Strategic Management” and “International Business”.
Vedat Kunt has developed a broad experience with enterprises in strategic management, export development, sales and marketing, brand management, organizational development, innovative product and service development at national and international level and Cluster development, Entrepreneurship Development and Export Marketing in various donor funded projects.
Vedat Kunt holds a degree in Industrial Engineering and an MBA in International Marketing.

This entry was posted in Uncategorized. Bookmark the permalink.

One Response to Clusters as a platform of “Innovation with Cooperation”

  1. Pingback: Innovation with Cooperation

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s