Study looks at technology clusters

It’s going to take five years and $2.5 million, but the Innovation Systems Research Network, along with the National Research Council, Statistics Canada, the Ministry of Industry and professors from various universities right across Canada will attempt to study and understand the effects of clustering in the IT sector.

Minister of Industry Brian Tobin was at the University of Toronto recently to announce the grant for the study. Tobin said clusters are important in understanding economic growth.

“The Canadian government is committed to making Canada a world leader in the knowledge-based economy. Innovation is the life blood of this economy.”

He went on to say that innovation will make Canada more competitive. “We’ve committed ourselves in becoming one of the top five countries in the world in our research and development performance by 2010, and that’s a bold, bold goal.”

Clustering has been defined as a phenomena in which similar companies gather in a concentrated area, but the study will delve deeper into understanding how clusters work and how they benefit the companies within the cluster.

“We know a certain amount about how clusters work, but nothing has been done on the kind of systematic basis that we’re attempting – trying to find similarities and differences, and how they work,” said Dr. David Wolfe, a professor of political studies at the University of Toronto and the principal investigator for the study.

Wolfe said businesses that have converged into a cluster can benefit from shared labour and a common knowledge base, as well as the commercial and social environments. The areas to be studied in the IT sector include: photonics, wireless technology, telecommunications equipment and multimedia. Wolfe added that a mix of high, middle and low technology companies will be observed.

One such cluster that has existed for the past two years, located in Winnipeg, is known as the Cyber Village. Karen Botan said clustering has worked successfully in Winnipeg because the companies are operating on a global market, as opposed to the local one. “Even like competitors can work together to accomplish larger projects on a global scale,” said the executive director of SMART Winnipeg.

Botan had high praise for the efficiency and co-operation that the cluster has brought, as it allows three or four companies to collaborate on a project while sharing resources, knowledge and occasionally, even HR. But, Botan admitted, it is the absence of competition that has fuelled this type of unity. “If you were dire competitors in a very local market, then no, you wouldn’t see the co-operation and joint bidding on projects that we are seeing.” Nonetheless, the cluster in Winnipeg is just the type of cluster that the study will examine.

When asked who shares in the success of the cluster, Botan said, “We have a very supportive mayor here who understands and supports what clusters are, and is very supportive of the IT sector.”

The study, called The Role of Local and Regional Clustersin Canada is a national initiative that will examine the regional implications of clustering, and will examine both urban and non-urban centres. The University of Toronto’s Program on Globalization and Regional Innovation Systems(PROGRIS) will manage the project. Wolfe and Dr. Meric Gertler are both co-directors of the program.

“We want to develop some systematic insights into what makes a successful cluster, try to develop a core understanding of what are the important clusters (and) what policies have the greatest effect on a successful cluster,” Wolfe said.