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A Cluster Initiative Sponsored by the AlaskaA Cluster Initiative Sponsored by the Alaska Partnership for Economic Development
Presented by:Presented by:Andy VarnerKathryn Dodge
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Why did the Alaska Partnership forWhy did the Alaska Partnership for Economic Development form?
• Structure for statewide EDOs and others in the field to collaboratefield to collaborate
• Allow focus on statewide planning and strategy, start to eliminate stovepipingstart to eliminate stovepiping
• Larger “umbrella” organization could accept fundingfunding
• Distinct from past statewide planning efforts
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Wh th C ll t A ti ?Why the Call to Action?
• Federal money in decline
(no more Senator Stevens) First National Bank Alaska
• Oil in decline (~85% of State revenue)
• Need to strengthen the Third Leg the• Need to strengthen the Third Leg – the remaining private sector economy
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Alaska Forward:Alaska Forward: Toward a Next Generation Economy
Alaska’s first statewide economic development strategy
• Phase 1– Situational Analysis: an “economic reality check.” completed
• Phase 2 — Strategy Development andPhase 2 Strategy Development and Implementation: developing recommendations for new economic development directions, policies and practices AND taking actions to implement change. p g p gongoing
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Phase I – Situational Analysis Report
• Economic Profile and Forecast
• Al k ' I d t Cl t P tf li• Alaska's Industry Cluster Portfolio
• Competitive Benchmarking
• Global Market Opportunities
• Analysis of existing economic development objectives and y g p jstrategies
• Assessment of Entrepreneurship and Business Climate
• Final Report - A Path to the Future
5
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Energy sector: no longer a source of growthgy g g
Source: IHS CERA - Cambridge Energy Research Associates
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The Key Problem: Alaska’s comparative stagnationAlaska s comparative stagnation
Real Gross Domestic/State Product
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What do we do about this?
• Cluster development recommended by consultants
• ED Community evaluated recommendations and discovered:
o Industry Cluster method highly respectedo Industry Cluster method highly respected
o Used as a tool to help create prosperity
o Internationally recognized technique to strengthen local economy based on what is presently in the region
o Recognized by EDA as credible technique for re-building economieso Recognized by EDA as credible technique for re-building economies
o Identifies actions that can be taken to strengthen sectors in the economy
o St th l l b i t ko Strengthens local business networks
o Clustered businesses are geographically sticky
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Developing a Dynamic Strategic PlanDeveloping a Dynamic Strategic Plan• Keep political leaders close & informed
• Identify top actions recommended by clusters
• Incorporate into dynamic “Action Oriented” approachIncorporate into dynamic Action Oriented approach
o Reflect current industry cluster recommendation
o Updated semi-annually
o Used to support funding and legislative requestso pp g g q
•• Most importantly- Led by private sector
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Put Together the Right Team & Resources
• Alaska Forward Leadership Council
• C l ti th T i l H li• Completing the Triple Helix:
o Universities – Researchers, Academia, Center for Economic DevelopmentEconomic Development
o Private Sector – Industry Associations, State Chamber of CommerceCommerce
o Regulators & Policy Makers – Governor, Legislators, State/Federal AgenciesState/Federal Agencies
• Broadened partnerships
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Alaska’s 11 Clusters
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Identify Clusters for Development
• Evaluate clusters for readiness by gauging:
o I d t ’ it t b t tho Industry’s excitement about the process
o Identification of cluster’s NAICS codes, support i d t i tindustries, etc.
o Coherence of cluster network
o Seasonal cycle(s)
o Size of cluster componentso Size of cluster components
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Alaska’s Cluster Readiness
I. Tourism (work well together, accelerated time frame due to seasonality, positioned for growth as “Star” cluster)
II. Alternative Energy (new & exciting industry,II. Alternative Energy (new & exciting industry, world leaders in certain applications, “seed” cluster)
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Alaska’s PoliticalAlaska s Political Regions
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Know Your (Sub) RegionKnow Your (Sub) Region
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Educate Your RegionEducate Your Region
• Business community
• Cohort of facilitatorsCohort of facilitators
• Chambers of Commerce
• Professionals in ED field
• B d• Boards
• Legislatorsg
• Tribal leaders
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Alaska Forward’s Relationship WithAlaska Forward s Relationship With Regions
• Alaska Forward project is hopefully pipeline for other regional processespipeline for other regional processes
• Dispersed regional/local efforts feed into larger statewide initiative to develop policies and strategic approachp g pp
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Alaska’s PoliticalAlaska s Political Regions
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Fairbanks’ Incorporating intoFairbanks Incorporating into Community’s Strategic Plan
• Restructured Comprehensive Economic Development StrategyDevelopment Strategy
• Met with industry groups to gather:o Priorities
o Actions to implement prioritieso Actions to implement priorities
• In process of developing first local cluster
• Doing work in alignment with Alaska Forward
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Fairbanks Clusters
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Woody Bio-mass Project in Fairbanks
• Seed Clustero Level of energy and passion
o N f to New manufacturers
o Many small/micro businessesy
o Challenges with local air quality exacerbated by burning “green wood”by burning green wood
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Alaska’s PoliticalAlaska s Political Regions
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SE Alaska Cluster Development –SE Alaska Cluster Development Asset Mapping Approach
• From the Council on Competitiveness:
o A th t ill id L d ith i t fo A process that will provide Leaders with an inventory of key resources that can be utilized in a development effort.
o A comprehensive asset mapping initiative will provide a deep understanding of the key networks and cultural
ttit d th t h th i l i di tattitudes that shape the regional economy, indicate gap areas that require further investment, and provide a baseline by which to judge future progress toward regional prosperity.
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Alaska Forward Lessons Learned• Cluster development across large spaces and• Cluster development across large spaces and
diverse areas takes time
• A geographic or political region may not be an economic region
• “Proximate” is a working definition in Alaska
• Doing the work yourself leads to richer• Doing the work yourself leads to richer understanding
• New networks and partnerships have emerged
• Educate yourself, your stakeholders &Educate yourself, your stakeholders & community
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Closing ThoughtsClosing Thoughts• Cluster development is not the tool for
all situations
• Where there is no prevailing economy• Where there is no prevailing economy, cluster development process may not b t ti i tbe proper starting point
• Cluster development across a vastCluster development across a vast region is difficult – and not always advisableadvisable
• However….We’re up for the challenge!