Interview with Christian Rangen, international advisor on strategy, transformation and cluster development
Interview with Christian Rangen, international advisor on strategy, transformation and cluster development. Extensive experience with cluster and Supercluster projects in Asia, Europe and Norway. Business School Faculty and author of Building Innovation Superclusters (report) and Innovation Superclusters - A New Playbook for Economic Growth (book, forthcoming).
ECCP: Chris, you recently wrote a report, Building Innovation Superclusters. What can you tell about this?
C.R.: Building Innovation Superclusters is our third report on the topic of Superclusters. It just came out and it is an attempt to gather our emerging understanding of Innovation Superclusters, to analyze and make sense of them, but also to give back knowledge to the larger community.
ECCP: Why did you choose this topic, on Superclusters?
First of all, I think it is time for a new generation of European Superclusters. Only four out of the top 30 most valuable companies are European (BOND report, Internet Trends 2019 by Mary Meeker, 2019). When we look at Unicorns, Scale Ups, access to investors and growth capital, future technologies, new platform-based business models, Europe is falling behind. Based on what I have seen in innovation ecosystems in Asia, US, Middle East and Europe, I genuinely believe Innovation Superclusters can be a big part of the solution for Europe.
While Europe has a long and solid history of cluster policies, it is standing on the brink of a paradigm shift in its cluster thinking; I think this is both really exciting, but also important for the future competitiveness of Europe – as well as other regions that develop Supercluster frameworks and policies.
ECCP: In your work, you use the term “Supercluster. Could you go in-depth on what your definition of a supercluster is and how can clusters aim to become one? C.R.: Sure, in our work we define three levels of clusters:
EC – Emerging Cluster
GC – Growth Cluster
SC – Supercluster
Caption – The Three Types of Clusters Emerging Clusters are smaller, more local by design, they have limited resources and, regretfully, limited impact. Yet, they are very important in their local regions.
Growth Clusters are larger, more developed. They have a more matured configuration, where startups, scaleups and investors are also represented (although, often in a limited capacity). Interestingly, I find that Growth Clusters often extend beyond a local region, often establishing international partnership, market access and are able to tap into global value chains; often in ways individual cluster members would not have been able to do themselves.
Superclusters are different. The best way of really understanding a Supercluster is to think of them as magnets. Successful Superclusters become global magnets, in the sense that they attract companies, investors, startups, researchers, policy makers and people will happily relocate to that Supercluster, because that is really where the breaking work in that field is happening and the innovation intensity and industry dynamics is just through the roof. But, it is important to separate a Supercluster and more general Innovation Ecosystems, we spend multiple pages on this in our recent report. Superclusters are formal, legal organizations, with a formal management structure, budgets, annual reports and active member lists. Most importantly, they are defined around a specific theme or topic, say Solar Energy or AI.
Another key point is the underlying cluster logic. Most European clusters are built around the Triple Helix philosophy. And that is great. But it is also insufficient. To be able to truly develop new growth industries, we also need to bring in entrepreneurship and private capital. This builds opon the Triple Helix, but goes beyond. We suggest using the Pentagon or Five-Point model to build true Superclusters.
Caption: The Pentagon / Five-Point Model (Excerpt from the Building Innovation Superclusters Report)
ECCP: Having worked with close to 40 clusters across the globe as an advisor over the past four years, what’s your most valuable takeaway from the work so far?
C.R.: The biggest takeaway is that every cluster, big or small, is different. Industry focus, theme, cluster configuration, funding, the quality of the board, support of the larger ecosystem, national frameworks; all these things add up to very different clusters. Take autonomous mobility or clean energy; these are now common cluster themes, but every cluster in various countries and region will be very different. Yet, at the same time, I strive to understand and identify shared traits or commonalities of successful innovation clusters. In both my work and my research, this has been really important. Because, while every cluster is different, and I respect that fact greatly, I also believe we can greatly expand our understanding of they key success factors behind clusters and various parts of a cluster’s strategy. It is this philosophy that has driven our research and development of the Innovation Supercluster visual strategy tools.
ECCP: Can you explain that a bit more? You also developed visual strategy tools.C.R.: Yes, this is something the team and I are deeply passionate about. When you look at strategy, there are textbooks, hundreds and hundreds of textbooks. Managers can read all of them, but the books still don’t help you - as a manager - understand what YOU should actually DO. This is a challenge for all academic research, with the intent of helping create change in practice.
So, when I started working with Innovation Clusters four years ago, I found a lot of very interesting research and lots of great reports, powerful insights and excellent textbooks; but I really, really lacked the hands-on, practical cluster leadership and cluster tools. The tools that allowed you to actually DO things. This has roots in my research extending back to 2010, but in 2016, my team and I started developing an entire series of strategy tools for clusters. Our collaboration with the Norwegian Cluster Program has greatly accelerated this development, so today there are more than 15 tools for cluster managers, cluster programs and cluster policy development; all of them are freely available online on www.strategytools.io.
Working with cluster programs in Asia, Europe and Norway, we train cluster leaders at all levels to work with these tools, as part of a larger capacity development and building better cluster leadership at both the national, regional and local levels.
Caption: One of the many visual tools we’ve developed for clusters
ECCP: In your most recent article – Leadership in the Age of Innovation Superclusters – you delve into how cluster leadership is quite different from traditional company-based leadership that we are so used to. Could you elaborate a bit on that and what it means to be a successful cluster leader?
C.R.: In most research related to leadership education and leadership development, we have a traditional, hierarchical structure with the leader, largely in charge. This is not the case for cluster leadership. I think Merete D. Nielsen, Director of Cluster Excellence Denmark and President of the TCI Network, says it well, stating that the cluster leader is a networker. This is very well said. It is precise. Research also shows that the best (cluster) leaders are influencers and networkers, more than anything else. Moving forward, I think training, coaching and capacity building of cluster leaders, cluster management staff and cluster boards will become increasingly important.
In this article, we propose a shift from five levels of leadership to eight levels of leadership. This means the CEO or Manager in a cluster has a far more complex and challenging leadership role to master. I have interviewed dozens of cluster leaders to understand what their top challenges are. Most of them have too many stakeholders. They have limited formal authority. They have few staff and mostly run network-based projects, collaboration and organizations.
Caption: The 8 Levels of Leadership
ECCP: We heard that you are currently writing a book on Innovation Superclusters. Could you share with us a summary of the content and why you think this is important to the cluster community?
C.R.: In the book, we go through a number of new ideas and new concepts around Innovation Superclusters. We look at Value Impact and Open Innovation at the cluster level, a new way of looking at national cluster frameworks, we look at cluster configuration, risk capital, accelerator maps and much more. We also introduce a number of new, visual strategy tools, specially developed for Innovation Superclusters. But most importantly, we have interviewed a number of experienced people across US, Asia, Middle East and Europe, and I think this helps bringing many fresh emerging perspectives to the topic.
The book will come out late 2020, but we are already sharing some of our work and findings, as we go. This is simply something we should do as a way of contributing to the global conversation on the evolution of clusters.
ECCP: How do you see European clusters developing in the future, say in 5 to 10 years time?
C.R.: I think we are just on the brink of a new paradigm. It is probable that within the next 2-3 years, there will be major changes on how we think about innovation clusters. I think Europe will move from a Triple Helix to a Pentagon model and in the process greatly changing the potential configuration of our clusters. This is the process Norway and the Norwegian Innovation Cluster program is going through, and it is very exciting. The team in Norway is really helping shape a different cluster landscape.
So the big shift I think we will begin to see is: bigger clusters, more resources and staff, more focused on a cluster capital strategy, attracting investors and venture firms, doing a better job of building scale-ups and truly high-growth ventures. Hopefully, and this is important I think, Europe will be able to attract more international (global capital), activate more pension funds and family offices into high-growth tech companies; and the future European Superclusters can really take the leading role in this development. Not just because it gains the startups, but this development would simply accelerate the speed of innovation across the entire cluster, to everyone’s benefit. That’s what I personally hope to see.
ECCP: Thank you for the interview.
C.R.: Thank you. It has really been my pleasure.