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Biomedical Engineering Institute Advisory Board Meeting
June 21, 2002
University of Minnesota
Clusters are highly-evolved regional economic ecosystems that are productive, competitive, and that innovate rapidly – they are constantly churning out new products and services.
Clusters are complex systems with many feedback loops.  No one knows exactly how they come about.   Anchor companies appear to be important early on in some industries, spawning new life in the ecosystem:  Hewlett-Packard in Silicon Valley, Nokia in Helsinki, Medtronic in Minnesota.
The term “cluster” was first used by Michael Porter’s in his landmark study The Competitive Advantage of Nations (1990).  Porter builds on the work of Albert Hirschman (1950s) on industrial linkages and Alfred Marshall (early 20th century) on the role of knowledge in industrial districts in the UK.
Minnesota’s medical device industry is one of Porter’s preferred models for showing how clusters keep upgraded. 
The Council on Competitiveness is a Washington, DC-based nonprofit of CEOs, university presidents and labor leaders.
 Michael Porter is a member of the Council’s Executive Committee and has guided cluster studies of these five regions in the US – San Diego, Wichita, Research Triangle, Pittsburgh, and Atlanta.
The National Governors Association (NGA) began a partnership with the Council late last year and co-sponsored a conference “National Clusters of Innovation” in Washington, DC in December 2001. 
The NGA’s Center for Best Practices is holding Regional Competitiveness Forums in 2002 in Denver and Atlanta.
Arizona, Connecticut, Oregon and Wisconsin are among states that have launched cluster initiatives.
The Harvard Cluster Mapping Project provides a search tool to help states identify their statewide or regional clusters.  The Institute for Strategy and Competitiveness at the Harvard Business School hosts the search tool on its web site at www.isc.hbs.edu
Results reflect the organizational advantage achieved through a cluster-driven Web portal.
Examples of biomedical clusters around the world. 
Minnesota
Bay Area of California
San Diego
Boston Area
Cambridge Network – United Kingdom
Medicon Valley – Sweden and Denmark
BioValley – Switzerland, France and Germany
Zurich MedNet – Greater Zurich Region
Monash Research Cluster for Biomedicine - Melbourne
Regional clusters of innovation are increasingly viewed as national resources with a global reach.
The MBBNet – Zurich MedNet Web Portal Link, joining the heart of North America with the heart of Europe, was dedicated at the University of Minnesota and the Swiss Embassy in Washington, DC in September 2000.
Zurich MedNet is a medical/biotech cluster of the Winterthur Consortium and the Zurich Network.
The Zurich region is “economic Switzerland,” strong in precision machining and medical devices, especially orthopedic devices. 
Switzerland is one of the countries studied by Michael Porter in The Competitive Advantage of Nations (1990).  It has a solid innovation infrastructure, a strong system of public education and significant capital resources, but it lacks a tradition of entrepreneurship.
Zurich MedNet has engaged in its activities the Universities of Applied Science in Winterthur and Wadenswil and the Federal Institute of Technology (ETH) in Zurich, which is spinning off biotech start-ups.
The pioneering New Product Design and Business Development (NPDBD) program has been supported by Swiss companies and has graduated Swiss students.  The NPDBD program is a collaborative venture between the Carlson School of Management, the Departments of Mechanical and Biomedical Engineering, and sponsoring companies.  Teams of graduate engineering and business students and faculty along with company employees work to develop a working prototype of a new product and a business plan.
Genesis Business Centers, under Harlan Jacobs, is the on-the-ground liaison for building the MBBNet – Zurich MedNet Link in Minnesota.
Factor Conditions are inputs in Porter’s “Diamond of Advantage” for how the public and private sectors can work together.  In a regional cluster system, they are the investments.
Stem cell technology being developed through the Stem Cell Institute in the University’s Academic Health Center is a broadly enabling technology with important implications for regenerative medicine. 
Biomaterials and biosensors:  Initiative lead by the University’s College of Biological Sciences and Institute of Technology through the interdisciplinary Biotechnology Institute that looks to use biocatalysis (enzymes and microbes) to make brand new environmentally friendly materials out of plant matter/biomass, with applications in healthcare and industry. 
Miniaturization and nanotechnology:  Minnesota has significant engineering research capabilities for miniaturizing medical devices and diagnostic instruments.
Technology-enhanced health services may be an emerging cluster in Minnesota.