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Illawarra Mercury - In Business with Greg Ellis - 2/8/01
Wollongong should follow the lead of Adelaide's Playford City Council and conduct some high quality anaalytical work to identify constraints to growth in important industrial sectors.
The suggestion was made during an address to Wollongong business and civic leaders by Organisation for Economic Cooperation and Development (OECD) representative Alistair Nolan.
The Paris-based OECD representative was invited to Wollongong after Councillor Kerrie Christian heard about his involvement in the Playford City Council project at a local government conference.
Mr Nolan, a Smartlink Fellow, said it was possible for Wollongong to conduct a similar exercise to the one at Elizabeth, in Adelaide.
While Playford City Council was concerned about the automotive sector Wollongong could relate its work to constraints in sectors such as manufacturing.
It is doing the background research and the homework which allows you to appropriately target public policy," he said.
But it required careful examination of the way public support programs for enterprises were established to make sure they didn't duplicate or compete with each other.
And there needed to be a simple visible architecture of service supply and careful consideration given to how well publicly provided services complemented what the market was already doing.
Mr Nolan said it was also important to carefully look at how schemes should be evaluated and their performance monitored over time.
He said it was important that industries did a lot of the work for themselves, with some kind of facilitation by the public sector providing an honest broker role in a mutual corner.
Mr Nolan also spoke about the role of business incubators, a tool to facilitate enterprise creation and development and the scope of public policy towards incubation.
He discussed the tendency of firms in related lines of business such as the call centre industry in Wollongong,to concentrate geographically and how clusters resulted in ideas and information flowing between them.
He said clusters, with open management should be encouraged hecause they lead to positive inter-firm networks.
As a distinction networks, which also provided an important function, were about the relationships that firms established between themselves.
`Networks require membership," he said.
"Companies come together they agree to do something collaboratively."
Mr Nolan said clusters were a connsequence of market dynamics while networks were essentially about collaboration.
He said clusters were important because they encouraged the specialisation and division of labour for firms, attracted buyers and sellers and reduced the unit costs of activities undertaken collectively.
A cluster can also reduce the unit costs of technical services provided to members of the cluster.
By operating in close proximity firms can more easily subcontract orders that exceed their own capacities to conipetitors. Mr Nolan said public programs to encourage inter-firm networks, such as clusters, had in part been inspired by a desire to replicate the success of enterprises belonging to renowned clusters in Silicon Valley and Emilia Romaga.
His visit to Australia was arranged through Smartlink - with his visit to Wollongong being facilitated by Rodin Genoff, Playford Council SA, in association with Cr Kerrie Christian, Wollongong City Council, NSW, with the assistance of Matt Waugh, Manager Corporate Relations, Wollongong City Council, NSW.
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