description distric new
DESCRIPTION
The model of the italian industrial districtsTRANSCRIPT
Industrial Districts
1) Description
Map and updated data
Districts setting up
MKT
Common elements in districts:
• Great Technological knowledge/practical experience
• Production cycles possible to be decompose into their single phases
• Availability/necessity to entrepreneurship
Articulation of Articulation of industrial districtsindustrial districts
Raw materials
Machinery
Semi-finished
SUPPLIERSSUPPLIERS
Trust
Job market
SOCIAL CAPITALSOCIAL CAPITAL
Attitude
Value
Accessibility
Transports
Water purifying
Building land
INFRASTRUCTUREINFRASTRUCTURECAPITALCAPITAL
Banks
Designers
Transports
Agents
PRIVATE SERVICEPRIVATE SERVICE
TYPICAL ACTIVITIESTYPICAL ACTIVITIES
Sub contractors
CUSTOMERSCUSTOMERS
Markets
Schools
Trade associations
SOCIAL SERVICESSOCIAL SERVICES
Services centres
Consortiums
Research
Marketing
ProductionSub contractors
Sub contractors
Districts main features - 1
• central role of the family and job sharing among the family members inherited from the rural society
• common social background and values
• high social mobility and entrepreneurship attitude
Districts main features - 2System of factories with an integrated vertical production cycle and greater division of work among single concern which minimises costs and promotes new businesses
Space contiguity among companies and consolidated relations which favour reduced transaction costs and greater intrinsic reliability
External economies of scale
Constant technical innovation
High specialization in phases and components
High competitiveness among enterprises
Districts main features - 3
Cooperation between enterprises and public bodies about external economies
Weak entry barriers are increasing because of bureaucracy problems
Exit barriers: the artisan can do just one specific task and cannot change his business
Professional and skilled workforce who learn locally
Collective learning (learning by localizing, learning by specializing, learning by interacting
Strong points
Flexibility
Professionalism
High competitiveness between firms
Continuous investment
Important role played by local banks
Co-operation with public bodies
Weak pointsWeak points
Excessive localism and closure to the external world “Death by asphyxia”
Maturity of the life-cycle of the area ( pointed out by slowing of enterprises turnover)
Difficulty to face radical changes and innovation outside the existing technological framework
Lack of guidance and strategies for growth and renovation
Less bargaining power with the distribution system
Competition by countries with low labour costs
Difficulty in reaching new potential growing markets
Problem of generation transfer
Industrial Districts
2) Evolution
• MARKET GLOBALIZATION, process which imposes a planned approach to the market on companies and takes back economies of scale problems, especially those related to research and engineering, marketing and financing
•TECHNOLOGY EVOLUTION, showing the coming-up of new technological paradigms (e-commerce) and rules (quality certifications, safety and environmental rules ), which reflex upon production cycle organization
The new competitive contextThe new competitive context
Districts challengesDistricts challenges
• HUMAN RESOURCES AND TRAINING
• INTERNAZIONALIZATION / GLOBALIZATION
•TECHNOLOGICAL INNOVATION AND NETWORK TECHNOLOGIES
• MARKET GLOBALIZATION, process which imposes a planned approach to the market on companies and takes back economies of scale problems, especially those related to research and engineering, marketing and financing
•TECHNOLOGY EVOLUTION, showing the coming-up of new technological paradigms (e-commerce) and rules (quality certifications, safety and environmental rules ), which reflex upon production cycle organization
The new competitive contextThe new competitive context
Internationalisation /globalisationInternationalisation /globalisation
• Delocalisation of low-costs phases
• Dismantling of traditional network
• New networking and co-business strategies
Relationship modelsRelationship models
Customer
CustomerCustomer
SS SS SS
SS SS SS
SS
SS
SS
SS
SS
SS
TRADITIONAL TRADITIONAL SUPPLIERSUPPLIERNETWORKNETWORK
Supplier
Customer
CustomerCustomer
SS SS SS
SS SS SS
SS
SS
SS
SS
SS
SS
Supplier
CustomerCustomer
SSSS SSSS SSSS
SSSS SSSS SSSS
SSSS
SSSS
SSSS
SSSS
SSSS
SSSS
PSPS
PSPSPSPS
PSPS
INNOVATIVEINNOVATIVE LOCAL SUPPLIERLOCAL SUPPLIER
NETWORKNETWORK
Primary Supplier(Comaker)
Secondary Supplier Customer
Relationship modelsRelationship models
Customer
CustomerCustomer
SS SS SS
SS SS SS
SS
SS
SS
SS
SS
SS
TRADITIONAL TRADITIONAL SUPPLIERSUPPLIERNETWORKNETWORK
Supplier
CustomerCustomer
SSSS SSSS SSSS
SSSS SSSS SSSS
SSSS
SSSS
SSSS
SSSS
SSSS
SSSS
PSPS
PSPSPSPS
PSPS
INNOVATIVEINNOVATIVE LOCAL SUPPLIERLOCAL SUPPLIER
NETWORKNETWORK
Primary Supplier(Comaker)
Secondary Supplier Customer
INNOVATIVEINNOVATIVE GLOBALGLOBAL SUPPLIER SUPPLIER
NETWORKNETWORK
Relationship modelsRelationship models
Medium St. Dev.
It will be slight 3.1 0.9
It will change districts winners and losers 4.8 1.8
It will change the local dimension of districts 3.1 1.2
It will cause a new aggregation of districts on virtual bases 4.9 2.1
It will cause districts development 5.8 1.5
It will outline new business relations 5.5 2.0
It will outline new relations between customers and suppliers 6.6 1.5
E-commerce impact on the structure/survival of districts
Source: A.Ordanini, Università Bocconi - Club dei Distretti Industriali
Network technologiesNetwork technologies
market market
process process
• to gain visibility• to supply innovative services• continuous trust by customers• turnover increase• enlargement of the market
• to make information easy to get• to make production flexible• to optimise resources
• upgrade of supply quality• reduction of supply time and costs• to increase flexibility• to reduce logistic investment
• virtual shop• marketplace• telecommunication channel • corporate portal• call centre• advance sale• post sale
• eXtended ERP• System Integration • message Broker • outsourcing
• access to marketplace• auctions• supply chain management• exchange• supply advancement
supply supply
Companies /districts targets and solution models
Network technologiesNetwork technologies
From Local Districts to From Local Districts to Global Virtual EnterprisesGlobal Virtual Enterprises
Ind
ep
en
den
t R
eg
ion
al N
etw
ork
sIn
dep
en
den
t R
eg
ion
al N
etw
ork
sUse of Virtual Enterprise concept for business development:
Intensive use of modern communication technologies
Global Business Integration
Virtual Enterprises
Glo
bal V
irtu
al En
terp
rises
Glo
bal V
irtu
al En
terp
rises
Cairo - 29th June 2000
Industrial districts
3) Policies to development
a) Policies of : development / emersion maintenance of competitive
advantage revitalisation ( strategic
repositioning)
b) Public Policies as support to development and cooperation among local energies and competencies and not as substitute
Industrial politicies for districtsIndustrial politicies for districtsIndustrial politicies for districtsIndustrial politicies for districts
Experience teachesExperience teaches
- districts are not created by a law
- districts are a complex organization phenomenon
which comes from the interaction of social-cultural
and economical aspects
- it is necessary to act on every environment aspects
Who does what?
Districts projects and problemsDistricts projects and problems
creation of a network which involves all important local actors in order to avoid resources waste and to increase intervention efficiency and integration of different components of the internal local system economy
to make local public bodies to be guides, able to act as catalysers and able to strenghthen development strategies for districts
Cairo - 29th June 2000
Policy suggestions to createPolicy suggestions to createenvironments conducive to SMEs environments conducive to SMEs
1st level aims at promoting the private SME sector in general
2nd level consists in sectorial -specific actions, aimed at increasing the competitiveness of clusters
3rd level reinforcement of a positive institutional environment
3 LEVELS OF ACTION3 LEVELS OF ACTION
Cairo - 29th June 2000
actions for reducing bureaucratic costs and complexity of bureaucratic procedures for enterprises;
actions for providing information about incentive laws for the creation of new enterprises and for investment;
actions for supporting existing or potential enterprises in presenting application models for incentive laws;
actions for providing micro-credits for enterprises and to design guarantee schemes;
11stst level - (a) level - (a)
Cairo - 29th June 2000
actions for building up basic infrastructure on the local level, consisting in industrial areas, roads, water electricity, telecommunications;
actions for promoting entrepreneurship from a cultural point of view, and for educating existing or potential entrepreneurs in basic managerial techniques;
actions for providing services to micro-enterprises of the informal sector.
11stst level - (b) level - (b)
Cairo - 29th June 2000
actions for promoting local products on foreign markets;
actions for providing local enterprises with information about technology and markets;
actions for training specific strategic human resources for production and business processes;
22ndnd level - (a) level - (a)
Cairo - 29th June 2000
actions for promoting networks of SMEs and for setting up collective service activities;
actions for providing temporary management and mentoring for local SMEs;
actions for providing adequate medium-long term financial support, in order to facilitate enterprises to buy new technical equipment, consultancies, etc.;
22ndnd level - (b) level - (b)
Cairo - 29th June 2000
actions for increasing the quantity and quality of infrastructure;
actions for creating international linkages for local enterprises, and possibly, joint-ventures;
actions for the attraction of foreign investment in innovative and complementary activities;
22ndnd level - (c) level - (c)
Cairo - 29th June 2000
actions for connecting local enterprises to university and research centres and for transferring the results of scientific and experimental research;
actions to reinforce local identity and to stimulate the circulation of information;
actions for promoting international cooperation between institutions and for creating institutional networks at the international level, in order to exchange experiences and to create regional networks.
22ndnd level - (d) level - (d)
Cairo - 29th June 2000
the networking of all relevant actors at the local level to avoid dispersion of resources and increase the effectiveness of interventions and the integration of different components of the local economy within the system
generating local leading institutions, which act as "catalysers", able to develop strategic development guidelines for the cluster by involving and coordinating different local actors in policy initiatives to fulfil common objectives.
33rdrd level level