Opportunity for Innovation in Medical Device Industry Clusters

Promoting Clusters

Industry clusters are known to give rise to collective benefits, favour creation of providers of specialised technical, logistical, administrative and financial services and enabling conducive environment for the development of inter-firm cooperation and collective learning. Basic underlying strengths of clusters are:

• Agglomeration of firms (in a small geographical area) and

• Linkages among people, resources, skills and knowledge at regional level.

There are enough quantitative evidences to substantiate that firms gain in their performance collectively due to their concentration in specific region and by being in close proximity of knowledge infrastructure ( R&D facility, University, Mother firm etc).

A decade of cluster development experience in India/abroad suggests that firms in a cluster do cooperate whenever they feel that their business secrets are not being jeopardised. For example, SMEs of leather cluster at Chennai collaborated with The Central Leather Research Institute to introduce design innovations in their products, leading to significant increase in exports.

Similarly, the small firms in the ceramic cluster at Sassualo in Italy collaborated with their equipment suppliers to develop new machines that significantly improved the finish of tiles they were producing. This continuous innovation has helped the Sassualo Cluster to retain their dominance in the global tile business. For over a decade the cluster has more than 60% share in the global tile market.

The Project: Promoting Innovation Clusters

Department of Science and Technology (DST), Ministry of Science & Technology has initiated a Programme on Innovation Clusters (PIC) with the long term vision of promoting cooperative research and development in MSME (Micro Small and medium Enterprise) clusters as well as artisan clusters to produce high value goods and services.

It is high time for Indian industry to move up the knowledge pyramid and operate at the frontiers of knowledge. Issue is pertinent to Small enterprises, which have been the engines of economic growth around the world and the major sources of inventions and innovations. Investment in knowledge creation, acquisition, absorption and diffusion is critical for this purpose.

This project aims to develop collective research and learning in horizontal and vertical clusters by facilitating inter-firm collaboration and trust building. The project also envisages the development of a knowledge network and linkages with the national and global markets.

It is an action research project and the intent is to identify clusters with promise and initiate development activities in these clusters. It will develop an approach, methodology and tools based on practical demonstration of promotion of collaborative, open (or with limited partners) innovation in MSME clusters.

Innovation: A planned activity

Innovation is larger than R&D in scope and occurs only when the new or improved device, product, processor system is involved in a commercial transaction and leads to production of goods and delivery of services of high or better quality at per unit price. It inherently covers the whole value chain of the product and impacts whole organisation.

Innovation is a systematic and planned activity like other business operations in a firm or a sector .It enables an organisation to be competitive on its ability to create and apply knowledge unique to its operations, markets and industry.

The vision of the project is to identify institutions, experts and entrepreneurs, create a web of inter-relationship and develop institutional mechanism for cooperation i.e. an enabling ecosystem for innovation in MSME clusters for enhancing competitiveness and employment generation. Project aims to encompass industrial, service and rural enterprise (artisanal) clusters to come out with an effective strategy and implementation methodology.

Project aims at :

• Identifying industry clusters and entrepreneurs interested in partnering for innovation. 

• Conducting detailed study of the identified clusters, which includes value chain analysis, assess support institutions, etc. to identify bottlenecks where interventions are necessary to promote innovation.

• Strengthening the clusters and firms in the value chain by – Developing knowledge Network (national and international experts, knowledge institutions etc.) and linking it with entrepreneurs keen in innovation and willing to partner with the Foundation.

• Identifying and linking support institutions (national and international) with cluster(s). Also building up support systems according to the needs of the cluster.

• Linkages with financial institutions (banks, non-banking financial institutions etc), and develop new instruments for extending risk capital to MSME clusters.

• linking national and international market players with the clusters for marketing of the products.

• developing virtual information network for knowledge sharing and building learning communities.

However, strategy and approach will vary sector to sector and also on cluster types (as opportunities/challenges and henceforth respective solutions will be different for knitwear cluster of Ludhiana from what can happen at Kanpur’s leather cluster).

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