According to Appalachia Regional Commission, a cluster is ‘’ a geographically bounded concentration of similar, related or complementary businesses, with active channels for business transactions, communications and dialogue, that share specialized infrastructure, labor markets and services, and that are faced with common opportunities and threats.’’ To be more specific, successful (synergy producing) clusters are characterized by:
In this research there was a wide assumption that;
1) Businesses have a tendency to cluster, and this ought to affect policy
2) Companies clustered in a region are independent
3) Companies that learn about and use the most innovative and suitable technologies, invest in the skills of their personnel, and moreover possess or can access professional guidance and assistance are more competitive than those that do not
The assumptions stimulated a sequence of research questions.
1. What is the exporting and the export capabilities of the existing small scale and medium sized enterprises?
2. What is the level of competitiveness and the strength and effects of interdependencies and networks amongst the small scale and medium sized enterprises?
3. How do the small and mid-sized firms interact and take advantage of their complementary strengths and potential economies of scale.
4. How do the firms utilize their mutual advantage as a cluster and do they yield synergy?
The Pittsburgh area medical devices cluster
This medical devices cluster has an overall of 25 firms having ten employees and above, and over 50 total establishments. The cluster also contains firms with fewer than ten employees. These are the firms exclusively in the prosthetic appliances, sub-sector. These particular firms supply prosthetic devices orders to local hospitals. The prosthetic firms’ deficiency in real export potential expounds the full picture for their insignificant growth and opening out (Rosenfeld).
ARC Pittsburgh Area Medical Devices Cluster
SIC Classifications Number of firms Employees Share of cluster employment Employees per firm
Surgical & MED. Instruments 9 555 20.2% 51
Surgical appliances and supplies 11 1, 897 69.1% 172
Electro medical 5 292 10.6% 58
Total 25 2, 744 100% 110
From the table it can be illustrated that the establishments are distributed consistently between surgical and medical instruments and surgical appliances and supplies. The clusters deficiencies are in specialization in the areas of x-ray apparatus and surgical appliances. Surgical appliances and supplies is evidently the leading sector in relations to the actual number of personnel. This poses an immense challenge in the sense that, the surgical supplies sub-sector is less suitable to export, for the reason that most of the devices are legitimately low tech, and that the sector serve local markets that demands for products intended to fit particular clients.
The other worry is that the employment in this subsector is made...