Industry Cluster Formation Through Collaboration

 

Industry Cluster Formation Through Collaboration

Murad Abel, DBA
 June 12, 2025

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Keywords: Economics, Clusters, Innovation, Industry

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Abstract

Technological innovation is transforming economies at unprecedented speeds, reshaping industries, and redefining national growth trajectories. Central to this transformation are economic clusters—geographic concentrations of interconnected businesses, institutions, and networks—which serve as engines of innovation, productivity, and regional development. These clusters enable collaboration among academia, government, and private industry, fostering environments conducive to the rapid development of next-generation products and services. Drawing on theories such as Schumpeter’s Creative Destruction, this paper explores how innovation-driven clusters support economic resilience, quality of life enhancements, and human capital development. It emphasizes the importance of infrastructure, data networks, and inclusive strategies in sustaining global leadership in innovation. Despite persistent barriers—such as resource limitations and technological adoption gaps—clusters offer scalable solutions through coordinated stakeholder efforts, startup integration, and cross-sector collaboration. The paper concludes that a hybrid approach to cluster formation, blending intentional design with organic growth, holds the greatest promise for advancing regional economies and addressing 21st-century challenges through shared innovation ecosystems.

  Industry Cluster Innovation Through Collaboration

 Technological change is accelerating at a pace unimaginable to our grandparents and great-grandparents. Advances in computing power and emerging technologies have reshaped our environment, making rapid innovation a critical driver of national growth. The development of new products and services not only influences economic health but also renews interest in expanding research and knowledge. This, in turn, encourages companies to bring cutting-edge offerings to market.

Economic clusters—regions where businesses, research institutions, and networks converge—play a vital role in fostering innovation. By enhancing connectivity and collaboration, these clusters create enriched environments that support the development of next-generation products and services. While improved GDP at local, state, national, and regional levels is one key benefit, such clusters also offer significant opportunities to enhance Quality of Life (QOL) and support long-term human capital development.

Technology Innovations

Technological innovation often drives broad economic growth within industries and regions (Thi & Do, 2024). When tied to infrastructure—such as railroads or the Internet—these advancements can deliver widespread benefits, especially for those who leverage resources effectively. For instance, the strength of data networks and fiber infrastructure, combined with advancements in artificial intelligence, significantly influence national growth prospects. As of this writing, the U.S. ranks among the top three countries on the Advanced Innovation Index 2024 (Dutta et al., 2024). However, maintaining this position requires intentional efforts to foster innovation through a more inclusive and networked approach.

Creating innovative environments accelerates the development of new products and services. In some cases, paradigm-shifting discoveries—such as breakthroughs in energy, AI, infrastructure, or materials—can rapidly transform multiple industries. With the right conditions, innovation clusters can give rise to entirely new sectors.

Joseph Schumpeter described this phenomenon as Creative Destruction—a natural economic process where old structures are continuously dismantled and replaced by new ones. As he wrote in Capitalism, Socialism, and Democracy (1942):

“The opening up of new markets, foreign or domestic, and the organizational development from the craft shop to such concerns as U.S. Steel illustrate the same process of industrial mutation—if I may use that biological term—that incessantly revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one. This process of Creative Destruction is the essential fact about capitalism.” (p. 83)

Economic clusters offer governments a practical way to support innovation, economic development, and quality of life improvements. These clusters—often formed through partnerships among industry, academia, government, and communities—serve as microcosms of economic progress, enabling stakeholders to collaborate and mutually benefit.

Fostering clusters of related industries helps catalyze these natural processes. According to Porter (1998), such clusters are inherently innovative and contribute to economic resilience. They do so by forming networks of complementary businesses that boost efficiency and competitiveness—advantages that are difficult to replicate elsewhere.

Economic Growth Environments

Economies are complex systems that, when functioning effectively, generate value for both industries and the communities in which they operate. Technological advancement has long served as a catalyst for economic growth and has improved the quality of everyday life. The development of new technologies depends on a region's physical assets combined with human capital, which together create innovative advantages.

Industry clusters—geographic concentrations of interconnected companies, suppliers, and institutions—have been shown to foster innovation, improve efficiency, and increase productivity, enabling firms to compete at both national and global levels (Porter, 1998). Due to their significant financial and supply chain impacts, fostering innovation through clusters is increasingly viewed as a strategic avenue for economic development. For economies aiming to compete globally, the ability to produce cutting-edge technologies and engage in advanced manufacturing is essential to enhancing value and resource attraction.

More than fifteen years of research into industrial clusters suggests that rapid innovation arises from the interaction of multiple interrelated factors. These factors can be isolated, studied, and optimized to further accelerate cluster formation and effectiveness. Ideally, clusters should be purposefully developed to strengthen community resilience, address critical industry challenges, or advance sector-specific research. Centering cluster development around clear objectives can improve coordination and collective impact.

Collaboration among key stakeholders—including industry, academia, government, and local communities—can create robust economic ecosystems. These systems harness unique regional advantages, such as data assets, coordinated resource use, branding, process innovation, and management infrastructure, to foster scientific progress and address market or societal challenges (Tanaka & Lopez, 2024).

However, barriers frequently impede the adoption of new technologies within manufacturing sectors (Rached et al., 2022). Removing these obstacles is critical for promoting innovation and enhancing industrial competitiveness through technological advancement (Zou, 2024). Common barriers include lack of technical knowledge, high labor and installation costs, inadequate government support, limited resources, and insufficient infrastructure (Rashed, Bagum, & Haque, 2022).

Well-designed economic clusters aim to minimize these barriers by fostering environments that support industrial growth. Such environments ensure access to necessary infrastructure, promote skilled labor development, facilitate research and development initiatives, offer tax incentives, strengthen digital connectivity, and enhance overall quality of life. These factors collectively create fertile ground for industry development, resulting in mutual growth and problem-solving capacity within targeted sectors.

Stakeholder Collaboration

Collaboration is essential to building strong economic clusters due to the significant investment of time and resources required to develop their foundational elements. In some cases, clusters form organically, while in others, they emerge from strategic efforts to fill industry gaps or stimulate innovation. When key stakeholders identify critical bottlenecks to industry development, they often come together to address these challenges, aiming to drive regional economic growth by advancing business innovation (Pulido-Gomez, de Jong & Rivkin, 2025).

Clusters operate as interconnected systems, linking labor, education, firms, and networks to form viable, dynamic ecosystems (Konig, 2023). These connections enhance resource efficiency and add depth to the local business environment. Companies that effectively leverage cluster resources tend to adapt and grow more rapidly within competitive markets (Handoyo et al., 2023). This accelerated growth contributes to regional gross domestic product, strengthening the broader economy (Pyo & Choi, 2025).

Start-ups play a critical role in these ecosystems by acting as sources of innovative capital for larger firms (Giglio et al., 2025). Clusters create fertile ground for the launch and scaling of start-ups, providing the support and conditions needed to foster radical innovation. Such innovation often arises under specific environmental pressures that trigger a reordering of industries. For instance, the development of AI followed a Schumpeterian model of Creative Destruction, where new technologies replaced outdated ones and reshaped entire sectors (Ramazan, Tuluce & Aykac, 2024).

The potential to spur innovation across multiple industries is one of the most transformative outcomes of successful clusters. A single invention can influence several sectors through ripple effects across the supply chain. Cross-industry collaboration, particularly where inter-industry networks overlap, can amplify innovation (Shi & Xiao, 2024). Ultimately, building clusters is about cultivating environments that are not only capable of inventing new products and technologies but also of generating entirely new technological trajectories that were previously unimaginable.

 Conclusion

 The development of clusters can be driven by local and regional stakeholders to promote both social and economic growth. Clusters support higher levels of industry innovation by fostering shared goals, collaboration in research and development, resource sharing, and knowledge spillovers. When designed for industry advancement, they leverage common infrastructure and expertise to drive innovation. Alternatively, organically formed clusters can enhance economic resilience by connecting diverse industries around shared competencies and resources. A hybrid approach—combining elements of both intentional and organic development—may offer the greatest potential, maximizing local assets across social and economic dimensions.

References

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Dutta, S., et al. (2024). Global Innovation Index 2024. World Intellectual Property Organization (WIPO). https://www.wipo.int/web-publications/global-innovation-index-2024/en/

Giglio, V., et al. (2025). Cooperation between large companies and start-ups: An overview of the current state of research. European Management Journal, 43(1). https://www.sciencedirect.com/science/article/pii/S0263237323000919

Handoyo, S., et al. (2023). A business strategy, operational efficiency, ownership structure, and manufacturing performance: The moderating role of market uncertainty and competition intensity and its implication on open innovation. Journal of Open Innovation: Technology, Market, and Complexity, 9(2), 100039. https://doi.org/10.1016/j.joitmc.2023.100039

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Kadlec, Ž., Josip, H., & Bedeković, M. (2018). Attracting investment in entrepreneurial zones of small cities by creating preconditions for the development of small and medium-sized enterprises. Interdisciplinary Management Research. https://www.researchgate.net/publication/368881896

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Working on the Classic Car: Hunker Junker Still Runs! (Repainting and Landau)

Removed damaged landau

You can buy a new car, finance it, and if you spend enough money, you're bound to turn some heads. I have a friend who bought a new luxury car—they definitely get attention, but they’re a hefty price for it. I decided to forego any new high interest debt and simplify my life down to as close to a flip flop wearing casual beach lounger as much as possible (Live your freely and then dress in a tux every once in a while if something important is going on). 

Nearly every day someone comments on my work-in-progress: a 1985 Buick Riviera. In some ways, I think a few people enjoy watching the evolution of the car as I drive it around town. Small but noticeable differences.

I’m just experimenting with minimal tools and equipment, so yes—there are mistakes (I laugh at them, too). But hey, you can’t buy style!

For those who love old cars, you already know—it’s a labor of love. Every repair or upgrade requires research and hunting down hard-to-find parts. You spend hours watching YouTube tutorials, tinkering, and testing out possible fixes before making a final diagnosis.

In continuing this journey with my “hunker junker,” I’ve sanded down most of the rust, applied rust converter, filled in damaged areas, and put on a coat of primer. I bought the car for $1,000 and have put about $700 into it so far, not counting my own labor. With a total budget of around $3,000, I’m aiming to turn it into a solid runner that looks good enough for local car events—not a full restoration, but something respectable.

Removed hood rust

What’s Been Done So Far:

• Windshield washer pump replaced

• High-mileage oil change

• Landau top (looks better than before, but it’s a rough job—some sections need redoing)

• Greased carriage and joints

• HVAC control module replaced

• Window repairs

• New speakers

• Door handle fix

• Temporary exhaust fix (Can and chicken wire method. It is quiet but want to quote out a custom replacement. Need some time.) 

What’s Still on the To-Do List:

• Diagnose slow fluid leak

• Fix door linkage

• Redo landau top properly

• Repair or replace dashboard

• Long-term muffler solution

• Recharge or fix A/C

• Finish primer and paint

• Continue smoothing the hood

• Deep-clean carpets and upholstery

This article was interesting,

Collectible cars have inspired generations of enthusiasts and collectors. Their growing appeal translates into new opportunities along the entire automotive value chain.

The Power of Perception and Truth (Hypothetical Thought Experiment on Hate and Corruption)

What We See Isn’t Always What Is

The way we view the world—and interpret information—is often a reflection of who we are and the backgrounds we come from. Our perspectives act as mirrors. One person may see one reality, while another sees something entirely different. This divergence becomes dangerous when good people are mistaken for bad, and bad people are celebrated as good. These misjudgments are often the result of perceptual filters clouded by inappropriate beliefs—many of which stem from social group exclusion or a lack of exposure to broader societal norms that promote shared understanding.

When groups become too insular, like isolated tribes or clans, their perception of the world can shift so dramatically that justice and laws become warped to serve narrow interests. A classic example is the story of a tribe encountering a glass bottle for the first time—an event that fundamentally reshaped their worldview. Over time, isolation can give rise to fundamentally different assumptions and social behaviors.

A thriving society relies on its people and their shared commitment to fundamental principles. These principles are often learned implicitly, through lived experience, socialization, and cultural norms (Implicit Learning and Implicit Bias 👆). But what happens when that learning breaks down?

Consider an example where the legal system fails—where harm is knowingly inflicted on some, while others are unjustly rewarded. In this scenario, a group of corrupt officials—closely tied to wrongdoers—apply pressure on victims to protect and benefit their associates. Their actions include damaging reputations, manipulating children, abusing official positions, coaching others to violate civil rights, and even deceiving the elderly for profit. Veterans and intellectuals similary mistreated. These behaviors aren’t random; they reflect a pattern of goal-directed collusion, historically useful and now repurposed for modern use.

These aren't mere missteps but coordinated actions influenced by individuals with high levels of dark triad traits (narcissism, Machiavellianism, psychopathy), surrounded by enablers—“blind monkeys,” as in The Wizard of Oz. They dehumanize victims, distort the truth, and weaponize the law. They disrepected the sanctity of life and the innocence of others because of their desires. Just about everyone knew they were doing it, were immunized to do again, and rewarded. Without effective checks, the system becomes a closed loop serving insiders rather than the public good.

In such environments, even those aware of wrongdoing may stay silent, fearing exclusion from the clan or social circle. The system becomes an extension of their social lives and identity—not a mechanism for justice. While the system may be functioning, it struggles to consistently serve its intended purpose.

"Your vision will become clear only
when you can look into your own heart.
Who looks outside, dreams; who looks inside,
awakes." Carl Young
The deeper meaning of
these social contracts and their
value to society.

Entrenched networks like these erode institutional trust, exploiting systems meant to protect for personal gain. In these complex cases, judges may find it easier and more tempting to side with aggressors and place burdens on victims, perpetuating injustice.  A type of its best we don't deal with what we created perspective. Whistleblowers are often met with retaliation, and the law becomes a tool of suppression rather than a vehicle for justice.

This doesn’t reflect the many principled officials who believe deeply in the law’s purpose. The vast majority serve honorably and care about their communities. However, a minority abuse the system without sufficient oversight or consequence. We can talk all day about justice and doing the right thing but if the end result is the same and bad actors can continue their patterned behaviors over and over then it is what it is!

Honor and integrity should outweigh hate and corruption. Unfortunately, in some settings, they have been replaced by self-interest, ego, and indifference to foundational values. When corrupted networks are silently enabled by judges or officials, public trust in institutional founding values written in the Constitution, the Bill of Rights, and other social contracts begins to unravel.

Unchecked hate in these environments becomes blatant and unapologetic. Unwritten rules replace constitutional ones, and “clan justice” begins to resemble the dysfunction often seen during times of transition. Once again, implicit learning plays a powerful role. The example of a worst case scenario helps us learn how to avoid by build models and limiting the infection of such "better than thou" wider groups with collective disdain for the philosophical purpose of justice.

Still, many good people and officials continue to fight for functional justice. But when those in power manipulate legal processes and conceal conflicts of interest, the justice system—because of its reach and power—is the first casualty. We can hope these injustices are eventually corrected, but it often takes years for the truth to be recognized and addressed. Examples can show us how hate and corruption works and what some of the solutions for correcting those unpatriotic values may be. It will also tell you how these clan based networks continue to be a risk when the perpetrators are left in their positions and illegal and secretive rulings of enrichment stand.

When hate and corruption take hold, the Constitution is reduced to a relic, scorned by those who reject the very ideals of liberty and justice for all—unless we hold the line and enforce those values, even against powerful insiders. We all must stand as a single people, a shared purpose, with a shared future benefit. There are those who are doing this and there are those who should have stood for something greater cowered (The proof in pudding to character and commitment to oaths.). While in some social networks it may be "cool" to engage in hate and corruption the truth is anything but. We can learn the peaceful, kind, encouraging, and persistence on values that will win at the end of the day no matter how many laws the clan breaks.

*This is a hypothetical philosophical thought experiment in which we will write a very positive ending. We must first explore what needs work and then discuss the abilty to improve. Take with a grian of salt and feel free to leave a message if you desire. 

Learning to Relay Pump and Draft with Fire Trucks

Firefighting is a demanding profession that requires both book knowledge and hands-on practical skills to ensure effectiveness and successful outcomes. A critical aspect of firefighting is knowing how to properly use the equipment to maximize efficiency. For example, flowing large volumes of water is often necessary to extinguish fires, so understanding fire trucks inside and out is essential.

The video below provides insight into water drafting and the process involved. You’ll notice the fire truck must be set to a specific gear with the pump engaged, and operators must monitor various dials to control the flow of water. Mastering this takes time—and even then, learning never truly ends.

Personally, I serve as a part-time firefighter when I can, and I enjoy being able to help out. Over the years, I’ve become familiar with most of the equipment and picked up a number of tactics along the way. It is a continuous learning process.

If you're interested in supporting a community-based fire department through a tax-deductible donation, feel free to message me. I’ll gladly connect you with the right people. Corporate donations for equipment are especially appreciated. Further, you should consider joining your local departments as most rural departments need good men and women. 

*This is part of a different project I'm working on. 

Art Formations and Clean Beaches in Escanaba and Gladstone (Could There Be More to the Story?)

Mysterious creature statues. 👽
Could be an image of their leader?

The weather is temperate as gentle waves lap at your feet. Walking along the beaches of Escanaba and Gladstone is one of those simple yet meaningful pleasures that enrich life. Every now and then, you might stumble upon beach art or strange, alien-like formations left behind from the evening before. This is a place where nature, creativity, and a clean environment come together to create a memorable experience. Take a half hour away from digital nomad work (or after your traditional job) and see the side of life you should enjoy more. 

Odd formations
Could there be aliens in Escanaba? 😝

You'll notice how remarkably clean the beaches are, thanks in part to the care shown by visitors. Personally, when I walk the shore, I make a point to pick up any trash I see and dispose of it properly—and I’ve seen others do the same. Clean beaches and spontaneous beach art add beauty to the outdoor experience. Both Escanaba and Gladstone’s shorelines are clearly well cared for and appreciated.

Perhaps what is more is that people care about their community?

A little infomration on Healthy Beaches and Healthy Lakes

(P.S. Buzz Lightyear was at Eagles Breakfast yesterday and then weird beach formations started showing up at the same time. 🤔 hmmmmmmmm! Word got out in the cosmo about the area. Local, regional, international, and intergalactic are all welcome  )

The other mysterious 
sighting in Gladstone.

Art Club Hub

Escanaba Log Jam was a Big Hit with Big Crowds!

The first-ever Escanaba Log Jam was a tremendous success, drawing crowds from across the region into downtown Escanaba. Several business owners I spoke with mentioned an uptick in both sales and foot traffic. Community members were buzzing with excitement, many expressing how much they enjoyed the event.

As a side note, the increased crowds created strong marketing-branding momentum. Events like the Log Jam can benefit local businesses by increasing exposure. Helping businesses capitalize on that foot traffic—through storefront engagement or event booths—could amplify the economic and cultural impact even more. Further, consider the long-tail marketing online of various well designed events that encourage media buzz buzz (p.s. Buzz Lightyear is at the Eagles Club breakfast this AM. Sometimes it is the small things that make the difference.).

Personally, I see this as a valuable opportunity to further develop branding that connects to the area’s rich heritage and current industries—such as Billerud. Interestingly, my own family has deep roots in the region, going back five generations in the Escanaba and Florence, WI areas. Many of them worked as log drivers, floating timber down the rivers—a dangerous but lucrative profession. You can review Logging Occupational Outlook and Michigan Forest History

Escanaba-Log Jam

Chamber of Commerce Delta County Log Jam

Log Rollers

Main Stage

12:30-2 p.m. Sit Down Francis
3-4:30 p.m. Sky Pilots
5:30-7 p.m. Stonewall
8-10 p.m. Them Pesky Kids

Side Stage
2-3 Dust Bunnies
4:30-5:30 p.m. Turbulence
7-8 p.m. Pick Stop

Center Court Stage
12:15 a.m.-1:45 p.m. Roman Around
2:45-4:15 p.m. Tony Crispigna
5:15-6:45 p.m. George Sailer

Great Lakes Timber Show
2-2:30 p.m.
4:30-5 p.m.
7-7:30 p.m.

Lumberjack Contests
10:30 a.m. – 6:30 p.m.

Vendors
10 a.m. – 8 p.m.

City of Escanaba City Council Meeting (June 19th, 2025): Upward Trajectory Growth, Development and Possibilities of Funding

The City of Escanaba: Growth and Development Update

The City of Escanaba continues to chart its course as a hub for investment, tourism, and entrepreneurship along the coast of Lake Michigan in Michigan’s Upper Peninsula. Over the past five years, the city has experienced a meaningful transformation, becoming an increasingly desirable place to live, work, and visit. This momentum is fueled by strong community engagement and dedicated local leadership—setting an example that other towns are beginning to study and emulate.

The collective commitment of local officials and residents is not only improving Escanaba’s economic outlook and quality of life, but it is also positioning the city as a model for revitalization across the region.

June 19th, 2025 Escanaba City Council Meeting Minutes and Video

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Highlights from the Escanaba City Council Meeting – June 19, 2025

Northern Initiatives Fund & Community Development Block Grant (CDBG) Program:
These funding sources are available to support local business development and could help launch new startups or expand existing operations. For entrepreneurs planning to start businesses in the near future, these programs could provide essential financial support—especially when combined with personal investment. The may be to foster downtown growth in ways that promote tourism, industry, and overall quality of life. Northern Initiatives Program and Community Development Block Grant (CDBG)

One strategic focus is on enhancing the exportation of high-value outputs—whether through goods (e.g., golf clubs, paper, metal fabrication), services (e.g., local suppliers, industry support, etc.), or experiences (e.g., cultural tourism, arts, etc.). These efforts aim to bring external revenue into the community, contributing to long-term sustainability. Drawing resources and revenue to maintain budgets and enhance local life is part of the overall process of fiscal solvency.

Other Council Items:

• Renewal of property and liability insurance.

• Acquisition of a new garbage truck and associated training.

• The city is in the black and fiscally solvent indicating strong local governance decision making practices.