Borderless Innovation

Crossborder Clusters, Competitiveness, & Strategies for New Clusters

Introduction

Kenn Morris

President & CEO of Crossborder Group Inc.

California-based crossborder market research and strategic consulting firm specializing in border business and policy

Former Director of UCSD San Diego Dialogues Crossborder Innovation & Competitiveness Initiative Lead researcher and lead author of Borderless Innovation report

Done in collaboration w/ Gobierno de Baja California, y CENTRIS

Overview of Comments

Borderless Innovation & Crossborder Technology Clusters in San DiegoBaja California Lessons for Crossborder Technology Clusters in US-Mexico Border Growing New Crossborder Cluster in Life Sciences

Borderless Innovation

www.SanDiegoDialogue.org/borderless.htm

English & Spanish (although)

A Regional Approach to Borderless Innovation

San Diego & Baja California: region of innovation, R&D, technology manufacturing Given economic & social linkages, felt that a latent opportunity to catalyze regional synergies was possible

But no comparable data existed

across the border

Crossborder Innovation & Competitiveness Initiative: identify clusters of opportunity in high value-added sectors in the binational region Focus on selected technology intensive clusters: biomedical devices, aerospace & defense, software, biotech, and others

SD-Baja Cluster Findings

Biomedical Devices

Over 30,000 employed in Cluster (2003)

San Diego: 6,800 Baja California: 23,700

BC: highest number of FDA-certified BD companies in Mexico (65+)

Many: Class 10,000 & 100,000 clean rooms 13 had HQ or operations in SD County

Sophisticated range of products heart pumps & stents, lenses, pacemakers, more

SD-Baja Cluster Findings

Aerospace & Defense

Over 23,000 employed in Cluster

(2003)

San Diego: 18,300 Baja California: 4,800

BC has highest concentration of aerospace companies in Mexico Knew that San Diego was regrowing cluster after major declines in 1990s

Binational S&T Workforce

Larger than expected, and growing

Surveyed large regional universities More Borderless technology graduates than known:

FACT: More engineering degrees issued by major BC universities than in SD (industrial)

Binational Software Degrees

A PerspectiveChanging Result

Most of San Diegos software industry leaders assumed very few software graduates in Baja California Very surprised that UABC graduated more individuals with software degrees than UCSD

Why did we do the Borderless Innovation study? What did we learn?

San Diego & Baja CA are worried about sustainable competitiveness

World is Flat: More than just China & India

Large number of existing and emerging regions of technology & innovation across globe Next two decades: China & India. After that?

Lesson: Broader Implications

Implications for Californias tech industries

Biomedical devices: Over 53,000 employed in CA Aerospace (Southern California) Automotive Software Semiconductors

and all other USMexico border states

Example: Aerospace & Defense

Within 1000 miles of Phoenix, most of US and Mexico aerospace employment

35% of US aerospace employment in 4 US border states

Arizona & Sonora: Major concentration of aerospace companies (Raytheon,

Honeywell, Boeing, etc.)

With good data: potential for 4 State Aerospace Strategy and Marketing

Example: Semiconductors & Silicon Border

Silicon Border Technology park in Mexicali, goal of 12 semiconductor fabrication facilities If successfulpotential synergy with technology industries in all US-Mexico border states

Growing New Crossborder Life Sciences Clusters & Observations

New Cluster Research: Life Science

UCSD-Merck project 4 Regions (plus one):

Nuevo Leon Guanajuato Jalisco Morelos Plus: Baja CA Doctoral and Masters degree graduates Existing facilities & linkages to US-biotech industry

Why these?

Life Sciences: What Were Seeing

Excellent research, some facilities are world class, some have incubator and contract research space Science is world class, but small number of highly capable scientists

Life Sciences: What Were Seeing

Increasing number of SNI researchers in key states Emerging risk capital in some regions (not all) Need to communicate better what resources they have (Google Metric) Butlittle experience with commercializing innovationsand

Google Metric: " Biotechnology"

china biotechnology 7,500,000 15,000,000
11,700,000 7,280,000 2,680,000 2,155,000 1,835,000 136,500 82,900 82,700 54,600

california biotechnology india biotechnology "san diego" biotechnology mexico biotechnology monterrey biotechnology guadalajara biotechnology "baja california" biotechnology "nuevo leon" biotechnology

Cluster Growth: A Culture of Innovation

Future cluster growth will require incentives and growing culture of innovation Large part of this relates to new innovations and patents

400 350 300 250 200 150 100 50 0 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

Patents by Mexican Innovators (Mexico & US)

Trend not positive

Often, incentive is to publish, not patent

Published research undermines IP of Mexican innovations

Mex Patents Granted to Mex Applicants US Patents Granted to Mex Applicants

New mechanisms: provisional patents in Mex?

Beyond Borderless Innovation

Potential for North American Crossborder Innovation & Competitiveness Initiative?

Take concept beyond San Diego-Baja California: Need additional data and regional assessments in border states of clusters of innovation & opportunity Some hope: North American Council on Competitiveness, and emerging regional economic development agreements

Such data is CRITICAL to civic and industry leaders to promote a new binational vision of clusters and economic development Opportunity to catalyze technology clusters and competitiveness if we choose path of Borderless Innovation

Borderless Innovation
Thank You Gracias
Kenn Morris
kenn@crossborderbusiness.com

CrossborderBusiness.com
Copies of Borderless Innovation report:

www.sandiegodialogue.org