Clusters Can Help MSMEs Cope with “Day After”
In the context of the COVID-19 crisis, solutions need to be identified and implemented in the short to medium term to help companies weather the storm and be able to revive their productive activity as soon as possible.
It is becoming increasingly relevant to consider the strengthening of collaboration and linkages between companies and organizations within a specific sector, production chain or market segment and within a given geographical location. In short, to create and develop clusters.
The benefits of this joint work include: increased productivity of SMEs driven by specialization, economies of scale with a subsequent cost reduction, promotion of innovation, creation of new business opportunities, increased productivity, improvement of sectoral competitiveness, access to contestable funds, production cycle stability, among others.
One case study is the mining cluster created in Peru’s southern macro region (CMSP) over the last year with the aim of developing and implementing an open innovation platform that enables the development of suppliers in the sector and create solutions to the great operational challenges of the mining sector. The initiative aims to encourage and implement an institutional structure and governance suitable for the proper functioning of the CMSP and long-term sustainability, forging cooperative ties by connecting with more sophisticated benchmark ecosystems, such as Australia and Chile, capitalize on their experiences and lessons learned.
The activities included the launch of the CMSP Open Innovation Program, in which mining companies Anglo American Quellaveco, Hudbay Peru and Southern Peru were actively involved. The Program initially identified more than 30 challenges that were subsequently narrowed down to a final selection, together with the representatives of the mining companies, of eight tasks that met the strategic objectives of these companies. Subsequently, during the tendering process for interested suppliers, a total of 42 solution proposals were received, which were evaluated by users, in order to identify those with greater feasibility from a technical and operational standpoint.
Thus, through collaborative work, agreements are expected to be reached between mining companies and suppliers in order to develop proposals that meet the operational and technological needs of the mining companies, in an effort to enhance the capabilities of suppliers in order for them to become local strategic partners of large companies. This is the first activity of an initiative that was conceived with the goal of involving these and other mining companies of the area, as well as encouraging collaborative relations with other important stakeholders such as academia, suppliers, professional associations, national, regional and local governments, regions, among others.
At the same time, work has been developed on other essential components to build the sustainability of the CMSP. In the area of governance, a steering committee has been set up, with representatives of the private sector and industry experts, both nationally and internationally, to build a strategic and long-term vision of the work that the cluster needs to do; an initial survey of the mining ecosystem of the southern macro region was conducted with the main groups of stakeholders, with the purpose of producing a detailed knowledge base of such ecosystem and related subsectors; a technical visit of Peruvian suppliers to Melbourne, Australia was organized, in order to have stakeholders come into contact with a more developed mining ecosystem and, to learn about cutting-edge technologies and close collaborative work carried out by mining companies and suppliers (METS).
In terms of competitiveness, once the main needs and opportunities to boost industry competitiveness with concrete and short-term initiatives have been identified, preliminary proposals were developed along three lines of action: optimization of the use of resources generated by mining, improvement of mining permit procedures and development of infrastructure for competitiveness.
Once we have taken stock of the activities after the first year, we can say that the CMSP is forging cooperative ties between the different representative stakeholders of the mining sector and building capacities and instruments that enable an adequate articulation of the different links in the production chain. Associative work is now pivotal as an instrument to identify the specific needs of stakeholders and subsequently find solutions that aim at mutual benefit and appropriate profitability for each party.
Faced with the dilemma of investing in technologies and solutions that boost productive efficiency in the medium term or the need to tackle priorities and taking urgent measures as a result of the COVID-19 crisis, it is important to highlight some of the advantages that the cluster may offer SMEs in the sector and that will help this business segment. The economies of scale that can be achieved by working together to engage in large-scale activities and projects that could not be tackled individually, cross-fertilization achieved through the generation of innovative and technological knowledge, the creation of disruptive products as a result of the generation of new businesses, and easier access to new markets that mining companies have already tapped into in previous years.
Finally, since their conception, such initiatives should be designed with a long-term vision, where the involvement and leadership of top management of companies is a pivotal factor in the search for sustainability of the sectors.
