Investigation of the Machinery Sector in Styria
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Investigation of the Machinery Sector in Styria Second draft of the scientific report for IKINET Michael Steiner Michael Ploder Sandra Leitner JOANNEUM RESEARCH Institute of Technology and Regional Policy Elisabethstrasse 20 8010 Graz IKINET 2 TABLE OF CONTENT 1 SUMMARY AND INTERPRETATIONS................................................................ 5 1.1. The evolution of the “Cluster”......................................................................... 5 1.2. Attributes of the cluster reflected by the internal structure of the participating Firms ................................................................................................................ 6 1.3. Innovation processes........................................................................................ 7 1.4. Relationships with local actors ........................................................................ 8 1.5. Relationships with national and international actors ....................................... 8 1.6. Policy intervention and support for innovating firms...................................... 9 2 INTRODUCTION - APPROACH AND REGIONAL CONTEXT........................ 10 2.1. The approach.................................................................................................. 10 2.2. Description of the region in the national context and the historical regional economic background with respect to the project IKINET ........................... 12 2.2.1 The R&D-location Styria............................................................................ 13 2.2.2 Overcoming historical structural problems ................................................ 15 2.2.3 Sectoral specialization patterns .................................................................. 18 3 EXCURSUS: DIFFERING AND CHANGING RULES OF INTERACTION ALONG THE VALUE-CHAIN IN THE MACHINERY SECTOR ............................. 23 3.1.1 Original Equipment Manufacturers resp. System Integrators .................... 26 3.1.2 Local tier 1 system suppliers ...................................................................... 26 3.1.3 Extended workbenches of international Tier 1 system suppliers ............... 27 3.1.4 Firms with a strong focus on toolmaking ................................................... 27 3.1.5 Firms in the field of Plastics Technology with a strong focus on tool- making ........................................................................................................ 28 3.1.6 Firms in the field of Hardening and Surface technology ........................... 28 4 BUSINESS SERVICE FIRMS AND THEIR PROFILE: ....................................... 29 5 R&D-INSTITUTIONS AND THEIR PROFILE: ................................................... 31 6 POLICY-AGENTS AND INTERMEDIATES AND THEIR PROFILE: .............. 34 7 FINANCIAL SERVICES AND THEIR PROFILE: ............................................... 38 8 THE EVOLUTION OF THE SECTORAL NETWORK ........................................ 40 8.1. Buyer supplier selations – the dimension of physical exchange.................... 42 8.1.1 Condensations in the field of automobile suppliers industry ..................... 43 8.1.2 Condensations in the field of polymer and plastics processing.................. 45 8.1.3 Condensations in niches beyond large volume automobile industry in the field of racing parts..................................................................................... 46 8.1.4 Familial networks and strict division of labour along the knowledge value chain in the field of measuring ................................................................... 46 8.2. Linkages between industry, engineering services and science ...................... 47 9 ATTRIBUTES OF THE CLUSTER REFLECTED BY THE INTERNAL STRUCTURE OF THE PARTICIPATING FIRMS...................................................... 50 9.1. Employment and qualification....................................................................... 50 9.2. Organization and management style.............................................................. 53 IKINET 3 10 INNOVATION HISTORY AND PROCESSES OF INNOVATION ................. 55 10.1. The industrial firms and Their R&D and Innovation profile......................... 56 10.1.1 R&D and innovation in Magna Steyr Fahrzeugtechnik.......................... 56 10.1.2 R&D and innovation in Magna Powertrain ............................................ 57 10.1.3 R&D and innovation in Anton Paar ........................................................ 58 10.1.4 R&D in Pankl Racing Systems ............................................................... 59 10.1.5 R&D and innovation in firm A ............................................................... 60 10.1.6 R&D and innovation in firm F ................................................................ 60 10.1.7 R&D and innovation in firm H ............................................................... 60 10.2. The Business service Firms and their R&D and Innovation profile.............. 61 10.2.1 R&D and innovation in firm O ............................................................... 61 10.2.2 R&D and innovation in firm S ................................................................ 61 10.2.3 R&D and innovation in firm R................................................................ 62 10.2.4 R&D and innovation in firm Q ............................................................... 62 10.2.5 R&D and innovation in the Laboratory for measuring technologies of firm P....................................................................................................... 62 10.3. General chacterization of innovation in the cluster ....................................... 63 10.4. Future innovation........................................................................................... 64 10.4.1 Financing of innovation .......................................................................... 65 11 RELATIONSHIPS OF LOCAL ACTORS .......................................................... 67 12 RELATIONSHIPS WITH NATIONAL OR INTERNATIONAL ACTORS ..... 70 13 POLICY IMPLEMENTATION: IMPRESSIONS FROM A POLICY AND INTERMEDIATES PERSPECTIVE ............................................................................. 72 IKINET 4 FIGURES Figure 1 Regional Map of Styria and its Districts.......................................................... 13 Figure 2 Regional R&D-Rates (GERD/BRP) in Austria in 2002 .................................. 14 Figure 3 The Styrian Participation in the 6th Framework-Program............................... 14 Figure 4 The Unemployment-rate of Styria compared to the Austrian average ............ 16 Figure 5 Share of turnover by “young” products and services resp. market novelties in Styria............................................................................................................................... 17 Figure 6 Per capita GRP in Styria compared to the Austrian and the EU-Average....... 17 Figure 7 Economic Growth (GRP) in 2004 in Styria and other Regions in Austria ...... 18 Figure 8 Sectorial Structure of the Manufacturing Sector in Styria............................... 19 Figure 9 Significance of employment in Manufacturing industries for the regional economy of Styria........................................................................................................... 20 Figure 10 Share of technical Engineers in total Employment (Index: Austria = 100) ... 21 Figure 11 Share of Styria in total Austrian exports of goods in different sectors .......... 22 Figure 12 Direct linkages between selected players in Policy, Science and Economy.. 34 Figure 13 Buyer Supplier Relations among the industrial firms in the investigation ... 43 Figure 14 Institutionalized Relationships between industrial firms, engineering-services and .the knowledge infrastructure in Styria.................................................................... 48 IKINET 5 1 Summary and interpretations The machinery sector in Styria as a network of firms linked by various activities does not have a determining centre in the nature of a leading firm overruling external demand. To make allowance for the entirely different types of vertical supplier networks which have been observed in the first round of qualitative in- terviews four main discussion-partners have been chosen for IKINET: Magna Steyr Fahrzeugtechnik (MSFT), Magna Powertrain1, Pankl Racing Systems, Anton Paar GmbH These firms belong to different sub-sectors of the machinery sector and culti- vate different supply-chain and innovation-strategies. Nevertheless common suppliers exist especially in the field of material and surface technology. Despite this the latter point is not decisive for the inclusion of an enterprise into the group of investigated firms. The investigation of the Styrian Machinery Sector and its network and coopera- tion structures (which are evidently developing und continuously rearranging) might be a good exercise to find policy implications beyond idealized Clusters following the Porter-Diamond and tense buyer-supplier relationships. The evolu- tion of sectoral networks and clusters in Styria has been accompanied by a consequential advancement of the institutional landscape and the portfolio of policy measures during the past years 1.1. THE EVOLUTION OF THE “CLUSTER” At the first glance the machinery sector in Styria seems to be dominated by the automobile sector. Since this activity exhibited the highest growth rate in the recent past - as an organized cluster