Evaluation of business cluster performance during its lifecycle

Abstract

Business clusters as geographic groupings of firms and other organizations and associated institutions are for more than two decades considered to be the efficient instrument in regional and industrial policies which enable to increase the innovation and competitiveness of firms and other institutions and regions. The assessment of their benefits and performance is an issue often discussed in professional literature with various approaches. The composition and structure of clusters develop during their lifecycle from establishment to maturity or decay and diff erent parts of firms in cluster contribute to cluster results in a variety of ways. The main aim of paper is to design a methodology for evaluation of business cluster performance during its lifecycle based on cluster analysis and time series analysis of business clusters and to reveal which parts of clusters called sub-clusters exert the decisive impact on business indicators by which the performance may be measured and to predict the future development of cluster and its parts. The methodology is verified on the case of the Czech machinery cluster with the longest life time in the Czech Republic. The results show that development of cluster is significantly aff ected by its structure and by performance of firms in sub-clusters.