Perspectives

Science parks are "buzzy clusters"

Professor John Allen

Encouraging a cluster of technology and science based businesses into a purpose built property development around the Tamaki campus of the University of Auckland is under serious study.

A group comprising the University of Auckland, the Ministry of Economic Development and Auckland City Council brought Professor John Allen to Auckland to discuss the option. Professor Allen is a UK based world-renowned expert in science and technology park development. Formerly chairman of the UK Science Parks Association and CEO and chairman of Manchester Science Park, Professor Allen has a wealth of experience in catalysing profitable science and technology parks. He believes they can ultimately help to define the image and brands of cities in which they are located.

The seven key offerings of science parks

Good environment and accommodation (the clustering effect)
Business support
Technology transfer opportunities
Incubation
'Grow on' support
Good environment for larger companies
Links to a reservoir of technology.

Professor Allen gave a public lecture in May at the University of Auckland's Business School explaining what a science park is and does. This is an abridged summary of his presentation.

"A science park is infrastructure for the support of knowledge-based businesses. It usually consists of a location - there must be somewhere for the companies to reside. The property itself is important, including its look, ambience and fitness for purpose. The whole physical environment can help science companies grow.

"Where companies grow together, you get a cluster effect: they are visible. If they are dotted around a city, they may not be visible. Together, they can help each other. In Charles Handy's words it's a "buzzy cluster" - it's exciting to be part of the group, and you can feel it when you go there. The effectiveness of grouping businesses has been demonstrated on a number of occasions.

"A focus on a formal or operational link with a research university is also important. A science park needs a 'reservoir of technology' nearby - something to exploit, through a link with a number of universities. Forging the links between the tertiary institutions and the tenant companies becomes vital. Management advice at hand is also imperative. Clustered science based businesses usually employ ex-researchers. They've been working in a technology based environment. In most cases the management, marketing, competition, production scheduling, financial control and structuring of the company - that is, the commercial parts of the company - are the biggest challenges, not the research. So the park needs management and commercial advice at hand.

"A science park is a long term project. It is not a quick fix. It takes up to a decade for the park to gain real momentum. Although you can see progress after four or five years, maturity takes at least a decade. In business terms, the park is a property development, with paying tenants. It needs to be properly managed and financed. It is not 'bolted on' to the university. Indeed, it can ultimately have a profound effect on the university's thinking, its entrepreneurial activity, and its academics.

"A good science park does not eat up public money, but is profitable. Just like any business, it needs investment to start with - pump priming, usually from the public sector - but it quickly becomes a business in itself, leasing accommodation to businesses. Its profit goes towards growing its own business and support services to its tenants.

"Science parks help cities make their mark amongst the world's league. A well developed park gradually makes a distinctive impact upon the economical and technological life of a region or city. It can ultimately have an impact upon the whole culture of the city and country.

"In Manchester, in the 1970s and 80s, all heavy industry in steel, textiles and shipbuilding was lost to China, Russia, India and Japan. There was huge unemployment which quickly became a major social problem. Regional governments initiated the Manchester Science Park largely out of crisis management to gain back employment, and the idea of creating a link to the university's technology was born. The park has been full since 1998 and now has 12 buildings in three locations. Its core business is providing property for companies who pay rent. They make a profit for the park, and the park in turn helps to grow the business.

"There is now a heavy emphasis on highly skilled employees at the park, but also a large number of local people employed in support as administrators, secretaries and technicians. In fact, the park café is a hub for knowledge exchange and entire business relationships have started there.

"Science parks do work. They can make a significant contribution to the knowledge economy. Overall, the commercial performance of tenants in the park is better than that of matched companies which are not in a park."

Published July 2008