1. Participatory Appraisal of Competitive Advantage in Thailand Progress and Experiences by SSIPP Ricarda Meissner 29. November 2002

2. Our Initial Expectations towards PACA Shared vision and coordinated action among players in a locality Local players are enabled to design strategies for SME promotion and LED Improved policy dialog between public and private sector Local players widen perspective and see SME promotion as part of a larger system (LED, global markets, etc..) Stakeholdes become efficient actor in implementing SME promotion programmes

3. Sequence of PACA Activites in SSIPP Start January 2002 with Training of 25 PACA Facilitators Start January 2002 with Training of 25 PACA Facilitators Road Shows Road Shows Selection of Locations and Negotiations with local stakeholders Selection of Locations and Negotiations with local stakeholders Completion of 4 full PACA projects and 2 sector-related ones Completion of 4 full PACA projects and 2 sector-related ones –Lampang (Northern ceramic and furniture town) –Chiang Rai ( Golden Triangle trade and tourism town) –Chiang Mai (Garment, Crafts Locations, Temples??) –Suphanburi (Agriculture and Food Industry) Development of Cluster and Value Chain projects as PACA follow- up Development of Cluster and Value Chain projects as PACA follow- up

4. Results of first Evaluation of SSIPPs PACA Approach Positive Experiences... Joint diagnosis of local stakeholders creates shared vision, group dynamics and initiates many innovative activities Joint diagnosis of local stakeholders creates shared vision, group dynamics and initiates many innovative activities Perfect instrument to build strong, output oriented stakeholder groups Perfect instrument to build strong, output oriented stakeholder groups Concept of competitive advantage improves perception of positioning in international and local marktes of sub sectors Concept of competitive advantage improves perception of positioning in international and local marktes of sub sectors Effective joint action of sub sectors are initiated Effective joint action of sub sectors are initiated Perfect tool to launch and initiate cluster promotions and promotion of value chain Perfect tool to launch and initiate cluster promotions and promotion of value chain

5. Examples: Lampang Ceramic Group jointly entered new markets in China and companies are selling now to Kunming Lampang Ceramic Group jointly entered new markets in China and companies are selling now to Kunming Lampang fundraised jointly for Cluster development program with IFCT Lampang fundraised jointly for Cluster development program with IFCT Lampang ceramic and tourism sector started cooperation and launched special award for hotel/ restaurants which use Lampang ceramics Lampang ceramic and tourism sector started cooperation and launched special award for hotel/ restaurants which use Lampang ceramics Lampang started tourist project: Visit of Ceramic Factory Lampang started tourist project: Visit of Ceramic Factory Chiang Rai tourism group organized itself and developed joint strategy Chiang Rai tourism group organized itself and developed joint strategy Garment Sector Chaing Mai started joint raw material sourcing Garment Sector Chaing Mai started joint raw material sourcing Furniture Group Chiang Mai started group for lobbying against regulations Furniture Group Chiang Mai started group for lobbying against regulations Governor Chiang Rai promotes PACA reports as guideline for all local government departments Governor Chiang Rai promotes PACA reports as guideline for all local government departments

6. ....and Problems Faced Concepts are complex and yet easily misunderstood Concepts are complex and yet easily misunderstood Approach requires excellent facilitation skills which local stakeholders and non- CEFE Trainers do not have Approach requires excellent facilitation skills which local stakeholders and non- CEFE Trainers do not have Implementation gets mixed up, deviated from standard recommendation and lacks depth and clarity Implementation gets mixed up, deviated from standard recommendation and lacks depth and clarity Some instruments to complicated for SSIPP Context, Sequence not clear, Diamond for LED diagnosis can be confusing Some instruments to complicated for SSIPP Context, Sequence not clear, Diamond for LED diagnosis can be confusing Stakeholders are sometimes too biased towards the competitive advantages of their locations-results are not necessarily correct Stakeholders are sometimes too biased towards the competitive advantages of their locations-results are not necessarily correct No clear guideline how to followup: Stakeholders are lost and start to initiate sometimes strange activities No clear guideline how to followup: Stakeholders are lost and start to initiate sometimes strange activities

7. SSIPPs Solution Investment into Simplicfications, Action Learning Elements, Group Plays, Examples, SLEs, PRA based Elements, etc. Investment into Simplicfications, Action Learning Elements, Group Plays, Examples, SLEs, PRA based Elements, etc. Development of new tools to supplement the missing links (for example Benchmarking, Custer mapping) Development of new tools to supplement the missing links (for example Benchmarking, Custer mapping) Development of detailed set of standard procedures concerning sequence, contents, logistics, facilitation, etc. Development of detailed set of standard procedures concerning sequence, contents, logistics, facilitation, etc. Quality Maintenance system Quality Maintenance system System for HRD Development and Licencing System for Facilitators System for HRD Development and Licencing System for Facilitators Development of Post PACA projects, in particular Cluster and Value Chain Promotion) Development of Post PACA projects, in particular Cluster and Value Chain Promotion)...and further development of PACA as a tool for Cluster promotion as per new Thai-German Cooperation Concepts...and further development of PACA as a tool for Cluster promotion as per new Thai-German Cooperation Concepts

8. Status and Progess of PACA in SSIPP PACA in Thailand will be more tool for sector and cluster promotion and for integration along value chains PACA in Thailand will be more tool for sector and cluster promotion and for integration along value chains Development of guidelines and quality system started and will be continued with a larger team in January 2003 Development of guidelines and quality system started and will be continued with a larger team in January 2003 Cluster promotion started with Scottish Enterprise Cluster promotion started with Scottish Enterprise Value Chain concepts in co-operation with the Supply Chain Center of the Federation of Thai Industries and ECR (Efficient Consumer Response Network Thailand) Value Chain concepts in co-operation with the Supply Chain Center of the Federation of Thai Industries and ECR (Efficient Consumer Response Network Thailand)

9. Post PACA Concepts Cluster Promotion

10. New Sector Strategy Working Group Meetings Organize Cluster Working Groups Action Group: Define Vision, Key Themes Working Group Co-Chairs Participants Working Group Co-Chairs Participants Initiative Team Cross-Cutting Initiative Teams Broad Vision, Strategy, Initiatives Key Themes New Business Propositions and Enabling Actions for Each Theme Cluster Promotion as Standard Concept of PACA in SSIPP Process Diagram for the Scottish Tourism Cluster MobiliseDiagnose CollaborateImplement

11. The Cluster Diamond Firm Strategy, Structure and Rivalry Demand Conditions Related and Supporting Industries Factor Conditions Continued innovation Vigorous competition Creative environment Demanding customers Customer/supplier relations Competitive advantage Close competition between firms to supply upstream industry Co-operative relationships Continual innovation High skill levels Continual upgrading Supporting institutions

12. Example: The Cluster Diamond - Ottawa Firm Strategy, Structure and Rivalry Demand Conditions Related and Supporting Industries Factor Conditions 1000 local high-tech firms Strong base of indigenous firms Well developed networking Technology demand Local demand allows comp advantage to be sustained Venture capital available at all stages Networks of business angels Specialist legal,tax and IP advice Specific Education courses High quality of life draws in immigrants Strong research hub

13. Generic cluster map Core of cluster Related and Supporting Industries Infrastructure & infraservices Upgrading & innovative institutions MARKETS DIRECT FINAL sophisticated less-sophisticated

14. Harbours, Airports Yards Oil & Gas Pipelines Industrial estates & other designated & serviced land Human Resource Agencies Comms & Power Networks Social o/head - houses, schools &c INFRASTRUCTURE & INFRASERVICES Petro chemicals Pharms Chems Plastics Motor & Aviation Conversion Heating & Aircon Electricity Spot markets MARKETS Cracking & Refining Gas Distribution Basic Petro- chemicals Exploration Operations and Production Process O&G Transport & Logistics Development CLUSTER CORE simplified version Management Knowledge & Information Expert Specialised FUNDING Sources Government & Licensing Authorities Health & Safety Authorities Information Brokers Training Bodies Incubator facilities UNIVERSITIES Targeted Industry Initiatives/ Networks TECHNOLOGY INSTITUTES Upgrading & innovative institutions POWER HEAT MOBILITY MATERIALS (HEALTH & SHELTER) Strategy & interface services Business services Consumables Operating services Development activities Direct support services Indirect support services Related and Supporting Industries simplified version OIL AND GAS CLUSTER

15. Example: BENCHMARKING FOR SCOTLANDS TOURISM CLUSTER Which? Costa Rica GermanyIreland New York Why? High level government support; add value through education; eco-tourism Leading destination; public sector-led; links across cluster (e.g. Visa); theme years branding; emotional tourism infrastructure (crime/entertainment); regeneration; branding; cluster was not the driver

16. Post PACA Concepts Promotion of Value Chain Efficiency

17. The Improved Supply Chain – Efficient Consumer Response Through Co-ordinated Action Coordination of Farmers Pesticide Management Traceability Coordination of Farmers Pesticide Management Traceability Logistics Management Standard Communication Systems Logistics Management Standard Communication Systems Benchmarking Quality Management Technology Transfer Testing and Calibration Services Compliance with Standards Benchmarking Quality Management Technology Transfer Testing and Calibration Services Compliance with Standards Flexible Financial Products Linkages and Partnerships Cluster Development Efficient Communication Bar Coding Efficient Consumer Response Linkages and Partnerships Cluster Development Efficient Communication Bar Coding Efficient Consumer Response PPP Transaction Management PPP Transaction Management Lower Transaction Costs Deregulation EDI Platforms Lower Transaction Costs Deregulation EDI Platforms From Typical Supply Chain…………… to Improved Supply Chain

18. Thank you for your Attention!