Introduction
Companies today enjoy a global marketplace with ease of access through the World Wide Web. Components can be developed and purchased globally with labor intensive products sourced to areas of cheaper labor. Supply chains crisscross the globe creating extra effort in management due to the distances and lag times associated with time zones. Add to this the increasing costs of material movement, and you have a recipe for chasing competition that you will never catch if your competition happens to be those using and developing clusters.
What Is a Cluster?
Porter (1998) defines a cluster as:
… geographic concentrations of interconnected companies and institutions in a particular field. Clusters encompass an array of linked industries and other entities important to competition. (p. 78)
The key word is geographic. Porter suggests that when firms operate in one location, the repeated interactions among them boost competition, improve productivity, innovation and coordination, and build trust (DeWitt et al., 2006). In our Amish case study, we see this close coordination and sharing of resources in the localized area of one county in Ohio for furniture building. Building various furniture pieces is the particular field requirement of the cluster that starts with specialization of timber processing through the various stages of linked industries to produce the final product for sale. The close proximity of the industry players leads to innovation, efficiency, relationships, knowledge sharing, and motivation for all to have success. This linked industry provides an ample supply of knowledgeable personnel reducing the added costs of recruitment. It is just much easier conducting business when all the players are in the same ...