Metamorphosis of cluster for survival and keeping competitiveness in the global market: Comparative research on Japan's Tsubame cluster and Silicon Valley

Tsubame-Sanjo (hereafter called Tsubame) is one of the world's top class precise metalworking cluster located in Nigata prefecture Japan. Tsubame cluster has 400 years history and changed the major products or processing objects from time to time at least seven different products for adapting to the domestic or global market needs through various type of innovations. During 1980s Tsubame was the world's top position as table ware manufacturing center. After losing the competitiveness toward Asian tableware manufacturers, Tsubame has created the new type of the cluster with wide diversification and sub-clusters which have mutual net workings. Some companies have world top class precise metal processing capabilities which were used for manufacturing one hundred millions of iPod cases. Silicon Valley on the other hand boasts 100 years of history and has formed the strongest industrial cluster in the world while implementing substantial changes in its core industries. The results of a historical comparison of the core industries of Silicon Valley and Japan's Tsubame cluster show that both are characterized by a different style of cluster transformation. Silicon Valley promotes cumulative change through product innovation, whereas the Tsubame cluster embraces changes in process technology.