Borderless Innovation…
Maintaining Competitiveness in the
21st Century
Introduction

Kenn Morris

Founder & Director of Crossborder
Business Associates



California-based crossborder market
research and strategic consulting firm
specializing in border business and policy
Former Director of UCSD San Diego
Dialogue’s Crossborder Innovation &
Competitiveness Initiative
Lead researcher and lead author of
Dialogue’s Borderless Innovation
report
Overview of Comments

Context of Challenge:
Why Worry?

Border & NAFTA:
Outdated Paradigm
Vision for Borderless
Innovation in San
Diego-Baja California
Region
Application of vision
to Arizona-Mexico,
border states, and
North America


21st Century Competitiveness: Why Worry?

“World is Flat”: More than just China & India


China: long term challenge
Regional tech clusters: Large number of existing –
and emerging – regions of technology & innovation
across globe


Many regional economic development strategies not prepared
An issue for US, Mexico…and North America
Why Worry?

Despite existing economic &
social linkages, US-Mexico
relationship stuck at “border”

Few cases of open, public
dialogue about weakening North
American competitiveness

Fewer examples of policy leaders
working to foster new paradigm
for North America

New vision beyond NAFTA
needed
A Regional Approach to
Borderless Innovation

San Diego & Baja California: region of innovation, R&D,
technology manufacturing

Given economic & social linkages, felt that a latent
opportunity to catalyze regional synergies was possible…

…But no comparable data existed

Crossborder Innovation & Competitiveness Initiative: identify
“clusters of opportunity” in high value-added sectors in the
binational region

Focus on selected technology intensive clusters: biomedical
devices, aerospace & defense, software, and others
Cluster Findings

Biomedical Devices

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Over 30,000 employed in Cluster (2003)

San Diego: 6,800

Baja California: 23,700
BC: highest number of FDA-certified
BD companies in Mexico (65+)

Many: Class 10,000 & 100,000 clean rooms

13 had HQ or operations in SD County
Range of products – heart pumps &
stents, lenses, pacemakers, more…
Cluster Findings

Aerospace & Defense

Over 23,000 employed in Cluster
(2003)




San Diego: 18,300

Baja California: 4,800
BC has highest concentration of
aerospace companies in Mexico
Mexico: 9th largest aerospace
supplier to US
US-MX BASA agreement pending
Binational S&T Workforce

…Larger than expected,
and growing


Surveyed large regional
universities
Issuance of engineering
and software of note:


More engineering degrees
issued by major BC
universities than in SD
(…industrial)
UABC graduated more
individuals with software
degrees than UCSD
A New Regional Model for SD-BC

Recommendations for San Diego-Baja
California
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Crossborder Innovation & Competitiveness Centers
(leverage existing organizations and institutions)
Research and comparable S&T data (foster
understanding)
Private investor networks (foster investing)
Increased educational linkages (physical & online)
and regional workforce training programs
Promote shared infrastructure investments (energy,
water, digital)
Increased security integration & enforcement
…Realized: Broader Implications

Implications for all of
California

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Biomedical devices: Over
53,000 employed in CA
Aerospace (Southern California)
Automotive
Software
Semiconductors
…As well as the USMexico border states
Implications: Aerospace & Defense

AZ: Large concentation of
aerospace companies (Raytheon,
Honeywell, Boeing, etc.)

Aerospace education: EmbryRiddle, U of A, Maricopa
Community College…and the
ASU/ITESM crossborder Masters
degree in Aerospace Logistics

35% of US aerospace employment
in 4 US border states

Within 1100 miles of Phoenix,
most of aerospace employment in
the US and Mexico

Sept. 26th: Mexican Aerospace
Conference…in Scottsdale
…Implications: Silicon Border

Technology park in Mexicali, goal of 1-2 Fab facilities

If successful…potential synergy with CA and AZ
semiconductor clusters (esp. Intel, Motorola, TI, Freescale, etc.)

… Not to mention concentration of semiconductor
related employment (160k+) in 4 US border states
A Model – for the 21st Century
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North American Crossborder Innovation & Competitiveness
Initiative?

Take concept beyond San Diego-Baja California

Requires regional assessments in border states, and
analysis of city-city and region-region “clusters of innovation
& opportunity”
Some hope:

North American Council on Competitiveness

Emerging understanding of regional opportunities and
economic development agreements (AZ-Sonora, maquiladora
supplier promotion of TREO)
Opportunity for “Third Nation” to catalyze technology
manufacturing and competitiveness for 21st Century – if we
choose path of Borderless Innovation
Borderless Innovation…
Maintaining Competitiveness in the 21st Century
Thank You – Gracias
Kenn Morris
kenn@crossborderbusiness.com
CrossborderBusiness.com
Copies of Borderless Innovation report:
www.sandiegodialogue.org