Umeå University's logo

Purpose– The purpose of this paper is to construct a process theory of cluster development, in order to complement the many studies focusing on the factors that determine successful clusters.

Design/methodology/approach– This theory-building effort relies on event-driven methodology, which triangulates narratives collected at different points in time with other documented materials, in order to trace cluster development over a six-year period. The empirical data are analysed according to theoretical classes formed a priori and anchored in Aldrich’s framework of emergence, events and consequences. The idea is to identify critical events that subsequently inform theory development.

Findings– The authors show that three critical processes drive sustainable cluster development: the exploitation of current opportunities, the exploration of future opportunities, and processes that facilitate the balancing of the two. Whereas the conceptual focus in the extant literature is on exploration and exploitation processes, the authors find that balancing processes are also critical.

Practical implications– The paper’s findings are of practical relevance to private and public policy makers with regard to the management and financing of balancing mechanisms that help to secure sustainable development. The authors will continue to follow the development of this specific cluster in order to identify a wider range of sub-processes that contribute to the long-term viability of clusters in general.

Originality/value– This work is original in the sense that it extends March’s exploration and exploitation theory, applies it to the inter-organisational context of clusters, and links the two processes through a process of balancing. The empirical evidence and the methodological approach used contribute in terms of building a “real process theory”, according to Aldrich’s specification of an event-driven research approach.