Bite-size Case Study

Silicon Valley: learning in a high-skill eco-system

Published on March 29, 2020 Originally recorded 2011   4 min
0:03
Silicon valley is an exceptionally good example. What David Finegold calls, a high skills ecosystem. There you can find an intense geographical cluster, high-tech firms that fed by the proximity to prestigious universities. Not only has UCLA got a number of campuses there, so Berkeley, San Francisco, San Diego, and Los Angeles, but also this really high-quality private institutions like Stanford, the University of Southern California, the California Institute of Technology. These provide expert labor, research and expertise, and interests for start-up companies. Remember that William Hewitt and David Packard were graduates of Stanford. There's also infrastructure there in terms of airport, rail, and of course, exceptional high-tech technology links with communications and infrastructure to support the organizations. There's financial support in terms of venture capital. The low levels of regulation make it extremely easy both to set up organizations and to go bankrupt to declare chapter 11. Networks of firms provide extensive support in developing new projects and markets. Individuals tend to learn from each over in loose professional associations. Now classically, you would expect that free market structure to have very little formal training. That is absolutely true. There are evening courses which individuals fund and of course, there's the formal education provided by the universities, but in work, there are very few formal courses. However, what that is, is a constant stream of challenging work. Many of the individuals here are engaged in work, whether on the cutting edge, they are among the first people to be doing these tasks. So of course, it would be utterly inappropriate to try and seek advice from pre-set programs because they simply haven't caught up with this. So what individuals do when they hit challenges is tap into their own networks, consult fellow experts. In this environment, interestingly enough, the labor mobility that normally damages training because firms won't invest in individuals if they think they're likely to lose them to competitors, actually helps develop expertise across the ecosystem because individuals are moving from firm to firm, taking their expertise with them, sharing it, and learning from the new environments. So in this high skills ecosystem, you've actually got a voluntary system working extremely well. This unstructured ecosystem is probably the best way to support the most expert working at the cutting edge. Remember, the USA strengths are in areas like filmmaking, so Hollywood and other high skills ecosystem, on biotechnology, on certain aspects of engineering, all areas that are very well supported by an excellent higher education system, and by the liberality of the ecosystem that allows this development.
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Silicon Valley: learning in a high-skill eco-system

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