HomeMy WebLinkAbout12- Imaging a Future for the Big Sky Optics Cluster by Regional Technology Strategies Prepared for MT Governor's Office of Economic Development 1
Imaging
a
Future
for
the
Big
Sky
Optics
Cluster
Prepared
for
the
Montana
Governor’s
Office
of
Economic
Development
October
2012
Regional
Technology
Strategies
205
Lloyd
Street,
Suite
210
Carrboro,
North
Carolina
27510
919-‐933-‐6699
www.rtsinc.org
2
Table
of
Contents
Introduction
and
Purpose
.......................................................................................................
3
Defining
Terms
.......................................................................................................................
4
Industry
versus
Cluster
...........................................................................................................................................................
4
Optics,
Photonics,
et
al…
.........................................................................................................................................................
5
The
Optics
Industry
................................................................................................................
6
Description
...................................................................................................................................................................................
6
Market
Size
...................................................................................................................................................................................
6
National
And
Multinational
Optics
Industry
Development
Approaches
And
Strategies
...........
7
An
Optics/Photonics
Cluster
Inventory
...................................................................................
8
Defining
the
Optics
Industry
in
Montana
..............................................................................
11
Does
Montana
Have
The
Ingredients
for
an
Optics
Cluster?
..................................................
15
Infrastructure
.......................................................................................................................
17
The
Optical
Technology
Center
(OpTeC)
......................................................................................................................
17
Spectrum
Lab
............................................................................................................................................................................
18
Montana
Manufacturing
Extension
Center
..................................................................................................................
18
TechLink
and
MilTech
..........................................................................................................................................................
18
Cluster
Profile
and
Development
Assessment
.......................................................................
19
Optics
Company
Respondents
Group
Profile
.............................................................................................................
19
Company
Characteristics
......................................................................................................................................................
19
Business
Needs
and
Issues
....................................................................................................................................................
20
Networking
Interest
................................................................................................................................................................
21
Competitiveness
Factor
Profile
........................................................................................................................................
21
Findings
................................................................................................................................
26
An
International
and
National
Context
.........................................................................................................................
26
Pinning
Down
the
Optics
Industry
in
Montana
.........................................................................................................
27
Infrastructure
.............................................................................................................................................................................
28
Optics
Company
Survey
Responses
................................................................................................................................
29
Competitiveness
Assessment
Summary
.......................................................................................................................
29
Clearing
the
Development
Path:
The
Optics
Cluster
Strategy
...............................................
31
Actions
.........................................................................................................................................................................................
32
Marketing
Considerations
For
the
Governor’s
Office
of
Economic
Development
And
The
Economic
Development
Community
...................................................................................................................................................
35
Appendix
A:
MT
Optics
Company
Survey
Instrument
............................................................
36
3
Imaging a Future for the Big Sky Optics Cluster
Introduction and Purpose
In
2002
RTS
analyzed
and
mapped
the
presence
of
IT
firms
and
their
support
infrastructure
as
part
of
its
cluster
development
strategy
for
the
Governor’s
Office
of
Economic
Development
(GOED).
During
the
course
of
this
analysis
we
discovered
11
companies
in
Montana
that
engaged
in
research
and
manufacturing
of
high-‐technology
optical
products.
At
that
time
the
focus
was
on
laser
products
and
components,
but
also
included
thermoelectric
controls,
electro-‐optic
sensors,
sensor
instrumentation
and
a
number
of
other
products.
Even
more
interesting,
ten
of
the
firms
were
located
in
Bozeman,
in
close
proximity
to
Montana
State
University
where
the
Optical
Technology
Center
(OpTeC)
and
the
Spectrum
Lab
conduct
research
in
electro-‐optics
and
develop
multi-‐spectral
optical
concepts
into
prototype
systems.
The
two
centers
worked
closely
with
each
other
and
the
Center
for
Computational
Biology
(CCB),
also
at
Montana
State
University.
The
local
companies
appeared
to
have
strong
ties
to
the
university
centers
and
often
collaborated
with
them
in
the
development
of
new
application
potentials
in
optical
fields.
The
optics-‐related
companies
were
very
research-‐intensive
and
accounted
for
a
total
of
approximately
250
mostly
high-‐tech
jobs
in
Bozeman.
Although
this
group
of
companies
did
not
show
a
tight
fit
within
what
were
then
generally
accepted
IT
sector
or
cluster
definitions
we
decided
to
“wedge”
them
into
the
on-‐going
IT
cluster
analysis
for
three
reasons.
1. A
huge
number
of
the
optics-‐related
technology
domain
applications
were
in
IT,
telecommunications,
and
computing-‐based
products,
services
and
companies.
2. Because
almost
all
the
firms
were
located
in
a
small
geographic
area
that
also
contained
a
research
university
with
two
R&D
centers
with
optics-‐related
missions
and
that
often
support
these
companies,
in
our
opinion,
this
represented
the
kind
of
robust
concentration
of
knowledge-‐based
companies
and
resources
that
could
grow
into
a
major
economic
development
opportunity
not
just
for
the
region,
but
for
the
state
as
a
whole.
3. We
wanted
to
make
sure
this
group
of
firms
was
noted
somewhere
as
an
asset.
At
the
time
this
concentration
of
potential
high
impact
firms
was
not
really
on
anyone’s
radar
outside
of
Bozeman
so
it
was
not
widely
regarded
as
a
potentially
significant
economic
development
asset.
We
wanted
to
make
sure
this
optics-‐
related
existence
was
captured
and
noted
even
though
it
was
beyond
the
purview
of
our
IT
cluster
analysis
to
pursue
a
separate
development
strategy.
In
the
original
IT
cluster
analysis
we
devoted
a
short
section
to
this
group
of
firms
and
benchmarked
it
against
the
optics
cluster
in
Colorado
that
at
the
time
included
about
150
firms.
This
group
has
continued
to
follow
a
cluster
development
path
since
that
time.
At
present
the
Montana
Manufacturing
Extension
Center
(MMEC)
has
identified
27
optics
4
and
photonics
firms
in
the
state.
The
group
in
Bozeman
has
more
than
doubled
in
size
and
now
contains
at
least
28
companies.
Like
IT,
optics
and
photonics
technology
as
an
industry
–
as
a
technology
platform
–
as
a
product
–
as
a
service
–
is
now
ubiquitous.
In
addition
to
being
an
industry
in
and
of
itself,
it
has
become
an
enabler
for
all
the
others.
Building
on
the
insightful
MMEC
work,
this
report
supports
this
burgeoning
Montana
economic
development
opportunity
by
offering
an
assessment
of
this
optics
cluster
and
a
strategy
for
the
state
to
support
its
continued
development
based
on
an
understanding
of
the
competitiveness
needs
and
opportunities
for
its
companies
and
the
optics
cluster
innovation
infrastructure.
Defining Terms
Industry versus Cluster
The
terms
“industry”
and
“cluster”
are
not
used
interchangeably.
Although
there
are
many
versions,
“Industry”
is
typically
defined
as
some
form
of
organized
economic
activity
connected
with
the
production,
manufacture,
or
construction
of
a
particular
product
or
service
or
range
of
products
or
services.
This
analysis
employs
a
variation
of
the
“cluster”
definition
developed
and
used
by
RTS
in
numerous
publications
over
the
last
seventeen
years
including
two
publications
for
the
National
Governor’s
Association,
A
Governor’s
Guide
to
Cluster-‐Based
Economic
Development
(2002)
and
Innovation
America:
Cluster-‐Based
Strategies
for
Growing
State
Economies
(2007).
“Cluster””
herein
is
defined
as
a
“geographic
concentration
of
interrelated
competitive
firms
and
institutions
of
sufficient
scale
to
generate
external
economies…making
the
whole
greater
than
the
sum
of
its
parts.”
Clusters
exist
whether
or
not
states
and
regions
adopt
strategies
to
address
their
needs.
Industry
clusters
do
not
need
a
public
sector
strategy
in
order
to
exist,
but
the
right
strategies
can
help
the
businesses
in
them
become
more
successful
and
competitive.
A
cluster
occurs
where
a
group
of
businesses,
drawing
on
similar
resources,
exist
in
relationships
with
other
nearby
businesses
and
institutions
that
contribute
to
their
competitiveness.
This
is
why
such
a
wide
variety
of
clusters
occur,
ranging
from
the
“high
tech”
clusters
of
microelectronics,
semiconductor,
and
software
businesses
in
Silicon
Valley,
California,
to
the
Automotive
industry
in
Detroit,
Michigan,
to
the
Houseboat
Building
industry
in
Eastern
Kentucky
or
the
Ceramics
industry
in
western
New
York.
Any
concentration
of
similar
businesses
that
draw
on
a
common
pool
of
suppliers,
services,
educational
institutions,
workforce
skills,
natural
resources,
or
other
assets
that
can
be
found
in
a
region
may
be
a
cluster.
Nobody
engineered
them,
or
created
them
in
most
cases,
but
they
happened
anyway.
This
report
identifies
and
describes
the
Montana’s
optics
industry
sector.
It
also
examines
the
potential
of
an
optics
cluster
within
the
state
for
three
reasons.
1. A
region’s
clusters
tend
to
be
the
primary
wealth
generators
in
a
region’s
economy.
5
2. Clusters
often
generate
innovation
and
technological
dynamism
and
produce
higher
wage
jobs
in
the
economy.
3. Clusters
can
be
the
basis
for
intelligent
and
cost-‐effective
public
strategies.
Optics, Photonics, et al…
While
there
are
numerous
accepted
definitions
of
optics
and
photonics,
there
are
no
single
standard
definitions.
Although
the
scientific
and
engineering
literature
will
often
distinguish
between
optics
and
photonics,
within
the
current
industry,
economic
development
and
public
policy
literature
and
media,
the
terms
optics,
photonics,
and
optoelectronics
are
most
often
used
synonymously.
Certainly
optics
as
a
concept
has
a
long
history
beginning
in
the
early
18th
century
with
Isaac
Newton’s
text
on
the
fundamental
principles
of
reflection
and
refraction.
It
is
generally
viewed
as
being
ushered
into
the
modern
era
as
a
field
with
the
publications
of
Einstein
and
Planck
and
eventually
the
invention
of
the
first
laser
in
1960.
The
rest
is
history
with
a
development
path
including
fiber
optics,
laser
surgery,
optical
lithography,
laser
material
processing,
high-‐resolution
microscopes,
new
lighting
technologies
and
so
on.
The
terms
photonics
and
optoelectronics
have
phased
into
common
usage
in
order
to
capture
the
modern
versions
of
science,
engineering
and
technology
domains
that
fuse
optics
with
electronics.
For
photonics,
the
definitions
are
all
over
the
map
and
vary
from
straightforward…
Photonics
Directory
(www.photonics.com)
“the
technology
of
generating
and
harnessing
light
and
other
radiant
energy
whose
quantum
unit
is
the
photon.”…
…to
precise…
U.S.
National
Research
Council
(1998)
–
“the
field
of
science
and
engineering
encompassing
the
physical
phenomena
and
technologies
associated
with
the
generation,
transmission,
manipulation,
detection,
and
utilization
of
light.”…
…to
broad…
UK
Department
of
Trade
and
Industry
2007
–
“those
organizations
for
which
the
manufacture
or
use
of
photonic
enabled
products
is
a
key
aspect
of
their
business.”
Photonic
enabled
products
are
defined
as
“products
that
would
not
be
possible
without
their
photonic
content.”
The
terms
in
use
for
these
kinds
of
endeavors
vary
from
state
to
state
and
cluster
to
cluster
–
for
instance,
“optics”
in
Arizona
and
New
Mexico
and
“photonics”
in
Colorado
and
New
York.
For
the
purposes
of
this
analysis
and
strategy
we
have
opted
to
use
“optics”
as
the
descriptor
for
the
cluster
and
the
associated
innovation
and
research
domains
unless
otherwise
noted
for
two
reasons.
First,
as
mentioned
above,
while
including
photonics
and
optoelectronics,
historically,
the
optics
field
connotes
a
longer
and
wider
science,
engineering
and
technology
perspective.
Second,
and
most
6
importantly,
that
is
the
term
the
private
sector
and
university
firms,
organizations
and
people
in
Montana
that
have
built
this
capacity
and
generated
this
activity
use
to
describe
themselves.
The Optics Industry
As
a
ubiquitous
enabling
technology
domain,
optics
is
already
established
with
a
wide
and
deep
technology
platform
that
encompasses
a
group
of
technologies
with
a
multitude
of
existing
applications
as
well
as
the
promise
of
an
untold
number
of
future
technologies
and
applications.
However,
as
an
industry
optics
is
still
emerging.
While
its
significance
is
easily
understood,
attempts
to
define
it
as
industry
are
elusive
because
its
existing
base
of
technologies
and
applications
are
continuing
to
evolve
while
new
technologies
and
applications
are
constantly
and
rapidly
being
created.
Description
Perhaps
the
most
rigorously
considered
and
most
structured
optics/photonics
industry
definitions
have
been
sponsored
by
the
European
Commission.
(Along
those
same
lines,
there
is
no
standard
or
generally
accepted
definition
currently
in
use
in
the
United
States.)
The
group
responsible
for
driving
the
European
optics
agenda
is
the
European
Technology
Platform
Photonics21.
Photonics21
devoted
considerable
effort
and
resources
to
crafting
a
definition
of
the
photonics
industry.
Note,
Europe
has
opted
to
use
“photonics”
as
opposed
to
“optics”
as
its
descriptor.
Photonics21’s
photonics
industry
description
is
contained
in
a
2007
report,
Photonics
in
Europe:
Economic
Impact
performed
by
Optech
Consulting.
That
report
divided
the
photonic
industry
into
ten
sectors
that
produce
photonics
technologies,
components
and
systems
that
are
then
used
in
end-‐user
products,
processes
and
services.
Each
sector
has
a
series
of
segments
as
shown
below
in
Table
1.
Market Size
As
cited
in
a
March
2011
Photonics21-‐sponsored
analysis
prepared
for
the
European
Commission
et
al,
using
the
photonics
industry
definition
developed
by
Optech
Consulting
in
their
2007
report
(Table
1),
the
total
world
market
for
photonics
products
in
2008
was
estimated
at
€277bn
or
about
$370bn
in
2008
US
dollars
at
current
exchange
rates.
1
The
two
largest
sectors
–
flat
panel
displays
and
information
technology
comprised
about
44%
of
the
total
2008
market
at
$96bn
and
$65.4bn,
respectively
while
the
global
2008
defense
photonics
market
was
estimated
at
$28bn.2
The
authors
estimated
an
annual
real
global
photonic
market
growth
rate
of
10%
for
the
2005-‐08
period.
By
way
of
comparison,
for
this
same
time
period,
worldwide
gross
national
income
grew
at
4.4%.3
1 Maurits Butter, Miriam Leis, John Lincoln, Mick McLean, Marjin Sandtke, Alastair Wilson, The Leverage Effect of
Photonics Technologies: the European Perspective (European Commission, 2011. p 20.)
2 Ibid.
3 Ibid.
7
Table
1
Photonics
Sectors
and
Segments4
National And Multinational Optics Industry Development
Approaches And Strategies
At
the
international
level,
the
most
prominent
optics
industry
effort
is
the
aforementioned
Photonics21
initiative.
Photonics21
is
a
European
Technology
Platform
formed
in
2005
to
unite
Europe’s
photonics
industry
and
research
institutions.
The
group
has
over
1800
members.
Augmenting
its
2007
definition
of
the
photonics
industry
sectors
and
segments,
in
March
of
2011
the
European
Commission
published
a
Photonics21
sponsored
analysis
that
configured
a
series
of
six
value
chains
in
which
photonics
is
the
core
technology.5
4 Arnold A. Mayer, Photonics in Europe: Economic Impact (Dusseldorph, Germany: European Technology Platform
Photonics21, 2007. p.9.)
5 Maurits Butter, Miriam Leis, John Lincoln, Mick McLean, Marjin Sandtke, Alastair Wilson, The Leverage Effect of
Photonics Technologies: the European Perspective (European Commission, 2011.)
8
The
organization
now
bases
its
overall
approach
on
addressing
these
value
chains.
They
are:
1. Scanning,
Sensing
and
Imaging
2. Information,
Communications
and
Networks
3. Screens
and
Displays
4. Advanced
Lighting
5. Photonic
Energy
Systems
6. Laser
Systems.
Subsequent
to
the
release
of
the
above
analysis
Photonics21
released
a
statement
of
its
vision
for
photonics
as
a
key
enabling
technology
of
Europe
(Photonics
–
Our
Vision
for
a
Key
Enabling
Technology
of
Europe,
European
Technology
Platform
Photonics21,
May
2011)
and
then
in
September
of
2011
issued
a
press
release
to
announce
its
commitment
to
a
proposed
public-‐private
photonics
partnership
with
the
European
Commission.
One
of
the
major
goals
of
the
partnership
would
be
to
improve
Europe’s
photonics
innovation
potential
by
addressing
the
photonics
innovation
value
chain
gap
between
“successful
science
and
pilot
scale
industrial
deployments.”
According
to
Photonics21,
the
proposal
targets
a
7
billion
euros
investment
level
by
2020
with
5.6
billion
euros
contributed
by
the
photonics
industry
and
1.4
billion
euros
provided
by
the
European
Commission.
At
present
the
US
has
no
photonics
or
optics
industry
innovation
strategy
or
development
policy
at
the
national
level
nor
is
it
regarded
a
trackable
category
from
an
industrial
activity
standpoint.
As
mentioned
below
however,
there
are
a
number
of
photonics
or
optics
cluster
development
strategies
in
play
in
the
US
at
the
state
and
regional
level.
An Optics/Photonics Cluster Inventory
Presented
below
is
a
domestic
and
international
inventory
of
optics/photonics
clusters
and/or
cluster
support
organizations.
The
various
entities
are
gathered
through
several
sources
including
the
European
Commission,
The
International
Society
for
Optics
and
Photonics
(SPIE),
academic
papers,
and
a
rigorous
Internet
search.
Some
are
identified
through
critical
analysis
by
researchers
while
others
are
“self-‐selected”
in
that
they
identify
themselves
as
a
cluster
support
entity.
They
run
the
gamut
from
very
substantive
optics/photonics
clusters
and
organizations
that
support
them
to
“aspirational”
entities
that
are
formed
to
attempt
to
induce
cluster
development.
9
Table
2:
US
Optics
Clusters
and
Organizations6
US
Optics
Clusters
and
Organizations
Location
Arizona
Optics
Industry
Association
Tucson,
AZ
Colorado
Photonics
Industry
Association
Boulder,
CO
Connecticut
Optics
and
Photonics
Association
Hartford,
CT
Florida
Photonics
Cluster
Orlando,
FL
New
Mexico
Optics
Industry
Association
Albuquerque,
NM
New
York
Photonics
Industry
Association
Rochester,
NY
Rochester
Regional
Photonics
Cluster,
Inc.
Rochester,
NY
Carolina
Microptics
Triangle
Charlotte,
NC
Carolinas
Photonics
Consortium
Greenville,
SC
Table
3:
International
Optics
Clusters
and
Organizations7
International
Optics
Clusters
and
Organizations
Location
Asia
Pacific
Region
Victorian
Photonics
Network
Australia
Optics
Valley
of
China
China
Korean
Association
for
Photonics
Industry
Development
Korea
Singapore
Photonics
+
Optics
Singapore
Canada
Ontario
Photonics
Technology
Industry
Cluster
Ontario,
Canada
Ottawa
Photonics
Cluster
Ontario,
Canada
Quebec
Photonic
Network
Quebec,
Canada
Europe
Austrian
Photonics
Platform
Austria
Cluster
Wallons
"Photonique"
Belgium
Tampere
Centre
of
Expertise
Finland
Joensuu
Science
Park
Ltd.
Expert
Services
-‐
N.
Karelia
Center
of
Expertise
Finland
Optoelectronics
Research
Centre
Finland
Laser
Competence
Centre
(LCC)
Finland
6 Sources for Tables 2 & 3: European Commission, Photonics Unit, 2101; International Society for Optics and
Photonics, Regional Technology Strategies.
7 Sources for Tables 2 & 3: European Commission, Photonics Unit, 2101; International Society for Optics and
Photonics, Regional Technology Strategies.
10
International
Optics
Clusters
and
Organizations
(Continued)8
Location
Route
Des
Lasers
France
POPSUD
-‐
OPITEC
France
Optics
Valley
France
France
ELOPSYS
–
Poole
de
Compètitivitè
France
Poole
ORA
(Optics
Rhone-‐Alps)
France
Rhenaphotonics
–
Alsace
Optics
and
Photonics
Poole
France
PhotonAIX
e.V.
Germany
Bayern
Photonics
e.V.
Germany
HansePhtonik
e.V.
Germany
Optec-‐Berlin-‐Brandenburg
e.V.
Germany
Optence
e.V.
Germany
OpTech-‐Net
e.V.;
Duisburg
Germany
OptecNet
Deutschland
e.V.
Germany
OptoNet
e.V.
Germany
Photonic
Net
Germany
Photonics
BW
Germany
ANTICIPA
-‐
Technopoole
du
Tregor
Germany
PHOTONICSGR
-‐
Greek
Photonics
Platform
Ireland
Optics
&
Photonics
Cluster
in
Ireland
Italy
PHORIT
–
Italian
Photonics
Platform
Netherlands
Potonics
Cluster
Netherlands
Netherlands
Wroclaw
Research
Centre
EIT+
Poland
KLASTER
“Knowledge
and
Innovation
Community
for
Information
and
Communication
Technologies"
Poland
Mazovian
Photonics
Technology
Cluster
-‐
OPTOKLASTER
Poland
Polish
Photonics
Platform
Slovenia
Southern
European
Cluster
in
Photonics
and
Optics
Spain
FOTONIKA21
Slovenian
Photonics
Platform
Spain
Fotonica21
Spanish
Photonics
Platform
Spain
PhotonicSweden
-‐
The
Swedish
Photonics
Platform
Sweden
SLN
Swiss
Laser
and
Photonics
Network
Switzerland
Swiss
Photonics
and
Laser
Network
Switzerland
Electronics,
Sensors,
Photonics
Knowledge
Transfer
Network
UK
Photonics
Cluster
UK
UK
Scottish
Optoelectronics
Association
UK
The
Welsh
Opto-‐Electronics
Forum
UK
UK
CPO
-‐
UK
consortium
for
Photonics
&
Optics
UK
SEPNET
Ltd.
Photonics
Network
/
South
East
Photonics
Network
UK
8 Sources for Tables 2 & 3: European Commission, Photonics Unit, 2101; International Society for Optics and
Photonics, Regional Technology Strategies.
11
Defining the Optics Industry in Montana
In
the
U.S.
there
is
no
standard
definition
yet
for
optics
or
photonics
as
an
industrial
sector
or
subsector.
Attempting
to
actually
define
all
of
this,
as
an
industry
comprised
of
discrete
NAICS
codes,
is
an
impossible
task
for
two
reasons.
First,
because
the
technologies
are
developing
so
rapidly
and
applications
are
multiplying
and
morphing
so
quickly,
any
attempt
at
a
definition
would
be
a
moving
target.
Second,
and
more
importantly,
under
the
current
NAICS
code
taxonomy,
many
of
the
subsector
codes
that
might
logically
be
applied
to
capture
the
optics/photonics
industry
also
include
firms,
and
in
many
cases
a
majority
of
firms,
that
would
not
be
part
of
the
optics
industry.
For
example,
depending
on
the
specific
optics
technology
or
market
orientation
an
optics
firm
might
place
itself
in
the
NAICS
code
for
Engineering
Services
(541330)
or
Research
and
Development
in
the
Physical,
Engineering,
and
Life
Sciences
except
Biotechnology
(541712)
or
Welding
and
Soldering
Equipment
Manufacturing
(333992).
All
three
of
these
subsectors
will
include
firms
not
associated
with
the
optics
industry.
As
a
result
of
the
NAICS-‐based
definition
dilemma,
analysts
may
use
NAICS
codes
for
guidance,
but
for
the
most
part
they
then
build
up
their
particular
industry
or
cluster
description
organically
by
identifying
firms,
one-‐by-‐one
that
appear
to
engage
in
optics
or
photonics-‐related
commerce.
Even
then,
in
many
cases,
firms
cannot
be
clearly
assigned
to
a
NAICS
code.
In
the
course
of
this
work
they
have
occasionally
constructed
working
definitions
based
on
what
they
have
found
in
their
market
or
state.
The
working
definition
for
this
assessment
combines
two
approaches.
First,
it
populates
the
cluster
with
known
establishments
that
have
self-‐selected
as
optics
firms
and
then
identifies
their
NAICS
codes.
It
then
triangulates
among
several
analyses
that
identified
NAICS
codes
in
which
optics
firms
resided
(Connecticut,
Arizona,
Florida)
and
compiles
this
list
and
then
merges
with
the
NAICS
codes
for
known
Montana
optics
firms.
The
resulting
NAICS-‐based
template
is
then
used
to
identify
the
names
of
Montana
firms
in
each
of
these
NAICS
subsectors.
The
firms
are
then
vetted
one-‐by-‐one
to
determine
if
they
are
a
“fit”
that
should
be
included
in
the
Montana
optics
industry
or
cluster
definition.
As
was
the
case
with
the
emergence
of
Information
Technology
in
the
80’s
and
90’s
as
both
a
new
and
evolving
industry
and
as
a
ubiquitous,
enabling
technology
across
many
sectors
and
applications,
there
are
optics
intensive
user
firms
in
just
about
every
industrial
sector
and
sub-‐sector.
For
the
purposes
of
qualifying
the
optics
cluster
in
Montana
we
will
focus
on
the
core
of
this
cluster
–
on
firms
that
generate
optics
products
or
services
or
the
technologies
in
which
they
are
embodied
and
the
innovation
infrastructure
that
enables
this
activity.
Additionally,
the
cluster
definition
is
subject
to
refinement
and
may
be
amended
to
include
groups
within
significant
Montana
optics
user
market
segments
as
additional
findings
come
to
light
during
the
course
of
this
analysis.
Based
on
the
NAICS
codes
associated
with
the
list
of
self
identified
optics
firms
and
on
other
codes
gleaned
from
other
definitions
as
described
above,
here
is
the
initial
list
of
NAICS
codes
that
might
include
establishments
that
qualify
as
optics
firms.
12
Table
4:
Optics
Industry
Definition
NAICS Optics Cluster Definition
313210 Broadwoven Fabric Mills
323111 Commercial Gravure Printing
325188 All Other Basic Inorganic Chemical Mfg
332312 Fabricated Structural Metal Mfg
332993 Ammunition (except Small Arms Mfg)
333314 Optical Instruments & Lens Manufacturing
334512 Auto Environ Ctrl Mfg for Residential, Commercial, & Appliance Use
334513 Displaying & Controlling Industrial Process Variables
334519 Other Measuring & Controlling Device Mfg
335122 Commercial, Industrial, & Institutional Electric Lighting Fixture Mfg
335129 Other Lighting Equipment Mfg
335931 Current-Carrying Wiring Device Mfg
336321 Vehicular Lighting Equipment Mfg
336992 Military Armored Vehicle, Tank, & Tank Component Mfg
339112 Surgical & Medical Instrument Mfg
339115 Ophthalmic Goods Mfg
339999 All Other Miscellaneous Mfg
517919 All Other Telecommunications
541330 Engineering Services
541511 Custom Computer Programming Services
541712 R&D in the Physical, Engineering, & Life Sciences
541720 R&D in the Social Sciences & Humanities
561990 All Other Support Services
With
at
least
the
parameters
of
an
industry
definition
established,
our
first
step
was
to
query
Hoover’s
online
business
directory,
a
Dun
&
Bradstreet
company,
for
companies
associated
with
the
above
NAICS
codes.
Each
company
was
then
researched
one
by
one
to
determine
whether
or
not
its
products
and/or
services
were
in
alignment
with
the
established
definition.
In
some
cases,
calls
were
made
to
confirm
the
company’s
current
activity
and/or
location.
We
removed
companies
that
were
no
longer
in
business
and
those
that
were
outside
of
our
scope.
In
this
regard,
because
our
focus
is
on
the
optics
industry’s
core
value-‐creating
companies,
we
chose
not
to
include
ophthalmology
and
optometry
offices,
service
labs
and
product
distributors
though
they
are
included
in
some
industry
and
especially
cluster
definitions
as
they
are
part
of
some
of
the
marketing,
distribution
and
end-‐user
chains.
The
remaining
38
companies
included
in
Table
5
form
the
basis
for
the
optics
industry
in
Montana.
The
geographic
distribution
of
these
companies
is
depicted
below
in
Figure
1.
13
Table
5:
Montana
Optics
Companies
Company
City
ADVR
Inc
Bozeman
Altos
Photonics
Bozeman
Bridger
Photonic
Inc
Bozeman
Christensen
Research
LP
Missoula
Chrono-‐Chrome
Inc
Bozeman
DRS
Technical
Services
Inc
Polson
Electronic
Realization
Bozeman
Fluorescence
Innovations
Bozeman
Fusion
Technologies
Billings
GFT
Technologies
Inc
Bozeman
Gradient
Geophysics
Inc
/
Gradient
Geothermal
Inc
Missoula
GT
Equipment
Technologies
Missoula
Horne
Technologies
Bozeman
ILX
Lightwave
Corporation
Bozeman
Image
Labs
Bozeman
Lattice
Materials
LLC
Bozeman
Litron
Lasers
Bozeman
Montana
Instruments
Corporation
Bozeman
MSE
Technology
Applications
Inc
Butte
New
Gate
Technologies
Inc
Bozeman
New
Wave
Research
Incorporated
Bozeman
Nu-‐Trek
Bozeman
NWB
Sensors
Bozeman
Phenix
FO
Bozeman
Phoretic
Technologies
Inc
Kalispell
Photon
Machines
Bozeman
Quantel
Laser
Bozeman
Quantum
Composers
Bozeman
Resodyn
Corporation
Butte
Resonon
Bozeman
S
&
K
Electronics
Inc
Ronan
S2
Corporation
Bozeman
Scientific
Materials
Corporation
/
FLIR
Systems
Bozeman
SensoPath
Technologies
Inc
Bozeman
Snider
Technology
Inc
Bozeman
TerraEchos
Inc
Missoula
Wavelength
Electronics
Inc
Bozeman
Zdye
LLC
Bozeman
14
Figure
1:
Geographic
Distribution
of
Montana
Optics
Companies
15
Does Montana Have The Ingredients for an Optics Cluster?
The
short
answer
is,
“Yes.”
In
absolute
terms
the
Montana
cluster
is
not
the
scale
of
perhaps
the
most
well
known
cluster
in
southern
Arizona,
which,
according
to
the
Arizona
Optics
Industry
Association
(AOIA),
boasts
160
companies9.
However,
at
least
three
of
the
critical
ingredients
are
present
that
define
developed
clusters:
a
geographically
dense
(in
this
case,
very
dense)
concentration
of
optics
companies,
a
burgeoning
infrastructure
that
includes
a
third
ingredient,
talent
production,
and
an
innovation
hub.
Table
6:
Comparisons
-‐
Gallatin
County,
Montana
to
Maricopa
and
Pima
Counties,
Southern
Arizona10
Non-‐Farm
Establishments
2010
Optics
Estabs
Estabs
Opt
Estabs/
All
Estabs
%
MT/AZ
Gallatin
County,
MT
28
4,759
0.00588
0.5884%
3.86
Maricopa
&
Pima
Counties,
AZ
160
104,839
0.00153
0.1526%
Maricopa
84,520
Pima
20,319
Non-‐Farm
Employment
2010
Optics
Estabs
Employ
Opt
Estabs/
All
Employ
%
MT/AZ
Gallatin
County,
MT
28
37,337
0.00075
0.0750%
8.03
Maricopa
&
Pima
Counties,
AZ
160
1,712,987
0.00009
0.0093%
Maricopa
1,411,836
Pima
301,151
Population
2010
Optics
Estabs
Population
Opt
Estabs/
Population
%
MT/AZ
Gallatin
County,
MT
28
89,513
0.00031
0.0313%
9.38
Maricopa
&
Pima
Counties,
AZ
160
4,797,380
0.00003
0.0033%
Maricopa
3,817,117
Pima
980,263
Twenty-‐eight
of
the
38
Montana
optics
industry
companies
are
located
in
or
around
Bozeman
(Gallatin
County),
Montana.
In
order
to
generate
a
rough
sense
of
the
density
of
the
Gallatin
County
optics
cluster
compared
to
the
one
in
southern
Arizona,
RTS
compared
its
estimated
number
of
optics
establishments
in
Gallatin
County
to
the
number
of
optics
establishments
in
southern
Arizona
normalized
with
three
different
measures:
optics
firms
as
percent
of
total
non-‐farm
establishments
for
the
area,
optics
9 http://www.biztucson.com/biznews/cover-story/170-driving-tucson-optics, Friday 27 February 2009
10 Regional Technology Strategies; U.S. Census Bureau: State and County QuickFacts.
16
firms
per
capita,
and
optics
firms
per
non-‐farm
employment.
Although
AOIA
ascribed
160
optics
companies
to
all
of
southern
Arizona,
only
Maricopa
County
(Phoenix)
and
Pima
County
(Tucson)
were
used
for
the
establishments,
employment,
and
population
counts.
When
the
percent
of
establishments
in
each
region
that
represent
optics
companies
was
used
as
a
density
measure,
the
Gallatin
County
optics
cluster
was
about
3.8
times
denser
than
the
southern
Arizona
cluster.
When
both
population
counts
and
employment
counts
were
used
to
produce
a
normalized
density
measure,
the
Gallatin
County
optics
cluster
was
over
9
times
denser
than
the
southern
Arizona
optics
cluster
on
a
per
capita
basis
and
8
times
denser
when
normalized
with
employment
counts.
The
optics
company
core
of
the
cluster
developed
in
three
stages.
First
was
the
establishment
of
Big
Sky
Laser
(now
Quantel)
in
1981.
This
was
followed
by
three
more
firms
from
1986-‐1989
–
ILX
Lightwave,
Lattice
Materials
Corporation,
and
Scientific
Materials
Corp.
(now
Scientific
Materials/FLIR).
Another
group
of
five
companies
was
formed
in
the
1992-‐1995
period
–
Wavelength
Electronics,
Quantum
Composers,
New
Wave
Research,
Image
Labs,
and
Altos
Photonics.
Over
the
next
sixteen
years
the
number
of
optics
companies
operating
in
Gallatin
Valley
grew
from
9
to
28.
The
companies’
efforts
span
a
wide
range
of
activities
and
applications
and
for
the
most
part
are
distributed
across
four,
occasionally
overlapping,
industry
segments
though
there
is
also
some
activity
in
other
areas
including
Medical
Technology
and
IT/Consumer
Electronics
areas.
1. Optics
Production
Technology
2. Optical
Measurement
and
Machine
Vision
3. Defense
Photonics
4. Optical
Systems
and
Components.
Though
some
of
this
information
will
be
addressed
in
more
detail
in
later
sections
of
this
analysis,
for
the
purposes
of
a
general
characterization
of
the
cluster,
several
other
aspects
should
be
noted.
• The
group
of
companies
that
comprise
the
Bozeman/Gallatin
Valley
concentration
engage
in
a
rich
mix
of
production
manufacturing,
custom
design
and
manufacturing,
R&D,
and
product
and
process
development
activities.
• A
sizeable
majority
of
the
firms
in
the
cluster
were
formed
since
2000
and
they
tend
to
be
young,
small
and
innovation
intensive.
• Many
of
the
companies
have
a
strong
connection
to
Montana
State
University’s
Optical
Technology
Center
(OpTeC)
and
its
associated
non-‐profit
Spectrum
Lab.
17
• Though
there
is
always
competition
for
talent
from
the
labor
pool
for
any
cluster,
in
spite
of
their
numbers
the
Bozeman
area
optics
firms
tend
not
to
compete
in
the
same
market
segments
for
the
same
customers.
Infrastructure
A
common
element
among
clusters
that
produce
numbers
and
levels
of
jobs,
income,
wealth
and
competitive
advantage
within
regional
economies
is
a
well
functioning
infrastructure.
In
this
case,
we
define
“infrastructure”
as
“the
underlying
resource
and
public
and
private
entities
that
advance
the
competitiveness
of
the
firms
within
the
cluster.”
Fully
developed
clusters
reach
a
level
of
activity
that
induces
the
formation
of
entities
whose
operations
are
directly
tailored
to
servicing
the
cluster.
This
can
encompass
a
wide
range
of
activities
but
typically
includes
post-‐secondary
and
higher
education
institutions
with
offerings
targeted
to
the
cluster,
public
and
non-‐profit
research
operations
that
support
innovation
within
the
cluster,
technical
assistance
providers
with
cluster-‐specific
expertise,
attorneys
and
capital
providers
with
very
specialized
cluster-‐specific
expertise
and
so
on.
Industry
associations,
alliances,
networking
organizations
and
centers
are
also
important
cluster
infrastructure
elements.
These
entities
often
end
up
functioning
as
robust
hubs
that
connect
and
leverage
talent
and
innovation
resources,
transmit
and
relay
technical
and
business
information,
and
advance
the
overall
interests
of
the
cluster.
As
presented
below,
to
a
great
extent
the
elements
to
form
a
strong
hub
are
already
in
place
within
Montana’s
optics
cluster.
The Optical Technology Center (OpTeC)
Officially
formed
in
1995,
the
Optical
Technology
Center
(OpTeC)
at
Montana
State
University
is
a
virtual
multi-‐disciplinary
center
that
supports
and
advances
education
and
research
in
optical
science
and
engineering.
To
accomplish
this,
OpTeC
includes
research
groups
and
students
from
three
MSU
departments:
Electrical
&
Computer
Engineering;
Physics;
and
Chemistry
&
Biochemistry.
OpTeC
functions
as
the
Montana
optics
cluster’s
primary
information
sharing
and
networking
platform
for
university
researchers
and
faculty,
private
industry
and
students.
As
part
of
this
work
in
addition
to
an
annual
conference
that
features
presentations
from
students,
faculty
and
research
staff
on
recent
optics
developments
at
the
university
it
also
sponsors
a
colloquium
over
the
course
of
the
academic
year
that
addresses
a
broad
range
of
optics
topics
and
promotes
cross-‐
disciplinary
interactions
of
students,
faculty,
staff
and
employees
from
optics
cluster
companies.
OpTeC
plays
a
prominent
role
within
the
optics
cluster
as
its
networking
center
for
research
and
talent
production.
Many
of
the
companies,
especially
those
formed
since
2000,
are
staffed
and
led
by
scientists
and
engineers
from
MSU
that
were,
and
in
many
cases
still
are,
active
OpTeC
participants.
A
number
of
these
companies
also
have
on-‐
going
research,
intellectual
property
creation
and
licensing
relationships
with
MSU
and
its
faculty
through
the
OpTeC
conduit.
18
Spectrum Lab
Spectrum
Lab
was
“spun
out”
of
OpTeC
in
1999
to
further
develop
technologies
from
Montana
State
University’s
research
laboratories,
to
move
those
technologies
into
private
companies
and
to
provide
educational
opportunities
for
MSU
students.
To
this
end,
Spectrum
Lab
serves
as
a
kind
of
optics
“applications
incubator”
for
faculty
and
industry
and
as
a
bridge
between
MSU
labs
and
the
private
sector.
Spectrum
Lab
is
funded
through
contracts
and
grants.
It
has
a
strong
mission
track
record
that
includes
spinning
out
two
of
the
cluster’s
very
active
companies
–
Bridger
Photonics
and
S2
Electronics.
Spectrum
Lab
is
another
prominent
element
within
the
cluster’s
innovation
infrastructure.
At
present
it
has
formal
collaborations
in
progress
with
four
optics
cluster
companies
–
ADVR,
Bridger
Photonics,
S2
Corporation,
and
Scientific
Materials
Corporation.
Montana Manufacturing Extension Center
Montana
Manufacturing
Extension
Center
(MMEC)
at
Montana
State
University’s
College
of
Engineering
in
Bozeman
is
a
statewide
manufacturing
assistance
center
that
provides
technical
support
and
training
to
Montana
businesses.
MMEC
is
also
a
part
of
the
National
Institute
of
Standards
and
Technology
(NIST)
nationwide
network
of
centers
created
to
assist
small
and
mid-‐size
manufacturers,
the
Manufacturing
Extension
Partnership
(MEP).
MMEC
offers
a
wide
array
of
services
to
Montana
manufacturers
including
business
management,
design
and
product
development,
lean
enterprise,
process
improvement,
and
quality
systems
services
as
well
as
a
variety
of
training
courses.
While
MMEC
works
throughout
Montana
and
services
all
manufacturing
sectors,
it
has
played
an
on-‐going
role
as
a
highly
valued
technical
assistance
resource
for
those
optics
companies
with
a
production
and
manufacturing
focus.
MMEC
engineers
have
specialized
optics-‐related
manufacturing
expertise
and
the
center
itself
has
developed
into
an
integral
part
of
the
optics
cluster
infrastructure.
TechLink and MilTech
Established
in
1996
at
Montana
State
University
and
funded
primarily
through
the
US
Department
of
Defense
(DoD),
TechLink
connects
companies
throughout
the
country
with
DoD
research
laboratories
for
licensing,
development,
transfer
and
commercialization
of
new
technologies
including
photonics
and
sensor
technologies.
It
also
assists
Montana
companies
in
the
preparation
of
SBIR
and
STTR
proposals
for
submission
to
any
federal
agency.
MilTech
is
a
DoD
sponsored
effort
that
provides
technical
and
management
assistance
to
small
companies
to
accelerate
the
transition
of
technology
to
the
US
warfighter
more
quickly,
reliably
and
cost-‐effectively.
This
national
program
is
a
partnership
between
TechLink
and
MMEC.
Though
both
TechLink
and
MilTech
operations
are
national
in
scope,
Montana
optics
companies
benefit
from
both
programs
being
headquartered
in
Bozeman
in
at
least
three
ways.
First,
DoD
is
a
major
customer
for
several
of
the
cluster
companies. Second,
much
19
of
the
on-‐going
R&D
and
product
development
within
the
cluster
is
geared
toward
DoD
applications.
Third,
DoD
is
in
itself
a
source
of
funds
through
grants
and
contracts
for
Montana
optics
cluster
R&D
efforts.
Cluster Profile and Development Assessment
RTS
designed
and
deployed
a
short
10
question
Internet-‐based
survey
to
sketch
out
a
profile
of
the
state’s
optic
cluster
companies
–
who
they
were,
what
they
did,
and
their
perceptions
about
their
most
pressing
business
issues
(see
Appendix
A).
This
was
followed
by
a
series
of
on-‐site
face-‐to-‐face
interviews
to
generate
a
more
detailed
understanding
of
the
competitiveness
issues
the
firms
were
facing
as
well
the
resources
they
understood
to
be
at
their
disposal
and
connectivity
and
relationships
among
the
firms.
The
information
gleaned
from
the
survey
responses
and
interview
results
was
then
used
to
compile
an
Optics
Company
Group
Profile
and
to
craft
a
Cluster
Competitiveness
Factor
Profile,
both
of
which
are
presented
below.
Information
was
gathered
from
12
of
the
28
(43%)
Bozeman
optics
cluster
companies
(this
response
level
also
represents
32%
of
the
Montana
optics
industry
total).
Face-‐to-‐face
interviews
were
also
conducted
with
seven
of
these
respondents
as
well
as
the
two
previously
described
major
optics
infrastructure
elements
that
connect
to
the
university
community
and
to
the
companies
-‐
OpTeC
and
Spectrum
Lab.
Optics Company Respondents Group Profile
Company Characteristics
All
the
respondents
were
from
Gallatin
County/Bozeman
area.
Sixty-‐four
percent
of
the
respondents
had
just
a
single
office
while
36%
had
additional
offices
–
all
located
out
of
state.
Sixty-‐three
percent
of
the
companies
reported
less
than
20
employees
while
18%
had
21
to
50
employees
and
another
18%
had
50
to
100
employees.
The
companies
represented
a
variety
of
product
or
service
areas
including
production
of
laser
components,
lasers
and
laser
systems,
R&D
and
prototype
development,
instrument
manufacturing,
custom
instrument
manufacturing,
and
measurement
services.
Most
of
the
firms
(70%)
reported
in-‐state
sales
but
at
very
modest
levels.
In
terms
of
sales
volume,
roughly
55%
of
their
sales
were
in
out-‐of-‐state
US
markets
and
39%
of
sales
were
in
international
markets.
Only
6%
of
sales
were
to
Montana
customers.
Forty-‐five
percent
of
the
companies
had
received
SBIR/STTR
awards
with
three
quarters
of
those
firms
also
receiving
Phase
II
awards.
20
Business Needs and Issues
The
respondents’
were
asked
to
select
their
most
pressing
business
issues
from
the
following
list.
• Experienced/specialized
employee
recruitment
• Worker
training
• Access
to
capital
• Strategic
partners
• Business/market
development
• Distribution
and
logistics
• Access
to
specialized
suppliers
or
materials
• Intellectual
property
management
• Manufacturing
or
process
issues
• Access
to
specialized
scientific
or
engineering
expertise
• Administrative
assistance
• Human
resources
assistance
• Using/maximizing
impact
of
social
media
• Other-‐
please
specify
The
following
four
needs
were
flagged
by
at
least
one
third
of
the
firms.
1. Experienced/specialized
employee
recruitment
(64%)
1. Business/market
development
(64%)
2. Access
to
capital
(45%)
3. Strategic
partnering
(36%)
Experienced/specialized
employee
recruitment
and
Business/market
development
tied
for
first,
each
with
64%.
Next
was
Access
to
capital,
which
was
selected
by
45%
of
the
respondents
followed
Strategic
partnering,
selected
by
36%
of
the
responding
firms.
Three
need
categories
were
identified
by
just
over
18%
of
the
respondents,
Intellectual
property
management,
Manufacturing
or
process
issues,
and
Access
to
specialized
scientific
and
engineering
expertise.
Just
under
10%
of
the
respondents
identified
Worker
training,
Distribution
and
logistics,
Access
to
specialized
suppliers
or
materials,
and
Administrative
assistance
as
pressing
business
issues.
No
firms
indicated
that
Human
resources
assistance
or
Using
social
media
were
pressing
needs.
21
Networking Interest
The
survey
concluded
with
the
following
question:
Are
you
interested
in
participating
in
events
or
functions
that
bring
Montana
optics
companies
together
to
network
or
address
common
issues?
Ninety-‐one
percent
of
the
respondents
answered
“yes”
to
this
question.
One
respondent
offered
a
comment
that
bears
noting
here
as
it
was
often
refrained
in
the
follow-‐up
interviews.
The
optics
community
is
a
strong
collection
of
individuals
with
various
niche
technologies,
and
it
is
of
interest
to
bring
them
together,
although
it
will
be
challenging.
I
am
interested
in
being
a
part
of
a
new
community,
but
will
like
and
need
to
see
the
common
elements
grow.
Competitiveness Factor Profile
Based
on
the
Internet
survey,
the
nine
on-‐site
interviews
with
cluster
members
and
follow-‐
up
communications,
RTS
constructed
the
below
presented
Montana
Optic
Cluster
Competitiveness
Factor
Profile.
Using
a
variation
of
the
template
RTS
has
designed
over
its
15
years
of
cluster
analysis
at
the
regional,
state,
national
and
international
levels,
the
profile
is
organized
around
eight
key
cluster
asset
categories.
The
completed
profile
is
then
used
to
chart
a
future
development
strategy
for
the
cluster.
1. Workforce And Human Capital
Strengths
• MSU
and
OpTeC
are
viewed
as
major
resources
for
knowledgeable
entry-‐level
or
near
entry-‐level
employees
and,
from
a
human
capital
perspective,
were
viewed
as
infusing
their
students
and
researchers
with
an
innovation
mindset.
• The
high
concentration
of
companies
in
the
Bozeman
area
was
also
viewed
as
a
significant
workforce
and
talent
attraction
asset
in
and
of
itself.
As
stated
by
one
of
the
optics
company
officials,
“A
concentration
of
companies
really
helps
build
the
talent
pool
as
people
now
come
here
with
the
expectation
that
if
a
job
doesn’t
work
out
they
can
find
another
one
in
the
industry
right
here.”
• The
younger,
more
R&D
intensive
companies
did
not
view
talent
recruitment
as
a
significant
problem.
While
they
often
hired
MSU
graduates,
they
also
recruited
out-‐of-‐state
for
employees
with
specialized
experience
or
knowledge.
Weaknesses
• Companies
with
more
than
20
employees
and/or
with
more
of
a
production
orientation
indicated
they
had
issues
with
finding
specialized
and
experienced
engineering
expertise
and
in
finding
optics-‐qualified
manufacturing
technicians.
In
one
case
a
company
was
looking
out-‐of-‐state
for
technicians
from
two
post-‐
secondary
training
programs.
22
• Several
company
representatives
mentioned
that
more
research
support
is
needed
for
OpTeC
to
get
“more
kids
working
in
labs
to
get
hands-‐on
experience.”
2. Innovation And R&D Assets
Strengths
• OpTeC
and
Spectrum
Lab
form
the
innovation
infrastructure
for
the
Montana
optics
industry
and
the
Bozeman
optics
cluster.
As
such,
they
function
as
the
industry’s
major
optics
research,
applications
development
driver
and
talent
source
and
have
historically
played
an
integral
part
in
the
development
of
Bozeman
cluster.
• While
the
group
has
several
older
well-‐established
companies,
to
a
great
extent
it
is
characterized
by
young,
small
technology
or
applications
development
companies
committed
to
innovation
within
the
market
segments
they
have
targeted.
• On
the
innovation
deployment
side,
the
Montana
Manufacturing
Extension
Center
(MMEC)
is
regarded
as
a
valuable
technical
assistance
resource
by
those
optics
companies
with
a
manufacturing
orientation.
Weaknesses
• Several
company
respondents
felt
that
there
is
a
real
need
for
innovation-‐
and
business-‐oriented
technical
assistance
specifically
tailored
to
optics
companies.
The
general
sentiment
was
the
cluster
companies
and
their
interactions
with
OpTeC
and
Spectrum
Lab
together
have
generated
a
cadre
of
existing
technical
entrepreneurs
and
continue
to
produce
aspiring
optics
entrepreneurs
who
need
help
in
areas
such
as
intellectual
property
management,
contracts
administration,
access
to
capital,
recruiting
strategic
partners
for
continued
applications
development
or
market
development
and
so
on.
• There
was
a
sense
among
several
respondents
that
the
overall
innovation
capacity
of
the
Bozeman
optics
cluster
was
not
clearly
understood
and
therefore,
under-‐
recognized
because
so
many
of
the
firms
were
unfamiliar
with
each
other.
3. Entrepreneurial Energy and Financial Capital
Strengths
• There
appears
to
be
a
burgeoning
entrepreneurial
culture
within
the
Gallatin
Valley
optics
cluster.
A
distinct
majority
of
the
firms
in
the
cluster
have
been
formed
since
2000
so
they
tend
to
be
young,
small
and
innovation
intensive.
This
Gallatin
Valley
innovation
ethos
is
also
fueled
by
MSU,
OpTeC
and
Spectrum
Lab,
which
tend
to
produce
and
support
graduates
and
researchers
with
bleeding
edge
optics
science
and
technology
orientations.
23
• Capital
is
an
issue
(see
weaknesses)
however
many
of
the
companies
are
adept
at
obtaining
SBIR
Phase
I
and
II
awards
as
well
as
other
federal
grants.
Several
have
also
been
successful
applicants
for
Research
and
Commercialization
Board
grants.
• Capital
requirements
for
companies
within
the
optics
industry
tend
to
be
relatively
low
when
compared
to
other
knowledge-‐intensive
industries
like
bioscience.
As
a
result,
many
optics
companies
are
desirable
targets
for
angel
investors
and
angel
networks.
Although
there
is
some
angel
investment
in
play
among
the
Montana
optics
companies,
angel
investors
as
a
reliable
early
stage
capital
source
were
not
viewed
as
having
a
strong
presence.
This
may
represent
an
opportunity
to
develop
a
larger
scale
initiative
tailored
to
the
optics
cluster.
Weaknesses
• Access
to
capital
was
identified
as
a
top
priority
business
issue.
• Several
company
representatives
pointed
out
that
there
were
very
few
visible
and
successful
optic
entrepreneurs
to
serve
as
role
models
and
mentors
and
that
mentors
were
badly
needed
for
startups
and
early
stage
companies
within
the
cluster.
• There
was
a
perceived
lack
of
access
to
startup
and
growth
management
technical
assistance
and
experience
specific
to
optics
companies.
Because
the
underlying
science,
engineering
and
technology
is
dynamic
and
constantly
changing,
applications
are
diverse
and
in
a
state
of
flux
and
it
is
so
niche
oriented,
there
is
a
feeling
that
any
help
here
needs
to
be
tailored
to
the
optics
sector
–
generic
entrepreneurial
assistance
will
be
of
limited
value.
4. Ease of Moving Goods, People and Information
Strengths
• The
companies
use
Fed
Ex,
UPS,
et
al
to
ship
and
receive
materials
and
product.
In
general,
they
viewed
these
services
as
adequate
for
their
needs.
Weaknesses
• Transportation
for
people
was
the
most
frequently
mentioned
weakness
for
this
element
–
specifically,
airfares
and
flight
availability
and
times.
• In
terms
of
moving
information,
bandwidth
limitations
and
expense
was
also
identified
as
an
occasional
issue.
5. Quality of Life and Amenities
Strengths
• Quality
of
Life
and
Amenities
were
frequently
cited
as
major
strengths
for
Montana
optics
companies.
This
was
true
both
for
recruiting
key
employees
and
for
24
business
startups
and
location.
This
is
a
substantive
marketing
asset
for
the
cluster.
The
Montana
outdoors
lifestyle
and
the
attractiveness
of
Bozeman
as
a
college
town
and
amenities
were
the
key
factors.
A
CEO
from
one
of
the
very
well
established
and
older
optics
companies
indicated
they
initially
located
in
Bozeman
explicitly
as
a
lifestyle
choice.
Weaknesses
• Montana’s
remoteness
and
distance
from
major
commercial
centers
was
the
only
quality
of
life
and
amenity-‐related
disadvantage
that
was
mentioned
during
the
interviews.
6. Connectivity Within the Cluster
Strengths
• A
number
of
the
cluster
companies,
especially
the
“younger”
ones,
have
strong
and
on-‐going
connections
to
OpTeC
at
MSU
and
in
some
cases
to
Spectrum
Lab.
For
these
companies,
OpTeC
for
all
intents
and
purposes
functions
as
a
conduit
to
and
window
for
cutting
edge
optics-‐related
and
often
inter-‐disciplinary
research
and
as
a
talent
pipeline
for
the
cluster
companies.
OpTeC
and
Spectrum
Lab
together
through
their
missions,
practices,
graduates
and
researchers
have
over
time
fostered
an
entrepreneurial
culture
and
strong
innovation
mindset
within
the
cluster.
In
effect,
they
function
as
cluster
hub
for
talent
production
and
bleeding
edge
research
and
applications
development.
• A
subset
of
the
cluster
companies
are
pretty
tightly
networked.
• The
companies
as
a
rule
do
not
compete
in
the
same
market
spaces.
Many,
but
not
all,
feature
niche
applications.
This
bodes
well
for
any
attempts
to
build
collaborative
networks,
strategic
alliances
and
other
associative
behavior.
• Ninety-‐one
percent
of
the
survey
respondents
answered
“yes”
to
the
question:
“Are
you
interested
in
participating
in
events
or
functions
that
bring
Montana
optics
companies
together
to
network
or
address
common
issues?”
• The
Montana
Manufacturing
Extension
Center
(MMEC)
is
a
major
asset
here
in
that
they
provide
highly
valued
technical
assistance
to
those
optics
companies
with
a
manufacturing
orientation.
Weaknesses
• While
some
of
the
cluster
companies
were
networked
either
through
vendor
relationships
or
through
connections
to
OpTeC
or
Spectrum
Lab,
in
interviews
several
companies
indicated
they
“had
no
idea”
what
most
of
the
other
cluster
companies
did.
25
• One
company
described
the
connectivity
environment
as
“a
number
of
us
are
connected
to
OpTeC
but
we
are
not
really
connected
to
each
other.”
• While
there
are
some
supplier/vendor
relationships
and
occasional
business
referrals
among
the
companies,
there
is
not
a
significant
level
of
on-‐going
business-‐to-‐business
collaboration
and
mentoring.
7. Access to Specialized Suppliers and Services
Strengths
• There
were
a
number
of
specialized
supplier/vendor
relationship
among
of
the
cluster
companies.
Seventy
percent
of
the
survey
respondents
reported
in-‐state
sales
and,
based
on
follow-‐up
interviews,
many
of
these
customer
relationships
were
with
other
optics
companies.
However,
the
actual
sales
levels
reported
by
the
respondents
on
average
represented
6%
of
their
total
sales
with
55%
of
sales
going
out-‐of-‐state
in
domestic
markets
and
39%
into
international
markets.
• Those
optics
companies
that
engaged
in
manufacturing
often
cited
MMEC
as
a
valued
technical
assistance
provider.
Weaknesses
• As
many
of
these
companies
are
developing
or
offering
niche
products
or
services,
most
(but
not
all)
of
the
specialized
service
providers
were
outside
the
cluster.
• For
the
smaller
and/or
younger
firms,
a
need
for
specialized
optics
business-‐to-‐
business
services
was
often
mentioned
in
the
follow-‐up
interviews.
This
includes
administrative,
accounting,
business
development
and
intellectual
property
management
help
for
established
business
plus
startup
assistance
for
new
firms
and
entrepreneurs.
8. Government Regulations
Strengths
• No
one
mentioned
local,
state
or
federal
government
regulations
as
being
of
specific
benefit
to
their
company
or
the
optics
industry.
Weaknesses
• International
Traffic
in
Arms
Regulations
(ITAR)
export
compliance
regulations
were
cited
and
characterized
by
defense
contractors
selling
lasers
and
laser
system
components
as
a
major,
unfair
and
irrational
trade
restriction
burden
in
that
they
were
developed
years
ago
when
lasers
“were
new.”
The
regulations
have
not
been
updated
and
as
a
result
US
companies
cannot
sell
lasers
and
components
in
international
markets
when
their
competitors
in
other
countries
can.
• Montana’s
business
equipment
tax
was
also
mentioned
as
a
government
generated
business
cost
–
especially
for
small
companies
using
very
high
value
equipment.
26
Findings
An International and National Context
• As
a
ubiquitous
enabling
technology
domain,
optics
is
already
established
with
a
wide
and
deep
technology
platform
that
encompasses
a
group
of
technologies
with
a
multitude
of
existing
applications
as
well
as
the
promise
of
an
untold
number
of
future
technologies
and
applications.
• Defining
optics
or
photonics
as
an
industry
is
problematic
as
it
is
still
emerging.
Its
existing
base
of
technologies
and
applications
are
continuing
to
evolve
while
new
technologies
and
applications
are
constantly
and
rapidly
being
created.
The
US
has
adopted
no
definition
for
this
industry.
At
this
point
US
optics
companies
can
be
found
in
numerous
NAICS
codes.
• The
European
Commission
has
sponsored
the
development
of
its
own
industry
definition
through
Photonics
21,
a
European
Technology
Platform
formed
in
2005
to
unite
Europe’s
photonics
industry
and
research
institutions.
The
group
has
over
1800
members
and
drives
the
European
optics
agenda.
This
activity
has
produced
several
developments
that
should
be
noted
for
the
purposes
of
this
Montana
optics
industry
strategy
development
effort.
o The
total
world
market
for
photonics
products
in
2008
was
estimated
at
€277bn
or
about
$370bn
in
2008
US
dollars
at
current
exchange
rate.
o The
annual
real
global
photonic
market
growth
rate
was
10%
for
the
2005-‐
08
period.
By
way
of
comparison,
for
this
same
time
period,
worldwide
gross
national
income
grew
at
4.4%.
o Photonics21
released
a
statement
of
its
vision
for
photonics
as
a
key
enabling
technology
of
Europe
(Photonics
–
Our
Vision
for
a
Key
Enabling
Technology
of
Europe,
European
Technology
Platform
Photonics21,
May
2011).
o In
September
of
2011
Photonics21
issued
a
press
release
to
announce
its
commitment
to
a
proposed
public-‐private
photonics
partnership
with
the
European
Commission.
According
to
Photonics21,
the
proposal
targets
a
7
billion
euros
investment
level
by
2020
with
5.6
billion
euros
contributed
by
the
photonics
industry
and
1.4
billion
euros
provided
by
the
European
Commission.
o At
present
the
US
has
no
photonics
or
optics
industry
innovation
strategy
or
development
policy
at
the
national
level
nor
is
it
regarded
a
trackable
category
from
an
industrial
activity
standpoint.
27
• A
domestic
and
international
inventory
of
optics/photonics
clusters
and/or
cluster
support
organizations
identifies
nine
clusters
or
cluster
support
organizations
in
the
US
and
50
organizations
in
Asia/Pacific
Rim,
Canada
and
Europe.
Pinning Down the Optics Industry in Montana
• In
the
US
there
is
no
standard
definition
yet
for
optics
or
photonics
as
an
industrial
sector
or
subsector.
As
a
result
of
this
NAICS-‐based
definition
dilemma,
analysts
may
use
NAICS
codes
for
guidance,
but
for
the
most
part
they
then
build
up
their
particular
industry
or
cluster
description
organically
by
identifying
firms,
one-‐by-‐one
that
appear
to
engaged
in
optics
or
photonics-‐related
commerce.
• The
working
definition
for
this
assessment
combines
two
approaches.
First,
it
populates
the
cluster
with
known
establishments
that
have
self-‐selected
as
optics
firms
and
then
identifies
their
NAICS
codes.
It
then
triangulates
among
several
analyses
that
identified
NAICS
codes
in
which
optics
firms
resided
(Connecticut,
Arizona,
Florida)
and
compiles
this
list
and
then
merges
with
the
NAICS
codes
for
known
Montana
optics
firms.
The
resulting
NAICS-‐based
template
is
then
used
to
identify
the
names
of
Montana
firms
in
each
of
these
NAICS
subsectors.
The
firms
are
then
vetted
one-‐by-‐one
to
determine
if
they
are
a
“fit”
that
should
be
included
in
the
Montana
optics
industry
or
cluster
definition.
• Because
our
focus
is
on
the
optics
industry’s
core
value-‐creating
companies,
we
chose
not
to
include
ophthalmology
and
optometry
offices,
service
labs
and
product
distributors
though
they
are
included
in
some
industry
and
especially
cluster
definitions
as
they
are
part
of
some
of
the
marketing,
distribution
and
end-‐user
chains.
This
narrowly
defined
approach
identified
38
companies
that
form
the
basis
for
the
optics
industry
in
Montana.
• Twenty-‐eight
of
the
38
optics
companies
in
Montana
were
located
in
or
around
Bozeman.
From
1981
to
1995
nine
optics
companies
were
established
in
the
Bozeman
area.
From
1996
to
2012
18
optics
companies
were
established
in
the
Bozeman
area.
• A
sizeable
majority
of
the
firms
in
the
cluster
were
formed
since
2000
and
they
tend
to
be
young,
small
and
innovation
intensive.
• Though
in
absolute
terms
the
Montana
cluster
is
not
the
scale
of
perhaps
the
most
well-‐
known
cluster
{in
southern
Arizona,
at
least
three
of
the
critical
ingredients
are
present:
a
geographically
dense
(in
this
case,
very
dense)
concentration
of
optics
companies,
a
burgeoning
infrastructure
that
includes
a
third
ingredient,
talent
production,
and
innovation
hub}.
• The
companies’
efforts
span
a
wide
range
of
activities
and
applications
and
for
the
most
part
are
distributed
across
four,
occasionally
overlapping,
industry
segments
though
there
is
also
some
activity
in
other
areas
including
Medical
Technology
and
IT/Consumer
Electronics
areas.
28
1. Optics
Production
Technology
2. Optical
Measurement
and
Machine
Vision
3. Defense
Photonics
4. Optical
Systems
and
Components.
• The
group
of
companies
that
comprise
the
Bozeman/Gallatin
Valley
concentration
engage
in
a
rich
mix
of
production
manufacturing,
custom
design
and
manufacturing,
R&D,
and
product
and
process
development
activities.
• Many
of
the
companies
have
a
strong
connection
to
Montana
State
University’s
Optical
Technology
Center
(OpTeC)
and
its
associated
non-‐profit
Spectrum
Lab.
• Though
there
is
always
competition
for
talent
from
the
labor
pool
for
any
cluster,
in
spite
of
their
numbers
the
Bozeman
area
optics
firms
tend
not
to
compete
in
the
same
market
segments
for
the
same
customers.
Infrastructure
• Industry
associations,
alliances,
networking
organizations
and
center
are
also
important
cluster
infrastructure
elements.
These
entities
often
end
up
functioning
as
robust
hubs
that
connect
and
leverage
talent
and
innovation
resources,
transmit
and
relay
technical
and
business
information,
and
advance
the
overall
interests
of
the
cluster.
As
presented
below,
to
a
great
extent
the
elements
to
form
a
strong
hub
are
already
in
place
within
Montana’s
optics
clusters.
• OpTeC
plays
a
prominent
role
within
the
optics
cluster
as
its
networking
center
for
research
and
talent
production.
Many
of
the
companies,
especially
those
formed
since
2000,
are
staffed
and
led
by
scientists
and
engineers
from
MSU
that
were,
and
in
many
cases
still
are,
active
OpTeC
participants.
A
number
of
these
companies
also
have
on-‐
going
research,
intellectual
property
creation
and
licensing
relationships
with
MSU
and
its
faculty
through
the
OpTeC
conduit.
• Spectrum
Lab
was
“spun
out”
of
OpTeC
in
1999
to
further
develop
technologies
from
Montana
State
University’s
research
laboratories,
to
move
those
technologies
into
private
companies
and
to
provide
educational
opportunities
for
MSU
students.
To
this
end,
Spectrum
Lab
serves
as
a
kind
of
optics
“applications
incubator”
for
faculty
and
industry
and
as
a
bridge
between
MSU
labs
and
the
private
sector.
• While
MMEC
works
throughout
Montana
and
services
all
manufacturing
sectors,
it
has
played
an
on-‐going
role
as
a
highly
valued
technical
assistance
resource
for
those
optics
companies
with
a
production
and
manufacturing
focus.
MMEC
engineers
have
specialized
optics-‐related
manufacturing
expertise
and
the
center
itself
has
developed
into
an
integral
part
of
the
optics
cluster
infrastructure.
29
Optics Company Survey Responses
• Information
was
gathered
from
12
of
the
28
(43%)
Bozeman
optics
cluster
companies
(this
response
level
also
represents
32%
of
the
Montana
optics
industry
total).
Face-‐
to-‐face
interviews
were
also
conducted
with
seven
of
these
respondents
as
well
as
the
two
previously
described
major
optics
infrastructure
elements
that
connect.
• Most
pressing
business
needs
and
issues
-‐
Experienced/specialized
employee
recruitment
and
Business/market
development
tied
for
first,
each
with
64%.
Next
was
Access
to
capital,
which
was
selected
by
45%
of
the
respondents
followed
by
Strategic
partnering,
selected
by
36%
of
the
responding
firms.
• The
survey
concluded
with
the
following
question:
Are
you
interested
in
participating
in
events
or
functions
that
bring
Montana
optics
companies
together
to
network
or
address
common
issues?
Ninety-‐one
percent
of
the
respondents
answered
“yes”
to
this
question.
Competitiveness Assessment Summary
The
emergence
of
the
Montana
optics
cluster
is
not
really
a
recent
phenomenon.
Although
it
has
certainly
become
more
visible
over
the
last
few
years
as
a
presence
in
Bozeman
and
as
a
significant
economic
development
asset
for
the
state,
it
is
a
thirty-‐year
story
that
unfolds
in
fits
and
starts
beginning
in
1981.
Hindsight
allows
us
to
spot
a
cluster
development
path
that
begins
with
a
small
group
of
production
oriented
optics
companies
in
the
80’s
and
then
expands
in
the
90’s
with
another
group
of
companies
along
with
the
establishment
of
OpTeC
and
then
Spectrum
Lab.
The
path
continues
to
expand
and
extend
itself
over
the
next
15
years
as
the
pace
quickens
as
more
optics
companies
and
connections
develop.
30
Table
7:
Cluster
Competitiveness
Factors
Asset Category Comments
Workforce & Human Capital OpTeC is a major contributor to the talent pool. High
concentration of companies in Bozeman is a talent attraction
asset. Some issue with finding specialized engineering expertise
and qualified manufacturing technicians.
Innovation & R&D Assets OpTeC and Spectrum Lab function as research and applications
driver and talent source and promote a strong innovation
mindset. MMEC is a valuable technical assistance resource for
firms with manufacturing orientation. However, there is a need
for entrepreneurship and business assistance tailored to optics.
Entrepreneurial Energy &
Financial Capital
There is a burgeoning entrepreneurial culture within the Gallatin
Valley optics cluster. Access to capital is a major issue. Optics
company capital requirements are relatively low so should be an
attractive angel investor target. Need for entrepreneurial
assistance tailored to optics companies.
Ease of Moving People, Goods
& Information
No major issues shipping and receiving product due to FedEx,
UPS, et al but some concerns with air fare and flight availability
and schedules for people.
Quality of Life and Amenities Montana outdoors lifestyle and beauty frequently cited as a
major strength for recruiting talent and for business location
decisions.
Connectivity with the Cluster A number of the younger companies are connected – often
through relationships with OpTeC. Older, more established
companies not as well connected within the cluster. 91% of optics
company survey respondents indicated interest in participating
in networking functions.
Access to Specialized Suppliers
and Services
Most specialized supplier sources were outside Montana. Many
of the companies had traded relationships with each but on
average only represented 6% of sales (94% outsides the state).
MMEC often mentioned as major specialized assistance source
for manufacturers. For younger firms, need for optics specialized
business assistance often mentioned.
Government Regulation Obsolete and irrational ITAR export compliance regulations a
major obstacle for optics defense contractors.
31
Clearing the Development Path: The Optics Cluster Strategy
To
a
great
extent
the
goal
of
this
strategy
is
to
help
clear
the
development
path
this
cluster
is
already
in
the
act
of
charting.
As
stated
earlier
in
this
document,
clusters
do
not
need
a
public
sector
strategy
in
order
to
exist
but
the
right
strategies
can
help
the
businesses
in
them
become
more
successful
and
competitive.
To
this
end,
then,
this
strategy
needs
to
accomplish
five
things.
1. By
this
analysis’
count,
at
least
28
of
Montana’s
38
optics
companies
are
located
in
Gallatin
County,
in
or
around
Bozeman.
The
strategy
should
focus
on
Bozeman
cluster
power
as
the
differentiating
organizing
asset.
However,
it
is
important
to
note
there
are
other
optics
companies
scattered
around
the
state
including
four
in
the
Missoula
area
plus
three
more
north
of
Missoula
up
Highway
93
in
Ronan,
Polson
and
Kalispell
as
well
as
two
companies
in
Butte.
While
the
focus
should
be
on
the
geographically
bounded
Bozeman
concentration
of
optics
companies,
the
cluster
development
strategy
should
be
implemented
in
a
way
that
facilitates
and
connects
and
the
flow
of
benefits
and
information
to
Montana
optics
industry
companies
outside
of
Bozeman.
2. The
strategy
should
respond
directly
to
the
most
pressing
needs
expressed
by
the
companies.
The
companies
say
they
need
help
with:
• Specialized
employee
recruitment
• Business
development
• Getting
access
to
capital
• Identifying
and
developing
strategic
partnering
relationships
The
companies
surveyed
indicated
a
strong
interest
in
networking,
getting
better
connected
to
each
other
and
improving
business
and
technical
information
flows
within
their
group.
3. The
strategy
should
feature
a
mechanism
that
responds
to
the
above
listed
needs.
4. The
strategy
should
protect
and
feed
the
cluster’s
key
infrastructure
elements
and
fill
in
important
infrastructure
gaps.
The
key
elements
are
the
OpTeC
–
Spectrum
Lab
tandem
that
perform
and
advance
multi-‐disciplinary
bleeding
edge
research,
drive
into
applications
development,
and
generate
talent
and
MMEC
that
provides
valued
technical
assistance
to
optics
companies
with
manufacturing
operations.
5. The
strategy
should
position
the
cluster
as
an
economic
development
marketing
asset
for
Montana.
32
Actions
The
below
presented
action
recommendations
define
a
cluster
development
strategy
designed
to
both
respond
to
optics
companies’
most
pressing
business
needs,
as
expressed
by
those
companies,
while
pressing
the
advantage
on
the
cluster’s
most
distinctive
and
powerful
development
assets.
To
this
end,
these
actions
are
designed
to
enrich
the
entrepreneurial
culture
and
very
strong
innovation
orientation
that
define
the
cluster
and
its
companies
–
a
culture
and
orientation
that
is
fueled
by
an
innovation
infrastructure
that
generates
multi-‐disciplinary
science
and
engineering
talent,
bleeding
edge
research
and
a
strong
flow
of
application
possibilities
for
this
ubiquitous
industry
with
diverse
international
market
segments
and
niches.
Action
1
Working
with
a
steering
committee
of
key
optics
cluster
companies
and
stakeholders,
design
and
establish
the
Big
Sky
Optics
Alliance
to
oversee
the
implementation
of
the
strategy
and
to
function
as
a
hub
for
the
cluster.
The
steering
committee
would
be
charged
with
managing
the
development
of
the
initial
business
plan
for
the
Alliance
including
mission,
structure,
operating
priorities
and
funding
sources
and
with
recruiting
the
first
board
of
directors.
Two
early
and
key
decision
points
here
are
1)
whether
the
Alliance
should
be
“incubated”
within
another
organization
during
its
formative
stages
and
2)
whether
the
Alliance
should
be
designed
as
a
stand-‐alone
entity
or
as
a
working
entity
under
the
umbrella
of
another
entity
such
as
Innovate
Montana
or
the
Governor’s
Office
of
Economic
Development.
Action
2
Assuming
they
are
amenable,
factor
in
roles
for
OpTeC,
Spectrum
Lab,
and
MMEC
within
the
strategy
implementation
effort
as
key
innovation
infrastructure
elements.
The
Alliance
should
focus
on
responding
to
optics
company
business
needs
and
on
helping
them
grow
and
prosper.
In
view
of
its
mission,
its
board
should
be
private
sector
dominated.
However,
a
well
developed
innovation
and
technical
assistance
infrastructure
here
imbues
the
optics
industry
with
competitive
advantage
–
it
helps
the
firms
and
the
cluster
continuously
create
new
value.
These
three
organizations
together
are
to
a
large
extent
what
make
this
a
cluster
rather
than
just
a
collection
of
companies.
Because
they
produce
talent,
research,
commercialization
paths,
applications
and
technical
assistance
for
the
manufacturing
dimension,
they
create
an
advantage
for
the
companies.
Action
3
Establish
very
focused
initiatives
to
address
the
optics
company-‐specific
entrepreneurship
training
and
technical
assistance
gap.
While
OpTeC,
Spectrum
Lab,
and
MMEC
help
define
a
well-‐developed
infrastructure
for
this
cluster,
there
is
still
a
notable
gap.
A
number
of
companies
expressed
a
need
for
business-‐
33
oriented
technical
assistance
specifically
tailored
to
optics
companies.
The
general
sentiment
was
that
cluster
companies
and
their
interactions
with
OpTeC
and
Spectrum
Lab
together
have
generated
a
cadre
of
technical
entrepreneurs
within
the
cluster
and
that
they
will
continue
to
produce
aspiring
optics
entrepreneurs
who
need
help
in
areas
such
as
intellectual
property
management,
contracts
administration,
access
to
capital,
recruiting
strategic
partners
for
continued
applications
development
or
market
development
and
so
on.
To
this
end,
two
initiatives
are
recommended
–
one
directed
at
university
students
and
researchers
so
they
are
better
prepared
for
the
business
of
optics
company
development
and
one
aimed
at
providing
assistance
to
existing
entrepreneurship
and
companies.
1. Either
through
GOED
or
under
the
auspices
of
the
Big
Sky
Optics
Alliance,
working
with
and
through
MSU
and
OpTeC,
design
and
find
funding
for
an
initiative
to
infuse
entrepreneurship
courses
and
experiences
into
optics-‐related
curriculum.
2. Either
through
GOED
or
under
the
auspices
of
the
Big
Sky
Optics
Alliance,
establish
a
program
to
provide
optics
companies
access
to
entrepreneurship
and
business
assistance
providers
that
work
with
technology
companies
and
are
viewed
as
credible
by
the
optics
companies.
At
the
moment,
the
demand
for
these
services
is
acute
but
limited.
Put
more
simply,
due
to
the
size
of
the
cluster,
for
the
near
future
only
a
handful
of
companies
will
need
this
kind
of
help
at
a
moment
in
time.
But,
those
that
do
need
it
really
need
it.
As
the
cluster
continues
to
develop
and
expand
the
demand
for
this
type
of
assistance
will
also
expand.
These
services
could
be
delivered
by
putting
a
qualified
individual
or
organization
on
retainer,
by
providing
the
optics
firm
with
a
voucher
to
be
used
for
the
purchases
of
technical
assistance
help,
or
by
working
with
an
existing
technology
entrepreneurship
entity
to
develop
more
in-‐depth
optics
industry
specific
business
knowledge.
Action
4
Design
and
launch
an
initiative
to
promote
and
encourage
angel
investment
in
Montana
optics
companies.
Capital
requirements
for
companies
within
the
optics
industry
tend
to
be
relatively
low
when
compared
to
other
knowledge-‐intensive
industries
like
bioscience.
As
a
result,
many
optics
companies
are
desirable
targets
for
angel
investors
and
angel
networks.
Although
there
is
some
angel
investment
in
play
among
the
Montana
optics
companies,
angel
investors
as
a
reliable
early
stage
capital
source
were
not
viewed
as
having
a
strong
presence
though
cluster
companies
as
a
group
regard
access
to
capital
as
one
of
their
highest
priority
needs.
As
a
starting
point,
two
actions
are
recommended
here.
1. GOED
could
encourage
the
formation
of
a
small
optics
angel
investment
network
by
paying
for
the
development
of
the
group’s
business
plan
and/or
helping
to
defray
the
34
network’s
organizing
costs.
In
the
past
these
types
of
modest
efforts
have
been
effective
in
fomenting
the
formation
of
business
and
manufacturing
networks.
The
GOED
role
here
is
that
of
a
catalyst
and
not
a
sustainer.
2. Enact
financial
incentives
for
angel
investment
in
qualified
companies.
This
could
be
accomplished
by
providing
a
tax
credit
for
early-‐stage
investment
in
qualifying
companies
and/or
by
deferring
taxation
of
capital
gains
from
investment
in
qualifying
early-‐stage
companies
that
are
reinvested
in
qualifying
early
stage
companies.
Action
5
Continue
to
build
the
talent
base
–
talent
trumps
everything.
Establish
a
robust
optics
internship
program.
Spearheaded
by
GOED
or
under
the
auspices
of
the
Big
Sky
Optics
Alliance,
this
internship
program
would
work
with
and
through
OpTeC
to
place
promising
students
in
cluster
companies.
An
effective
approach
here
might
fund
these
positions
at
some
prescribed,
competitive
rate,
say
$15/hour,
and
the
state
could
reimburse
the
company
for
half
the
hourly
wage.
This
would
be
an
“everybody
wins
scenario”
where
the
student
receives
an
attractive
wage
and
obtains
in-‐the-‐trenches
experience,
the
company
gets
a
good
deal
and
the
cluster
and
state
build
talent
with
a
very
modest
fiscal
impact.
Action
6
Connect
to
the
Globe:
Establish
a
formal
initiative
to
connect
Montana
optics
companies
and
the
Montana
optics
cluster
to
firms
and
clusters
in
other
places
–
especially
in
other
countries.
Montana
optics
company
survey
respondents
indicated
almost
40%
of
their
sales
were
outside
the
US.
This
report
identifies
at
least
50
optics/photonics
alliances
and
associations
in
other
countries.
These
organizations
are
now
participating
in
numerous
international
optics
alliances
and
collaborations
covering
North
America,
Europe,
the
Pacific
Rim
and
Australia.
Their
activities
include
information
exchange
among
researchers,
rotating
summer
schools,
employee
exchange,
and
internship
programs.
The
most
logical
entity
to
undertake
this
initiative
is
the
Big
Sky
Optics
Alliance
once
it
is
up
and
running.
OpTeC
should
also
be
regarded
as
a
valuable
participant,
especially
on
education-‐related
and
research
connections
and
exchanges.
Action
7
Consider
larger
optics
firms
outside
of
Montana
as
a
strategic
recruitment
target
to
anchor
the
cluster.
The
Montana
optics
cluster
is
comprised
of
small
firms
and
very
small
firms.
There
are
some
circumstances
in
which
recruiting
a
larger
firm
to
anchor
the
cluster
makes
business
sense
for
the
cluster
and
economic
development
sense
for
the
state.
The
strategic
35
recruitment
target
would
need
to
meet
two
criteria:
1)
it
could
not
be
a
direct
competitor
of
existing
firms
and
2)
it
would
need
to
have
the
capacity
to
be
a
substantive
customer
for
a
subset
of
the
existing
cluster
firms.
If
the
recruitment
target
meets
these
criteria
then
the
remaining
issue
is
the
labor
market
and
workforce
availability
impact
associated
with
adding
a
larger
firm
into
the
cluster
mix.
An
argument
can
be
made
that
while
this
may
indeed
be
an
issue,
it
is
a
good
issue
to
have.
You
address
this
by
producing
more
talent
and
importing
more
talent
–
both
important
capacities
for
dynamic
clusters.
Marketing Considerations For the Governor’s Office of Economic
Development And The Economic Development Community
As
a
final
note,
based
on
the
foregoing
analysis
and
recommendations,
the
Montana
optics
cluster
can
boast
at
least
five
characteristics
that
can
serve
as
distinctive
assets
from
an
economic
development
marketing
standpoint.
1. Company
density
can
be
a
talent
recruitment
magnet.
The
large
number
of
companies
in
the
Bozeman
area
portends
employment
mobility.
A
talented
engineer
or
scientist
considering
a
move
to
Bozeman
can
anticipate
other
employment
and
career
advancement
opportunities
if
the
one
in
question
does
not
work
out.
2. Bozeman
(Big
Sky
Country)
as
a
place
and
lifestyle
is
one
of
the
most
desirable
locations
in
the
country.
3. Through
OpTeC
(and
Montana
State
University)
and
Spectrum
Lab,
optics
companies
and
optics
talent
have
access
to
bleeding
edge
science,
engineering
and
applications.
4. Youth
and
Energy.
Young
entrepreneurs,
engineers,
and
scientists
drive
the
companies
and
environment.
5. Big
Sky
Optics
Alliance
(assuming
it
is
established).
The
cluster
has
its
own
activity
and
information
hub
that
supports
a
wide
range
of
company
business
needs
and
promote
peer-‐to-‐peer
networking
and
collaboration.
36
Appendix A: Montana Optics Company Survey Instrument
Page 1
Montana OpticsMontana OpticsMontana OpticsMontana Optics
Montana’s optics industry is one of the state’s best-kept economic development secrets. We’d like to change that. We
are contacting you because your company has been flagged as member or potential member of our state’s optics
industry.
The Governor’s Office of Economic Development wants to know what it can do to help Montana optics companies
continue to start and to grow. We also want to shine a national spotlight on what you and your peers have already
accomplished. To do this we need to know who you are, what you do, and what business issues are on your mind
when you are driving to work in the morning. Please take a few minutes to complete this very short on-line survey. Once
we assemble this information we will act on it.
Please note this survey guarantees respondent confidentiality. Findings are only reported at an aggregate level, not on
an individual basis.
1. Company Information
2. Do you have offices other than the location listed above?
3. If yes, where are your other locations?
4. Approximately how many employees do you have?
Name:
Company:
City/Town:
State:
Email Address:
Phone Number:
Yes
No
1-5
6-20
21-50
50-100
Over 100
37
Page 2
Montana OpticsMontana OpticsMontana OpticsMontana Optics
5. What are your products or services OR planned products and services?
6. Where are your markets (approximate % local, national, international)?
7. What are your most pressing business issues at the moment? You can select more than
one answer.
8. Have you ever received an SBIR grant?
Local
National
International
Experienced/specialized employee recruitment
Worker training
Access to capital
Strategic partners
Business/market development
Distribution and logistics
Access to specialized suppliers or materials
Intellectual property management
Manufacturing or process issues
Access to specialized scientific or engineering expertise
Administrative assistance
Human resources assistance
Using/maximizing impact of social media
Other (please specify)
Yes
No
38
Page 3
Montana OpticsMontana OpticsMontana OpticsMontana Optics
9. If so, what phase(s) and what is the title? What is the status?
10. Are you interested in participating in events or functions that bring Montana optics
companies together to network or address common issues?
Thank you for participating in this survey! We truly hope this project benefits companies like yours.
Yes
No
Comment