The Dutch Flower Cluster

Introduction

Prof. Michael Porter of HBS, Dirk Hogervorst of FloraHolland, Prof. Fred van Eenennaam of The Decision Institute and Stacie Rabinowitz of Harvard Business School. Co-writer Prof. Jorge Ramirez-Vallejo is not in the picture

The Dutch Flower Cluster case is a business case on the success of the Dutch flower sector.  Prof. Dr. Fred van Eenennaam of The Decision Institute is co writer of the case, together with writers Professors Michael E Porter and Jorge Ramirez Vallejo of Harvard Business School and with the help of FloraHolland. The case is part of the MoC MBA course (link to TDI.Academic.MoC) and was launched on April 5th. The first teaching of the case was performed at Harvard Business School by Prof. Dr. Michael E. Porter. Prof. Dr. Fred van Eenennaam and Dirk Hogervorst operated as protagonists.

Via this page, The Decision Institute offers additional support to teach the case and provides more in-depth information on the flourishing flower sector of The Netherlands and other Dutch Clusters. The website will be updated regularly and more materials are being developed.

Short summary of the Dutch Flower Cluster Case

Prof. Michael Porter teaching the Dutch Flower Cluster Case Spring 2011 The Netherlands has always been a major player on the world market for cut flowers. Around 60% of the world export market for flowers is traded in The Netherlands, with sales of $16.7 billion of Floricultural products in 2008.

The Netherlands started cultivating and growing flowers with tulips from Turkey by the end of the sixteenth century. As a market for flowers emerged, greenhouses of glass, heated by gas were built and in 1908 the first flower trade organization was founded.

In 2009, there were two flower auctions (of which FloraHolland is the biggest in cut flowers) trading 20,000 varieties,  3,770 growers, 693 exporting companies and 20+ associations, councils, research centers et cetera. The square meters of greenhouse were declining in The Netherlands, but yield was growing through new production techniques.

Production was growing rapidly in competing countries with a more favorable climate and lower cost of labour like Columbia, Ecuador and Kenya, but most of these flowers were still traded via the Dutch auctions and ran through its extensive logistic system. In 2009 44.8 million flowers were sold in 125,000 daily transactions, most of them being roses, chrysanthemums and tulips.

In 2011, The Dutch Flower Cluster faces some major strategic challenges. Rapid technological developments, for instance internet applications and remote buying, pose a potential opportunity as well as a challenge for the Flower Auction. Another challenge lies in the changes in the cluster network and linkages. Examples are the emerging competition from African and Southern American countries, and the links with economic development of these countries. Increased prices of fossil fuels put pressure on Dutch growers (natural gas for the greenhouses) as well as on transportation, comprising a large portion of product cost.

Ordering your own copy

MoC IMBA students visiting one of FloraHolland's Auctions

To get your own copy you can order it at Harvard Business School (case nr 711-509) via the Harvard Business Publishing website (if you are a teacher). If you have any questions, please send an e-mail to r.oostwoud@thedecisiongroup.nl

 

Links to useful websites

Websites of organizations in the Dutch Flower Cluster:

Visiting the Netherlands and FloraHolland

If you plan on visiting The Netherlands we can help organize a trip to the Dutch flower auction with FloraHolland. The visit can be combined with a visit to other flower-related highlights, such as  Keukenhof, or other Dutch clusters such as the Port of Rotterdam or the Eindhoven High Tech Campus.

Please send an e-mail to r.oostwoud@thedecisiongroup.nl if we can be of any help. A visiting package is available and we can help arranging accommodation and transport.

Visits typically include

  • Visiting the FloraHolland Flower auction
  • Case Discussion
  • Visit to Amsterdam
  • A company visit
  • Visit to other Dutch clusters. For instance
    - Port of Rotterdam (Transportation, Petrochemics and Dredging)
    - Schiphol Airport
    - High Tech Campus Eindhoven

Teaching support

As additional support to the case we can provide:

  • Short Skype or conference call before your lecture
  • Distant teaching (guest lecture) via Skype/video conferencing
  • Live guest lecture at your university

People that could help you with this:

Co-writer of the case Prof. Dr. Fred van Eenennaam is an expert in the field of Strategy, Governance and Competitiveness. See www.thedecisioninstitute.org/academic for his academic positions. He is working with Prof. Dr. Porter and Prof. Dr. Ketels in the Micro-economics of Competitiveness Program, set up a number of leading commissioners and board programs and performs directorships at a number of companies and organizations.

Dirk Hogervorst, General Manager at FloraHolland Rijnsburg. Dirk is expert on supply chain management and has a lengthy experience in the Flower sector. He contributed to writing the case and is a subject matter expert on the Dutch Flower Cluster.

Prof. Dr. Pablo Collazzo has extensive academic and professional experience in sustainable competitiveness. He has been teaching Strategy and Competitiveness at multiple academic institutions. Pablo has been Director of Academic Affairs at the European Academy of Business in Society and developed a career in investment banking and later in strategy consulting. He has served as board member/advisor to a number of companies and remains Strategic Advisor in Sustainable Competitiveness for the Latin American Program to the United Nations Industrial Development Organization (UNIDO).

Other Dutch Clusters and Cases

The Decision Institute has in-depth knowledge of clusters and affiliate The Decision Group performs consulting projects, studies and monitors for Dutch clusters and associations.

A shortlist of  other clusters in The Netherlands:

The  IMBA class of Prof. dr. Fred van Eenennaam and Prof. Dr. Pablo Collazzo wrote some prizewinning and runner up cases for the Microeconomics of Competitiveness course – case writing challenge at Harvard.

  • Port of Rotterdam
  • Dutch Dredging Cluster
  • Taiwanese Bicycle Cluster
  • Australian Mining Cluster

Topgebieden

In 2011 the Dutch Government has pointed out 9 “topgebieden” (top areas) which are important sectors for the Netherlands. The Dutch top areas or clusters that were picked by the minister of Economic Affairs are Horticulture & propagation materials (Flower Cluster); Life Sciences & Health; Logistics (Port of Rotterdam, Schiphol); Agro food; Water; Energy; Chemicals, High tech and Creative industry.

More about Dutch government policy can be found on www.agentschapnl.nl

June 17th 2011, all top areas presented their plans to the Minister of Economic Affairs.  This website reports in Dutch on the top sectors. Click to download the reports with action lines for the next 20 years for the Flower cluster (tuinbouw) and the Dutch Life Sciences & Health Cluster.

We’ve translated the main action lines for these sectors in the following documents:

Our affiliate The Decision Group presents a yearly Outlook for the Dutch Life Sciences & Health sector. In the Top sector Report of Life Sciences, The Decision Groups monitoring methodology is used in the Top sector’s plans.

23 March Cluster Master Class

March 23rd 2011, we organized a MasterClass on the Development of clusters with Harvard Business School professor Christian Ketels, Prof Dr. Fred van Eenennaam of The Decision Institute and Jeroen Heijs of AgentschapNL.

Click here for a presentation on Cluster success in The Netherlands by Prof. Dr. Fred van Eenennaam

Click here for a presentation of Agentschap NL on Dutch Cluster Policy

Click here for a presentation of Prof. Ketels of Harvard Business School on Cluster development and the role of cluster initiatives.

The Dutch Flower Cluster Case in the media

Diverse articles have been published on the Dutch Flower Cluster Case. Here are some links and examples:

Flower Cluster Case Teaching Worldwide

The Dutch Flower Cluster Case is taught worldwide. Even Harvard Business School Shanghai the case is presented at the website. Here are some experiences with Case discussion of the Dutch Flower Cluster Case:

  • Case Teaching for 140 first year BA students at Erasmus University, Rotterdam. Response from the Audience: “The last guest-lecture by Prof. van Eenennaam was the best of all guest lecturers we had for the organization & strategy class. He had an interesting talk. We did not even mind that there was no break in between, that nice it was to us students”
  • Case Teaching at Darla Moore School of Business at the University of South Carolina by Prof. Douglas P Woodward. On October 10th, 2011.   Professor Woodward told us “this was the best case I have used in the class. It was great to have the video of the flower auction. The case questions are good for discussion. I will definitely use this case in future classes”.

Some testimonials & quotes from students

The country of Holland is formidable. Indeed I returned today from Amsterdam for a business trip. I found the case Dutch Flower Cluster as the most interesting because of my interest in this country, also the international trade that takes place in large scale with the cluster of flowers.

Oscar Anaya
TELEPLAN, General Manager Mexicali Operations.

The development and technological advancement on this cluster is very impressive, especially the advanced application of technology applied to something as simple as flowers. Excellent design and distribution logistics program including sales and post-sales.

Karla Coronado
Gulfstream Aerospace Corporation

A lot of creativity and intelligent way to distribute a primary product to the world.

Sergio Arceo
Kenworth Mexicana, Country Manager Paccar Capital

The case was very interesting because it broadens your vision. It lets you see how an industry that may seem very simple and elementary as the flowers can make a 180 degree turn to apply a high level of technology. They use their skills, maintain their culture and innovate.

Gregoria Padilla
Honeywell Aerospace, Design Engineer