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Feb 17 -- The Small Business Administration (SBA) invites comments to OMB by March 27, 2023 regarding the Evaluation of the Regional Innovation Cluster (RIC) Initiative. [Comments due 30 days after submission to OMB on February 23.]

The U.S. Small Business Administration's (SBA) statutory mission is to “aid, counsel, assist and protect, insofar as is possible, the interests of small business concerns.” The Agency's Office of Entrepreneurial Development (OED) helps to carry out this mission by providing training and counseling programs and initiatives, such as the Regional Innovation Clusters (RIC) initiative, to existing and prospective small businesses.

Through the RIC initiative, the SBA is investing in regional clusters—geographic concentrations of interconnected companies, specialized suppliers, academic institutions, service providers, and associated organizations with a specific industry focus— throughout the United States that span a variety of industries, ranging from energy and manufacturing to advanced defense technologies.

The RIC Initiative capitalizes on the theory of regional cluster development by supporting “actively managed” clusters (i.e., clusters that are administered by a team of individuals and possess a form of governance rather than a cluster that occurs naturally without intervention in a regional economy). The clusters provide a host of services to the target population of small and emerging businesses within their regional and industry focuses. Services include direct business advising and support and sponsoring events, such as networking opportunities with investors, large businesses, and other stakeholders in the regions.

The three primary goals of the initiative are to (1) increase opportunities for small business participation within clusters, (2) promote innovation in the industries on which the clusters are focused, and (3) enhance economic development and growth in cluster regions. This information collection is necessary for the SBA to understand the progress of the RIC initiative toward achieving those goals. These surveys will gather information from administrators, clients and other stakeholders who participate in the industry cluster and its programs. SBA will use the data to compare the economic outcomes of the businesses to non-participants and document the initiative's effect and client satisfaction in a public report.
In 2020, the SBA conducted the Evaluation of the U.S. Small Business Administration’s Regional Innovation Cluster Initiative. Prepared by contractors, the evaluation consisted of two key components: an implementation evaluation and an outcome evaluation. The implementation evaluation focused on how the Initiative was implemented across the 14 clusters and on the services that each cluster provided to its small businesses. The outcome evaluation the extent to which the desired program outcomes have been achieved. The results suggested that the RIC has supported small business participants’ growth in both revenue and employment. Over the evaluation years, study data and revised surveys have helped to track the program performance outcome and provide suggestions for the program improvements. Furthermore, data from the survey also helped the SBA to better focus on rural and agricultural small businesses.

The SBA plans to continue collecting program performance and participating business outcome data from the program administrators and participants annually. Changes in key measures, such as revenue and employment growth will be benchmarked against similar firms in the same regions. In addition, the participants’ satisfaction with the program and the perceived program’s effects on their business outcomes (and the goals of the Initiative) will be tracked from year to year. The SBA hired an independent contractor to plan and conduct this evaluation of the RIC Initiative.

The evaluation will examine the program’s short-term, intermediate, and long-term outcomes. The short-term and intermediate outcomes are directly linked to cluster services, activities, and events, and are expected to be observed during or soon after participation in the RIC. The short-term outcomes include the satisfaction and the perceived effectiveness of the program on business management and growth. The intermediate outcomes are development of new products and the commercialization of new technologies, marketing and exports, access to capital, and industry and business network integration. Long-term outcomes, such as increased revenue, profits, and employment are expected to be observed in subsequent time periods as results from the short- and intermediate-term outcomes achieved.  

The data collection effort discussed in this request involves the collection of a variety of data from three types of RIC initiative stakeholders. Small businesses participating in the cluster represent the first group of initiative stakeholders. They will be sent an online survey to provide data about their participation and satisfaction, the performance of their firm regarding a variety of performance indicators that are expected to manifest themselves due to cluster participation, and the role of cluster participation in the achievement of these key performance indicators. In addition, twelve small businesses will be recruited to participate in a semi-structured interview about their experiences with the cluster, how the cluster helped them achieve their business goals, unmet needs, and suggestions for improving cluster services. The contractor may request to record the conversation for internal use at a later date, provided that the interviewee consents to being recorded. The recording will not be distributed and will only be used to assist qualitative data coding.

Large organizations, a broad group that includes universities and national laboratories, public sector agencies, nonprofit organizations, and business associations, represent the second group of initiative stakeholders. They will be asked to answer an online survey to provide data about the reasons for their participation, their collaboration or involvement with small businesses, and the role of cluster participation on key indicators associated with their operations. In addition, twelve will be recruited to participate in a semi-structured 30-minute interview about their experiences with the cluster, how the cluster helped them achieve their organizational goals, unmet needs, best practices, and issues supporting small businesses, and suggestions for improving cluster services. The contractor may request to record the conversation for internal use at a later date, provided that the interviewee consents to being recorded. The recording will not be distributed and will only be used for qualitative data coding.

The administrators of the clusters involved in the RIC initiative will be asked to complete a survey that provides the frame from which small business and large organization surveys are sent, as well as information about the services they provided to these two groups of stakeholders, and about their operations in general. In addition, cluster administrators will be interviewed once a year to clarify and follow up on the content of their progress reports, and to obtain information about how their operations have evolved, the adjustments they made, best practices, issues encountered, and the lessons learned during the year. During this one-hour interview, the contractor may request to record the conversation for internal use at a later date. Please note, the recording will not be distributed, and the contractor will only record the conversation provided that the interviewee consents.  

The proposed evaluation will be used to increase the SBA’s understanding of outcomes of small business across its RIC portfolio, to identify potential difficulties and mitigations in the Initiative implementation, and to contribute to the body of knowledge surrounding how RICs help small businesses. This data will not be used to evaluate the effectiveness of an individual cluster.  The evaluation results also do not allow for causal claims regarding the relationship between the outcomes and the services provided through the Initiative.   
At least three categories of users exist for the information collected and it is used in the following ways:

1. The SBA uses the evaluation findings on a regular basis to monitor program trends across its portfolio and assess participants’ satisfaction with the services. Evaluation findings are also used by the SBA during interactions with its stakeholders, including Congress. The SBA has used the outcome data to assist in defining the markets to focus the cluster initiative for the newest clusters. The evaluation findings allow the SBA to continue to monitor trends across the portfolio of the existing clusters.

2. Cluster administrators use these evaluation results to refine their strategy and improve the service mix they provide to participants. They may also use this information during discussions with potential partners, in an effort to obtain other sources of funding outside of the SBA.

3. Researchers in the field of economic development as well as cluster practitioners use the findings from this evaluation (which are shared with the public) to implement or refine a cluster strategy in their region, improve how they measure their own initiative or project, or develop improved methods to measure cluster performance.
This study will use quantitative (i.e., descriptive and inferential statistical techniques) and qualitative methods for analyzing the data. The analysis is expected to include tables for the statistics and graphs. The full report will include the inferential statistics, such as the p-value for statistical significance at the 5 percent and 1 percent levels. Other data gathered from the surveys will be presented in tables using descriptive statistics. Qualitative analysis will involve identifying the main themes about challenges, lessons, and the factors to which participants attribute their success. A final public report will be released approximately 6 months after the data collection is complete.  

The consultants who will design, collect, and analyze the information for the SBA are from Optimal Solutions Group, LLC.  

RIC Initiative: https://www.sba.gov/local-assistance/regional-innovation-clusters
SBA submission to OMB: https://www.reginfo.gov/public/do/PRAViewICR?ref_nbr=202302-3245-003 Click IC List for information collection instrument, View Supporting Statement for technical documentation. Submit comments through this webpage.
FRN: https://www.federalregister.gov/d/2023-03363

For AEA members wishing to submit comments, "A Primer on How to Respond to Calls for Comment on Federal Data Collections" is available at https://www.aeaweb.org/content/file?id=5806

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