I just finished reading How Money Walks: How $2 Trillion Moved Between the States and Why It Matters by Travis Brown. It traces the flow of adjusted gross income (AGI) over a 15 year period from high tax to low tax states. It’s a quick and compelling read, well worth the time and it got me thinking — for decades the cornerstone of economic development has been to “tell the story” no matter what that story might be. Let’s dress it up, brand and broadcast it to as many willing listeners in our target audience as possible, lure them for a site visit and then manage the project. I know there is more to it than that, in fact much more but that really is the essence, right?
But in today’s digital age, where information is readily available and much of the due diligence related to site locations and expansions is completed well in advance of the EDO’s knowledge, are we dedicating our resources properly? Should the emphasis still be on telling our stories or should we be more aggressively trying to change our stories?
Among the current stable of RDG projects, over the spring and summer I have been spending the bulk of my time in Miami, Orlando and Chattanooga. Recently I also had the opportunity to spend some time in Oklahoma City and Rocky Mount, NC as they look ahead to new funding cycles. There has been a common theme in every one of these great but very different markets: how do we get better? Not so much how do we get better as an organization although that is an important component of the dialog, but how do we get better as a community/region and what can we as an organization do to be catalytic in that process.
Talent, infrastructure, housing, access to capital, K-12 education, entrepreneurism, higher ed-business collaboration, physical product, government regulation and tax structure — these are the common themes. What’s missing from the list? Branding, marketing, sales — meat and potatoes ED. My takeaway? It’s not the process and mechanics of economic development – branding, marketing, project management, etc. – that’s making the difference today, it’s our communities themselves; ergo, we need to change the story!
OK, I am exaggerating to make a point, and please don’t misinterpret this point to be that EDO’s should be emphasizing product improvement at the expense of product branding, marketing and sales. What I am suggesting is EDO’s need to be concerned about both. Another contradiction of the digital age is that with so many avenues of information, it is harder than ever to communicate! As a result, EDO’s can’t stop telling their story; however, it’s also true that competition among communities and regions is fiercer than ever, so EDO’s also MUST be thinking about how to make their communities/regions better! Change the story! Whether it’s the EDO, Chamber, Community Foundation or a consortium of organizations, someone needs to be focused on the product!
Product issues are deep, endemic and often-times systemic. The solutions are long term, hard to see and even harder to measure. That’s why many EDO’s have avoided this area in the delivery of services. No more. While sophisticated corporations understand product challenges, they also understand that some places work on them better than others. And while the expectation is not that a community has “solved” their challenges, corporate leaders want to know that the community has a plan to address them. Companies want to be places that want to be better.
The gist of How Money Walks is that AGI is moving from high cost to low cost states. Clearly there is more to it than just tax structure, but equally as clear is that this “product” factor – taxes – is a meaningful and compelling differentiator. What are your differentiators? What are you doing to change your story?