Kim Didier is from Newton, Iowa, a little town of 15,000 that rests smack-dab in the middle of the state.   In my imagination she regularly belts out would-be top-40 hits in the shower, but only when she’s not on tour with her entourage and counting the millions she’s made from going platinum.  In reality, Kim’s—well—totally normal.  She’s friendly, inquisitive, entirely approachable, and generally nice to be around.  She has a professional haircut and sports business casual with the best of ‘em.  So, what makes her so undeniably cool?

Regional Economic Crisis
In 2001, Maytag Corporation, which had been headquartered in Newton for 113 years and employed 4,000 people at its peak, announced it would reduce the local labor pool by moving to new facilities in Mexico.  On October 25, 2007, Maytag ceased operations in Newton for good, with closure of both a production facility and corporate offices.  That day, a final 1,800 Maytag employees lost their jobs.

Townsfolk began going through the seven stages of grief, starting with shock and denial, pain and guilt, anger and bargaining, and depression.   People might have gotten stuck there but, rather than wallowing in their sorrow, the common loss brought the community together.  Community leaders, including Kim Didier, pounced on the opportunity to shift negative energy focused on confusion, grief, and anger to more constructive purposes.

Taking Action
Like any good counselor, Kim called on community residents to do a little role playing.  The process started off with something called “The Futures Game.”  An Australian “gent” from rural Australia, David Beurle, led the exercise, which helps people understand how, when faced with tough futures about growth and development, different choices at critical points in time can lead to drastically different community outcomes.  This process led to development of a community vision, steeped in the understanding that if people stray from the decision or don’t make collaborative, mission-driven choices, the community’s future outcomes could be sharply affected.  Salt brines or development

In addition, Kim prodded the community to participate in a process called “network weaving.” This entails understanding how strongly connected community leaders are to one another, where their passions and expertise intertwine, and how they view one another as collaborators, innovators, and trusted partners.  U.S. national intelligence agencies use the process to understand the effectiveness of terrorist networks, and the U.S. Centers for Disease Control has employed the technique to control deadly infections in hospitals.  Kim Didier and her peers employed the process to understand how to most effectively move their community forward.

Did these hokey processes really make a difference for Newton?  The answer is an irrefutable “yes.”    These processes helped the community establish common desired outcomes and rallied leadership around it—fully leveraging the full strengths of the communities assets and building trust relationships that have allowed the community to move forward.  Today, Newton isn’t “formerly the home of Maytag.” They are at the center of innovation, becoming a manufacturing and design hub for state-of-the art wind turbines and, with just one employer, home to 400 new, related jobs.

Recovery
Slowly but surely, the town is moving through its phases of grief: the upward turn, reconstruction, and acceptance and hope in abundance.   This transition was possible because some folks dared to do the unthinkable—to step back, create a vision, create safe spaces to build trust, and understand how to focus community leaders’ energy at the right places at the right time.

What do you call someone who recognizes the need for this kind of process and gets the buy-in to make it happen? Yep–that’s a “Rock Star” in my book.

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Thanks to Cristóbal Cobo Romaní in Flickr.

NOTE: This is the third in our recent “let’s share the findings from all those OECD reports with each other (and the world)” series. Again, the content is not likely scintillating, but it’s important to us, and we’re happy to let you in on it.

The OECD Designing Local Skills Strategies Report (2009) focuses largely on questions of balance in locally designed workforce strategies: balance between short- and long-terms needs, balance between training and placement, balance between meeting the needs of people, firms, and communities, and balance between workforce players – private, non-profit, and a diverse collection of government agencies at different levels.

Authors Francesca Froy, Sylvain Giguère, and Andrea Hofer offer case studies of the following communities:

• Shanghai (China)
• Michigan (U.S.)
• Choctaw Tribe (Mississippi, U.S.)
• Mackay (Australia)
• Malmö (Sweden)
• New York City (New York, U.S.)

While, other communities are also cited in the narrative, these communities’ launched initiatives representing what the report calls balanced strategies, the authors’ recommended approach. Balanced strategies focus simultaneously on:

• Attracting and retaining talent
• Integrating disadvantaged groups
• Upskilling those in employment – though in most cases, this was the most difficult strategy because of its complexity (designing opportunities for working adults, often with families).

The report concludes by recommending that local workforce actors seeking to implement effective (and balanced) approaches focus on five key strategic issues:

• Access to relevant data and information. Local actors need to understand their “skills ecology” and its impact on the wider economy to be able to design appropriate policy and program interventions.
• Balanced and long term strategies. It is tempting for local actors to focus on only one or two strategic objectives. Focusing on all three areas is more difficult, but also promises to deliver more substantive impact over time.
• Batter mapping of skills provision, for example through “career clusters” or “career ladders.” This provide a focus for otherwise disjointed systems and creates opportunities for individuals to advance in meaningful ways. However, careers advice is a key (and often lacking) component of this approach.
• Building strong relationships with employers. While necessary to ensure effective connecting of supply and demand, public-sector and non-profit entities can play an important role in emphasizing long term needs and suggesting changes in workplace practices in ways that round out employer’s tendency to focus on short-term needs.
• Look to the future and anticipate change. Skills strategies should be subject to regular review and change, and should build toward local areas of “flexible specialization” (sometimes called workforce or talent competencies, or clusters of talent) that encourage the development of local talents and skills that are specific enough to make the community distinctive, but broad enough to avoid dependency on narrow industries or occupations.

Not rocket science, but it does take determination – people who do this work rely on persuasion and trust, not hierarchy.

Leadership and Governance Really Matter

While the report does not emphasize leadership and governance as a theme, the frequency with which the difficulty of this work is noted in the narrative is striking.  Meeting many diverse public and private needs, balancing the short and longterm, collaborating with large and changing networks of partners absent a structure, meeting shared national policy needs and in a local (and sometime divergent) context, developing and allocating resources fairly and in ways that deliver results – this is complex work all over the world, and speaks to the level of management expertise and leadership talent it takes to do well.

What’s our strategy for developing the workforce workforce?

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We just reviewed Regions Matter (OECD, November 2009). It’s chalk full of bits and bobs we’d picked up (and learned ourselves) while studying, conducting research, or providing technical assistance to stakeholders in regions, but offers a difference level of coherence than we’ve seen in some time.  We thought we might share.

Key Policy Messages about Regional Economies and Development (the “Big Picture”)

• The intent of regional policies is evolving: they are increasingly about fueling growth and not just limiting (or reducing) disparities.
• There is no consistent relationship between urban concentration and economic performance – simply concentrating resources in a place does not necessarily lead to growth.
• Public policy matters in maximizing the potential of assets in regions.
• Leading and lagging regions are both important – when lagging regions improve, they make important contributions to growth and equity, opportunity.
• The use of productive assets (labor, capital, technology) are correlated with growth, but no single factor explains improved performance in a region. It is the interaction and interdependence of key assets that matters (suggesting flexible and integrated policy approaches).
• Investment and governance are important dimensions of regional innovation and change, but there is no blueprint for these. Policy should be developed in the context of the specific assets a particular region offers.
• Research- and technology-driven innovation is highly concentrated, but public policy can impact growth and capacity in regions with assets in emerging fields.
• Innovation policy is not just about inventing the next new technology, but also about its adoption or application. Different regions have different innovation assets and can and should develop these based on their unique capacities. Some regions will invent; others will deploy or scale.
• Innovation capacity is moving East (to Asia, where there are high concentrations of skilled labor and dense supplier networks). This mean regions in OECD countries must be mindful of how they develop knowledge capital that allows them to compete.
• Rural regions offer innovation potential but in different ways – social innovation around environmental issues, better public services (on which most rural areas are highly dependent), and new cooperative arrangements for living, working, and managing communities hold promise.
• Sustainable urban growth is widely recognized as a key policy priority.
• Regional policy is difficult to manage at the national level. It would benefit from coordination and multi-year co-financing.
• Learning, knowledge-sharing, monitoring and evaluation need to be coordinated across levels of government.

What turns places with concentrations of assets into agglomeration economies? (from Krugman, 1991)

• The sharing of unique, place-based facilities (labs, universities, creative space, etc.)
• Gains from producing complementary products in a wider array of facilities
• Gains from a wider array of suppliers (and supply chain connectivity)
• Deeply and broadly skilled labor reduces risk of adjusting to market shocks
• Matching mechanisms (connecting workers and jobs, suppliers and purchasers, distributers with buyers and sellers, etc.)
• Learning mechanisms based on the generation, diffusion, accumulation of knowledge and the systems that cultivate and disseminate it.

Results of OECD Growth Model Analysis

• Human capital and innovation positively influence regional growth (as traditional growth theories suggest).
• Elements from new economic geography theories (e.g. agglomeration economies) are also relevant and reveal a spatial connection to growth.
• Infrastructure is a necessary but not sufficient condition for growth – it is only relevant if human capital and innovation are also present.

Time also matters in regional development efforts…

• Infrastructure and human capital shifts require three years to positively influence growth
• Innovation is even longer-term, netting positive effects after five years.

Governance in Regions

Regional development depends on efficient governance. Accountable and credible leadership is important, but it looks different than a generation ago:

• It’s network-based, not organization based.
• It’s championed by collaborative leaders, not individual heroes.
• It’s more likely to be university or public sector-based than private sector based (and that’s okay, as the attention of private sector leaders is now often global, not local).
• It manifests in shared public-private ventures that can take a variety of forms.

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Promising Practices in Regional Economic Development: Northeast Ohio

Last week, I attended an event focused on the importance of regional planning, partnerships between government, workforce, education, and economic development, and how encouraging entrepreneurship in regions can help spur economic growth and prevent further population loss.

My own organization, Corporation for a Skilled Workforce (CSW), has initiated or has involvement in several regional strategies in Michigan, Arizona, and across the country. Though CSW is not working in Northeast Ohio, this region won notoriety in its efforts to transform the region into a global economic competitor. We can learn from this example.

Regional Strategic Planning

In 2003, philanthropic and corporate leaders committed themselves to building a strategy from the ground up. I was living in Cleveland at the time and took part in the focus groups called Voices and Choices that informed the region’s efforts.

Moving to Action

Advance Northeast Ohio, the region’s economic action plan was launched in 2007 and creates a common vision for more than 80 partner organizations, institutions and leaders from business, philanthropy, and government. The 16-county partnership is committed to collaborating and implementing strategies that help create jobs, increase incomes, and reduce poverty, collectively strengthening the region.

Clear Priorities

The partnership has identified four clear priorities to guide its work:

• Business Growth and Attraction
• Talent Development
• Racial and Economic Inclusion
• Government Collaboration and Efficiency

Regional Investors

A regional funders collaborative, The Fund for Our Economic Future, emerged to support the region’s effort, and demonstrates how corporate and philanthropic partners can invest in a common vision.  Of the over $60million raised, most of the resources have been granted to regional economic development organizations that work to start, accelerate, attract, and grow companies in the region.

Tracking Progress

To monitor progress, partners, assisted by George Erickcek of the Upjohn Institute, created a community economic dashboard which is now updated annually by Cleveland State University. The dashboard is an index, tracking indicators in the following nine areas:

• Skilled Workforce and Research & Development (R&D)
• Legacy of Place
• Urban Assimilation
• Racial Inclusion and Income Equality
• Locational Amenities
• Technology Commercialization
• Urban/Metro Structure
• Individual Entrepreneurship
• Business Dynamics

Award Winning Practices

Jumpstart is northeast Ohio’s venture development organization that invests in early stage businesses and ideas. Through the end of 2008, it invested in 34 companies, which have raised more than $100 million in growth capital. The program was recently recognized for Excellence in Urban or Suburban Economic Development by the U.S. Economic Development Administration.*(See footnote)

Community engagement, regional action guided by strategy and clear priorities, consistent investment, and innovative practices—these are key ingredients in a recipe for regional transformation.

* Other finalists in the same category: Composites Kansas (WIRED Initiative, Wichita, Kansas); Conway Development Corporation (Conway, Arkansas); Los Angeles County Economic Development Corporation (Los Angeles, California).

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Thanks to ell_brown for the Flickr photo.

Training vs. Jobs

In communities across the country where unemployment is especially high, leaders and policy makers urge workers to upgrade their skills and search for employment in new and growing industries – like wind energy. But often, the jobs aren’t there yet.

Better Bridges Between Economic and Workforce Development

Yes, the world is getting smarter. Technology has enabled us to work in new and different ways: to collaborate, partner, and innovate in the way we do our work. Yet in regional economies, where programs are increasingly reliant on federal and state resources, siloed funding streams systemically impede effective collaboration. Integrated, comprehensive planning can help regions that are looking to bridge that gap. And new tools for practitioners and better research about integrated approaches are emerging.

Regional Research Symposium

In late October, the U.S. Economic Development Administration (EDA) partnered with the Regional Research Institute at West Virginia University on a Regional Research Symposium (links to presentations). EDA has invested in a number of initiatives that suggest areas where workforce and economic development should be connecting to create comprehensive regional strategies:

• Data. A collaborative research program between Indiana and Purdue Universities (leads), EMSI and the Rural Policy Research Institute’s Center for Regional Competitiveness created a set of data tools that take a regional approach to innovation-based growth to help identify promising paths to economic growth. While not yet complete, the tool will allow users to create their own region and access federal data all in one place.
• Funding Innovation. The same group also created an innovation index to help guide new investments. Innovation was seen as a place where economic developers could broaden their thinking and provide definition for other federal agencies. Further research into human capital qualities that promote innovative growth was also mentioned as a future funding interest.
• Linking Industry and Occupational Clusters. The research team from Indiana and Purdue Universities also created maps to help understand local workforce and education clusters to help bridge the gap between workforce and economic development. The maps can show how well the occupation and knowledge clusters strength match industry cluster strength. Location quotient analysis and changes in location quotient analysis maps can be found on their website.

Community Resilience

Another place of intersection is around community resilience. The EDA funded research from the Savannah River National Laboratory Community and Resilience Institute (CARRI) to provide a framework of community resilience. Taking a comprehensive approach to resilience, CARRI is researching communities’ ability to adapt to perceived adversity—in any situation—and suggests a long-term planning agenda to grow social capital between community assets.

We are keen to find ways to enhance our own effectiveness by integrating these new tools and approaches.

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What’s Community Agility?

Two years ago – when we launched the Community Initiatives Team – agility was on ours minds. Pre-recession, we were hearing flat, but seeing spiky. Our team members live and work in regions as diverse as Portland (OR), Tucson (AZ), Charlotte (NC), and all over Michigan. So while the U.S. economy at the time was widely perceived as booming, our communities were still smarting from the steep downturn a few year before. Yet, we were also bearing witnesses to infinitely creative responses to new challenges, and the beginnings of new kind of economy.

In our work, we were confronting significant structural challenges:

• Decreasing overall economic security for families despite job growth
• Industry-wide transitions changing job and skill requirements for large numbers of workers
• Lack of access to investment capital where entrepreneurs seemed to need it most
• Chronic budget shortfalls compromising basic public services in our communities, and
• Institutions, agencies, and organizations with clearly shared missions acting in isolation.

At the same time, we saw opportunities for collaboration (on and offline) and reinvention everywhere. We focused on building agility.

Developing Methods for Change

With the aim of helping communities find opportunities to thrive while also managing through downturns, and with partners including the U.S. Department of Labor, the Council on Competitiveness, and the Charles Stewart Mott Foundation, we developed methods and approaches for cultivating agility:

• Developing shared intelligence, by collecting and making meaning out of data that matters to multiple community organizations and agencies.
• Promoting network weaving, based on the theory that a whole host of benefits derived from well-networked communities (we had been studying networks for some time, but found Sean Safford’s early work at MIT – subsequently published in book form – very compelling). Later we partnered with June Holley to learn techniques for social network analysis.
• Facilitating collaboration across “silos”, so that people from across disciplines, departments, agencies, programs, organizations, and institutions find common ground and begin to share ideas, talent, and resources in ways that maximize wider community benefits.
• Encouraging public engagement, since real change happens in firms, schools, and neighborhoods, not just boardrooms.
• Advancing an entrepreneurship agenda that emphasizes not just new ventures, but entrepreneurial culture itself.

These methods emphasize the building of capacity—to collaborate and to innovate—so that communities can reinvent themselves over and over, not just build the next new thing. We worked with (and learned from) community leaders and project partners from five U.S. Department of Labor WIRED regions (Southeast MI, Mid MI, Southern AZ, Kansas City, and the Piedmont Triad NC partnership) and two BRAC regions (Ft. Bragg NC and Southwest OK), and a host of other communities in transition.

Checking In

Last week, our team met in person to review progress, and take a look at the current (and growing) ecosystem around community agility (now increasingly called resilience.)

New Trends

While we’d been paying attention to the emergence of new conversations and community innovation spaces individually, sharing this information helped all of us see that we are now in the company of more (and more diverse) people advancing some of the same goals. Here are a few we’re pretty excited about.

Social Innovation

The people who identify with “social innovation” are a wildly diverse, eclectic and exciting bunch, ranging from the academically-inclined Stanford Social Innovation Review crowd to the entrepreneurial community that is Social Edge (Skoll Foundation) to the activists, organizers, and media mavens who see new ways to make change through the social web. The new White House Office of Social Innovation will certainly accelerate interest in the field, which is now beginning to map itself. And interest in social innovation is appropriately global. The Young Foundation, SIX, and the Skoll World Forum, together with institutions like Ashoka and the Aspen Institute have nurtured social innovation networks around the globe for years. More recently, the John S. and James L. Knight Foundation has sponsored a host of initiatives designed to help innovators of all ages and stations leverage the power of social media and the web.

Video and Twitter have helped make much of this activity accessible and transparent. Last week, 900 people gathered at SoCap09 in San Francisco to figure out how to fund it.

Gov2.0

Government (at all levels) is also beginning to reimagine itself. The Obama campaign demonstrated the power of technology to enable self-organization in a campaign context, now we’re working through the implications of this kind of mass connectivity on governing itself. Catalyzed by Tim O’Reilly’s advocacy of “Government as Platform,” gov2.0 has become a rallying cry for transparency, participation, and just better, smarter, government  – among people inside government and out. This week’s Gov2.0 Summit brings together public servants and technologists and advocates and organizers, many of whom are already working together to build the next generation of public intelligence systems and platforms for participation.

The Resilience Movement

The resilient communities movement stems from two different though related sets of ideas: one relating to security, and the other to sustainability more broadly.

• The U.S. Department of Homeland Security (DHS) is exploring Community Preparedness and Resilience in a variety of ways – the Community and Regional Resilience Initiative (CARRI), for example, reflects a partnership between DHS, the Department of Energy’s Oak Ridge National Lab, and a handful of communities in the Southestern U.S.
• The Institute of Urban and Regional Development at the University of California Berkeley (supported by the MacArthur Foundation) has established a Building Regional Resilience Network , which has published a variety of papers on different dimensions of resilience (environmental, social, economic).
• The Council on Competitiveness made the materials used in its Risk and Resilience workshop available to the public.

People are helping communities become more resilient outside the U.S. as well – parallel efforts exists in Australia, and a more locally-driven approach launched in England.

Smart Communities

Firms like Cisco are promoting smart cities from a data-connectivity point of view, and IBM is advancing its “internet of things” agenda. But people and processes matter just as much. The stakes are high, the promise, great, and the need, urgent. Brookings is tracking the impact of the American Reinvestment and Recovery Act (ARRA) on cities and regions seeking to advance innovation or leverage structural change. Rosabeth Moss Kanter and Stanley Litow offer a manifesto for smarter, more connected communities.  John Hagel, John Seely Brown and Lang Davison’s Big Shift focuses on change dynamics in firms, but their analysis offers insight relevant to communities, too.

Going Forward?

We’re taking a good look at this context in an effort to learn from others, and focus our efforts in ways that maximize impact.

We believe in the power of not just tinkering, but “…unbundling and reconstituting…”
– Don Tapscott

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