One of the slightly humorous/very telling things that happened at the Brookings Chicago Summit was a interesting linguistic choice by the folks from Munich. As I’ve mentioned, on the first day of that event, each of the three Metropolitan Business Plan regions presented on their plans paired with presentations from international regions: Ohio with the industrial economy of Cleveland, Twin Cities with the high talent/quality of life economy of Barcelona…and Puget Sound paired with the high tech economy of Munich.
It was actually a decent pairing, especially because of their focus on aerospace and clean tech. And yet, there was an important difference. When Munich was discussing their comprehensive economic development initiative, they didn’t use “strategy” or “plan” like we do. Instead, they referred to it as the Offensive Zukunft Bayern: the “Offensive for the Future of Bavaria”!
Now, this is not meant to be poking fun at the stereotypical image of Germans as militaristic. I’m bringing it up because I actually think that there’s a real value in this phrasing, intentional or not. By using the military attack term “offensive”, they’re highlighting the fact that economic development is a competition.
Too often, regions address economic development in a vacuum, as if other regions around the world aren’t trying to attract and retain the same talented people, companies and investment dollars. And while we can’t go around using military force to ensure our economic competitiveness, we do need to understand that all of our progress in growing the region’s jobs and prosperity happens because of relative changes. For example, the Global Health Nexus, Seattle initiative (or offensive, as the Germans might say) is working to brand the region not just as “good for global health” but rather “one of the best”…that is, better than most other places. Such that, if you’re looking around the world at where to do global health stuff, you should choose us instead of London or Geneva or Boston.
Practically, when we think about the competition that is regional economic development, we don’t try to stay up to speed on what every single other region in the world is doing. That would be too much effort, but also most regions aren’t our competitors. The Puget Sound is competing against regions that have similar profiles as us (demographically and economically), and that are looking for the same people, companies and investment dollars in the same fields as we are. Which brings me to an important point: those competitors are different depending on what we’re benchmarking.
When we first began to identify our peers/competitors, we chose five for our Regional Competitiveness Indicators: Denver, Twin Cities, Phoenix, San Diego and the Bay Area. And while there are are lot of similarities in terms of size, economic focus and other demographics, it doesn’t take an economic development professional to see that there are definitely a lot of things on which we are not competing with those regions on. And similarly, there are a lot of things that we’re competing on with regions that aren’t in those five. Probably the most stark example is Boeing’s selection of Charleston, South Carolina as the location for the second assembly line for the 787; clearly, we’re competing with South Carolina, Kansas and Texas for aerospace manufacturing, yet these are not traditionally places that we compare ourselves to. Less obvious and just as important is the competition we’re in with Boston on life sciences and global health, or how we compare to places like DC (now the most literate city for highly educated people.
So, what’s the solution? How do we identify the right five places that we should be benchmarking ourselves against on all 20-something of our economic indicators? And the answer is, we shouldn’t. We should pick a couple of different regions around the country for each of those indicators. Some of those regions may be the same for multiple indicators, but some of them may only be peers for a specific industry cluster or a specific innovation metric. So, we don’t benchmark ourselves against Boston in terms of degree production, because they’re a much bigger city than us with significantly more higher education institutions, but maybe we can at least strive to compare ourselves to them in quality of life indicators and investment capital. We don’t necessarily need to say that we want to be as good or better than them, because that may not be possible, but it’s still important to know how we rank and how that comparison changes over time.
Today at the enterpriseSeattle Economic Forecast Conference, Bob Aylward – Executive Vice President for Business Operations at the Seattle Mariners – was speaking on the topic of Global Health Nexus, Seattle. He made a great analogy about how building an international leading global health sector in our region is like building a baseball team: you don’t need the number one pitching staff and the number one offense necessarily; rather sometimes if you’re in the top five or top ten in every category, the whole is greater than the sum of the parts and you turn out to be the best overall team. That’s our status in global health, where we may not be the best in delivery, the best in development and the best in discovery all at once, but we’re close enough to the top in all three that we’re overall exceptional. Brad Smith, Microsoft VP and Prosperity Partnership Co-Chair, has been delivering a similar message (including in his remarks at the Chamber’s Regional Leadership Conference): as long as we’re in the top five for the good stuff (quality of life, human capital) and in the bottom five for the bad stuff (regulation, anti-competitive business climate), we’re going to be alright.
As we develop the next Regional Economic Strategy, we’re also going to do a new Regional Competitiveness Indicators report, which may involve both different metrics and different peer regions. I don’t know yet what either will be, but I do know that we’re going to take these lessons to benchmark ourselves against different regions based on those indicators. And we may not “win the war” on every one, but we’ll live to fight another day.