A few weeks ago, Alex Pearlstein and I attended the Southern Economic Development Council’s (SEDC) annual conference in Myrtle Beach. We had the opportunity to visit with many past and current clients, and our very own Mac Holladay was designated as an Honorary Life Member! Aside from the recognition for Mac, the quality socializing, and the lovely scenery, the conference was one of the most informative I’ve attended in recent years. At times, I feel like I’ve left a conference and haven’t gained any new insights, information about best practices, or sound advice from experienced practitioners. That definitely wasn’t the case at SEDC; it was a very worthwhile trip. A few takeaways from the various sessions are highlighted below.
The Dealmaker’s Role in the Establishment of High Performance Regional Entrepreneurial Networks
The opening keynote by Ted Zoller, Fellow at the Ewing Marion Kaufman Foundation and Director of the Center for Entrepreneurship at the University of North Carolina, went far beyond the increasingly tired discussion of the role of networks in supporting entrepreneurship and small business growth. Dr. Zoller reviewed his “Dealmaker’s Algorithm,” a network mapping exercise based on years of research that seeks to identify the “dealmakers” in twelve major metropolitan areas in the United States. In short, Dr. Zoller’s research examines a variety of indicators of individuals (board positions, personal investment data from corporate filings, executive positions, etc.) to identify serial entrepreneurs and serial investors in each metropolitan area, and then map their numerous connections. His research has highlighted the role of the hyper-connected “dealmakers” that bring together innovators, entrepreneurs, and investors. Dr. Zoller found that in Silicon Valley, nearly 99 percent of all identified serial entrepreneurs and investors are connected through professional linkages. In the Research Triangle Park, only 60 percent of similar individuals are connected. Dr. Zoller implies that identifying these dealmakers and then increasing the connections between them is a critical step in ensuring that a region effectively commercializes new innovations and breeds successful companies.
Next Generation Supply Networks and Logistics Panel
Randy Mullet, Vice President of Government Relations and Public Affairs at Con-way Inc., and Deborah Butler, EVP of Planning and Chief Information Officer at Norfolk Southern shared their thoughts on the future of transportation and logistics in the coming decades. While the two at times seemed to be highlighting the future virtues of one mode (trucking for Con-way and rail for Norfolk Southern) at the expense of the other, the two both agreed, not surprisingly, that additional federal investment in transportation networks was critical to the nation’s future competitiveness. Some alarming information was shared regarding potential future congestion on our nation’s interstate system in 2040; for example, it was suggested that in 2040 levels of congestion along Interstate 20 in rural areas between Atlanta and Birmingham would be as high as current levels along the Interstate 75/Interstate 85 connector in the heart of Atlanta today. Although it wasn’t clear what defined a “community” (incorporated area, county, metropolitan area?), Mr. Mullet noted that only 20 percent of communities are served by some mode of freight transportation other than truck (rail, water, or air). And for all the emphasis that is placed on the role of intermodal transportation, it was noted that if intermodal shipments currently hold just a 1.5 percent market share.
Talent Development in the South
Mike Wiggins, EVP of Human Resources at Southwire discussed the company’s remarkable partnership with the Carroll County School System – the 12 for Life program (which my colleague Christa Spaht has previously blogged about). The program targets students with a high risk of dropping out and provides them with the opportunity to work at a Southwire manufacturing plant that was built for and is entirely operated by students in the program. Students earn above minimum wage for their labors and are enrolled in a supportive program that provides mentorship and guidance to help them complete their studies while working in one of four daily shifts at the Southwire facility. Since 2007, 422 students have completed the program; its success has been recognized by the Obama administration on multiple occasions. Additional information on the program as well as video with student testimonials can be found at the following links:
Site Location – the Good, the Bad, and the Ugly
Ed McCallum from McCallum Sweeney Consulting and Mike Mullis from J.M. Mullis Inc. shared their thoughts on the “good, the bad, and the ugly” that they’ve seen and experienced in their years as site location consultants. It was likely the most informative, engaging, and humorous session at the conference. Some truly awful stories were shared about practitioners making basic mistakes when hosting a prospective company or site location team (from “We’re going to have to wrap this meeting up by 4:00; union laws won’t let me go any later” to “You’re paying for lunch, right?”). But there were also some great insights shared on their process. Ed McCallum emphasized that practitioners should call a site location consultant multiple times when responding to an RFI; he cited numerous reasons for calling him, all of which would help establish a connection (acknowledging receipt of the RFI, calling with questions, calling to notify that the requested information was delivered, following up to see if they have any additional questions about the community and/or site, etc.). Mike emphasized that their team always turns to existing businesses in a community being considered for a specific project to gauge how responsive the community is to their needs. They often ask three questions:
- What has the community done to address challenges and present opportunities?
- What’s your impression of the public education system and how does education and training interface and communicate with the business community?
- How competitive is your operation relative to other sites you operate?
The first question underscores the need for focused business retention and expansion outreach efforts, and the direct impact that they can have on communities’ viability for new investments. Mike noted that the lack of an existing business outreach program was, in his mind, one of two “unacceptable practices” for a community. The other “unacceptable practice” mentioned by Mike: a belief that incentives are all that matters. While many have outstanding existing business programs, I wish every practitioner in the Southeast had a chance to hear those words first hand.