Program takes more calculated approacahed to development

Published 12:00 am Tuesday, November 9, 2004

By Matt Kramer, Tribune guest columnist

If local and regional economic development efforts have a consistent shortcoming &045; one that survives business cycles or policy changes brought about by shifting political winds &045; it may be the often used scattershot approach to luring company startups, expansions and relocations to our industrial parks and Main Streets.

The pattern is understandable. Pressure on elected officials and economic development professionals to stimulate economic growth, provide ever more jobs, and add to the commercial-industrial tax base is so intense that it’s a wonder these carbon-based beings haven’t turned into diamonds under the weight of all that responsibility.

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Because the demands &045; and the stakes &045; are high, economic development players trend rather heavily toward the notion that any development is good development. Many economic development folks hunt for new businesses with a shotgun, blasting away at a whole flock of prospects in hopes that they might at least bag one.

The method requires a great deal of wasted effort and ammunition, but it seems the options have been few &045; until now.

Researchers at the Minnesota Department of Employment and Economic Development (DEED) and the University of Minnesota Duluth (UMD) have come up with a new tactical weapon that we think may put an end, or at least reduce, the shotgun approach to local economic development efforts.

The Enterprise Network System we’ve developed is now being put to the test as part of pilot project in the Duluth-Superior area.

Using data from the North American Industry Classification System (NAICS), researchers have developed a comprehensive inventory of the “inputs” &045; goods, services and raw materials &045; cuffently available in the area. Armed with the data, researchers are then able to identify specific industries that can thrive in the region, based on a majority of complementary resources and suppliers already present.

Communities and regions can make strategic choices about the industries and suppliers they recruit and create opportunities that meet the highest priorities of local businesses. They will even be able to prioritize the types of skills to develop for the jobs they want to create.

This model offers communities throughout the state a brand new way of marketing their’ assets to business. It eliminates much of the guesswork that goes into local recruitment efforts and replaces it with a more targeted, intentional and strategic approach to economic development.

DEED has funded the project with the intention of incorporating the lessons of the Duluth pilot into a statewide, locally driven, economic development strategy. And the Area Partnership for Economic Expansion (APEX) based in Duluth has agreed to host a community discussion on the results of the Duluth project.

APEX President Rob West thinks the Enterprise Network System is an effective tool to help evaluate the business community, and has been very supportive of the pilot project in the Twin Ports. West also thinks the data will be extremely useful in regional economic development planning.

DEED regional administrator Jim Wrobleski, Scott Moore, and UMD economist Richard Lichty provided an overview of the Enterprise Network System recently at the Minnesota Development Conference in Minneapolis. Needless to say, those who saw the presentation found the concept intriguing.

The idea seems to make a great deal of sense. We’re eager to see the new model tested during the pilot study and excited about the potential it may hold statewide. We’ll keep you abreast of the developments as we work to give communities a rifle and a highpowered scope to replace that old shotgun.

(Matt Kramer is the Commissioner of the Minnesota Department of Employment and Economic Development.)