Economic Development Outcomes: Four Simple Rules for Successful Implementation

By Kevin Crowder, CEcD, Director of Economic Development 

Plan Your Work and Work Your Plan. It is not enough to have an economic development plan, it must be a realistic, implementable plan. It must be based on careful due diligence that is relevant to the economic development goals and market research that realistically looks at the condition of the five drivers of economic development (Land, Labor, Capital, Markets and Regulation), and how your community can realistically improve them. The plan must understand the private sector perspective, since it is their investment that is necessary for economic development to occur. And finally, the plan must be implementable. A long list of great sounding initiatives that the community supports is no good if there is no money, people, or time to do them.

Adopt Economic Development Values. To truly have economic development success, your entire organization needs to understand and adopt three key economic development values. This does not just apply to the economic development department (if you have one), it applies to every department, and includes the elected and appointed leadership. The first value is Responsiveness: the difference between the public and private sectors is that a business will suffer from bad customer service, while a local gov­ernment can still thrive with bad customer service. The key here is not that government should be run like a business, but that a local govern­ment economic development strategy should focus on adopting private sector standards for responsiveness and customer service into the local government processes. Secondly, Information should be provided that is meaningful and rel­evant to the customer. And finally, Credibility. Predictability, fairness and timeliness are critical to the inves­tor. A local government can give significant incentives to a business, and then have the project killed by the fire marshal, building inspectors, or even state or county agencies.

Build Relationships. Successful economic development requires the effort of a lot of people inside and outside the organization. Internally, adoption of economic development values is critical, but it is equally important to build relationships with other economic development stakeholders. Four of the most important are brokers, bankers, businesses and residents. Real estate brokers, as well as bankers put food on their table by doing deals in your city. Establishing relationships with them improves your credibility, lets you better understand your local market conditions, and helps you better guide the type of business and investment that occurs. It also lets you understand areas where your city can make improvements to enhance your market position. Merchants associations are also critical partners and can help the city understand the kinds of issues they are facing, and finally homeowner’s associations are important to ensure that economic development occurs within the context of community character and values.

Reputation is Everything. As previously stated, economic development requires the investment of private money, and entrepreneurs and businesses have many opportunities to choose from when selecting a location, and they will make that decision on their terms, not a city’s. It is critical that local governments understand the private sector perspective, and build a reputation of authenticity and responsible, responsive economic development. Regardless of market conditions, reputation and regulation are two areas where every local government has the ability to influence economic growth, and it is also where a local government starts on a level playing field with competitor cities. Is a city truly friendly to business or does it just say that it is; do the processes have predictability and certainty built into them; is there a perception of fairness in the pro­cess or a reputation for cronyism; are codes and regulations consistent with market conditions? When it comes to attracting investment, it’s all about how they think and feel about you, compared to your competition.