Last week, I stood before an economic development board of directors and gave a recap of a proposal on how to best grow an industry sector in their community.
We had submitted a proposal two months ago, and found ourselves one of four finalist firms selected to essentially argue our case. We had 30 minutes.
I spoke about the knowledge and experience of my project partners, who were present via Skype. They said more about their backgrounds and gave ideas on how we were offering more than just a report but an action plan.
Then it came to the question and answer phase, and one board member asked a question that momentarily threw me for a loop. I’m paraphrasing here but he asked in essence, “Why aren’t companies coming here. What is wrong with us?”
His question went to the very heart of what we would be delving into if we were chosen to do this work, because our starting point would be a SWOT analysis to determine the community’s strengths, weaknesses, opportunities and threats, especially relative to this one industry group.
Why Don’t He Write?
It’s weird how sometimes something from left field will come to mind at moments like that. Standing there, I thought of the scene from the movie “Dances with Wolves.” A crude wagon teamster looked down upon a skeleton on the prairie and laughed: “Somebody back east is saying, “Now why don’t he write?”
Why don’t companies come here? In most cases, communities that wait for business investment to come to them, typically find themselves waiting and waiting and waiting.
The truth is that you have to go fishing, and you have to know what you are fishing for, and you have to have good bait. For lack of a better phrase, we call this business development, which for me is not nearly as relaxing as fishing.
My reply to the board member’s question was something like this.
“Look, we haven’t yet done a SWOT analysis to determine what your community’s strengths, weaknesses, opportunities and threats are, so I would just be guessing.
“But it rarely works to sit back and wait for business investment business to come to you. You have to engage in business development, which is never easy, with target industries in mind, but only after you know what your strengths, weaknesses, opportunities and threats really are.”
I may have said it better here than I said it there, but you get my drift.
Outreach is Hard Work
Business development is an exercise in outreach and I’ve always believed that most economic development organizations are not particularly good at it. It’s hard work and to some degree it’s even scutwork, like digging a ditch. But it has to be done in a continuous and systematic way.
In a follow-up email the next day, I thanked the staff and the board of the economic development organization for giving us the opportunity to compete for the project.
I even offered to show them some not-so-obvious ways and means by which to identify and make contact with senior corporate decision makers in companies within that industry group.
Wave the Flag
I also suggested that the community has to get out there and wave the flag by attending at industry conferences and trade shows and developing relationships with business people outside their community.
You can make all sorts of strategic errors in business development, but if you meet the right people and develop relationships with them, good things can happen.
The Fixation with Hot Leads
Too many economic development groups are looking solely for “hot leads” when they should be looking at building long-term relationships with companies that could and would be a good fit for their community, whether there is an imminent project or not.
I cannot tell you how often I run across this short-term “hot lead” mentality among economic developers to the exclusion of almost everything else.
I’m convinced part of the reason is that there are some consultants out there selling that smoke in a bottle, and a goodly number of economic developers are buying it.
Last week, while I was in this city and about an hour before I spoke to the economic development board, I was on the telephone with the president of a manufacturing company in the Pacific Northwest. He said this, which is an accurate quote: “We have talked about a Southeast facility but it hasn’t moved much past the discussion phase.”
Playing the Long Game
Now that was music to my ears, a great opportunity for me to provide consulting assistance on a future site selection project. And because of that, I’m going to stay in touch with this man, all the while knowing that nothing will probably happen this year.
But because this is not an imminent project, I know of some economic developers who would see no urgency, no need to develop a relationship with this business person. No project, why bother.
And they would be so, so very wrong. Business development should be played as a long game and not for short gain.
He Gets It
Next week, I fly a southern state to consult with an economic development department of an electric utility company. They want me to look at their big data gathering initiatives and see how we can leverage all that information into developing relationships with people in identified companies.
I feel pretty confident that I can help them. But to gauge whether they were smitten with the “hot lead” mentality, I asked a senior executive with the utility this question: “If I introduced you to a company executive who said his or her company might be looking in your area two or three years from now, would you consider that a win?”
His answer was “absolutely,” which was the right answer. But I have worked some economic developers who would have said no, which to me is to cut off your nose to spite your face.
He Doesn’t Get It
Last month, I was on a conference call with the head of economic development for a New England state who had been bitten by the “hot lead” bug.
He didn’t want to hear about developing relationships with identified companies as likely suspects. Rather, he just wanted that silver bullet on how to win projects in the 200-300 people range.
I came away from that conversation thinking this man had no more understanding of business development that I do about quantum physics.
But at least I know what I don’t know. This was a bureaucrat with no economic development experience thrust in position that he shouldn’t hold and answering to a governor to whom he desperately wanted to please.
Actually, that is not a particularly rare scenario on the state level throughout this country come to think about it.
Part Art, Part Science
This thing we call business development is all about developing and then mining, that is extrating information from, sources over the long haul.
I believe it’s part art and part science, especially now with the big data resources that we can use to our advantage. Unfortunately, many people with the job title of business development will never really truly get the hang of it, largely because they don’t spend the time to learn what works and what does not.
In some ways, it is easier for me to show than explain how I go about getting names, email addresses, direct phone numbers, and mobile phone numbers of senior executives.
The president of that Pacific Northwest manufacturing company had invited me to call him. Over the course of two days, we communicated via LinkedIn inmail, email, telephone and text messages, four different mediums.
Whether he decides he needs our help with a future site search project a year or two from now, or whether this community chooses us in the next two weeks to help bolster their recruiting efforts for an industry is almost beside the point.
They now know about us. And they now have an idea about how we can help. And we will stay in touch because we’re playing the long game. And relationships matter.
I’ll see you down the road.
Dean Barber is the president/CEO of Barber Business Advisors, LLC, a location advisory and economic development consulting firm based in Dallas. He can be reached at firstname.lastname@example.org or at 972-890-3733.