As published in the November 1, 2014 Toledo Business Journal
Kenny McDonald
Columbus 2020
Columbus 2020 shares best ED practices
In early September, economic development officials from across northwest Ohio met with representatives of Columbus 2020 that included Matt McQuade, director, North American business development and Patricia Huddle, vice president, existing business services. Columbus 2020 is the regional economic development organization that includes Columbus and the 11-county area in which it is located.
The session was hosted by NORED and included members of leadership from the Regional Growth Partnership (RGP) and local economic development organizations in counties and cities in northwest Ohio. The representatives from Columbus 2020 shared information that has assisted its region in obtaining significant growth in new investment and new job creation.
In late September, Toledo Business Journal conducted an interview with Kenny McDonald, CEO of Columbus 2020, in order to share information involving economic development best practices.
Toledo Business Journal: Can you explain what Columbus 2020 is and why it was started?
Kenny McDonald: Columbus 2020 is a public/private partnership started by a group of business and civic leaders to lead a 10-year growth strategy for central Ohio. We work to retain and attract economic base employers and to help increase our competitiveness overall. Together with dozens of local organizations across our 11-county area, we work to generate short-term opportunities and build long-term capacity for additional growth.
TBJ: Why was it started? Anything about the timing back then that helped to initiate and launch Columbus 2020?
KM: Even though we have a very diverse economy in the Columbus region the “great recession” served as a call to action for both our communities and our private sector leadership. As a region with over 150,000 college students and the seat of State government, we have a stable base, but private sector growth is the key to long-term job creation. A large contingent from our business community took the time to get on a plane to cities around the country: Austin, Minneapolis, Raleigh, and other locations were visited to explore how they were organized, what their goals were, and how they worked together. Ultimately, it came down to that we had as many resources and as much potential as anybody we were visiting. The fact is that we just needed to come back and do it the Columbus way and the Ohio way.
TBJ: Were there any disruptive events specifically in the Columbus region that encouraged the creation of Columbus 2020?
KM: I think there were a variety. I knew that NetJets was considering leaving the community at one time, and it was publicly known that they were considering other locations around the country. Very glad they’ve stayed and grown in our region, but that would have been a tangible thing that happened that really started to raise questions about how are we organized and how do we react when we have to, but how do we get proactive about attracting companies and working with our local companies to make sure we’re not in those positions on a regular basis.
TBJ: Could you explain some of the major goals that have been set for the organization?
KM: It’s centered around four things:
- First, job creation is critical. We’ve set a goal of generating over 150,000 net new jobs over the decade. We did an incredible amount of analysis in developing our plan and looking at what our region had done in the decades past. The region created 140,000 net new jobs in the 90s, so the 90s were really good to the Columbus market. We set the goal a little higher than that, which would be faster job growth than we have ever experienced in a ten-year period. The fact that we used the words “net new” is important. We know some companies will fail, and others may have to move for business reasons. We need to do all we can do to serve them, but also continue to grow the pie. How do we fill up the bucket and help others grow so that the net growth is really strong? Between 2000-2010, the net new job growth was a negative 15,000. So not unlike the rest of Ohio, the first decade of the century we had essentially zero growth. So far, in the first four years of the plan, we’re at 98,000 net new jobs in our region. So we’re on track to have over 200,000 net new jobs if the pace continues. At this rate, we’re growing faster than we ever have before.
- To generate between $8-10 billion of capital investment from the projects we work on for the region. Capital investment is critical and speaks to our manufacturing community and other areas where they are investing in equipment and buildings in our market. That type of physical investment creates tangible evidence of our growth and helps to stabilize our local construction trades as well. That would also be about 20% higher than we had secured in decades past.
- The third goal is the hardest to reach, which is to raise per capita income by as much as 30%. When we started the decade that was hovering around $37,000 per person, and if we reach our goal that should be at about $50,000 per person or maybe a bit over that, and really level the playing field there. Hopefully, through job growth and capital investment, everybody in our region has a little bit more money in their pocket to go out to eat and to get new tires on the car and things like that that spur additional retail economic development growth.
- Finally, this is the softest goal, but a really meaningful one for us, is that we want to be considered one of the most dynamic regional economies in the country. It is important to the Columbus region to raise its profile nationally and internationally. We think that’s perhaps more important as a Midwestern region and as a community in Ohio. I think the perception a lot of times is that Midwestern communities are shrinking, but nothing could be further from the truth in the Columbus eregion. We need to tell the world what is going on here and what a special location Ohio is to start and grow a business.
TBJ: Can you discuss the efforts involving brand management that Columbus 2020 has addressed?
KM: We do very specific things to market our region as a business location, and we also work with Experience Columbus, the Columbus Foundation, and cities and counties around the region to position the region in a more general sense. From Ohio State students to skilled workers, we want the world to know that the Columbus region is thriving. If you visit Columbus you will see a similar brand on most of the non-profit organizations and even on our police cars in the City of Columbus. I think that is a critical issue all across Ohio. The Toledo region is a great example of a place with a lot of really great things happening; there’s job growth and there’s growth in general. We need to tell the world that and we need to develop a more distinct identity not only to companies and business executives, but to skilled workers, be they welders or experienced machinists or new graduates or information technology workers. It is a noisy marketplace, but we believe that through collaboration and hard work, the world will find their way to our region.
TBJ: Can you discuss the importance of your website and key information that your organization has put in place to assist development efforts?
KM: We look at it as a point of constant investment and reinvestment each and every year. Our website is an extension of our staff and we consider it a critical front door to the Columbus region when we’re branding and even providing information directly to people and companies, so we invest an incredible amount in it. It’s a way for us to tell our story, to highlight success stories, and also to be a tool for those that do need business resources to get facilitated to the right place so that people aren’t stumbling around trying to find the right entity to call or entry point into our region, whatever that might be. We want it to be a great portal so that anybody with a business question in our market can get a direct answer pretty quickly.
TBJ: Can you discuss your use of research in the development process?
KM: We believe it starts with knowing your product really well and knowing not only our strengths, but understanding missing elements of our supply chains and things like that, so we invest a lot in market research both internally and externally, and we want our outreach to the world to come from a fact-based position. We’re honest about what we have and perhaps what we don’t have or need to work on, constantly. We believe that’s really at the center of the process before we ever make a call on a company we need to know a lot about them, and that includes our own companies, so we need to know where they’re investing their dollars internally, we listen to earnings calls, we do lots of things so we better understand companies before we ever have a conversation with them, so that our value proposition can be a little more targeted toward their needs.
TBJ: What has been your experience concerning new investment and new job creation from both expansion of existing companies in your area and also from recruitment of companies from outside of your region?
KM: First, we think they’re both critically important, but that it starts with understanding our own companies and how they’re operating and what they’re doing in our region. Every day we learn more about what they’re doing. So companies that perhaps we feel like we know pretty well, the more we study them, how they’re doing business, where they’re doing business around the world, the kinds of things that they’re investing in over the horizon, really help us provide services to them so that we’re moving with them and not reacting to a business need that they may have, hopefully we’re working on it in partnership with them.
I’ll point to our export strategy as an example of that. We want to understand where our companies are trying to do business. We know that the more they expand around the world, the more jobs they create right here in Ohio. But we first have to ask them those questions and we have to be able to add value to that process.
A) We believe in helping our local companies and competing for their business every day, and
B) We believe the best way to a new customer is through our existing customers, just like a small business would think about their customers. So those referrals, a deep understanding of what suppliers and vendors they may have, lead us to a lot of people that we’re calling on around the world that are not presently doing business in our market.
About 70-80% of the projects we work on are with local companies that are already operating in the market, and 20-30% on an annual basis are new companies coming into the market.
TBJ: Does that hold true for both new job creation and new investment?
KM: About 20% of the projects would be new companies coming into the market, but those companies create 35-40% of the net new job growth, so attracting new companies to your market is critically important. They do create new jobs in your region, those coming from out of state or perhaps even out of the country setting up a new operation, so we think that adding new players to the market is really important, but we sincerely believe that you have to start with the base and help local companies expand, that’s going to always be the heart of the effort in economic development. That’s our principal belief.
TBJ: Are there any other issues you’d like to share?
KM: Our view has been that in the last four years that the Columbus region through our efforts has become more organized and more visible not only with our own region but around the world. A big part of our success is that Ohio is doing better, and through the JobsOhio network and the partnership we have with folks like the Regional Growth Partnership, we think that Ohio has perhaps the most organized state wide effort in the country. We also say that there’s incredible competition out there, and we have to constantly be evolving and making ourselves better and making the network better, sharing best practices so that we’re doing things together, leveraging dollars from the public sector and the private sector to go and compete around the world for jobs and opportunities for the citizens. The advancement in Ohio and the organization of the economic development network has been extraordinary in the last three to four years.