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The
most significant event of the year in the Richmond
region may have been the unveiling last week of a
report, "Putting
the Future Together," written by strategic
leadership consultant Jim Crupi. Based upon in-depth
interviews with 110 business, political and civic
leaders, Crupi delivered a comprehensive analysis of
the region's strengths and weaknesses that, for
better or quite possibly worse, could
provide a road map for future collective action.
The
Dallas-based consultant promised to pull no punches
-- and he didn't. Among the topics that people just
don't discuss in polite company, he confronted the
deleterious impact of the region's obsession with
race and history on everything from poverty to
economic development.
But
Crupi aimed his biggest guns at
the people who paid him a six-figure retainer to
compile the report. Richmond has many assets, he
wrote. By all rights, the region should be booming
like Atlanta, Charlotte and other fast-growth
cities. But it isn't. Why not?
"The
inability or lack of willingness to think and act
strategically is a major problem," Crupi wrote.
"The default position among area leaders is to
make individual, tactical, project-oriented
decisions without the framework and benefit of an
overarching strategic vision and plan. There is no
compelling picture of the future that gets people
excited. One could almost say that the Richmond area
is blessed with many great managers, but few
leaders. It has people who are strong on execution
but weak on seeing how the pieces should fit
together.
Thwap!!
The sound you just heard was that of the arrow
squarely hitting the bulls eye. Having made Richmond
my home for more than 20 years now, I can aver
that Crupi nailed his
target.
Alas,
there is one huge drawback to the Crupi report: The
author offers no compelling vision of his own -- not
even a set of criteria for developing such a vision.
Rather, he proposes a series of narrow-bore
initiatives organized under such vague
imperatives as "Strengthen Richmond's City
Government," Leverage the Past and Stop Being a
Prisoner To It," and "Prepare Now for the
Demographic Tsunami."
It is all
very useful material. I found much of it well
informed and thought provoking. What's not to like
(assuming cost were no object, as Crupi apparently
didn't) about a high-speed rail connection to
Northern Virginia? Or an economic development
initiative to recruit server
farms and data centers? Or building upon
Chesterfield County's best-of-class program for
training local government employees?
Crupi
spits out more intriguing ideas when he gargles in
the morning than Richmond government and civic
groups do in a year. (A list of Crupi budget busters
can be found in the footnotes.)
But his report offers no method for ranking or prioritizing
them.
Presumably, it will be the job of a proposed
2015 Metro Future Task Force to sort through his
recommendations and develop a regional master plan.
But without that overarching framework to guide the
thinking of its members, I predict, the Task Force will produce
a plan that covers too much ground, tries to please
too many constituencies, articulates more goals and
objectives than the region has resources to pursue,
and leaves the tough choices to others.
Unexamined
Assumptions
As
it happens, I have been laboring over the past few
months on the "Economy 4.0" series to
create an overarching framework for thinking about
economic and regional development. (Completed articles are listed at the top of the column to the
right.) As I have progressed through the series, I
have reached conclusions that
challenge some of Crupi's core assumptions.
For
instance, anyone embracing the Economy 4.0 paradigm
for economic and community development would dispute
Crupi's starting assumption that it
is desirable for Richmond to have a
"booming" economy like Charlotte's or
Atlanta's. Unless you are a member of the regional
"Growth Machine" -- the coalition of real
estate developers, construction contractors,
financiers and assorted service providers that
profit directly from the influx of new residents
and businesses -- there is nothing remotely
appealing about the idea of growth for growth's
sake.
As
citizens of the Richmond region, we
should not organize our collective efforts around
the goal of increasing "growth" -- which
often entails stimulating the growth of the
population, with a concomitant increase in the
demand for government services -- but increasing economic opportunity
and per capita incomes for the people who already
live here. Furthermore, we should endeavor to
raise incomes without engendering the crises typical of regions with fast-growing
populations, such as worsening traffic congestion, a
shortage of affordable and accessible housing,
destruction of environmental assets and spiraling
taxes.
The
Crupi report does not address the question,
"What do Richmonders want?" It's highly
unlikely, then, that a 2025 Metro Future Task Force
will either. With only 12 months to generate a
detailed plan, task force leaders will take the
Crupi blueprint as a starting point without taking
the time to rethink the assumptions that underpin
it.
In
describing the thrust of Bacon's Rebellion, I use
this tagline: "Building more
prosperous, livable and sustainable regions."
Likewise, I would humbly submit, the framework for
Richmond's metro task force should be built
around those three themes.
-
Building
a prosperous region.
By "prosperous," I mean a community
that raises incomes and creates economic
opportunities for all
segments of society. (As an aside, creating
broad-based economic opportunity will do more
for social justice than all the placard waving,
kumbaya singing and social welfare spending
since the dawn of time.)
-
Building
a livable region. By
"livable," I refer to the key
attributes of a high quality of life: low cost
of living, low taxes, low crime, clean water and air, good schools, good health
care, vibrant
entertainment and cultural institutions, and
social networks that create a sense of belonging,
interconnectedness and upward mobility.
-
Build
a sustainable region.
By sustainable, I mean an economic base that is
environmentally sustainable and that rebuilds,
rather than depletes, the region's natural
capital.
While
Crupi devotes considerable ink to "economic
development" initiatives, his proposals are
generically "growth" oriented, not geared
to increasing incomes. Although he does a reasonably
thorough job of addressing quality-of-life issues,
he gives little more than lip service to the
environment.
Productivity
and Innovation
The
Richmond region is competing in a
fast-evolving global economy. Economics
and wealth creation must be the fundamental starting
point of any regional plan. If we cannot create
wealth, we cannot
redistribute it to achieve ancillary goals such as
environmental protection and social justice.
While
the Richmond region enjoys higher-than-average
incomes and is afflicted by less poverty than the
nation as a whole, our prosperity is fragile. Gales of creative
destruction continually hollow out old
industries and give rise to new ones. Although the
Richmond region has done a respectable job of
building and attracting new businesses and
industries, it has hardly been a national or global
pace-setter. We are not a nationally recognized
center of knowledge creation, nor do we possess any
acknowledged world-class industries. Should we falter only
briefly, competitors around the world can easily
overtake us.
The
task of maintaining prosperity is made all the more
difficult by the fact that, by global standards, we
have high labor costs. We don't want to compete on a
global stage by underbidding the price of our labor, or
for that matter, by plundering our natural heritage. We
must embrace a strategy of increasing prosperity by
climbing the ladder to higher value-added
economic activities that generate higher wages,
salaries and profits.
In
the abstract, that means working smarter and more efficiently. As a
practical matter, that means specializing in solving complex
problems, creating new technologies, launching new
products, engaging in high-performance manufacturing
and managing global supply chains. In sum, it means
competing through productivity and innovation. Although Crupi touches briefly upon the importance of creativity,
he does not discuss the critical importance of
institutionalizing the capacity to bolster
productivity and innovation.
If
I could wave a magic wand, I would make productivity and
innovation the lodestar for every
collective effort in the Richmond region, permeating government,
the educational system, business and indeed the entire culture.
Richmonders would aspire to boost productivity, or efficiency, in all of
their endeavors
-- not at the
expense of more basic human virtues such as compassion
and social harmony, but as a means to create the
wealth by which to express those humanitarian values.
Likewise, Richmonders would cultivate an aptitude for
innovation -- not just in science, business and the
arts, but in the ability to reinvent core
institutions for the Knowledge Economy.
Building
a Culture of Productivity and Innovation
The
question becomes, then, how do we build a culture
around productivity and innovation? The 2025 Metro
Future Task Force must advance on several fronts.
Transform
human settlement patterns.
Certain human settlement patterns -- characterized
by moderate density, mixed uses, contiguous
development, pedestrian and transit friendly design,
and a high degree of transportation connectivity --
are more efficient from a perspective of providing
transportation, utilities and public services than
the "suburban sprawl" so prevalent in the
Richmond region. Crupi rightly observes that Richmond-area
development in recent years has consumed more land
than the far-larger regions of Northern Virginia and
Hampton Roads, and he favors a regional approach to
transportation and land use. But he leaves those
idea scrawny and underdeveloped.
Moreover, Crupi's idea of creating a regional transportation
authority and funding it with a regional sales tax
presupposes that the problem is a lack of tax
revenue -- a notion that we have critiqued at length
in Bacon's Rebellion and I won't belabor
here. Adopting more efficient human
settlement patterns is fundamental: It goes to the
heart of transportation, housing, the environment,
social mobility and other issues. Ignoring this
challenge will undermine all other efforts. Transform
government institutions.
Emphasize lean administration and innovative delivery of
government services. As Crupi spells out,
Richmonders are unlikely to embrace "regional
government" any time soon, but that should not
halt regional cooperation on a case-by-case basis
when it makes sense. In one of the stronger sections
of his report, he provides a number of
promising, narrow-bore ideas. Taking just one
important area, public safety, he notes:
There is cooperation
at the "street" level between police
officers and on infrastructure like a unified
police radio network, metro aviation and emergency
medical services. However, there has been no real
strategic look into issues like joint workforce
development and training; common operating
procedures and reporting; joint purchasing of core
acquisitions of technology, vehicles, weapons,
etc.; and consolidation of core services [i.e.,
forensic, canine, etc.].
Likewise,
Crupi suggests, Richmonders can build regional approaches for transportation, land use planning, waste
water treatment, poverty and aging. I agree. Build
human capital. In the
Knowledge Economy, building human capital also is
fundamental. The challenge has three parts, each of
which must be addressed with distinct strategies:
-
Transforming
the educational system.
Crupi focuses almost exclusively on the
grotesquely dysfunctional performance of the
City of Richmond school systems. But the entire school system in
the region -- indeed, the
very concept of marching children in lockstep
through 12 grades and mastering the same
subjects at the same pace in centralized
locations called "schools," whether
public or private -- is inadequate to the task
of inculcating Richmond
children with the intellectual capabilities they
need to thrive in a world of ever-changing
knowledge. Crupi's idea of ginning up new partnerships between
"business" and city schools is window
dressing that hardly warrants the effort. The region
needs to pioneer entirely new modes of educating
its citizens.
-
Recruiting
human capital. This is
primarily a marketing challenge, but someone --
presumably the Greater Richmond Partnership -- needs to be put in charge of it. The Richmond
region needs to identify those demographic
segments it wants to attract, cross-reference
them against the region's asset base (as a rule,
the region is more attractive to married couples
with children than to singles), brand the
region, and devise creative ways to reach the
target market.
-
Retaining
human capital. Once we
get productive, creative people to move to the
region, we need to shape an
environment that keeps them here. That means
paying attention to a wide spectrum of factors:
taxes, regional cost of living, quality of
neighborhoods, quality of schools, quality of
entertainment and cultural assets, quality of
public spaces and the natural environment,
quality of the built environment, and a host of
other matters.
This
last priority requires a shattering
of Richmond group think. One
of the questions Crupi was charged with addressing
was this: "What transformational projects
should the region consider undertaking to
improve its competitive position?" The
implicit assumption is that a handful of really
big, breakthrough projects can transform the
region. No such projects exist. As
creative class guru Richard Florida has stressed
repeatedly, big-dollar projects -- the convention centers,
sports stadiums, performing arts centers -- are not what appeal to the creative class.
Creatives prefer to participate in cultural happenings,
not to sit in seats and
watch. The region must overcome its Edifice
Complex and nurture cultural initiatives that bubble
up from
the streets and neighborhoods.
The
Richmond region does not
have the resources to splatter them around. It needs to
focus its finite fund-raising capabilities in
projects deemed to generate the highest economic and
social Return on Investment -- for the most part, in
knowledge-creating capabilities at all levels of
society.
Crupi
argues that Richmond should build its tourism
industry. Why? What kind of jobs do tourist
attractions create? How well do they pay? How many
of those jobs can be filled locally, and how many
will require H2-B visas to import greens keepers
from Central America, hotel greeters from
Eastern Europe or illegal immigrants from who knows
where? How will tourism add to the region's
productivity, innovation or knowledge creation?
Similarly,
Crupi
contends that Richmond could parlay its position
between the Pentagon and the world's largest Navy
base to become the capital of the U.S.
military-industrial complex. Assuming that such a
feat were even possible on the strength of the Fort
Lee Logistical supply center, how would such a
strategy play to the region's existing strengths?
Which
brings us to the fourth strategic priority...
Build
Nationally Competitive Industry Clusters. Rather
than building industries where the region suffers a
competitive disadvantage, Richmonders should build
industries and professions where they are national
or even global leaders. Such cluster-building
initiatives would entail identifying businesses in
selected industry clusters, recruiting targeted
businesses from outside the region, enhancing
R&D capabilities and expanding academic
departments in local colleges and universities that
supply critical skills.
Richmond
has a number of potential world-beating industry
clusters, though they aren't always recognized by
the surrounding community: the
advertising/marketing profession, the legal
profession, the insurance industry, mid-market
investment banking, the advanced fibers industry,
arguably even the biotech
and life sciences sector. As the productivity/
innovation leaders in Richmond, these clusters recruit top
talent to the region and they generate pay and
profits far higher than the
regional average.
In
conclusion, Crupi
is quite right to observe that Richmond needs
visionary leadership. When the Task Force convene to
consider his proposals, however, its leaders would
be well advised to develop their own framework for
building a more prosperous, livable and sustainable
region rather than relying upon Crupi's. Indeed,
that may be their first true test of leadership.
--
November 26, 2007
Footnotes
(1).
Crupi budget busters. Here is a partial list of some
of the "transformational" projects that
Crupi threw out for discussion:
-
Build
a presidential museum and monument to religious
freedom
-
Build
a new airport and rename it
-
Expand
mass transit
-
Build
a deep water port on the James River
-
Modernize
waste water treatment capacity
-
Build
a high-speed rail line to Northern Virginia
-
Expand
the network of roads and highways
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