Learning to Win Together: Lessons from Amazon

December 4, 2017

By Avalanche Consulting Inc.

This article was original published in Chamber Executive, Fall 2017 pages 6 – 9.

Amazon sent the economic development world into a frenzy on September 7th with the announcement that it was searching for its second North American headquarters location, called HQ2. Amid all the social media buzz, marketing stunts, and dozens of predictions from major news outlets, a total of 238 communities across North America submitted their bids to become home to HQ2.

Amazon’s wish list illuminates what many companies – big and small – want in a location. HQ2 underscores why investments in talent, modern transit, housing, and quality of life are critical. Regardless of whether your community submitted a bid, HQ2 has elevated the field of economic development and the roles of chamber of commerce onto a national stage. With so many people talking about Amazon, now is the opportune time to educate your community about community development, the site selection process, and what it takes to compete.

Here are several important takeaways for what it takes to be competitive based on Amazon’s wish list:

Create, Attract, and Retain a Talented Workforce

HQ2 Requirement:

Labor Force –The Project must be sufficiently close to a significant population center, such that it can fill the 50,000 estimated jobs that will be required over multiple years. A highly educated labor pool is critical and a strong university system is required.”

The ability to attract and retain talent has risen to the forefront of economic development and site selection conversations in 2017, and not just in relation to Amazon. In Avalanche Consulting’s 2017 annual survey of economic development professionals, 90% of the 150 communities that participated said having a skilled workforce and aligned training programs is their top priority.

Developing a strong talent pipeline has become a forefront initiative of many chambers of commerce across the county. From our perspective, it involves a three-pronged approach:

  • Create. Creating talent that is ready to enter your workforce involves building strong education programs aligned with industry needs, including PreK-12, higher education, and alternative training programs. It is important to forge collaborative relationships with your local businesses to understand their short and long-term labor needs, create and adapt curriculum and programs, and increase career awareness.
  • Attract. Another way to build your talent pipeline is to recruit talented individuals to live and work in your region. Attracting talent most often requires a strong internal and external marketing campaign to inform potential residents about the lifestyle and economic opportunities in your region.
  • Retain. Retaining a talented workforce can take more than just great lifestyle amenities. Successful communities offer unique ways to engage their residents through mentoring, volunteerism, and lifelong learning opportunities.

Connecting Talent to Career Opportunities:
The Talent Development Network & Miami-Dade’s Academic Leaders Council

The Academic Leaders Council (ALC) was created by Miami-Dade County to develop solutions related to creating and retaining a skilled workforce. The ALC addresses skills gaps in target industries by aligning curriculum with target industry needs, advancing internship programs that retain college graduates in Miami-Dade County, and collaborating on universal educational issues. Participants in the ALC includes the presidents of all six local colleges and universities, as well as the superintendent of Miami-Dade County Public Schools.

The Talent Development Network (TDN) – an outcome of ALC’s work – is an internship program that provides undergraduate and graduate students practical experience with industry partners that are aligned with Miami-Dade County’s target industries. The Talent Development Network also serves as the single internship hub for all Miami-Dade students and companies. TDN’s goal for the first two years is to create at least 200 new paid industry-specific internships.

 

Promote a Stable Business Climate

HQ2 Requirement:

“Cultural Community Fit – The Project requires a compatible cultural and community environment for its long-term success… A stable and consistent business climate is important to Amazon. Please demonstrate characteristics of this in your response. We encourage testimonials from other large companies.”

50,000 jobs and $5 billion in investment may sound like too good of an opportunity to pass up, but consider how such an enormous project will affect your region. It could disrupt established industries that serve as the current powerhouses of your economy. Their biggest concern might be the potentially insurmountable challenges HQ2 could have on workforce availability. They will also be keenly aware of the size of the incentives package, the strain HQ2 could have on infrastructure, and the pressure HQ2 will place on affordability and housing availability.

HQ2 gives chambers an opportunity to engage local employers in conversations about their needs and community vision. How can your community provide an even more stable and consistent business climate to encourage their growth?  What challenges and opportunities would surface for them if your community landed a large new project? If a prospect asked them today for their opinion on doing business in your community, what would they say?  Their responses to questions like this could warrant strengthening Business Retention and Expansion (BR&E) programs, advocating for a better business climate, or intensifying talent development initiatives.

Taking Care of Business:
Greater Richmond Partnership Business First

The Greater Richmond Partnership knows that the best way to promote a stable business climate is by supporting the existing businesses that are already an established part of the economy.

Business First is a collaborative initiative between the Greater Richmond (VA) Partnership and local governments. It includes a dedicated professional staff that meets with local companies and provides training to business retention & expansion (BRE) staff members at the local level. It embraces a customer service focus in which businesses share their opportunities and concerns through a formal, shared survey questionnaire utilized by all regional partners. The information is then shared in a process that alerts organizations in the region (e.g., utilities, developers, educators, public office holders) when a company has a need that could jeopardize its presence in the region. The Greater Richmond area is one of the few in the country with a regional, coordinated approach to supporting businesses that drive their economy.

 

Reevaluate Your Infrastructure

HQ2 Requirement:

“Logistics – Personnel travel and logistics needs, both from population centers to the Project site, as well as between company facilities, are critically important. As such, travel time to a major highway corridor and arterial roadway capacity potential are key factors. The highway corridors must provide direct access to significant population centers with eligible employment pools.”

The ability to move people and products quickly and efficiently is of great importance to Amazon, and ease of movement will continue to be a concern for any new, expanding, or relocating company. A prospect of this scale emphasizes the importance of having an efficient, multi-modal transit system and locating job centers near population centers. Whether your community is preparing for a 50,000-employee HQ2 or a smaller cluster of target businesses, access to transit will continue to be a site selection factor.

Use Amazon as the impetus to invest in transformative, connected infrastructure that readies your community for future economic growth. As a chamber, partner with others in your community to study how well your existing infrastructure meets Amazon’s criteria and the needs of your target industries. Determine how mass transit investments, such as bus rapid transit or light rail, could better connect your residents with jobs.  Consider how prepared your community is for autonomous vehicle technologies and how those technologies will affect mobility. Investing in connected regional transit networks will increase your region’s competitiveness and support continued economic growth.

Fast-Moving Solutions:
Denver FasTracks

In 2000, 2.5 million people lived in the Denver region. Faced with forecasts that called for another million residents by 2025, elected and business leaders were concerned about added traffic congestion in the region and how it would impact quality of life. The Metro Mayors Caucus – a collaborative working group of 31 Denver area mayors – unanimously supported the Regional Transportation District’s (RTD’s) FasTracks program and used their networks and united stance to get the Greater Denver region behind it.

The FasTracks tagline is “One region. One Mission.” This summarizes the Caucus’ approach to educating and gathering support of the initiative. They engaged CEOs, political party leaders, union leaders, environmental activists, and the community in a non-partisan effort to get a $4.2 billion transportation initiative passed. According to a FasTracks 2014 update, $5.3 billion has been invested or committed to date across the region. Every $1 invested in transit infrastructure translates into a $4 investment into the local economy over 20 years. Since 2005, FasTracks has created more than 13,200 direct, full-time jobs.

 

Invest in Quality of Life Amenities

HQ2 Requirement:

“Community/Quality of Life – The Project requires a significant number of employees. We want to invest in a community where our employees will enjoy living, recreational opportunities, educational opportunities, and an overall high quality of life. Tell us what is unique about your community.”

High on Amazon’s wish list, and the wish list of skilled talent, is quality of life. Young, educated workers have been flocking to major metros to be near high-paying jobs and plentiful recreation options. Reexamine the quality of life offerings in your region and determine what investments would enhance livability. Even a single community project, such as building a new trail system or entertainment venue, can become an advantage that helps your community vie for businesses and talent.

Amazon’s RFP shows that quality of life matters to businesses.  As a chamber, refer to the HQ2 RFP to convince local stakeholders that investing in cultural, recreation, and education amenities directly contributes to economic competitiveness.

Invest in Your Best:
Roanoke Region of Virginia

Roanoke, Virginia, is rich with outdoor assets, from access to the Appalachian Trail to Smith Mountain Lake. In 2009, the Roanoke Regional Partnership created a strategy to leverage its many outdoor recreation assets to drive economic development.

These amenities are not taken for granted – in fact, thoughtful outdoor infrastructure investments continue to be made with community support. One most recent example – a kayak launch site – opened on the Roanoke River near downtown in October 2016. The $80,000 investment was funded by a community crowdfunding campaign (all private donations, no tax dollars). Additional financial support and in-kind services came from dozens of local businesses. The campaign to develop the kayak launch was spearheaded by the Roanoke Outside Foundation, which is a nonprofit arm of the regional economic development entity, Roanoke Regional Partnership. The Roanoke City Parks and Recreation and the City’s storm water division now manages the kayak launch, which can be used by community members at no cost.

The kayak launch along with dozens of other investments and an outdoor-focused marketing campaign [www.roanokeoutside.com] is paying off for the region. Drawn to the outdoor lifestyle, the region now has a large cluster of craft breweries, including recent investments by Deschutes Brewery and Ballast Point.  The Roanoke region is a prime example that quality of life translates directly into economic opportunities.

 

Form Strong, Bonded Partnerships

HQ2 Requirement:

“Amazon is performing a competitive site selection process and is considering metro regions in North America for its second corporate headquarters. We encourage states, provinces and metro areas to coordinate with relevant jurisdictions to submit one (1) RFP for your MSA.”

In the past month, Avalanche Consulting has spoken with more than a dozen communities competing for HQ2.  One theme resonated across all of our conversations: Assembling the HQ2 proposal required regional cooperation at an unprecedented level.  Strong bonds were formed among project team members by rolling up shirtsleeves and working side-by-side on the bid. As one chamber board member told us, “Whether we win HQ2 or not, we’ve already won because we now have a model for acting regionally.”

As a chamber, what can you do to ensure that those bonds stay strong after Amazon?  Pull together your project team soon to discuss lessons learned.  Talk about how the community’s response to an opportunity like this can improve in the future. Also discuss how you can use your strengthened partnership to improve your community and help existing businesses.

Even though your community may be served by a single economic development team, that does not mean they alone are responsible for energizing your region’s economy. There is strength in numbers. Join forces with strategic partners and stakeholders to work together to assess regional assets, address regional challenges, and develop regional solutions. Unify your stakeholders behind a single economic vision that aims to elevate the entire region.

Regionalism at its Best:
Charleston SC’s One Region Global Competitiveness Strategy

VISION: “To act as a unified region to be a globally competitive place where people and businesses flourish.”

Charleston’s 2016 One Region Global Competitiveness Strategy unifies economic development partners, chambers, and other local stakeholders behind a singular vision to advance the three-county region’s economy. One Region is founded on an inclusive, holistic approach to economic development. The Strategy embraces a shared community value: True prosperity is accomplished when all residents can participate in the economy. Economic development should not leave people behind.

The One Region Strategy influenced the Charleston region’s decision to not pursue HQ2, but instead to refer to Amazon’s site criteria – talent, modern infrastructure, quality of life, and culture & diversity – to reinforce the importance of making community investments that will sustain the region’s long-term economic competitiveness.

 

Conclusion

Amazon’s HQ2 is the largest single economic development project in recent history, and communities have gone to unprecedented lengths to offer their most competitive bids. Whether your community chose to bid or not, there are important lessons to be learned from HQ2. Amazon’s wish list offered key insights into what metros will need to be competitive in the future. We hope you can use the hype around Amazon HQ2 as an impetus engage with stakeholders to strengthen your region’s preparedness for opportunities.