Episode 40: Next Practices in Site Selection: Insights from the Site Selectors GuildMarch 29, 2018
The Site Selectors Guild Annual Conference is arguably the most important conference in the world of corporate location decisions. So, naturally, we took “The Project” on the road to Cincinnati, Ohio to hear from some of the smartest minds in corporate site selection about what we like to call “next practices” in corporate location decision-making. On this special episode, we share three insights from interviews with Guild members Didi Caldwell, Principal at Global Location Strategies; Darin Buelow, Principal at Deloitte Consulting; Angelos Angelou, Founder and Principal Executive Officer of AngelouEconomics; Mike Mullis, President and CEO of J.M. Mullis Inc.; Tracey Hyatt Bosman, Managing Director at Biggins Lacy Shapiro; Jay Garner, President of Garner Economics, LLC; and Jeanette Goldsmith, Vice President of Strategic Development Group.
Patience Fairbrother (DCI): The Site Selectors Guild Annual Conference is what some would call the Super Bowl of the site selection and economic development world. It’s the gathering of 44 of the world’s foremost site selection consultants and 350 economic developers and investment promotion professionals from around the world.
Andy Levine (DCI): This is arguably the most important conference in the world of corporate location decisions. So, naturally, we took the project on the road to Cincinnati, Ohio to hear what some of the smartest minds in corporate site selection are talking about and what we like to call “next practices” in corporate location decision making.
So, welcome to episode 40 of “The Project: Inside Corporate Location Decisions.” I’m Andy Levine of Development Counsellors International.
Patience: And I’m Patience Fairbrother, also with DCI and Andy’s co-host of “The Project.” So, last month, I had the opportunity to do some on-the-ground reporting in Cincinnati at the Site Selectors Guild Annual Conference.
Andy: On this special episode of “The Project,” we’re going to share three insights from Patience’s interview with these key influencers where she essentially asked one question: What new practice have you seen a company or an economic development organization use that might be under the radar right now, but we’ll start seeing more of this in the future?
So, Patience, you did the interviews. Why don’t you quickly share the three headlines before we dive into and listen to what these consultants had to say?
Patience: Great. Here’s the quick rundown. So, number one, Technology and the Changing Site Visit: How technology advances are altering, and in some cases, eliminating the long established consultant visit to communities. Number two, Talent Rules. It’s the top concern for all consultants and their clients. And number three, Quality of Life is on the Rise. A site selection factor that used to be near the bottom of the list for companies is gaining an importance.
Andy: So, these are fantastic observations, Patience. Okay, let’s get to the interviews and sort of hit these one by one.
Patience: So, let’s start with Technology and the Changing Site Visit. This was a pretty central theme throughout my conversations. Technology, though perhaps slower to penetrate the site selection and economic development realm than other industries, is transforming the way location decisions are made. Here’s Didi Caldwell, Principal at Global Location Strategies. She was also named the first female board chair of the Site Selectors Guild during the conference.
Didi Caldwell (Global Location Strategies): So, one of the new practices that we’ve been using is called a Virtual Site Tour. And so, we use web conference techniques to do a web conference that is basically all of the things that we would ordinarily do on a site visit. We’re just doing it virtually.
So, they usually take about three to four hours depending on how complex the project is, but we go through all the things that we would go through on a regular site visit with the exception of employer interviews. And it really gives us a lot of insight into the site. Say, we can do about 80% of what we would do on a site visit without having to travel, which keeps the cost down and also makes it go a lot faster.
Patience: So, obviously, it’s a time saver, it’s a money saver. Is that really where you get into kind of the nitty-gritty initial details of the process?
Didi: Yes. So, a lot of our projects are very driven by utilities and transportation infrastructure and site characteristics. So, we make sure that on that virtual site tour, we have representatives from each one of the utilities from the rail company, from the Department of Transportation. We talk about work force. And so, we really go into a lot of detail. We have an agenda and we ask that the communities prepare a presentation, and they lead us through the visit as if it were a real site visit.
Patience: And how many communities would you typically take through that virtual process before you actually go do the site visit and so forth?
Didi: So, normally, that’s what we would call our medium list. Somewhere between six and eight is the number that we like to stick with, and then we would narrow down from there to ideally three or four sites that we would actually go and visit.
Andy: With the rise in technology, often communities are being approached much later in the process and consultants often won’t visit the sites until a short list, a very short list, has been finalized. So, what can those three or four finalist locations do to stand out? We’re gonna hear from Darin Buelow, a Principal at Deloitte Consulting.
Darin Buelow (Deloitte Consulting): You know, I would have to say just the rising use of technology in the business, in site selection and, you know, the use of drones, the use of augmented reality, virtual reality, visualization of data, that this has really been on the rise in the last two years. And we’re starting to get a sense that more and more places are picking up on this and want to use that as a differentiator. So, there’s a little bit of a window here where it’s not a fully promulgated technique that every place is using. And those that are using it, feel like they’ve got a leg up in terms of presentation, in terms of building an emotional connection with the prospects, and being able to put them inside a site visualization in an experiential way that they couldn’t before.
So, this could be more commonplace, you know, three years down the road, to your question.
Patience: While the use of technology and location decisions has certainly increased over the last several years, the consultants I spoke with agreed, this is an area in which there’s the most room for continued growth and change. Here’s Didi Caldwell once again.
Didi: So, that’s one of my frustrations in site selection and economic development is that I’ve been doing this 20 years and we use technology to do things faster, to gather information, to do better analysis, but technology has not really transformed economic development and site selection the way it has transformed some other industries. So, I think that this industry is actually ripe for disruption. And we’re always trying to keep our finger on the pulse and be ahead of the game in that regard.
Andy: So, insight number two should come as no surprise to our listeners. Talent is the top concern for corporations and economic developers. And it’s changing the way each group approaches a location decision or bid.
First, we’re going to hear from Angelos Angelou. Angelos is the Founder and Principal Executive Officer of AngelouEconomics and was previously with the Austin Chamber for about 12 years.
Patience: So, I’m doing a little trendspotting, kind of looking for next practices in the industry and what we’re going to see going forward. So, over the last few years, can you point to a new practice that you’ve seen a company use as part of a site selection process that you think we’ll start to see more of?
Angelos Angelou (AngelouEconomics): Talent availability is the number one concern around the country. And you have to be very innovative to be able to address that issue. With the low unemployment rate throughout the U.S. and communities like Austin where the unemployment rate is less than 2.8%, you have to find ways of still getting the interest of clients.
Patience: So, economic developers need to be more innovative than ever to address growing talent concerns. Next, we’ll hear from Mike Mullis, President and CEO of J.M. Mullis, Inc. Mike has worked with industry giants, including Boeing and Toyota, since founding the company in 1979.
Mike Mullis (J.M. Mullis, Inc): The underlying event right now from the economic development side, from any side I would say, would be how you formulate that marketing plan for labor. The states, the locations under the radar are looking at ways to entice people to come back to their states. State income tax credits, other benefits that are financially viable. Maybe you’ve got a series of graduates from certain universities of a state and they’ve left and gone elsewhere to work. Now, you’re trying to draw them back.
Andy: The issue of talent availability, quality, and skill set is also changing the way that companies and their consultants approach work force analysis. Here’s Tracey Hyatt Bosman, Managing Director at Biggins Lacy Shapiro.
Tracey Hyatt Bosman (Biggins Lacy Shapiro): One of the conversations that we typically have which is what labor will you need in the future, is becoming more difficult because they recognize that the world is changing very quickly, technology is changing very quickly, and it’s harder and harder for them to foresee the type of talent that they will need. So, they’re beginning to look more at skill sets and general competencies than specific titles, which is what we’ve seen them do in the past.
Patience: Jay Garner also spoke to a new practice that consultants and their corporate clients are using to more accurately analyze the changing workforce landscape of a given community. Jay is President of Garner Economics, LLC based in Atlanta. And speaking of talent, as a side note, Jay is the host of the conference’s talent show each year, which we hear is legendary.
Jay Garner (Garner Economics, LLC): Where we have evolved on the work force analysis components, you know, years ago we would do what everyone else would do and that is look at the gross number of people within a certain radius of their proposed location, and then measure based on employment and unemployment rates what we think might be the availability of labor. That is so archaic and there may be some folks that are still doing that, but you can’t survive in that way.
What we do now, and we’ve done it maybe for the last seven to eight years and we’re just getting better at it actually, we look at the people who are employed in certain occupations by their occupation code. And we also look at skill set transferability. So, if I’m a welder and I lose my job based on a downturn in, say, ship building or in oil and gas sector, what are the skills that can be transferred to another occupation based on my skills?
Patience: A shift towards looking at how current skill sets might transfer to new industries plays into another theme that emerged in my conversations. Companies aren’t just looking at where the work force is now. They want to know where talent is going to be in the future. A crucial component of that is the ability of a community to draw in new residents. So, that brings us to insight number three. Quality of life is more important than ever. Here’s Jeannette Goldsmith, Vice President of the Strategic Development Group.
Jeannette Goldsmith (Strategic Development Group): So, one of the trends that we’ve seen a lot of is a move away from looking for simply low cost locations in terms of the need for low cost land and low cost labor. We’re really seeing a push towards considering more amenities, more quality of life factors. A lot of the companies that we work for are looking to build manufacturing plants that will require higher skilled individuals, a lot of engineers, and technical talent. And in order to attract those engineers and those technical talents, you need to have access to a lot of other amenities. And so, they’re looking for locations where they not only can manufacture their products in a cost competitive way, but they also have the opportunity to be successful in their recruiting of new workers.
Andy: The quality of life factors companies are focusing on aren’t limited to amenities. They’re also looking at the political and economic factors that affect whether talent wants to relocate there. Here’s Darin Buelow again.
Darin: Maybe the one thing that I’m seeing a little bit more of and that, you know, perhaps we could see more companies adopting is more of an approach to look at very detailed kind of traditional quality of life factors. So, looking at things like the health of the state’s economy, whether or not the state is in debt, you know, political leanings of the state or the community, these companies are…you know, they’re run by people who are politically aware and physically aware. And they’re starting to look at things like that in a way that we haven’t necessarily seen as consistently in the past.
Patience: The Future Forward Economic Development Organizations are catching on to this trend and emphasizing quality of life in their strategies and pitches to corporations. Here’s Jeannette Goldsmith again.
Jeannette: We have seen economic developers taking a broader role, or I should say a broader definition of economic development. So, beyond the recruitment and retention piece, looking at their communities and saying, “Hey, what are we doing in terms of this livability? What are we doing in community development? What are we doing in housing?” A whole other set of issues that economic developers really hadn’t been involved in necessarily that they’re now having to start to pay attention to.
Andy: So, there you have it. Technology, talent and quality of life were the hot topics at the Site Selectors Guild Annual Conference in Cincinnati.
Patience: I should also note that public bids like Amazon and Apple were also widely discussed, but less so than these other three topics, which I actually found pretty surprising.
Andy: So, Patience, I do wanna thank you for taking two days out of your important schedule and going on the road to Cincinnati. It sounds like you really enjoyed the conference as well.
Patience: It was a pleasure to be there and, really, these guys are just some of the sharpest tacks I’ve had the pleasure of speaking with. So, I really enjoyed it.
So, that is a wrap on episode 40 of “The Project: Inside Corporate Location Decisions.”
Andy: We have a number of people that we have to thank for making this episode possible — Dennis Donovan, Michelle Comerford, the team at The Angela Rogers Group as well as FrazierHeiby — all of them for their willingness to host Patience at the conference and help arrange these interviews.
Patience: Special thanks also to the site selectors and economic developers who took time out of their busy conference schedules to speak with me. In the interest of time, we unfortunately couldn’t include every interview, so we hope you will keep us in mind next time you have a project that might be a fit for the podcast.
Andy: “The Project” is sponsored by DCI. We are the leader in marketing places and have served over 450 cities, states, regions, and countries. You can learn more about us at aboutdci.com.
Patience: We hope you will keep listening. There are many more projects to come.