With increasing economic globalization and heightened economic competition among cities and regions, a well-formulated and strategic approach to economic development is critical for sustaining the economic welfare of a city or region. An effective economic development strategy focuses on building a long-term sustainable competitive advantage based on strengthening key economic assets and linking them to sectors with wealth-creation and export potential. This page summarizes our approach to economic development planning and strategy formulation, highlighting three areas:

Economic Development Planning Principles

  • A sound economic development plan is built on a shared understanding of market conditions and critical assets that will shape local and regional economic development opportunities. This shared understanding ensures that all key stakeholders agree on the critical economic development issues and opportunities facing the community or region. This understanding encompasses the community's or region's role in the broader economy, how the community or region can capitalize on these key opportunities, and critical challenges.
      
  • The economic development process involves both strengthening economic assets and building effective linkages among key economic institutions and businesses. While physical, human, financial and technological resources are the foundation for economic development, what differentiates the most successful regions is the ability to build effective relationships and networks across key institutions and business sectors to make on-going investments in key assets and connect them to business creation and growth.
      
  • Effective strategies target export-oriented sectors with the potential for a sustainable competitive advantage. Since export-oriented businesses sell goods and services to customers outside of the region, they bring income into a region and are the primary economic engines. Within the export sectors, economic development efforts will build on business clusters that are have the strongest growth potential and are closely allied with local competitive advantages.
      
  • Economic development goals extend beyond job creation to fostering good quality jobs and distributing economic benefits to all segments of society. A community or region's economic development potential and quality of life is enhanced when all areas and populations share in the benefits of economic development and these benefits include quality jobs and the potential for asset accumulation. Specific strategies and interventions are needed to ensure full participation in economic growth.
      
  • Implementing the recommended strategy is central to the economic development plan. An Economic Development Plan is valuable only to the extent it is actually implemented. An effective plan must address the capacity and resources needed to implement recommendations and provide a detailed and realistic implementation roadmap.
      

Planning Methods

  • Steering Committee creation to oversee the study with representation of the full range of economic institutions and actors, including business, government, key institutions (e.g., universities and financial institutions) and community organizations. This committee provides the foundation for building a shared understanding and vision to guide planning and create the commitment to implement plans.
      
  • Demographic and economic base analysis identifies key demographic and economic trends shaping the community or region, assesses economic performance to identify strengths and potential problems, and analyzes the economic structure of the regional economy to define the major industries and clusters that serve as "engines" of regional growth and sources for regional competitive advantage;
      
  • Asset and resource assessment identifies the major economic assets and resources that provide the foundation and competitive advantages to support and capture economic clusters and development opportunities. This resource assessment address five critical areas:
  1. Physical capital (real estate and infrastructure systems) 
  2. Financial capital; 
  3. Human capital (the labor force and education and training systems); 
  4. Technology assets and their deployment 
  5. Economic development capacity.

After identifying key assets, this analysis addresses how well these assets serve current and future business needs, especially in major regional industries and clusters, defines critical gaps in and barriers to utilizing key resources, and develops plans to strengthen resources and build more effective linkages between businesses and major resource institutions.

  • Industry and cluster analysis provides an in-depth understanding of the composition, competitive issues and resources needs of critical industries and business clusters in a region, drawing upon data analysis, surveys, focus groups, interviews and trade literature reviews. Results include a richer understanding of the inter-relationships within and shared resources supporting key clusters, gaps in institutional relationships and special resources need to enhance the cluster's growth and competitiveness, and specific policies, investments and initiatives to enhance clusters and their development impact.
      
  • Benchmarking analysis compares important aspects local or regional resources and economic outcomes to key competing areas to help identify competitive strengths and weaknesses.
     

Results

  • Consensus among key stakeholders on economic development goals and priorities, key strategies to pursue and detailed action plans and resource commitments.
      
  • A stronger understanding of the local and regional economy, including critical development opportunities, major competitive advantages and weaknesses, to build broader public support for economic development initiatives.
      
  • Well-defined strategies that build on regional competitive advantages and capitalize on critical opportunities
      
  • Specific recommendations within each strategy regarding new investments and activities, improvements to existing efforts, and strengthening relationships and partnerships across key sectors
      
  • Detailed action plans to guide implementation of economic development plans addressing important obstacles and liabilities that prevent realization of opportunities.

Learn more about our Economic Development Planning Experience 

Learn more about Funding Sources for Economic Development Plans 

 

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