Leveraging Success Factors

Published September 2008

Last month I identified some recurring factors among successful businesses in Central Iowa, namely:

  • Entrepreneurism and Innovation
  • Location
  • Productivity
  • Speed and Flexibility
  • Relationship

This month I’d like to explore things that business and government leaders, as well as the workforce can do to optimize these factors.

Owners of successful businesses already located here have an infinite number of possibilities when their companies outgrow their current facilities. Communities around the globe will gladly welcome an expansion plant or the relocation of the entire organization. Citizens and government leaders alike share a responsibility to continually make their communities as attractive to these successful businesses as the day they were first drawn to them. Citizens do this via volunteering, supporting appropriate bond referendums for the general good, and maintaining attractive properties.

The odds of growing new entrepreneurs can be increased with emphasis by our education system. To be sure, growing entrepreneurs is not like growing beans, where almost every seed results in a plant. Organizations such as the ISU Pappajohn Center for Entrepreneurism can spend thousands of dollars on scholarships, business plan competitions, and other activities with only a small percent eventually resulting in a successful business located here. But just one success can yield benefits many times over. A friend recently told me about her 10-year-old daughter’s great experience with an entrepreneurism class as part of the Ames School District’s “Super Summer” program. Right on!

It’s just by sheer luck that we happen to be located in the center of the country, right on the major north-south thoroughfare and within an hour of the primary east-west corridor for not only the United States but for North America. Quick, reliable access to the interstates and rail systems of Central Iowa provides an inherent advantage to any company that ships its products to the outside world. We protect this advantage by ensuring adequate investments in infrastructure are efficiently utilized.

Like agriculture, the reason that the output of manufacturing companies located here continues to rise, despite a steady reduction in the number of employees, can be summed up in one word – productivity. And while the children of many farmers and factory workers have chosen jobs in the service sector, productivity in that sector accounts for an increase in output far greater than the increased number of workers. The fact that technological breakthroughs often displace workers can result in resentment and opposition to improvements. But regardless of the industry, productivity improvement, whether from technology or creativity, is a major factor in the long term protection of jobs. A best-in-world education system is needed to accommodate the higher technical demands of jobs. In addition, cultivating a healthy understanding of productivity’s role in protecting jobs, beginning with children by upper elementary school grades, is needed.

I’ve often used the analogy that I’m willing to compete against Mike Tyson provided I’m allowed to choose the contest. It certainly won’t be boxing. Trivial Pursuit perhaps? Likewise, Central Iowa businesses don’t want to compete against their Chinese and Mexican counterparts solely on price. But they may want to serve customers in the region who value speed and agility so much that they’re willing to pay a premium for it. By staying abreast of evolving techniques, such as Lean methods which allow companies to compete with speed and agility, Central Iowa companies can avoid a price war which they are almost certain to lose against the world’s labor heavyweights.

Finally, despite its diminishing importance, relationship is still a factor, and a major one, in some industries. Here again, business leaders bear the brunt of responsibility for ensuring that their organization is optimizing this factor. Employees should clearly understand what customers value, and their role in providing it. Business leaders must ensure that their employees are trained, have the ability to practice in a safe setting, and are held accountable for satisfying customers.

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