Effective Strategy in Local & Regional Development

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Slides used in June 5, 2014 presentation at the 2014 R&D Conference Open Strategy Sessions in Stuttgart, Germany

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Effective Strategy in Local & Regional Development

  1. 1. Copyright 2014 – Scott Hutcheson This work is licensed under a Creative Commons Attribution-NonCommercial 2.5 License. Effective Strategy Making in Local & Regional Development Scott Hutcheson, Ph.D. Purdue University, West Lafayette, Indiana, USA @jshutch64 The R&D Management Conference Special Sessions: Open Strategy in R&D Stuttgart, Germany – June 5, 2014
  2. 2. Better understand he nature of collaboration Identify what stage your collaborations are in Consider ways to move a collaborations to the next level Overview 1. Context of the presentation 2. The evolution of strategy making in local and regional development 3. Study methodology & findings 4. Strategic Doing: A promising protocol for open strategy
  3. 3. Context: Economic Development 3 The purpose of economic development is to build up the economic capacity of a local area to improve its economic future and the quality of life for all. It is a process by which public, business and non-governmental sector partners work collectively to create better conditions for economic growth and employment generation.
  4. 4. Context: Local & Regional Development Local = Typically single urban, suburban, or rural, municipality (i.e., city, town, county in the U.S.) Regional: Typically multiple municipalities that can be within a (a) single state (Dallas/Ft. Worth Metroplex), interstate (Greater Kansas City), or involving multiple states (Great Lakes Region) or even along a cooridor (i.e., river, interstate, etc. Usually has one or more hubs of economic concentration.
  5. 5. Eaton Corporation Aeroquip Hose Division Context: Strategy Strategy answers two questions: 1) Where are we going? 2) How will we get there?
  6. 6. Number of Local & Regional Economic Development Organizations in the U.S. 13,000 Colson, J. (2008). The Attributes of Successful Business Attraction. Angelou Economics. Retrieved from http://www.angeloueconomics.com/Articles/Success.html
  7. 7. Better understand he nature of collaboration Identify what stage your collaborations are in Consider ways to move a collaborations to the next level Research Question Why are some strategy processes for local & regional development successfuland others… not so much?
  8. 8. Answering the Question A grounded theory exploration using a sequential mixed method approach beginning with a qualitative phase in which semi- structured interviews were conducted with a purposively sampled panel of experts resulting in data that was open coded using the spiral analysis method followed by a quasi-experimental quantitative phase in which two contrasted groups of purposefully sampled, randomly assigned participants were surveyed, resulting in data that was analyzed using Spearman’s rho to determine correlation coefficients. 1. Literature review 2. Interviews 3. Surveys
  9. 9. Better understand he nature of collaboration Identify what stage your collaborations are in Consider ways to move a collaborations to the next level Problem Statement • Literature gap regarding factors contributing to effective strategy in the context of local and regional development (Kwon, Berry, & Feiock, 2009). • Leaders face daunting tasks of developing and implementing strategies to address local and regional development (Markey, 2010). • Very little research-based information to guide decisions about effective strategy-development processes in these contexts.
  10. 10. • Evolution of public issues • Institutionalization • Locus of control • Increasing complexity • Tools for managing public issues • Early tools • Evolving tools • Emerging tools • Contributing theories • Strategy formation • Collaborative governance • Social innovation Insights from the Literature Conducted as part of the grounded theory data collection process (McGhee, Marland, and Atkinson, 2007). Conducted to provide contextualization (Dunne, 2011) and orientation to the phenomenon (Pozzebon, Petrini, de Mellow, and Garreau, 2011).
  11. 11. Strategic Planning: A Tool for Local & Regional Development Strategy 12 Early Tools • 1960s in universities, schools, municipalities (Hamilton, 2007) • Late 1980s/Early 1990s first economic development strategic plans (Blackerby & Blackerby, 1995) • Borrowed from industry models (Blair,2004) Evolving Tools • Recognition that corporate models are less effective (Bryson and Roering, 1987). • U.S. Economic Development Administration’s CEDS; Cooperative Extension Service’s Take Charge (Hein, Cole, & Ayres, 1990); Asset-Based Community Development, (Kretzmann and McKnight, 1996; Community Capitals, Flora, 1992) Emerging Tools • Effectiveness of strategic planning in business questioned (Mintzberg, 1994). • Effectiveness of strategic planning in economic & community development questioned ( Blair, 2004; Robichau, 2010; Morrison, 2012) • Organic Strategic Planning (McNamara, 2010, Open Source Economic Development (Merkel, 2010), Strategic Doing (Hutcheson, 2008;
  12. 12. Contributing Theories •Social Innovation •Strategy Formation •Collaborative Governance 13
  13. 13. Social Innovation Social innovations… • are best designed and implemented in networks • emerge from heterogeneousness (diversity) • are framed using existing assets • are products of co-creation • are the result of collective action • should have decentralized implementation • when implemented should focus on tangible results Bland, Bruk, Kim, and Lee (2010); Bouchard (2012); Mulgan, Ali, Tucker and Sanders (2007); Neumeier (2012); Oliveira and Breda-Vazquez (2012)
  14. 14. Strategy Formation Strategies… • are formed intuitively • are iterative • must be designed to account for unanticipated variables • must take into account contextual values, assumptions, beliefs, and expectations • must be flexible • should be designed collaboratively • and best developed as an intra-organizational activity Feser, 2012; Johanson, 2009; Lindblom, 1959; Mintzberg, 1978; Parnell, 2008; Rindova, Dalpiaz, and Ravasi, 2011; Sminia, 2012; Tapinos, Dyson, and Meadows, 2011
  15. 15. Collaborative Governance Collaborative governance… • takes advantage of network structures • connects existing assets • focuses first on small wins • Requires decision making to be made by consensus • works when there is trust among participants • is efficient • involves successful management of both internal and external stakeholders Ansell and Gash, 2008; Chiclana et al., 2013; Clarke, Huxley, Mountford, 2010; Emerson, Nabatchi, and Balogh, 2012; Gibson, 2011; Johnston, Hicks, Nan, and Auer, 2011; Kwon, Berry, and Feiock, 2009; Merkle , 2010; Olberding, 2009; Ospina and Saz-Carranza, 2010; Pammer, 1998; Poister, 2010
  16. 16. Better understand he nature of collaboration Identify what stage your collaborations are in Consider ways to move a collaborations to the next level Lines of Inquiry for Qualitative Phase • Organizational Structure (hierarchy, network, etc.) • Overall Framework (asset-based, deficit-based, etc.) • Processes (planning and Implementation separate and sequential, planning and implementation integrated and iterative, etc.) • Timeframe (focused on longer-term goals, focused on shorter-term goals, etc.) • Implementation (tasks centralized with one organization, tasked disseminated among multiple organizations) • Human Capital (level of trust, readiness
  17. 17. Insights from the Panel of Experts The Qualitative Data • Population of scholars and practitioners who design curricula, teach, and/or practice local & regional development strategy making • Sample: N=12 • Semi-structured interviews (IRB-approved, anonymity) • Verbatim transcripts, data spiral analysis with three levels of coding: open, axial, selective using qualitative analysis software • 56 single-spaced pages/over 31,000 words of data
  18. 18. Findings from the Interviews 19 1. Inter-organizational structure matters (hierarchies to networks) 2. Frameworks matter (deficits to assets) 3. Process matters (sequential and linear to agile and iterative) 4. Timeframes matters (longer-term transformational goals to shorter-term easy-win goals) 5. Implementation matters (centralization to decentralization) 6. Metrics matter (accountability to learning and adjusting) 7. Social capital matters (trust and readiness for change)
  19. 19. Variables 20 1. Network organization structures 2. Asset-based Frameworks 3. Iterative planning/implementation process 4. Inclusion of shorter-term goals 5. Decentralized implementation 6. Metrics to learn what is working 7. High levels of trust among participants 8. Readiness for change in community Independent Variables Dependent Variable = Effectiveness
  20. 20. Effectiveness For the effective strategy initiative you have in mind, how would you describe its level of effectiveness: • Completely effective • Significantly effective • Somewhat effective Ineffectiveness For the ineffective strategy initiative you have in mind, how would you describe its level of ineffectiveness: • Somewhat ineffective • Significantly ineffective • Completely ineffective Organizational Structure, etc. Measuring the Variables Hierarchical, with a clear top and bottom Network, with a hub and spokes
  21. 21. Insights from Participants The Quantitative Data • Population of individuals who have participated in community-based strategy initiatives to address public issues (economic development, community development, community health, etc.) • Sample of 300 (plus those reached by use of snowball sample) participants were randomly selected from PCRD contact database (N=209). Assured that Indiana was not over represented • IRB-approved survey constructed using the factors identified in phase 1, participants randomly assigned to two contrasting groups
  22. 22. Findings from the Surveys 23 Source: Scott Hutcheson, Distributed under a Creative Commons 3.0 License. Effective & Ineffective Strategy Initiatives – Mean Responses
  23. 23. Completely Effective Completely Ineffective Significantly Effective Somewhat Effective Somewhat Ineffective Significantly Ineffective Findings from the Survey Effectiveness Continuum DependentVariables Correlation
  24. 24. Findings from the Surveys 25 Source: Scott Hutcheson, Distributed under a Creative Commons 3.0 License. Correlation Between Strategy Initiative Effectiveness and the Eight Independent Variables
  25. 25. Recipe for EFFECTIVE Strategies • Have a network organizational structure • Frame strategies primarily around building on existing assets • Have a planning and implementation processes that is iterative • Include short-term, easy-win goals • Decentralize responsibilities for implementation among multiple organization • Use metrics to learn what is working and to make adjustments along the way • Build high levels of trust among participants • Assure that participants are ready to change
  26. 26. Recipe for INEFFECTIVE Strategies • Have a hierarchical organizational structure • Frame strategies primarily around addressing problems or deficits • Have a planning and implementation process that is linear and sequential • Include only long-term, transformational goals • Centralized responsibilities for implementation with one organization • Uses metrics primarily for accountability • Proceed even though there are low levels of trust among participants • Proceed although participants are not ready for change
  27. 27. A Protocol for Open, Agile, Iterative Strategy @strategic_doing facebook.com/stratdoing www.strategicdoing.net
  28. 28. • Think about strategy differently • Accelerate the collaborations needed to create open strategies • Develop and implement agile, asset-based strategies to meet strategic outcomes with a progressive series of Pathfinder Projects. Strategic Doing enables people to form action oriented collaborations quickly, guide them toward measurable outcomes, and make adjustments along the way.
  29. 29. Practicing Strategic Doing 30
  30. 30. • Local & Regional Economic Development Strategy • Cluster Development • Innovation Platform Development • Strategic Alliances • Inter-unit collaboration within a single organization Practicing Strategic Doing
  31. 31. Teaching Strategic Doing Existing & Emerging University Partnerships Michigan State University University of Alaska University of Missouri New Jersey Institute of Technology University of Central Florida Stanford University Southhampton Solent University
  32. 32. Teaching Strategic Doing
  33. 33. Greater Milwaukee Water Technology Cluster: How Open Strategy in Local & Regional Development Can Accelerate Research & Development 34
  34. 34. Scott Hutcheson, Ph.D. Purdue University, West Layette, Indiana, USA 765-479-7704 hutcheson@purdue.edu www.linkedin.com/in/scotthutcheson/ www.twitter.com/jshutch64 www.facebook.com/scott.hutcheson http://www.slideshare.net/jshutch/ For more information & to connect Copyright 2014 – Scott Hutcheson This work is licensed under a Creative Commons Attribution-NonCommercial 2.5 License. Slides available

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