The document discusses Metropolitan Business Planning (MBP) as a new approach for transforming regional economies. MBP applies private sector business planning disciplines to regional economic development. It involves analyzing a region's economic performance and market position, developing a shared vision and strategies, specifying products/services to implement strategies, creating operational and financial plans, and monitoring performance. Several metropolitan regions are adopting MBP approaches, working across sectors to coordinate economic development.

1. Metropolitan Business Planning
A New Approach to Transforming a Region’s Future
@BrookingsMetro
@Amy_Liuw
Metropolitan Policy Program Sao Paulo, Brazil / November 28, 2012
at BROOKINGS
Monday, November 19, 2012 1

2. The U.S. Economic Recovery Has Been Slow and Uneven Since the Great Recession
Employment (1,000,000s) Unemployment Rate Median Family Income ($1,000s)
10.0%
150 10.0 70
1.46M $67K
145 1.43M 7.5 65
7.9% $62K
140 5.0 60
135 2.5 55
130 0 50
2000 2012 2000 2012 2000 2010
Source: U.S. Bureau of Labor Statistics; Lawrence Mishel and others, “The State of Working America, 12th Edition,” Washington: Economic Policy Institute, 2012.
Monday, November 19, 2012 2

3. The Fiscal Crisis Is Putting a Squeeze on Public Sector Solutions
Publicly Held Federal Debt as a Share of GDP
100
Alternative Scenario
89.7%
80
60 58.5%
Fiscal Cliff
40
20
0
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Source: Congressional Budget Office, “An Update to the Economic and Budget Outlook: Fiscal Years 2012 to 2022,” Washington, 2012; Committee for a Responsible Federal Budget.
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4. To Prosper, We Need a New Growth Model
Monday, November 19, 2012 4

5. To Prosper, We Need a New Growth Model
TRANSFORMATIVE
INVESTMENT
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6. The Next Economy Will be Powered by Metro Areas
100 Largest Metropolitan Areasʼ Share of U.S. Prosperity
75%
65% 67%
12%
2007 2007 2007 2007
Share of Share of Share of Share of
Land Area Population Employment Output
Source: Brookings analysis of U.S. Census Bureau and Moodyʼs Analytics data.
Monday, November 19, 2012 5

7. Metro Business Planning Is an Emerging Model to Transform the Economy
Monday, November 19, 2012 6

8. MBP: Applying the Discipline of Private Sector Planning to a Region
Know Your Market Niche
Identify a Regional Economic Vision and Mission
Traditional Economic
Development
Identify Strategies and Goals
Specify Products, Services and Policies
Develop an Operational Plan
Develop a Financial Plan
Target and Monitor Performance
Monday, November 19, 2012 7

9. MBP: Applying the Discipline of Private Sector Planning to a Region
Know Your Market Niche
Identify a Regional Economic Vision and Mission
Identify Strategies and Goals
Metropolitan
Specify Products, Services and Policies
Business Plans
Develop an Operational Plan
Develop a Financial Plan
Target and Monitor Performance
Monday, November 19, 2012 7

10. To Start, A Region Must Know Its Overall Economic Performance
• Output
• Employment
• Population
• Productivity
• Wages
• Income
Monday, November 19, 2012 8

11. Concentrations of industries,
functions, and occupations
Linkages and movement
Spatial Efficiency Clusters of goods, people, and
information to support
economic efficiency
Enablers
Prosperity Government efficiency
and efficacy
Governance Human
Innovation Business environment
Capital Tax value proposition
Innovation performance Talent production, attraction,
Entrepreneurial ecosystem retention, and matching to jobs
Monday, November 19, 2012 9

12. A Dozen Metro Areas Are Acting on Business Plans for Growth
Minneapolis-St. Paul
Northeast Ohio
Puget Sound
Louisville/Lexington
Chicago, IL
Northeast Ohio Memphis
Phoenix
Syracuse
Chicago
Baltimore
Buffalo
Newark
New York
Monday, November 19, 2012 10

13. These Metro Areas Comprise a Large Share of Their State Economies
Chicagoʼs Share of State Economy Northeast Ohioʼs Share of State Economy
Chicago-Joliet-Naperville, IL-IN-WI MSA Cleveland-Elyria-Mentor, OH; Youngstown-Warren-Boardman, OH-PA MSA;
Akron, OH MSA; Canton-Massillon, OH MSA
35.9%
71.4%
Source: Brookings analysis of Moodyʼs Analytics data.
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14. NE Ohio: Applying the Discipline of Private Sector Planning to a Region
Know Your Market Strong manufacturing
base
Identify a Regional Economic Vision and Mission
Top tier research
Identify Strategies and Goals institutions
Weak job growth and
Specify Products, Services and Policies
productivity
Develop an Operational Plan Shrinking workforce with
low BA attainment
Develop a Financial Plan
Fragmented, high-cost
Target and Monitor Performance local governments
Monday, November 19, 2012 12

15. NE Ohio: Applying the Discipline of Private Sector Planning to a Region
Know Your Market
Identify a Regional Economic Vision and Mission
Create a connected,
Identify Strategies and Goals
collaborative region that
can compete for jobs,
Specify Products, Services and Policies
market share and
investments in the next
Develop an Operational Plan
global economy
Develop a Financial Plan
Target and Monitor Performance
Monday, November 19, 2012 12

16. NE Ohio: Applying the Discipline of Private Sector Planning to a Region
Know Your Market Help SMMs innovate in
growth markets
Identify a Regional Economic Vision and Mission
Grow/ connect employers
with skilled workers
Identify Strategies and Goals
Create entrepreneurial
Specify Products, Services and Policies ecosystem
Link regional planning and
Develop an Operational Plan
revenue sharing with
economic growth
Develop a Financial Plan
Reward government
Target and Monitor Performance efficiency/ collaboration
Monday, November 19, 2012 12

17. NE Ohio: Applying the Discipline of Private Sector Planning to a Region
Know Your Market Partnership for
Regional Innovation
Identify a Regional Economic Vision and Mission Services
(PRISM)
Identify Strategies and Goals
•Access to equipment,
Specify Products, Services and Policies research, and training
•Assistance identifying
Develop an Operational Plan new market opportunities
Develop a Financial Plan •Access to flexible risk
capital for
Target and Monitor Performance commercialization
Monday, November 19, 2012 12

18. NE Ohio: Applying the Discipline of Private Sector Planning to a Region
Know Your Market
Identify a Regional Economic Vision and Mission
MAGNET as lead entity
Identify Strategies and Goals
Specify Products, Services and Policies Services provided by key
partners (e.g. Nortech,
Develop an Operational Plan community colleges,
business schools)
Develop a Financial Plan
Target and Monitor Performance
Monday, November 19, 2012 12

19. NE Ohio: Applying the Discipline of Private Sector Planning to a Region
Know Your Market
Identify a Regional Economic Vision and Mission
$2.4 million
start-up costs
Identify Strategies and Goals
Specify Products, Services and Policies $8.4 million
budget over 5 years
Develop an Operational Plan
Shift to revenue-based
Develop a Financial Plan model in year 3
Target and Monitor Performance
Monday, November 19, 2012 12

20. NE Ohio: Applying the Discipline of Private Sector Planning to a Region
Know Your Market
12
Identify a Regional Economic Vision and Mission SMMs served in the first
year
Identify Strategies and Goals
Specify Products, Services and Policies
$275 million
projected new firm
revenue growth by 2014
Develop an Operational Plan
Develop a Financial Plan
425
projected new jobs at
portfolio companies by 2014
Target and Monitor Performance
Monday, November 19, 2012 12

21. These Metros Are Also Transforming the Civics to “Staff” an MBP
Northeast Ohio Chicago
Project
Fund for our Economic Future World Business Chicago
Manager
Magnet
Core Working McKinsey & Company
NorTech
Group Team NEO and others
City of Chicago
Loraine Community College Metropolitan Planning Council
Greater Cleveland Partnership Executivesʼ Club
George Fund Foundation Civic Committee
Board of
Cleveland Foundation Chicago Community Trust
Directors Municipalities Chicago Federation of Labor
Case Western McArthur Foundation
Greater Akron Chamber Chicago Land Chamber of Commerce
Monday, November 19, 2012 13

22. States Are Aligning to Regional Strategies
Ohio Tennessee New York
Regional Economic Regional Jobs Base Camps
Regional Economic Councils
Partners to JobsOhio and Plans
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23. In Sum, MBPs Can Lead to Results in Economic Performance
Rooted in analytic rigor
Nested in market dynamics
Surfaces transformative opportunities
Metropolitan
Business Plans
Identifies cross-cutting initiatives
Leverages private/philanthropic investments
Operationalized with clear accountability
Monday, November 19, 2012 15

24. Metropolitan Business Planning
A New Approach to Transforming a Region’s Future
@BrookingsMetro
@Amy_Liuw
Metropolitan Policy Program Sao Paulo, Brazil / November 28, 2012
at BROOKINGS
Monday, November 19, 2012 16