The South Bend presentation was delivered at the first ever South Bend Economic Summit, co-hosted by the Mayor of South Bend, and the heads of the Chamber of Commerce of St. Joseph County and the Corporate Partnership for Economic Growth.

1. Robert Weissbourd
Regions Charting
New Directions:
Metropolitan Business Planning
South Bend Economic Summit
June 21, 2012

2. Drivers of the Next Economy
Agenda
“Metro-Economics”
Metropolitan Business Planning (from theory to practice)
Understanding Your Economy
Key Lessons and Discussion

3. 0%
100%
200%
300%
400%
500%
600%
$s lbs
%Change
GDP Growth, 1950-2000
• Human Capital
• Information technologies
• Product innovation; flexible
customization
• Firm, consumer and knowledge
networks
• Increasing returns; divergence
The Global Economy is Undergoing a Fundamental
Transformation, Driven by Knowledge Assets
Source: “Greenspan Weighs Evidence and Finds a
Lighter Economy,” Wall Street Journal 3

4. 0
20
40
60
80
1920s 1990s
Years Spent on the S&P Index
As a Result, the Economy is More Dynamic
Sources: Newsweek,Manyika, Lund and Auguste, “From the
Ashes,” 8.16.2010;Brookings Institution
18.3%
US
Global GDP (2015)
25.8%
BIC Countries
20.2%
US
21.4%
BIC Countries
Global GDP (2010)
0%
20%
40%
60%
80%
100%
15% 20% 25% 30% 35%
GRPGrowth
Firm Starts and Closures (Churn) as % of All Firms
Churn and GRP Growth by MSA
-- and Global

5. ServiceExports
75%
U.S.AirCargoWeight
79%
AirlineBoardings
92%
Population
66%
GraduateDegrees
75%
VentureCapitalFunding
94%
Patents
78%
Wind+SolarEnergyEmployment
76%
Top 100 Metros Share of U.S. Total
Sources: Brookings analysis of US Census Bureau, FAA, BLS, NIH, NSF, and BEA data; Brookings, ExportNation, 2010 (2008 data); Forthcoming research from Brookings and Battelle
GrossProduct
73%
…and Centered in Metropolitan Areas
Gross
Metropolitan
Product, 2005

6. Driver’s of the Next Economy
Agenda
“Metro-Economics”
Metropolitan Business Planning (from theory to practice)
Understanding Your Economy
Key Lessons and Discussion

7. How Metro Economies Grow
Metro economy = total value of goods and services
produced in the region
Growth is inherently business sector growth (number, size
and profitability of firms)
Business sector grows through firm creation, growth and
location decisions (retention and attraction)
Firm creation, growth and location depend upon increases
in efficiency and productivity (of firm and system, including
product innovation)
Core Question: What attributes of the region increase
efficiency and productivity, leading to business sector growth?

8. What Makes Metropolitan Regions more
Productive in the Next Economy?
Economic
Geography
Institutional
Economics
New
Growth
Theory
8

9. Metros Can Enable People and Firms to
Concentrate and Achieve Efficiencies
Act Comprehensively – The Whole is
Greater than the Sum of the Parts.
Develop Institutional Capacity and
Intentionality.
Customize and Build on
Distinctive Assets.
Economic
Geography
Institutional
EconomicsNew
Growth
Theory
9

10. Leverage
Points
for Sustainable
and Inclusive
Prosperity
Deploy
Human Capital
Aligned with
Job Pools
Create Effective
Public & Civic
Culture &
Institutions
Enhance
Regional
Concentrations/
Clusters
Increase
Spatial
Efficiency
Develop
Innovation-
Enabling
Infrastructure
Five Market Levers
Drive Regional
Economic
Performance
10

11. “… poverty has no causes. Only
prosperity has causes.
Analogically, heat is a result of
active processes; it has causes.
But cold is not the result of any
processes; it is only the absence
of heat. Just so, the great cold of
poverty and economic
stagnation is merely the absence
of economic development. It
can be overcome only if the
relevant economic processes are
in motion.”
-- Jane Jacobs
Photo from Shelf-Basin Interactions
Leverage Points
for Sustainable
and Inclusive
Prosperity

12. -.20.2.4.6
WageGrowth(1990-2000)
0 .1 .2 .3 .4
Poverty Rate (1990)
Equity and Opportunity are Good for Business
Neighborhoods and Regions Move in Tandem
Variation of appreciation trends across neighborhoods,
King County 1990-2004

13. The Pieces of Economic Development …

14. Succeed or Fail “In Context” of Each Other
Entrepreneurship
Business Development
Sustainability
Housing
Workforce
Training
Infrastructure

15. 15
New Approaches for the Next Economy

16. Driver’s of the Next Economy
Agenda
“Metro-Economics”
Metropolitan Business Planning (from theory to practice)
Understanding Your Economy
Key Lessons and Discussion

17. Metropolitan Business Planning:
A New Way of Doing Business
Grounded in Economics and Business
Comprehensive, Actionable
Strategies
NOT Plans — Enterprises
Continuous Process and
Improvement

18. Business Planning: A Proven Discipline for
Comprehensive, Effective Action
 Identify regional
assets/opportunities
 Develop customized
strategies
 Turn strategies into
concrete actions
 Build institutional
capacity
 Execute
Metropolitan Business Planning
Regional Economy Mission and Vision
Market Analysis
Identify Strategies and Goals
Specify Products, Services and Policies
Operational Planning
Financial Planning
Performance Monitoring

19. Pilot Metro Business Planning Regions

20. Northeast Ohio
Partnership for Regional Innovation Services in Manufacturing ( PRISM )
Metropolitan Business Plans in Action

21. Metropolitan Business Plans in Action
Puget Sound (Seattle)
Building Energy-Efficiency Testing and Integration Center (BETI)

22. Developing Institutional Capacity
Steering
Committee
Strategy 1
Team
Initiative 1AInitiative 1B
Strategy 2
Team
Initiative 2A
Strategy 3
Team
Initiative 3A
Strategy 4
Team
Initiative 4A Initiative 4B
Engage stakeholders across public, private and civic sectors
Iterate analysis/strategy and institutional development
High-level (e.g., C-suite) leadership group/steering committee
Day-to-day (staff-level) working teams
Expert/business/practitioner teams for specific strategies and
initiative development
Strategy is coordinated; Implementation is distributed

23. Driver’s of the Next Economy
Agenda
“Metro-Economics”
Metropolitan Business Planning (from theory to practice)
Understanding Your Economy
Key Lessons and Discussion

24. Understanding the South Bend Region’s
Economy
South Bend MSA
Rest of “Michiana”

25. The Big Picture: Restructuring?
Source: Bureau of Economic
Analysis; Bureau of Labor Statistics
South Bend MSA USA All Metros
80.0
90.0
100.0
110.0
120.0
2000 2002 2004 2006 2008 2010
Employment
(Indexed to 2000)
$55,000
$65,000
$75,000
$85,000
2001 2003 2005 2007 2009
Productivity (Output per Worker)
$25,000
$35,000
$45,000
$55,000
2000 2002 2004 2006 2008 2010
Average Annual Wage
100
105
110
115
120
2001 2003 2005 2007 2009
Real GRP/GDP
(Indexed to 2001)

27. Analyzing Clusters
Current Concentrations: Assets, Legacies and Bets
Cluster Dynamics and Drivers
Cluster Organization
Cluster Map Source: Bo Heiden, Strategic Uses of the Global Patent System
Growth
Concentration

28. Opportunities to Target, Redeploy
Legacies? (3-digit NAICS, employment)
Bets
Assets
Manufacturing
• Concentrations in primary and
fabricated metals, machinery, electrical,
chemical, transportation equipment,
plastics
• Connections to nearby orthopedic
devices and RV/manufactured housing
clusters?
• Specific sub-segments growing?
Industry Growth
ConcentrationinRegion
Education
• Leverage university strengths to
support private sector?
Communications Technology
• High employment growth; High LQ;
high wage; high productivity; low
absolute employment
Biotech/Life Sciences
• Tie in with hospitals or Notre Dame
research?
Growth industries that build on
South Bend assets?

30. Understanding Human Capital Dynamics
Status, Attraction and Retention
Segmentation, Skills Match and
Labor Market Efficiency
Opportunity and Mobility

31. High-end Production, Weak Retention
0.0%
20.0%
40.0%
60.0%
80.0%
100.0%
High School
Diploma
Bachelor's +
Educational Attainment
St. Joseph County
Indiana
USA
-0.1%
-0.6%
-1.1%
USA
Indiana
South Bend MSA
Growth in 25-44 Population,
1997-2009
16 Colleges and Universities  High Production of Human Capital
0%
10%
20%
30%
40%
Management +
Professional
Service Sales + Office Natural
Resources,
Construction +
Maintenance
Production,
Transportation
+ Material
Moving
Occupation Share, 2010
South Bend MSA USA Skills mismatch?
Which jobs/
industries will
help retain recent
grads?

33. Cultivating Innovation
Innovation
Ecosystem
Market
Research
Marketing
Manufac-
turing
Finance
R&D
Innovation Pipeline
Cluster-based innovation
Innovation ecosystem

34. Weak Indicators Across Pipeline
Increase university
commercialization?
Explore cluster-based
innovation
opportunities?

36. Enhancing Spatial Efficiency
Urban Growth Form
Connectedness and Mobility

37. South Shore Line South Bend Airport
TRANSPO St. Joe Valley Metronet
Strong Transportation Assets and Relatively
Dense
Source: Center for Neighborhood Technology, Housing + Transportation Index; Innovation Index , Stats America
Residential Density Employment Density
463
500
700
South Bend MSA
Indiana
USA
Broadband Density, 2009
Connections across broader region?
Jobs-housing mismatch?

39. Achieving Good Governance
Fragmentation
Tax/Value Proposition
Governance
20,000
30,000
40,000
50,000
60,000
70,000
4.00% 6.00% 8.00% 10.00%
GDP Per Capita vs. Sales Tax Rate
(Illustrative)

40. Compete on High Value instead of Low
Costs
 Most important
public goods and services to
industry, residents? Quality
of these?
 Regulatory processes
(permitting, licensing,
inspections, etc.) onerous
for businesses?
 Alignment of ED programs,
organizations?
 Govt 2.0: engaging firms and
citizens, transparency,
flexibility, use of public data
for economic growth, …?
Services/initiatives that might
be efficiently coordinated,
streamlined?

41. Challenges &
Opportunities
Assets
Illustrative Strategy Development
Strong research assets
at Notre Dame, esp. in
Microsensing
Biomedical Diagnostics
and Nanotechnology
Proximity to Warsaw’s
Medical Devices cluster
Legacy manufacturing
assets and human
capital in need of
redeployment
Predevelopment
barriers (assembly,
product and market
development, etc.)
Targeted, employer-
driven workforce
training
Industry Innovation
Center of Excellence
(advanced medical
manufacturing)
Potential Strategy

42. Driver’s of the Next Economy
Agenda
“Metro-Economics”
Metropolitan Business Planning (from theory to practice)
Understanding Your Economy
Key Lessons and Discussion

43. Global, Knowledge
Economy
Specialization and
Dynamism
Build on Your Assets
Coordinated, Cross-
Sectoral, Flexible,
Adaptive, Open,
Information-Rich,
Inclusive,
Entrepreneurial
Compete on
Value-Added
(not low-cost)
Intentionality
Economic
Development
in the Next
Economy

44. DISCUSSION

45. Robert Weissbourd
Regions Charting
New Directions:
Metropolitan Business Planning
South Bend Economic Summit
June 21, 2012