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Rural areas need new strategy, economist saysBy Larry Dreiling Telling more than 250 persons interested in rural development that they can no longer afford to maintain a status quo position in order to keep their part of the country vibrant, a leading rural economist said there must be a new strategy for rural America to win in the global economic race. Dr. Mark Drabenstott, director of the Rural Policy Research Institute's (RUPRI) Center for Regional Competitiveness at the University of Missouri, spoke at the recent Governor's Forum on Colorado Agriculture at Denver. "Globalization has made regions the new 'athletes' in the global economic race," Drabenstott said. "Every region on the planet is asking how best to run this race. A regional approach will be critical if rural America and rural Colorado has a shot at gold in this race." Rural regions lag far behind in the race for jobs and income compared to urban areas, Drabenstott explained, because of the lack of critical mass in these regions and the heavy reliance on assembly manufacturing. "Because of this, transformative innovation appears scant," Drabenstott said. Globalization handicaps most rural regions. While many places in rural America are adding jobs at a faster rate than urban areas, such as rural Colorado versus metropolitan Denver, incomes are growing more slowly. Winning the race In order to win this global economic race, it will take a four-step approach to win, Drabenstott said. Those four steps are: 1. Craft a regional strategy. 2. Build robust regional governance. 3. Deliberately pursue innovation. 4. Grow a lot of entrepreneurs. A new system for prosperity must be developed in rural America, involving regions rather than small localities. "It will involve strategy, governance, innovation and entrepreneurship," Drabenstott said. In a sound regional strategy, regions must identify their unique competitive advantage-founded on their distinct economic assets-then chart a course to seize it and prioritize public investments to leverage it. "Without a strategy, you will not know the 'ask' in Denver or D.C.," Drabenstott said, outlining what he called two key strategy principles. "First, the strategy must be founded on the region's economic strengths. The era of smokestack chasing is over. Second, it must target industries where the region can build synergies around established or potential business clusters." Regional roundtables are crucial to crafting sound regional strategies, Drabenstott said. "The region must own it, if it's to work," he said. "This roundtable must engage public, private, nonprofit leaders. The questions that remain are who will supply the Round Table and who plays King Arthur?" In framing robust regional governance, communities will have to stop thinking of themselves apart, and begin thinking and acting as a region, Drabenstott said. "Much of rural America rests on the laurels of assembly manufacturing and commodity agriculture. We must look much further onto the horizon," Drabenstott said. "The key will be deliberately connecting public research with what each region does best." This is followed by a deliberate investment in regional innovation that can lead to a world-class entrepreneurial climate. "Creating this climate will require a change in culture, from we work for 'them' to we work for 'us,'" Drabenstott said. "That means developing entrepreneurship support systems that must be systematic in approach and regional in scope and recycling the wealth in new equity instruments. "Simply put, don't bury your talent in the dirt." Moving forward Drabenstott then offered tips to the attendees on how to move forward in regional development. "The first step is pretty easy. Identify a 'region,'" Drabenstott said. "Select the best economic direction you can and craft strategy to seize it. Figure out who does what. Build a governance group. Diagnose the region's competitive advantage. Map the region's assets and potential from a ground level view. Identify the public and private investment priorities." Drabenstott's six questions that must be asked in identifying a region are: -What is the most logical economic region? -What is the "commuter shed"? "Retail shed"? -Is there compelling geography? -Who plays well together in the same sand box? -Are there historical and cultural factors to consider? -Is there a business cluster to unite the region? "In building regional governance," Drabenstott said, "the questions are who are the regional champions? Who can provide sponsorship for the roundtable? Which public officials and private sector leaders will engage? Which foundations or non-profits can supply glue to hold the region together and can a university or college bolster the effort?" Identify the trends In diagnosing a region's competitive advantage, Drabenstott suggests identifying key economic trends in the region, such as how is the region doing against its peers and what can be learned from leaders and laggards in the region. "Identify what are the region's existing and emerging clusters and what are the various impacts of economic options," Drabenstott added. That leads to mapping a region's economic assets, those that are distinct or unexploited. "Identify what it would take to unlock their potential and, finally, what are the region's biggest economic barriers," Drabenstott said. This leads to the last step of crafting a region's strategy. "This requires presenting a menu of near-term and long-term economic options to this governance group. Identify consensus options. Prioritize public investments and leverage the 'ask' with the governance group along with near-term and long-term development steps. Launch your action steps and monitor progress against plan and evaluate progress." Drabenstott reminded the group that globalization is handicapping most rural regions. "Critical mass is more important than ever," Drabenstott said. "Most rural areas lack that critical mass. Thinking regionally will unite people behind a common set of goals to help rural America win the global economics 'Olympics.'" Larry Dreiling can be reached by phone at 785-628-1117 or by e-mail at ldreiling@aol.com. 5/19/08 Date: 5/13/08 Advertisement
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