Transformation: The Case for Building a Competitive Workforce Through Strategic Partnerships

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Transformation The Case for Building a
Competitive Workforce Through Strategic
Partnerships

• Presentation
• December 3, 2013
• Workforce Professional Development Academy
• Leadership Training
• Orlando, Florida
• _______________________________________
• Wes Jurey
• President CEO, Arlington Chamber of Commerce
• Chair. of the Texas Workforce Investment Council

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• If the pace of change inside the
• organization is slower than the pace of
• change outside the organization
• the end is near.

Jack Welch Retired CEO General Electric
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Premise

• Pace of change, driven by globalization, is
  unprecedented
• It has created an intense, globally competitive
  environment driven by innovation
• This has resulted in significant economic change,
  which demands both strategic and organizational
  change
• Intellectual capital (quality of workforce), as
  developed through our education and workforce
  training systems, will define our competitiveness
• Attracting, developing, and retaining a
  competitive workforce demands systemic change
  based on strategic, collaborative partnerships

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What are we going to talk about?

• Understanding economic development
• Understanding the forces driving change
• Understanding the changing structure of the U.S.
  economy and its effect on our workforce
• Shaping our response Defining our challenge
• Developing strategic partnerships among
  government, education and business
• Selling change

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Cluster Theory(Understanding Economic
Development)

• Wealth generating cluster
• Aligned with integrated suppliers service
  providers (wealth recirculation)
• Supported by economic foundations
• Public regulatory policy
• Access to capital
• Access to Infrastructure
• Access to Technology
• Trained, Educated, Competitive Workforce
• Dependent upon
• Mobility
• Logistics Distribution

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Four Forces Driving Change

1. Globalization
2. Technology and Telecommunications
3. Regionalism
4. Sustainable Development

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The Impact of Globalization

• We won the cold war capitalism prevailed and
  in the process we created 3 billion new
  competitors for the worlds markets and
  resources.
• The U.S. is 4 of the worlds market, consuming
  26 of the worlds resources.
• Most of the worlds natural resources, people and
  capital are somewhere else.
• Half the worlds population lives on lt 2/day
• 1 billion people live on lt 1/day

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Does the Global Economic Slowdown Matter?
Percent of 2011 Revenue Outside U.S.

• YUM Brands 70
• Wal-Mart 26
• IBM 64
• Boeing 41
• Intel 84
• General Electric 54
• Bank of America 20
• Ford 51
• Dow Chemical 67
• Microsoft 46

• Apple Inc. 61
• JNJ 56
• Caterpillar 64
• Dell 48
• ExxonMobil 45
• McDonalds 66
• Amazon 45
• General Motors 46
• Nike 50
• Hewlett Packard 65

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Technology Telecommunications

• Technology and innovation have historically been
  the drivers of economic development
• The internet, discovered in a federal lab, is the
  single greatest factor driving and enabling
  global competition.

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Disruptive Technology What it is, why do I care?
Advanced Oil Gas Exploration Hydraulic fracking, creates 4 trillion in new oil gas
Renewable Energy Wind solar, new energy sources declining prices
Advanced Materials Nano Particles
3-D Printing Make plastic products with ink-jet printing techniques
Energy Storage Batteries Capacitors
Next Generation Genomics DNA sequencing, gene mapping
Autonomous Cars Robot cars, sensors in roads
Cloud Technology Server farms serving 2.7 billion internet users
Internet of Things Weblinking devices, HIT
Automoation of Knowledge Work Work activity displacement, all occupations
Mobile Internet Smart phone Interconnections, 24/7 workers
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Regionalism

• The urban landscape has spawned economic regions,
  irrespective of political or geographic
  boundaries.
• Globally competitive regional economies demand
  intergovernmental collaboration, and effective
  public/private sector partnerships
• Effective regional collaboration requires neutral
  conveners and nontraditional approaches

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The Changing Face of the Labor Market Structural
Transformations
New Business Supply Chain Practices
Demographics
Globalization
Regional
Labor Market
Tradable Skills Occupational Blending
Energy
Economy
U.S. Economy Credit Capital
Innovation Technology
Telecommunications Internet/Social Media
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Sustainable Development

• We are running out of natural resources we face
  water and energy shortages based on increased
  demand and dwindling supply
• Federal entitlements that became competitive
  grants are becoming seed and venture funding, to
  enable and incentivize collaborative capacity
  development within regions, rather than ongoing
  support for programs and projects
• Public policy has to focus on renewable resources
  in a consumption based economy

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The Changing Structure of the US Economy

• Fundamental changes in the U.S. and global
  economy are ongoing
• Until mid- 2001, the U.S. experienced the
  strongest growth and development in history
  record lows in unemployment and record growth in
  per capita income
• Fortune 500 companies made up 26 of
  nonagricultural workforce 40 years ago and those
  firms have lost over 12 million jobs and
• In the past decade, medium and small companies
  accounted for all of the net job growth across
  the country.

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1980 Fortune 500 Top 25

• Exxon
• General Motors
• Mobil
• Ford Motor
• Texaco
• Chevron
• Gulf Oil
• IBM
• General Electric
• Amoco
• ITT Industries
• Atlantic Richfield
• Shell Oil

• US Steel
• Conoco
• DuPont
• Chrysler
• Tenneco Automotive
• ATT Technologies
• Sunoco
• Occidental Petroleum
• ConocoPhillips
• Procter Gamble
• Dow Chemical
• Union Carbide

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2013 Fortune 500 Top 25

• Wal-Mart Stores
• Exxon Mobil
• Chevron
• Phillips
• Berkshire Hathaway
• Apple
• General Motors
• General Electric
• Valero Energy
• Ford Motor
• ATT
• Fannie Mae

CVS Caremark McKesson Hewlett-Packard Verizon
Communications UnitedHealth Group J.P. Morgan
Chase Co. Cardinal Health International
Business Machines 21Bank of America Corp. Costco
Wholesale Kroger Express Scripts Holding Wells
Fargo
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Maintaining Our Competitive Workforce

• Unemployment rate has fallen to 7.3 from 10 in
  2009
• Business has added 7.6 million jobs over the same
  time
• However, Long term unemployment is up 213 over
  the same time!

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Maintaining Our Competitive Workforce

• What Kind of Jobs Are Coming?
• Demand for skilled workers will only intensify
  42 of U.S. jobs today require technical or
  academic degrees, up from 29 in 2000
• What Kind of Workers Are Needed?
• All but one of the top 10 business sectors that
  have the fastest employment growth are service
  sectors
• 2 are in social services, 2 are in health care,
  3 are in information technology, 2 are in other
  services, and 1 is in utilities
• Where Will They Come From?
• A potentially untapped workforce
• According to BLS, in addition to officially
  unemployed Americans, more than 75.7 million
  working-age adults are not participating in the
  workforce
• Another 24.2 million are part-timers
  potentially interested in working increased hours
• Another 2.3 million are marginally attached
• SOURCE U.S. Bureau of Labor Statistics

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How Has Global Competition Reshaped the
Workplace?

• Automation, to drive productivity, is responsible
  for more jobs lost than outsourcing
• Outsourcing has penetrated higher skilled
  higher paid sectors (example engineers in
  India, comparably trained, make 20 of U.S. wage)
• Lack of technically trained workers has escalated
  wages in U.S., increasing the speed at which jobs
  move offshore
• Industry is consolidating to areas of U.S. where
  they can remain competitive

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What is IT? Is this IT?
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Shaping our Response Defining Roles Missions

• Premise Education is workforce development,
  which equals economic development
• Business industry defines both the challenge
  and need (demand) putting capital at risk to
  create wealth and jobs
• Education provides the skills and knowledge
  (supply) required to succeed in marketplace
• Government workforce system moving from talent
  placement to talent development. Determines
  public policy, establishes regulatory framework,
  funds infrastructure

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Defining the Challenge Were 4 of the worlds
population

• 3 billion people in China, India, Russia 10
  highly educated 300 million
• 300 million people in U.S. 10 highly educated
  30 million
• And that doesnt count the rest of the world

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Defining the Challenge Were projected to lose
population to 2050

• 12 million undocumented workers
• 20 million projected shortages from
  retirement
• 32 million shortfall to fill current jobs!
• (Is it time to resolve immigration?)

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Defining the Challenge Educational attainment
levels for the majority minority

• Percent of high school graduates ages 25-29 in
  the U.S.
• Anglo 93
• Black 87
• Hispanic 53
• Drop outs in the U.S.
• 1 every 29 seconds, 6000 each school day

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Defining the Challenge Tech training isnt cool

• Manufacturing was 49 of U.S. GDP after WWII
  today it is 6-8
• Lack of qualified technically trained workers is
  driving jobs offshore
• Scientists are critical but so are machinists

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Defining the Challenge Early childhood needs
attention

• The high school graduating class of 2026 entered
  the public education system this fall
• Its a 13 year production cycle
• Kids are born prepared to learn
• 3rd graders who cant read seldom catch up (and
  generally drop out)

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State Regional Response

• Moving from Hunting to Gardening (slowly)
• Focusing on Industry Clusters
• Emerging Clusters of Knowledge Competency
• Asset Mapping linking assets
• Hubs Nodes understanding the value chain
• Hubs sufficient critical mass to drive
  development
• Nodes support development with complementary
  process
• Moving from taking the order to anticipating the
  order

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Developing our Commercialization Infrastructure

• Fostering applied research commercializable
  discoveries
• Establishing industry/academic partnerships
• Venture capital formation
• Business technical assistance
• Entrepreneurial development

Its How Northern California Became Silicon
Valley
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• The successful organizations of the next decade
  will be those who learn to collaborate and build
  partnerships.

Tom Peters Author
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Developing Strategic Partnerships

• Relationship Building must take place at all
  levels
• Engagement integration of employers (and the
  organizations that represent them) with public,
  higher education, adult education, publicly
  funded workforce investment, voc-tech, post
  secondary
• Importance of Systemic Change (not MOUs)
• Incentivize
• Open discussion of the M word
• Foundation for partnership based on Trust

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Lessons Learned from National Workforce
Initiatives

• Challenge to sustain a grant funded approach
  funding must be integrated in operations of
  partners at all levels state, region, local
• Challenges posed by existing public policy need
  to resolve and align at federal, state, local
  levels
• Focus should be to develop replicable,
  sustainable, scalable models
• Successful models based on collaborative,
  cooperative partnerships
• Importance of organizational capacity in support
  of business leadership and engagement

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Why is Employer Engagementa Challenge?

• Employers dont use or understand the workforce
  investment system arent engaged with education
• Employers dont care about the public policies
  that define systems they dont use or are not
  engaged in
• Employers are hard to reach by educational
  institutions and other workforce development
  agencies who try to engage them one at a time
• Need to engage employer intermediaries they get
  paid to organize employers

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Systemic Change Walking the Walk

• The path to strategic partnerships
• The tipping point
• Focus on commonality
• Define the relationship(s)
• Importance of full disclosure
• Integrate your organizational charts

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How to Engage Partners

• Start at the top
• Face to face
• Full disclosure (open kimono)
• Defined case for support
• Put the M word on the table (face up)
• (No one said it would be easy)

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When To Engage

• At the beginning
• In the planning stage
• In the selling stage
• In the implementation stage
• In the evaluation stage
• (This isnt your fathers MOU)

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Who To Engage

• Business
• Chambers of Commerce
• Economic Development Corporations
• Trade Associations
• Business Roundtables
• Innovation Intermediaries
• Education/Workforce Investment
• Early Childhood/Pre-K
• K-12
• Adult Education and All Postsecondary
• Workforce Investment Boards
• Government
• City
• County
• State
• Federal

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What You Do When You Engage

• Plan
• Organize
• Staff
• Direct
• Evaluate

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Selling Change Your Message Matters

• Every child in America deserves an opportunity
  to learn in a great school with a great teacher,
  preparing them for life in a crime free drug
  free atmosphere, supported by parental
  involvement.

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Ten Commandments

• Simplicity
• Brevity
• Credibility
• Consistency
• Novelty
• Sound Texture Matter
• Speak Aspirationally
• Visualize
• Ask a Question
• Provide Context/Explain Relevance

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Positive Messages

• A childs education everywhere should prepare
  them for life anywhere
• We need better pay for better teachers
• We need parental involvement in our schools
• Its what students learn not what you teach
  results matter
• We need to go back to basics

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Things You Can Do

• Define the convener
• Define the incentive for each partner
• Identify and define your economic
  drivers/industry clusters at state and regional
  levels
• Identify and define the primary stakeholdersyour
  potential partners.
• Define your expectations of them, and what they
  can expect from you discuss the M word
• Educate members, funders, investors,
  constituents, public
• Remember employer organizations provide a
  structured, organized framework for employer
  engagement and involvement.
• Get started.

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• There is nothing stronger than the heart of a
  volunteer
• Colonel Jimmy Doolittle, WWII