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Local Economic Development Strategic Planning in 8 Steps


E-mail: info_at_uled.com.ua. Web: www.uled.com.ua. A USAID funded project ... Profile of (high) school graduates; attractiveness of certain professions ... – PowerPoint PPT presentation

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Title: Local Economic Development Strategic Planning in 8 Steps

Local Economic Development Strategic Planning in
8 Steps
  • Community-Based Economic Development Strategic
    Planning Process Overview

Strategic Planning as a Systematic Process
  • It is not ONLY about projects
  • Where we are now?
  • Where do we want to be?
  • How do we get there?
  • To improve allocation of limited resources
  • To establish priorities of action

Strategic Planning
  • systematic way to manage change and build a
    community-wide consensus and shared vision of the
    municipalitys economic future
  • creative process to identify critical issues and
    agree on credible goals, objectives and tasks
    which, when implemented, will address those

Community-based EDSP
  • The community all the citizens is the source
    of empowerment. Local leaders, both government
    and private, must reach consensus on a preferred
    economic future and then cooperate in doing what
    is necessary and practical to create that future.

Basic Principles of EDSP
  • 2 equally important parts planning and
  • Permanent partnership between public and private
    sector is essential
  • Where will the money and human resources come
    from to implement the Plan? - Plan must be
    realistic and credible
  • Plan if implemented will result in positive
    changes improving the competitive position of the

History of Strategic Planning in CE
  • Berman methodology developed in US (1989-1995)
  • USAID sponsored projects in Czech Republic
    (1995), Poland (1999), Slovakia (2001), Serbia
    (2002), Romania (2003)
  • 8 steps methodology of community based economic
    development strategic planning adopted
  • Wide use of methodology AFTER the USAID projects
    in towns, cities, microregions and regions
  • Experience of the BermanGroup with strategic
    planning (facilitation of almost 100 plans
    special studies and analyses performed)

Strategic Planning in 8 Steps
  • Step 1 Getting Organized
  • Step 2 Environmental Scan
  • Step 3 Critical Issues and Vision Statement
  • Step 4 SWOT
  • Step 5 Action Plans
  • Step 6 Strategic Plan
  • Step 7 Implementation
  • Step 8 Monitoring and Updating

Economic Development Strategic Planning
  • Step 1 Getting Organized

STEP 1 Getting organized
  • City / microregion / region
  • Community based / Expert / Internal resources
  • Strategic development Commission (SDC)
  • Involvement of the most busy persons in the town
  • beginning date and ending date
  • list of all meetings, including dates
  • SDC orientation meeting

SDC members
  • Mayor, council members, political opposition
  • Most important companies (production, service)
  • Financial institutions
  • Education institutions
  • City Hall administration
  • SME representatives
  • NGO representatives
  • Local specifics (tourism, health care, library,
    Zoo, theater)

Role of SDC
  • Leadership role in strategic planning process
  • decision making about critical issues
  • studying and approval of analytical documents
  • creation and adoption of Action Plans
  • setting priorities among objectives
  • recommendation to implementation
  • presentation to City Council
  • nominating implementation committee

Economic Development Strategic Planning
  • Step 2 Environmental Scan
  • Community Profile
  • Business Attitude Survey

What is Community Profile (CP)?
  • Not only book full of numbers
  • description - analysis of community
  • hard data, statistics, trends
  • common objective information
  • common basis for decision making

What is the Profile used for(in strategic
planning process)
  • Comprehensive description of geographic area
  • definition of problems - critical issues
  • reference document for SWOT (mainly for S W)
  • basic information for Goals, Objectives and Tasks
  • entry data for quantification of Projects
  • reference data for evaluation of implementation
    of several parts of Action Plans

Contents of Community Profile(structure)
  • Introduction, regional role of the city
  • Population, demography, education
  • Households and housing
  • Employment and unemployment, incomes
  • Local economy, large employers
  • Utilities and infrastructure
  • Social infrastructure (schools, health care,
  • Environmental issues
  • Local government and institutions
  • Specific issues tourism, environment, other

Business Attitude Survey
  • Why are we interested in businesses?
  • Attitudes and opinions
  • SDC members involvement

Business Attitude Surveys in Czech, Slovak and
Romanian cities
  • Questionnaire with 20 25 stabilized questions
  • Over 75 cities and regions in 1999 2004
  • 2000 companies in CR, 250 in Slovakia, 800 in
  • Objective data employees number, salaries,
    export, investments
  • Subjective data evaluation of local government
    services, barriers of development, labor force
  • Changes and development in time frame

Sales and salaries
Barriers of development 2003 results
Quality and availability of the workforce
  • Relatively high unemployment rate (8 15)
  • Massive attraction of FDI into towns with
    population 15 30,000 (focus ONLY on jobs)
  • Social system does not motivate people to work
  • Profile of (high) school graduates
    attractiveness of certain professions
  • Ability to react on needs of employers
  • Competences, time of response

Business support
  • More financing into the city, region state, new
    customers, public tenders
  • Local government approach, information provision,
    organization of relationships between businesses
    and LG
  • Interest in traditional companies, not only new
  • Combat with black (grey) economy
  • Competencies local vs. national

Offer of sites for business
  • Greenfields, brownfields, shops, workshops,
    offices, administrative buildings, speculative
  • Technical infrastructure
  • Conflicts of interests
  • Businesses vs. Citizens (NIMBY syndrome)
  • Businesses against each other (privatization vs.
    ownership, principles of rents)
  • Businesses vs. Government (interventionist public
    policy causing market price distortions etc.)

  • Roads reconstruction, new roads
  • Parking city center housing estates parking
  • How to get through the city crossings, traffic
  • Public transportation (number of lines, bigger
  • Geographical limits, financial limits, property

Why is BAS important?
  • Key issues are identified and articulated
  • Companies informed about the strategic planning
  • Business leaders interested and involved in
    process results
  • Analytical and benchmarking tool for the city
    comparison to competitors

Economic Development Strategic Planning
  • Step 3 Critical Issues
  • and Strategic Vision

What are critical issues?
  • Priority areas which limit future development
  • selective decision making process
  • broad versus narrow definition
  • must be consensus based
  • must provide direction for Action Plans
  • relation to economic development jobs,
    investments, infrastructure etc.
  • What are typical critical issues of cities in
    Ukraine? Why?

Examples of critical issues
  • SME development
  • infrastructure for business development
  • organization of economic development
  • attraction of investors
  • environment
  • work force quality
  • quality of life
  • image
  • city - center of region
  • tourism development
  • transportation
  • Etc.

Building consensus about critical issues
  • Techniques to identify the right critical issues
  • Activity based Facilitated participatory
  • Fair-share based each SDC member must say one CI
  • Consultants assist the selection by
  • Encouraging the use of CP or BAS to support
    arguments for specific critical issues
  • Limiting the number of critical issues to 3 - 4
  • Showing linkages allowing combination of related
  • Organizing voting with ballots

How to define the selected critical issues?
  • Consultants must establish a common understanding
    of the CI SDC must be identified with CI
  • Name of critical issue clear and short statement
  • Critical issue description elaboration of the
    main problems and issues to be dealt with
  • Further direction for internal analysis (SW)
  • Basic input document (SoW) for work Task Forces
    in their work with Action Plans

What is Strategic vision?
  • SV is a simple (1 3 paragraphs)
    non-controversial text based on consensus of SDC
  • SV is a mutually shared vision of the future of
    the City, specifically in relation to the
    selected critical issues
  • SV is a motto of the entire SP process
  • SV is the competitive differentiation slogan for
    the city (to general visions are useless, too
    specific visions
  • SV will be reached by implementation of the
    Action plans

Strategic vision statement structure
  • strategic vision
  • - usually brief text
  • - general statement answering question Where
    do we go?
  • global goals
  • - track according to critical issues
  • - several sentences answering generally How
    to get there?

Olomoucko Strategic vision 2000
  • Greater Olomouc will become a regional
  • Of European importance building on the best of
    its heritage reacting and also generating new
    incentives both inspired and inspiring
  • Strengthening its position in Central Moravia
    being both good neighbor and partner
  • With high level of education, providing the
    highest standard of quality of life to both
    citizens and visitors
  • With attractive business climate and growing
    local economy interlinked with international
    business new economic engine of Moravia
  • Open and accessible crossroads of people, goods
    and ideas.

Economic Development Strategic Planning
  • Step 4 SWOT analyses

What are the SWOT Analyses?
  • Internal Analysis (competitive positioning)
  • Strengths
  • Weaknesses
  • External Analysis (cities must deal with results,
    but cannot influence causes)
  • Opportunities
  • Threats

Typical Issues of Internal Analysis
  • Geographic location, transportation access
  • Quality and availability of work force
  • Infrastructure
  • Sites and buildings for business
  • SME development
  • Financial resources available
  • Relations to City Hall

Typical Issues of External Analysis
  • How do you see the following issues?
  • EU and NATO entry
  • Change of legislation, tax system
  • FDI shift from Western to Eastern Europe
  • Restructuring of traditional industries
  • Change of lifestyle, population aging
  • Development of information technology

Use of SWOT in Strategic Planning
  • Fit the Plan to local needs and potential
  • Correct weaknesses
  • Build on strengths
  • Be prepared to use opportunities
  • Create conditions to reduce negative effects of

Economic Development Strategic Planning
  • Step 5 Action plans

Action Plans - overview
Many issues

Critical Issue 1
Critical Issue 2
Critical Issue 3
Task Force 1
Task Force 2
Task Force 3
? Action Plan 1
? Action Plan 2
? Action Plan 3
Action Plans - structure
Critical Issue
Goal 1
Goal 2
Goal 3
Objective 2.1
Objective 2.4
Objective 2.2
Objective 2.3
Task 2.2.1.
Task 2.2.2

Task 2.2.n
Task Forces
  • Chair and Vice-Chair
  • manage and host task force meetings
  • invite members to meetings
  • serve as liaison between members and consultants
  • New members from specific areas relevant to the
    Critical Issue to
  • enlarge knowledge base
  • bring new resources to the process
  • increase credibility of the process
  • develop support for adoption of the plan
  • start to form implementation momentum

  • Brief description of where we want to go, very
    similar in many cities
  • Adopted by consensus
  • Internal structure of critical issue
  • Transportation (internal, external, parking)
  • Tourism (product, infrastructure, marketing)
  • FDI attraction (sites, work force, marketing)
  • SME development (institutional support, property
    development, financial support)
  • Quality of life (housing, leisure-time,

  • Provide both existing and new-coming investors in
    automotive and electronic industries with well
    educated labor force
  • Address the internal transportation problem, to
    eliminate transit transportation and increase
    transportation capacity of the city.

  • Provide new housing in the city for its current
    and new residents
  • Develop system for assistance to SMEs that will
    provide for technical and managerial information
    as well as information on the financial resources

Objectives projects (SMART)
  • core of the action plans
  • 2-5 objectives to reach each goal
  • 4 basic principles
  • competence resources
  • specific result
  • short term (start within 3 years)
  • community must want it

Objectives - samples
  • Objective 1.1. New Housing in Green Meadow
  • City Hall to prepare land with technical
    infrastructure in the area of Green Meadow and to
    offer it for private housing construction.
  • Institution responsible activities
  • City Hall (urban planning ownership
  • Measure
  • Number of lots prepared

Typical objectives
  • FDI attraction Industrial parks, marketing
    campaign, technical infrastructure
  • SME development Information center, Business
    Incubator, training and retraining, privatization
    of municipal property
  • Housing small apartments, infrastructure, old
    peoples pension build-in apartments
  • Transportation parking and garage, traffic
    lights, road reconstruction, lobbying

Objectives problems to avoid
  • Be specific enough, no more general statements!
  • Conflicts of interest existing vs. new
    businesses main street vs. outskirts business
    vs. city hall
  • Low willingness to contribute by other
    institutions too many objectives to be
    implemented by too few organizations (e.g. only
    by City)
  • Wish list - overly ambitious objectives,
    unlikely to be accomplished

Tasks- what are they?
  • What exactly will be done (outputs, description)?
  • 600 m of sewage line
  • Who will guarantee it (person)?
  • Head of investment department
  • When will it be done?
  • March 2005
  • How much will it cost and Who will provide for
  • 300,000 75 city budget 25 utility company
  • Others cooperation, specific notes, personal
    involvement of IMC members

Economic Development Strategic Planning
  • Step 6 Strategic plan

Prioritizing objectives
  • Why prioritize? Lack of resources transformation
    of wish list into strategy
  • How to do it? SDC ranks objectives using
    evaluation sheet (0-3 points per criterion per
  • Criteria
  • Impact on jobs and investments
  • Feasibility (usually double weight)
  • Time of completing
  • Influence on other objectives
  • Private sector participation
  • Impact on goal

Strategic plan adoption
  • Public hearing
  • Meeting with political parties
  • Plan presentation in media
  • Information and communication campaign
  • City Council meeting SDC to present the Plan

Economic Development Strategic Planning
  • Steps 7 8 Implementation and Monitoring

Implementation Management
  • Strong political leadership and willingness, plan
    MUST be adopted by City Council
  • Implementation and Monitoring Commission
  • Implementation Manager
  • Financial resources available
  • Well organized city hall economic development
  • Take plan seriously

How to evaluate implementation?
  • Two levels of evaluation
  • Review and Inspect
  • Were the tasks completed?
  • Evaluate
  • Did the project reach its goal?
  • Are the planned objectives still relevant?
  • What did we receive back from resources put into
    the project?

Implementation results
  • Tangible
  • new industrial sites
  • Roads, parking lots
  • Upgrade of infrastructure and technology
  • Reconstruction of buildings, new housing
  • cultural, sports and social activities and events
  • More companies located in the community, higher
    revenues, new jobs created etc.
  • New LED organizations, services, professionals in
    the community
  • Non-tangible
  • change of attitudes
  • economic development becomes institutionalized as
    part of the City Hall landscape,
  • business leadership and public officials work
    together to prepare a blueprint for the best
    economic future for the municipality,
  • a permanent, public/private partnership is
  • responsibilities for managing the partnership and
    implementing the blueprint are agreed upon

Implementation Survey - summary
  • March 2003 by University of Pardubice and
  • 170 out of 470 Czech towns interviewed
  • 90 have strategic plans, 42 have other type of
  • Projects for 10 billion Czech crowns implemented
  • Different approach to plan preparation,
    implementation and monitoring

Was approved by Council?
of projects implemented
Problems with lack of resources?
How to update the Strategic Plan?
  • IMC to monitor implementation
  • IMC to prepare update of the Plan
  • Mayor to call SDC to meet again
  • SDC to revise the Plan and adopt changes proposed
    by IMC
  • Strategic planning process starts again by
    environmental scan after 3-4 years
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