Cars and Parts Springfield Swap Meet
Carroll Commencement
Fairborn commencement
Ellen Belcher is the Dayton Daily News opinion pages editor. She writes about state government, education, the environment, higher education and all things Dayton.
Martin Gottlieb is an editorial writer and columnist for the Dayton Daily News opinion pages. He focuses on the political process itself and does such national issues as war, the economy, taxes and Social Security, as well as a hodge-podge of local and state issues.Home > Blogs > A Matter of Opinion > Archives > 2009 > June > 07
Sunday, June 7, 2009
Guest Column: How Dayton can keep jobs, attract more
David Gasper, of Beavercreek, is a software entrepreneur. Formerly with NCR Corp, he sold his start-up company that serviced automated teller machines to NCR in 1999. His start-up, PicsMatch, is a consumer software product that uses facial recognition to organize photographs.
In the wake of NCR Corp. leaving Dayton, many of us are asking how Dayton can hang on to the jobs it has — and grow more.
Here are concrete ideas for keeping our local information technology businesses healthier and more connected to Dayton.
Let’s target the major IT companies that we want to be more vested in Dayton. In information technology, the logical and obvious candidates are:
• Lexis Nexis
• Teradata
• Reynolds and Reynolds
• Standard Register
Let’s also develop an IT outreach strategy modeled after how the community went after jobs during the Base Realignment and Closure Commission process. That elements of that strategy should be:
• Uniting the region and speaking with one voice. One organization needs to own the effort to retain jobs, and all communities and stakeholders need to participate. A single municipality or chamber of commerce is too small to act alone. In the BRAC campaign, collectively we achieved success because we leveraged each other’s energy, knowledge and contacts.
• Developing deep relationships with executives and board members of the targeted companies even if they do not live or work in Dayton. The BRAC team spent a great deal of time in Washington and other communities building relationships.
• Developing strategic plans to counteract the competition from other cities and competing economic entities.
• Including political leaders at the state and federal level.
• Creating a partnership climate for our local businesses. Officials, community leaders and citizens need to understand businesses’ problems and how we eliminate roadblocks — in exchange for more jobs.
•Creating incentives for the targeted companies above and beyond standard tax breaks.
Some examples of might be:
•Start an executive recruitment program in which the Dayton community participates in attracting executives to the area. Create a welcoming and sale committee to help sway executives to live in Dayton.
• Creating specialized tailored management programs that would develop top local talent. This would be more specialized than a standard generic MBA program.
• Enlist business faculty to help businesses. Some educators already participate in the community, but we need still more.
• Convert Dayton to a “tier 1” broadband communications city by turning on the underground fiber network system that has been place but is not being used. Make this high-speed network available to locally vested companies. We have an information super highway lying under our streets, yet we are unable to drive on it. Let’s open it.
• Create more applied research programs for our local universities that could directly benefit local companies. Use Third Frontier Funds to make the research more affordable for our local partner companies.
• Link our local IT companies to state and federal sales opportunities at Wright-Patterson Air Force Base and in Columbus.
Finally, let’s focus on our small- and medium-sized business. Small businesses have created far more IT jobs in Dayton than NCR did. Yet, they don’t receive multi-million dollar incentive packages. Rather, we face many more obstacles than large companies, yet we are the engine for future job growth.
Warren Buffett compares our economic crisis to a war. While this might not be an appropriate analogy, his point is that we have to respond as if we’re in a fight. We need plans and a strategy; focus and sacrifice; unity and a sense of purpose.
I’m disappointed that NCR no longer believes in Dayton. But we have a lot to offer many other companies. Let’s do it.
Permalink | Comments (13) | Post your comment | Categories: Economy, Guest Columns, Local Business
TweetGuest Column: Focusing on innovation is the better strategy
Carol M. Shaw is professor emeritus of engineering management at the University of Dayton, where she formerly was director of the Center for Competitive Change.
W. Edwards Deming, the famous MIT professor who set Japan on its course to manufacturing success, cautioned managers about failure to understand a system.
If we consider the United States as an economic system, we might ask: what is the benefit of moving 1,200-plus NCR jobs from one region to another, from Ohio to Georgia? How does using incentives to benefit one region at the expense of another represent an overall gain for the U.S. economy as a system?
Focusing on moving a business from one region to another is the wrong mindset for management. It creates chaos, and it’s comparable to moving chess pieces around on the same board.
What the country needs is for management to focus on innovation — developing products to expand the playing field, or, using our chess analogy, to create a new version of the game. In fact, management should be so busy innovating the next product line that it wouldn’t consider a regional move because doing so would disrupt the creative flow of ideas from their most important asset — people.
The fact that NCR made an executive decision to move without consulting its most important asset provides insight into how NCR views the community. It didn’t care about Dayton.
But should it? Should an executive consider his business’ connection to community? Does it contribute to the bottom line?
Toyota, Deming’s most well- known success story, thinks so. In fact, a long-term commitment to community is in that company’s mission statement. Does that pay off?
Toyota entered the recession with $35 billion in cash, enough to loan the Japanese government money. A taxpayer’s dream, instead of the taxpayer nightmare created by NCR.
There is something to learn, however, from NCR’s decision to move to another region. Bill Nuti’s comment about being the first CEO to open a manufacturing facility in the United States is a signal that state and local officials should note. Get ready!
Manufacturing is coming back to the United States.
In fact, David Huether, chief economist for the National Association for Manufacturing, says, some manufacturing — such as chemicals and food — never left the country. We still produce 21 percent of the $7 trillion in world manufacturing. That’s only a 3 percent change from the 1970s, when that number was 23 percent.
The hit U.S. manufacturing has taken is in metals, apparel and computers, according to Huether, but he agrees that NCR’s Georgia plant opening is a harbinger of a high-tech manufacturing rebound.
U.S. manufacturing is 50 percent more productive than the next 12 leading manufacturing nations, something that’s critical for high-tech manufacturing.
A high-tech manufacturing rebound has ramifications for state and local planning, as well as universities. It’s too bad that NCR missed the high-tech potential that an NCR/University of Dayton/Wright State University/Sinclair Community College partnership could have created. Creative skilled trades, combined with creative engineering, is a powerful foundation that exists now in Dayton.
Meanwhile, Ohio has a key valuable asset many manufacturers need, and many regions lack — water. NCR should revisit the headlines about Georgia’s extreme drought in 2006-2008. Will NCR remember Dayton the next time the reservoir dries up and its water is shutoff?
The Dayton region has pride, enthusiasm, creativity, ingenuity and a friendliness that will assist those moving to Georgia as they sit in the Atlanta airport waiting for delayed flights.
That will not include Nuti, however. He lives in New York and flies in a private jet.
Permalink | Comments (5) | Post your comment | Categories: Guest Columns, Local Business
TweetEditorial: Rap on Ohio and Dayton costs jobs
Losing NCR’s world headquarters is not just heartbreaking for Dayton. It’s also a kick in the teeth for Ohio.
People from NCR’s Bill Nuti to Republican gubernatorial candidate John Kasich are using the occasion to trash the state on taxes — a symptom of a bigger problem.
Here’s an exchange with Mr. Nuti from the Atlanta Journal Constitution’s Web site:
“Q: How did you settle on Georgia, Duluth in particular?
“A: We did a complete analysis of the lower 48 states, measuring a state’s political environment, demographics, tax incentives, foreign direct investment, skilled labor, infrastructure, supply chain, airports and, of course, we looked very, very hard at the cost of living.
“Georgia scored among the highest-ranked states for the high availability of a skilled work force and (training). Georgia has a thriving economy, the No. 8 lowest corporate tax rate, No. 16 in the United States for foreign direct investment, great logistics, particularly for supply chain and infrastructure. It’s home to many research centers and many Fortune 500 companies, including many of our customers in town.”
Now, admittedly taxes are just one item on Mr. Nuti’s list. But he happens to be wrong if he’s referring to a state corporate income tax.
Ohio doesn’t have one. So, as a frustrated state tax official asked, how can Georgia’s rate be lower than zero?
Ohio’s primary business tax is the commercial activity tax, which is effectively a tax on sales. NCR will pay that tax on anything it sells in the state regardless of where its headquarters is, and, had it stayed, it would not pay taxes on its profits.
When he bemoaned NCR’s decision, former Republican Congressman Kasich, who is running against Gov. Ted Strickland next year, complained that “Ohio has the seventh highest state and local tax burden in the country.”
Both Mr. Nuti’s tax statistic and Mr. Kasich’s are from a conservative outfit called the Tax Foundation. Researchers and tax commissioners across the country — no matter how their state stacks up — say the Tax Foundation’s methodology is squirrely. If you were doing a bona fide site analysis, you would never get your information from the Tax Foundation.
The real truth is that Ohio’s tax rates — state and local together — are not low, but neither are they outrageous as compared to other states.
According to 2006 Census data, Ohioans’ state and local tax burden, as a percentage of their personal income, ranked 18th. On a per capita basis, Ohio did better, coming in at 24th. (That number is also somewhat misleading because a bunch of states are clustered together, separated by piddling differences.)
The “high tax” rap is maybe not central to, but a big part, of Ohio’s “brand” problem. We’re just miserable — no, make that inept — at telling a rich, but complicated, story:
For instance, yes, Ohio stacks up poorly in its number of college graduates. But the Dayton region is home to a cluster of engineers and researchers — because of the presence of Wright-Patterson Air Force Base and its universities — that is the envy of other communities. (This is a fact; Massachusetts tried to rip off many of them during the BRAC process.)
The numbers of scholars and scientists in Columbus because of Ohio State, and in Cleveland because of the Cleveland Clinic, are phenomenal.
Yes, Ohio once had high labor costs, but the industries where unions dominated — automotive, for instance — have been decimated. The manufacturing Ohio is excelling at today is precision manufacturing. Those jobs still pay well because they require high skill levels.
Yes, the state is exporting too many of its young people. But it’s also crawling with universities and community colleges that are swelling with students who might consider staying if they were offered jobs here.
As for the cost of living, in Dayton and any corner of the state, you can have a palace for what it costs to buy a guest house on the coasts and in large cities. (The notion that the Atlanta area has it over Dayton on this metric is laughable.)
Dayton and Ohio have to look at NCR’s departure as a failure if not in a specific sense, at least in an overall way. Mr. Nuti, who was hell-bent on leaving Dayton, convinced his board that the move was in the company’s interests by parroting information that’s widely believed. Ohio and Dayton have only themselves to blame for not countering that.
The sales job this region and the state have is, indeed, formidable. Perceptions definitely die hard. But there’s something wrong when important truths are on our side and no one’s buying.
Permalink | Comments (7) | Post your comment | Categories: City of Dayton, Economy, Editorials, Ellen Belcher, Local Business, Local History, Montgomery County, Ohio politics
Tweet
