Value-adding has gotten a bad rap. Mostly because we are used to hearing the term “value-added,” which has come to mean a financial reward for our step of the chain on the way to consumers.
I spoke in Beirut in November to the ministers of energy, environment and other arenas, plus 120 CEOs of corporations in related industries. The video is above. Value-adding is the subject of the talk. Value-adding means to change positively the lives of the stakeholders every time you engage them. The ‘ing” is indicative of a never-ended commitment to increase the value to the system of stakeholders.
When I was a keynote speaker for The Competitiveness Institute last year, I was swamped by people who wanted to talk about the failure of the clustering model of economic development. They were from Africa, Ireland, South America— many other nations and regions around the world. “Why did some work, some seem to work only to fail later and some never get off the ground””, they wanted to know. I stayed an hour talking with them.
Sept 29th, Obama gave a speech that may foster the same questions in a few years. The call is to return to innovation as the basis of greatness. They Office of the President’s Economic Council issued a white paper to announce and detail this call for a Strategy for American Innovation. The intention is very important—sustainable growth and quality jobs. And they are to be place-based, meaning in their case the “targeting of places and drawing on the compounding effect of cooperative arrangements”. The intention is a good start. But it has the same challenges as the concept of clustering, which is also promoted by the National Council of Economic Development. Until they understand the living systems approach to organizing economic planning and exchange among humans, we will have the same failures, shortfalls and episodic successes that cannot be rationally unexplained.
I will say here, what I said to the folks at The Competitiveness Institute, from regions, cities and counties who inundated me with their questions. You can only succeed IF you organize around the unique story of that Place. That is the true meaning of place-based. Otherwise it is like trying to change careers at mid-life because you want to make more money and you have defined your next career move based on what is paying the most at the moment. It likely is not something you are particularly suited to or even evokes something you are passionate about. Not a good career defining process. Better to be who you are in life, uniquely, and so it is for your city and region. That is what Story of Place branding and development process is about. It grows sustainable economies and quality jobs that spark and regenerate innovation as a part of its nature. It is built into the infrastructure. More
Carol Sanford and Joel Glanzberg on Chautauqua, KVNF, Public Radio. We explore the meaning of Story of Place® in creating Developmental Economies® and regenerating communities.
“Developmental Economies®” (DE) involve the Business community in a different and more effective way. DE is a way of improving the vitality and viability of existing business and creating and incubator for new businesses that extend the uniqueness of the region and its “vocation”. Every PLACE has a uniqueness and out of that comes an opportunity to create unique value-adding (rather than value-added) offerings that cannot be copied and as a result become valued in the region and beyond for their uniqueness and distinctiveness that mirrors the PLACE itself. The cities where this has happened, for examples Portland OR, Curitiba, Brazil, have increased greatly the wealth and prosperity of a place and overcome the hazards that traditional economic development causes. It also makes a more cohesive community within its diversity of creativity. You can stream it or download it for listening to later.
Throughout history, countries that have shipped their raw materials to other counties for processing have lost out to the converters. The further along the conversion process a company is, in adding value, the more viable it is through time. Nations, and the businesses in them by and large, become stable and wealthy because they can make and provide goods and services, not because they own a source of basic commodities. Even with soaring international prices, the amount of income generated by mineral resources in a modern advanced economy remains relatively low compared to the converted products into which they are made. The tendency is to seek efficiencies for a competitive advantage, leaving other nations and businesses to make the real wealth off the resource. This is a losing strategy in the long run, and the long run is getting closer every day. More
Highest and best use is a concept in real estate appraisals. It states that the tax or sale value of a property is directly related to the use of that property; the “highest and best use” is the reasonably probable use that produces the highest property value. This use, the Highest and Best Use, may or may not be the current use of the property. But there is an attempt to recover that potential value in a sale or tax valuation as if it were. So even a landlord who is renting below the potential rent, she is stilled taxed at the most probably rent given the available information. Or a farmer is taxed for the “highest and best” value, which is the zoned value for typically something like commercial buildings. More
How to grow the wealth of a town, city or region without undermining its vitality and heritage: it’s an on-going challenge because we tend to see economic development and cultural and ecological stewardship as being at odds. But any viable future is going to require us to reconcile this apparent dichotomy.
I’m heartened by an integrated approach that emanates from a shared sense of uniqueness of a bioregion—a shared sense carried by its Story of Place. The story of a place is as old as its land and waterways. It is told and stewarded by native peoples and recent residents alike. Those who are drawn to a place represent it in their metaphors, prose and historical accounts. Story of place is made from the patterns that are apparent only on close observations—patterns that underlie all that is there. A place’s story guides what can and will be possible, whether or not we are aware of it. And, if we bring this story into our awareness, it can guide economic prosperity, community vitality and human learning processes that bring together stakeholder groups for the benefit of all. More
When Malvina Reynolds sang about “little boxes on the hillside,” she was describing the monotony that is created when our homes and neighborhoods fail to reflect the essence of people in a unique place. While the song illustrates this with the image of a housing development, the same observation holds true for businesses.
People intuitively react negatively to big chains that give no consideration to a local community and its distinctiveness. Many cities fight back, trying to stop the flood of commodification of their communities that box stores bring. It is often said that this fight is about losing local businesses, but it may be better said that it is about losing the “essence of place” with which local businesses are more connected.
Communities are fighting valiant battles. These battles would be more effective if they focused not only on slowing or stopping the pace of commodification of their towns and villages, but also on beginning to attract and build what is distinctive to their place.
This is done by growing what we call Developmental Economies—economies based on the unique “Story of Place” for where you live. Growing a Developmental Economy begins with assessment, integrating the diverse aspects (social, cultural, and natural) that make your place unique into a narrative framework that all can understand. unique It then uncovers the unrealized potential implied by that assessment, and sets out to develop the capacity of local business and community infrastructure to cultivate it. This creates an inspiring and engaging framework from which businesses can grow, and with which economic development councils and city councils can hold people’s feet to a fire that warms then, instead of scorching them.