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Friday, December 4th, 2009

The Mayor as CEO

“Transformation comes from entering new markets and leaving old ones. Companies rarely transform themselves through cost cutting or improved operational effectiveness. Operational effectiveness is necessary to compete, and world-class operators can create competitive advantage, but in almost all cases, operational effectiveness is insufficient to stave off disruption and drive long-term competitive advantage.” – Scott Anthony
My latest post is online over at Forbes. It is called “The Mayor as CEO” and it is about how cities need to create strategies that are unique to them in order to find sustainable success over the long term.

As always, I’ll offer more commentary here. So many people on the right seem to believe that all you need to succeed as a jurisdiction is low costs/taxes. Cost efficiency is of course important in business and in government. But how many businesses have a strategy that is simply “low costs”? Usually they have some ideas about a target market, brand position, and value proposition they are delivering. Unless you are the low cost producer in a commodity market, low cost is generally not a sufficient strategy. And alas, our core cities are structurally high cost producers (usually higher taxes, more crime, worse schools, and older infrastructure) that cannot compete for jobs with their suburban regions purely on price.

On the other hand, too many on the left lack concern about costs and taxes. There are lots of ideas about what can and should be implemented, but too-seldom and appreciation for the negative impact high taxes, costs, and regulations have on the attractiveness of a place to prospective residents and investors.

In the ideal world, cities would combine the best of these approaches, keeping a keen eye on the bottom line and cost competitiveness while making targeted investments aligned with a focused strategy for success. Too often, however, we get the worst of both worlds in the form of highly subsidized boondoggles.

To illustrate the dilemma facing the central city mayor and how that is so different from other governance challenges, let’s compare the case of Indiana and Gov. Mitch Daniels with Indianapolis and Mayor Greg Ballard. Gov. Daniels is one of America’s premier fiscal conservative leaders. His belief is that Indiana’s attractiveness to business needs to be rooted in low costs, low taxes, and lean government. Now, when you are in his office and survey the world, you see your state surrounded by the likes of Illinois, Ohio, and Michigan. It is easy to see how you can envision yourself having a price advantage over those states. Indeed, while Indiana can never beat the China’s of this world on cost, it is very feasible for Indiana to be one of the lowest cost states in America and probably the lowest cost state in its region. This makes a cost-led strategy appropriate and doable for Indiana. (I should note that Daniels is also investing in infrastructure and elsewhere, but clearly his primary focus is the fiscal realm. If you want to know more about his philosophy of governance, the Indy Star just did a 15-minute video interview with him. I would have embedded it, but the video unfortunately auto-plays).

Mayor Ballard takes a look out his window and sees a very different world. Thanks to the state’s low costs and other factors, his region is very attractive to business. But instead of being surrounded by a collection of high cost states, his city is surrounded by very low cost suburban counties. These greenfield locations have brand new everything, great schools, extremely low crime, and lower taxes. No matter what Ballard does he’s not going to be able to change this. So how does he attract people and business to his part of the region? That’s a very different challenge from the one facing the state or one of those suburban counties. What’s more, many of the people and businesses he might target are those that are also being aggressively targeted by many cities around the country. Simply adding things like bike lanes, trails, and stadiums aren’t likely to produce a particularly compelling offering on a national basis. How do you make yourself stand out in the crowd? It is one of the toughest leadership challenges out there.

So many central cities, particularly those in the Midwest are struggling today. They need to reinvent themselves to recreate relevance for themselves in the 21st century. As the quote at the top says, cost and efficiency are a necessary, but not a sufficient condition to make that happen.

Here is some further reading on this topic:

What Is a Strategy?
The New Discipline of True Urban Design
The Talent Equation
Creative Destruction is Real

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3 Comments
Topics: Strategic Planning
Cities: Chicago, Indianapolis

Wednesday, December 2nd, 2009

Columbus: Fantasy Transit Maps

There’s a sort of genre of urbanist creativity out there of fantasy transit maps. These are maps of transit systems that don’t exist and usually aren’t even proposed yet, but rather just express some dream of the creator, often quite epic in scope.

What I find interesting is how much better these often are than actual transit maps or proposals. I noted before how the Cincinnati streetcar people basically don’t even have a decent map of the line. Contrast that with this example that Columbus Underground points us at. If you click the image, you’ll get a high resolution PDF.

Now that’s a pretty slick map. It is, for locals at least, recognizably Columbus. The crisp, modern design, 45 degree angles, and relatively equidistant stations recall the famous London map and others from cities around the world. The idea being to show how Columbus could position itself among these global cities by creating a transit system. You can even buy it as a poster! A nice possible marketing tool.

This map was created by designer Michael Tyznik and is part of his online design portfolio and is reproduced with permission.

People who are pushing actual transit system improvements could learn a lot from these fantasy maps. Coming up with high quality collateral that demonstrates what the end state looks like is important. And if you can make short term progress and update the map to show reality being made, even better. Transit advocates should take note.

Update: Here is a collection of Columbus fantasy transit maps.

Additional fantasy maps some people linked to. Indianapolis:

New Orleans:

Cincinnati (printed on a T-shirt):

St. Louis:

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Topics: Transportation
Cities: Columbus

Tuesday, December 1st, 2009

Role Reversal

Gay Talese releaesd his masterwork on the history, culture, and inner workings of the New York Times, The Kingdom and the Power, in 1969. It’s the story of a bygone era in journalism, but also more than that. I found this passage particularly curious.

And so what worked in Mississippi worked as well in Manhattan, although the reverse was not so true. The impersonal pushing of the North was out of step with the South; Southerners could not easily accept it: the South was deep-rooted and fixed in its way, as Federal lawmakers would later learn. The South set its own pace and style and stamped its people for a lifetime, and when Northerners went South to live, it stamped them, too. Northerners who settled in the South adopted the regional accent; Southerners who settled in the North did not. [emphasis added]

I found this an interesting observation because it is so contrary to what I see in the present day. It strikes me that people – or at least young people – who move north today do everything in their power to lose their southern accent as quickly as possible. My wife is from Alabama (where Talese attended college, incidentally). Having just returned from a visit there, I can tell you southern accents are alive and well in the South. I great up in rural Southern Indiana with an accent myself. Today, neither of us sounds at all like people with southern roots. I’ve seen this story many times.

And also, when people from the north move south, I see a major effort undertaken to preserve a flat accent in the children. Indeed, we are seeing in places like Atlanta, Charlotte, and Nashville significant upscale districts where large numbers of people have no southern accent. An intern at work a year or so ago was born and raised in Brentwood, Tennessee outside of Nashville, and didn’t have a trace of a southern accent.

We’ve certainly seen since the 1960’s a massive change in the fortunes of the South. The civil rights struggles were still ongoing when Talese wrote his book. Today the South, or at least parts of it, are re-energized and feel confident meeting and competing with the rest of America on its terms.

But perhaps we shouldn’t read too much into the south. It seems to me that there has been a significant decline in regional accents and dialects generally in the United States. Perhaps some of this is due to the interstate highway system, which enabled significant mobility around the country and homogenized things a bit. I don’t know. But even within the last 15 years I’ve noticed, for example, a significant decline in the number of people with Hoosier accents on the north side of Indianapolis, especially among younger people.

It is interesting to see the changes in American culture in even a relatively short term. Of course, some things haven’t changed. The Southern style can still be very effective in the north. Let me just say this, do not underestimate someone just because they talk like a good ol’ boy. You might well end up regretting it.

On another topic completely, a lot of what Talese wrote about journalism in the 1960’s as a period of transition is completely relevant today. I will share a few excerpts to demonstrate. The challenges facing the newspaper business are actually longstanding, and clearly the major media companies failed to meet them. Perhaps that bygone era isn’t so bygone at all.

Now the newspaper industry had a serious new threat, television, and [Managing Editor] Catledge knew that the formula that had worked so well [in the past] would require some adjusting. A newspaper could not compete with the speed of television in covering spot news, nor could it match televisions dramatic presentation of a single news spectacle…but [he] was confident that newspapers could bring readers more details and could explain the significance of these details more effectively than could television…Newspaper reporters would now have to dig more deeply into more areas and to inform the public more thoroughly; they could no longer merely report the facts, but they would often have to interpret the meaning behind these facts. The trick was to do this without editorializing.

…

The [NYT] could no longer financially afford to print lengthy stories about relatively minor news events….The paper was now actually printing fewer columns of news than it had been in the 1920’s and 30’s. And since the end of WWII it had also greatly increased the volume of advertising to a point where it regularly carried more lines of advertising than news….The only what the The Times could both cover the news and pay its bills was to get its reporters to say more in less space, as the tabloid men from the New York Daily News had been doing so well for years

…

It had become one of the corporate jokes within The Times that most of the money earned did not come from publishing the greatest newspaper in the world but from the 42 percent interest that Ochs had bought in 1926 in a paper-making mill in Canada – The Times made more money producing paper without words than paper with words.

…

Only The Times and two tabloids, the morning News and the evening Post, would remain in a city than in 1900 had sixteen dailies, and than in 1930 had a dozen…Of the New York dailies, only The Times and the News [had been] consistent money makers; the others survived on subsidies from newspaper chains or from individual owners whose wealth was derived from outside sources.

…

The Times would have to accept the computer. The computer was still a relatively controversial subject at The Times, but now in Sulzberger’s first year as publisher he began to prepare the institution for its introduction. Timesmen would have to overcome their aversions and romantic notions about the newspaper business.

Plus ça change….

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Topics: Urban Culture

Tags: journalism

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