Much of the talk in economic development circles today is about making a place (a town, county, state, or country) more attractive to businesses by cutting taxes, regulations, and financing costs—the very things that drive up business costs and eat into profits. Public policy options generally include tax breaks; expedited permitting; and low-cost loans, state-guaranteed bank loans, and tax increment financing. But, a new book by business strategist Gary Hamel suggests that factors beyond public policy’s reach may have as much to do with business success as the traditional policy options.
In What Matters Now: How to Win in a World of Relentless Change, Ferocious, Competition, and Unstoppable Innovation, Hamel identifies five paramount issues that can make or break a business: (1) innovation, (2) adaptability, (3) passion, (4) ideology, and (5) values.
In 1994, the General Assembly took a step toward economic development policy’s outer limits when it directed the labor and economic development agencies to (1) give priority for state assistance to businesses that continuously improve their operations; (2) allow workers to participate in decision making; (3) use flexible, cross-functional teams; and (4) meet other specified “high performance work organization” criteria (PA 94-116).
