Monthly Archives: July 2016

Managing the Complexity of Inclusive Growth

Organizations responsible for economic development are becoming more intentional about achieving inclusive growth, but many still view it as an “add on” to business as usual. If that continues, they are bound to fail, because current economic development efforts fall far short of delivering the good jobs on which everything else depends when it comes to inclusive growth.

It’s becoming clear that many of the strategies that worked well in the past are now largely ineffective, and some current job creation strategies may actually be making the situation worse when it comes to economic inequality. Most economic development organizations will need to radically rethink their strategies and retool their systems if they want to deliver more inclusive growth.

They will also need to more closely coordinate their efforts with workforce development, transportation, land use, and community development efforts. As it turns out, it’s not enough to just create more good jobs. Achieving inclusive growth also requires helping low-income residents prepare for and gain access to those jobs.

That’s a lot of complexity to manage. Some regional leaders have responded by developing comprehensive plans that try to capture as much of that complexity as possible, which has the advantage of helping stakeholders see the big picture, understand how the pieces fit together, and surface opportunities to work across traditional program and jurisdictional boundaries.

However, no single plan can hope to capture everything that’s relevant to inclusive growth. There are simply too many variables to consider, and conditions on the ground are constantly changing. So, even the best-laid plans for inclusive growth have a half-life of only a year or two.

Moreover, comprehensive plans are very difficult to implement. And trying to do too many things at the same time can spread resources too thin to make a difference, or lead to stress and burnout. So, the key is to find a scale that is big enough to have an impact, but not so big that the effort becomes too difficult to manage and sustain.

Another way regional leaders are trying to simplify things is to focus their inclusive growth efforts on particular communities. That approach has the benefit of reducing the number of actors that need to be involved, and increasing the likelihood that those actors already have some experience working together. Moreover, the smaller scale makes it easier to coordinate programs that create good jobs with those that help people prepare for and gain access to those jobs.

However, individual communities rarely have all of the assets needed to turn things around on their own. And experience has shown that it’s very difficult to attract enough jobs or to concentrate enough resources in one community long enough to make a significant and lasting difference. The key is to not only leverage the existing assets in the community, but also to connect the community to assets at the regional level, which requires that there be effective structures in place at the regional level. In other words, it’s not a matter of either/or. It’s a matter of both/and.

A third way regional leaders are trying to simplify things is by working on individual pieces of the inclusive growth puzzle. That gives the work a tighter focus and requires that fewer people be involved. It also makes the work easier to fund, since most funders prefer short-term projects with clear objectives and measurable results. And it lends itself to using collective impact as a problem-solving method, since that method is particularly effective in situations where the problem is well defined, the objectives are clear, the results are measurable, and the solution requires cross-sector collaboration.

However, focusing too narrowly can limit the impact of the work, since the biggest opportunities for making a significant and lasting difference lie in working across program boundaries and in changing existing systems. It can also be easy to lose sight of the big picture when focusing on separate pieces. The most successful regions have found that the key is to focus on a portfolio of mutually reinforcing initiatives guided by a strategic leadership group at the regional level.

In short, the key to dealing with the complexity inherent in inclusive growth is finding the right balance between doing too little and doing too much, between work at the community level and work at the regional level, and between focusing on individual pieces and focusing on the big picture. That takes a lot of practice.

Pete Carlson is president of Regional Growth Strategies