What is Business Retention and Expansion?
Most of a community’s job growth and capital investment comes from companies already located there. Based on Blane, Canada Ltd.’s research, an urban/suburban community will average 76% of their growth from existing employers. A rural community is even more dependent on internal growth. Given this, business retention and expansion (BR|E) programs are one of the three core economic development strategies: business attraction, business retention and expansion, and community development.
BR|E programs have five traditional goals:
While there are many parts to a BR|E program, the three central elements are understanding clients, identifying their needs and forming relationships. Executive visits/interviews are the primary means of achieving these goals.
- Identify companies with plans to expand
- Identify companies at risk of leaving/downsizing
- Identify company and community problems
- Provide assistance
- Build relationships
Improving the BR|E Process
"Business retention programs that fail to gather predictive data are less than 40% effective."
We were wrong in 1994 when we made the bold statement above. The reality is, the majority do well to achieve 25% effectiveness. Why?
- No comprehensive strategy
- Inconsistent, intermittent commitment
- Under funding and inadequate staffing (low priority)
- Viewed as requirement, a cost-center
- Failure to leverage findings
- Activity focus, counting visits instead of results
30 years of training...has limited the collective vision of what is possible in business retention. Business retention is not just customer relationship management, saves, expands, assists, and the ever-present problem identification. These are each excellent short-term results. But, the long-term potential is far greater
today! The current model broadly in use produces little information to help manage or anticipate economic growth, predict companies at risk, or identify growth industries. Questions of significant strategic value constitute less than 12% of the questions posed in the typical survey or
visit. Training has focused on the process with little attention to the structure of the conversation or the desired
outcome. While the business retention process is well established, many problems persist: inconsistent execution, weak data with limited value, poor follow-up, untrained red teams. Tweaking the process will not improve the results. Substantive, strategic change is an essential ingredient of the future success we define for clients.
Blane, Canada Ltd. resources:
- In-depth research on 65 economic development organizations' BR|E program results and outcomes
- In-depth research on 24 statewide existing
- A BR|E incubator with over 150 participating
Interviewing isn't a strategy. It is a tactic in a broader strategy.
The Synchronist System is designed as a platform for the
management of executive interviews and service delivery
required by a solid BR|E program.