09strategicplanning.pdf

Bruce

S.

Boggs

Community-based

strategicplanningisgaining

wide

acceptancein

North

Carolina.

Communities

large

and

smallhave usedstrategicplanningprinciples toset priorities,focus theirefforts

and

mobilizeresourcesfor

community

and

economic

development.

The

Regional

Economic

Strategy Project

(RESP),

undertaken by

Western

Carolina University's Center for

Improving

Mountain

Living,appliedstrategicplanning

methods

in

an efforttostimulate regional

economic development

inseventeen western

North

Carolinacounties.

The

proj-ectreceived a 1989Projectofthe Year

award from

the

National Association of

Management

and

Technical AssistanceCenters

(NAMTAC).

In 1990,it

won

a

sec-ond

NAMTAC

Projectofthe Year

award

forapplied

research

conducted

under

theproject'sBusinessCapital

Task

Force.

A

third

NAMTAC

ProjectoftheYear

award

was

announced

in1992 forthe

Mountain Commercial

Lending Consortium, an

initiativethat

grew

out ofthe

RESP.

Ina report to the Organization for

Economic

Cooperation

and Development,

the Corporation for

Enterprize

Development

(CFED)

cited theRegional

Economic

Strategy Project as

an

example

of

what

CFED

has called the

new

paradigm, orThird

Wave,

of

eco-nomic development

policy.

Background

In 1987, the

Economic

Development

Division of

Western

Carolina University's Center for

Improving

Mountain

Living

began

theRegional

Economic

Strat-egyProject to stimulate

economic development

initia-tives inthe seventeen

westernmost

countiesof

North

Carolina. H.F.

"Cotton" Robinson,

formerchancellor

BruceS.Boggsdesigned

and

directed theRegional

Eco-nomic

StrategyProject.

He

currently servesas

an

assistant directorofthe

EDA

UniversityCenterwithinthe

Economic

Development

Division of Western Carolina University's

CenterforImproving

Mountain

Living.

of

Western

CarolinaUniversity,supplied

much

ofthe

energy

and

visionfortheproject.

Robinson,

a nativeof western

North

Carolina, felt that the region's lagging

economic performance

fellfarshortofitspotential.

He

was

certain thatsubstantialgainscould

be

achievedif

Western

North

Carolinians could unite

around

key

development

issuesofregionalsignificance.

As

chancel-lor,

Robinson had

established

Western

Carolina

Uni-versity'sCenterfor

Improving

Mountain

Livingin1976

asa

means

ofdelivering technical assistance

and

other

servicestocommunities,groups

and

individuals

through-outthe region.

Ten

yearslater,incollaborationwiththe directorofthe Center's

Economic

Development

Divi-sion

and an economics

professor,

he

began

to articulate hisvisionfora regional

economic development

initia-tive.

In1987,

Robinson

assembled

an

Advisory Panel

and

a Steering

Committee.

The

AdvisoryPanel,

which

in-cludedstate

and

nationallyrecognizedleaders

from

the public

and

privatesectors, reviewed

and

critiqued the project design.

The

Steering

Committee,

on

theother hand,

had

a

more

participatory role inthe project. Its

members, which

includedregional leadersrepresenting

a

wide

range oforganizations

and

institutions,endorsed

the projectoutcomes.

Funds were

secured

from

theValley

Resource

Center ofthe

Tennessee

Valley Authority to underwrite the costsofplanningthe regionalinitiative.

A

community

development

professional

was

hiredin

December

1987

todesign

and

directtheproject.Earlyin1988, the

North

Carolina Rural

Economic

Development

Center

com-mittedfundstoimplementtheprojectDuringtheproject's

WesternCarolinaUniversity,homeoftheCenter forImprovingMountainLiving. the design ofthe project

was

refined continually. In addition,

members

ofthe Technical

Committee were

recruited

from

throughoutthe region.This

group

was

comprised

of 28individualswitha

broad

range of

exper-tise

and

experience. Its function

was

to identify

and

proposetothe Steering

Committee

amanageable

number

of

development

issues to be addressed through the project

With

thisgroupin place,theprojectwas launched

in

June

1988.

Project

Design

Strategicplanninginitiatives typicallybegin withan assessment ofthe

environment

within

which

planning

decisions

must be made.

Thisprocessisreferredto as

an

environmental scan,

and

itinvolves lookingattrends

and

outside forces that

impinge

on

community

and

economic

development.

The

RESP

useda participatory

scanning technique intended to build a

broad

base of

public

engagement and

support as it identified

and

selected key issues.

Readers

who

are technically

ori-ented

may

question thevalidity of

an

environmental scanthatisnot

grounded

inexhaustive expertanalysis. In designing the

RESP,

however, the directorjudged

that the success ofthe project

would be

determined

more

by

broad

consensus than byanalytical rigor.

The

scan

was

thereforedesignedasaseriesofhalf-daypublic

forums

engagingcitizens intheprocessofissue identifi-cation

and

selection.

Projectstaff,co-sponsoredbylocal

economic

devel-opment

organizations,

chambers

of

commerce

and

re-gional councilsofgovernments,

convened

five

forums

in theseventeen-countyarea.

The

forums

includedasfew

asthree counties,

and

as

many

as seven.

They

were

open

tothe public,

and

invitations

were

senttopublicofficials

and

civic

and

business leaders.

Attendance

at the

forums

generally

ranged

from 50

to 150. Participants included

civicleaders,educators, elected

and

appointed

publicofficials

and

business people.

Each

ofthe

forums

usedthe

same

agenda. Following a brief introduction of the

RESP

and

itspurpose,participants

worked

ingroups oftento fifteen to discuss each offour ques-tions.

To

getparticipants to articulatetheirvision for the region, the first question askedwas:

"What

would

bethecharacteristicsofa

well-developed western

North

Carolina

economy?"

Project staff intentionally avoided using the

term

'economic development' becauseittends to

evoke

narrow

thinking about industrial

recruitment

and

business development.

The

questionsucceededin elicitingbroadthinking

about the region's

economic

future. Partici-pants'

comments, which

includedfactorssuch

as

economic

opportunity, quality oflife, educational opportunity

and

sound

infrastructure,

were

recorded by

facilitators

and

posted for reference throughout the

remainingdiscussions.

Participants

were

then askedtoconsider,

and

tostate their ideas concerning, changes

and

events thatwill affectthe

development

ofwestern

North

Carolinabythe

year2000.

The

responses

were

recorded

and

ranked by

participants.

The

next

two

questionsaskedparticipants to identify factors that favor

and

those that limit the kinds of

development

they

want

to seein the region.

Again

the ideas

were

recorded

and

ranked. Finally, participantsreviewedtheresultsoftheprevious discus-sions

and

considered regional efforts that should be taken to ensure the kind of future that

had been

de-scribedatthebeginning oftheforum.

Afterthefinal

forum was

held

on

August

25,1988, the resultsofallthe

forums

were

synthesized.

The

next stage

ofanalysis

began

with the specific

recommendations

recordedatthe

end

ofeach forum.

The

recommenda-tions

were summarized,

and

similarones

were

consoli-dated.

The

resulting listof 30"strategic options"

was

presented to the project's Technical

Committee

for furtheranalysis.

These

options

were

more

specificthan

issuestatementsinthattheyincluded general prescrip-tionsforaction to

be

taken.

The

Technical

Committee

members

drew

on

their

own

expertise

and

insight in analyzing the strategic options.

They

consideredboththedevelopmental im-pact ofeach option

and

the feasibility of achieving resultswithinatwo-yearperiod,

and

plotted theresults

Strategic

Objectives

Adopted

by

the

Regional

Economic

Strategy

Project

Immediate

Objectives:

Improve

theavailabilityofbusinesscapital.

Reduce

solidwaste

and improve

solidwaste

manage-ment.

Enhance

thecontribution of tourism

and

recreation tothe

economy.

Develop

the region's leadership resources.

SecondaryObjectives:

Improve

the region's transportation systems, with

emphasis

on

strategichighways.

Provide for conservation of

Western North

Caro-lina's land resources throughtheestablishment ofa

method

of

growth management.

Increasepublicsupportforcontinuing

improvement

of educationinthe public schools.

Strengthenthe region'sinstitutionalcapacity to

pro-duce

aworkforce preparedfortechnicalcareers.

Improve

theeducation

and

skilllevelsofthe region's

present workforce.

synthesized thematricesbeforethe

meeting

at

which

the

Technical

Committee

made

thefinal selection of

op-tionstobe addressed bythe

RESP.

This

comprehensive

evaluation of strategic options

was

not intended to

determinethefinaldecisionoftheTechnical

Commit-tee.Insteadthisprocess

was

tohelpfocus the discussion

on

thoseoptionswiththe highestimpact

and

feasibility.

At

itsdecisionmeeting, theTechnical

Committee

dis-cussedtheaggregateresults,

and had

theopportunityto negotiateadjustments.This negotiation processallowed

members

withexpertiseorinsight

on

a particular issue tochallengethe

group

assessment ofimpact or feasibil-ity,

and

toarguefor

an

adjustment.Ifthe

group

reached consensusthat

an

optionshouldbe

moved

on

the

ma-trix,it

was moved.

Through

its process ofdiscussion

and

negotiation, the Technical

Committee

reached consensus

on

four objectives to

be

addressedinitiallybythe

RESP.

Five secondaryobjectives

were

selectedinadditiontothese

immediate

objectives, [see box]

The

secondary objec-tives

were

seenas criticallyimportant but lessfeasible

thanthe

immediate

objectives.

The

immediate

and

sec-ondaryobjectives

were

presentedtothe

RESP

Steering

Committee

in

October

1988.

The

Steering

Committee

adopted

the objectives

and

appointedco-chairsforeach ofthe four

immediate

objectives.

The

co-chairs

were

individuals

from

various

communities

withintheregion

who

had

expertise

and

leadership stature related totheir respectiveobjectives.

The

co-chairs

had

the

responsibil-ity to organize regional task forces

and

to lead those groups in the designofregional strategies to achieve

their objectives.

The

taskforce

members

were

recruited

duringthefirstthree

months

of1989.

Business Capital

Task

Force

Economic

developersinwestern

North

Carolina

and

throughoutthe rural

South

havereliedheavily

on

indus-trialrecruitingforcreatingjobs.Thisis still

an

impor-tant

development

strategy,but onlya partialsolution. Stimulating the formationof

new

business

and

thegrowth ofestablishedones ispartof a well-balanced

economic

development

program.

Such

a strategy necessarily fo-cuses

on

smallbusiness.

Most

new

businessesstartout

small,

and

themajorityofthe firms alreadyoperatingin theregion aresmall.

The

relative

abundance

of small business

and

self-employment

in the region indicate fertile

ground

for stimulatingbusiness formation

and

growth.

However,

obtainingequity

and

debt capital is difficult, limiting effortstostimulate business.Recognizingthis

gap

inthe capitalmarket,

many

ofparticipantsinthe

forums

rec-ommended

a regional revolving loan fund to finance

small businessdevelopment.

The

RESP

Business Capital

Task

Force

was

organ-ized todesign a strategy to

improve

theavailabilityof

capital tofinance small business start-up

and

expansion.

The

Task

Force

had

36

members,

representinga variety

ofinstitutions

and

organizations.

The

group

included

small businessowners,

economic development

profes-sionals, lenders, utility representatives, providers of

business assistance

and

staffofstate

economic

develop-ment

agencies.

The

Task

Force

began

by developing

an

understand-ingofthe

problem

ofbusiness

development

financein

western

North

Carolina.All

members

ofthe

group

had

insightsintotheproblem, buta clearconsensusdidnot

existwithin the

group

aboutthenatureofthe

problem

oritssolution.

To

buildthisconsensus,the

Task Force

began

its

work

with a couple of panel presentations

designedtoshareperspectives

and

stimulate

some

or-ganized discussion of critical issues.

The

first panel included

economic

development

professionals

and

providersofbusiness assistance

who

served

on

the

Task

Force.

The

second panel included

Task

Force

members

who own

and

operate smallbusinessesinwestern

North

Carolina.

These

paneldiscussions revealed

some

ofthe difficulties ofsmall business development.

However,

they alsodemonstratedto the

Task Force

thata

more

systematic analysis

would be

required to provide the

group

with theinformation

needed

to understand

and

solve the

problems

ofbusiness

development

finance.

and

the extent of

unmet

demand

for business capital

than could

be

provided by anecdotaldata.

To

gather the

needed

information, the

Task

Force askedlendersrepresented

on

the

Task

Forceto

partici-patein

what

came

to

be

calledthe

Deal

StreamAnalysis.

This study

measured

the

volume

and

nature of the

"nonbankable"

loanrequests.

RESP

staffdesignedthe analysisin collaborationwith the lenders

on

the

Task

Force.

A

one-page

form was

usedto collect specified

information

on

each small business loan request that

was

denied duringthethree-month study period

(No-vember

1989-January1990).

For

thepurposes ofthis analysis, small businesses

were

defined as those with annualsalesof

two

million dollarsorless.

During

the

three-month

period,data

were

collected

on

158 small business loan requests

made

at the six

participating lending institutions.

From

the results of

the

Deal Stream

Analysis,the

Task

Force concludedthat intervention in the business formation

and

develop-ment

processclearly

was

justified.

The

group was

par-ticularly impressed with the finding that in this

one

quarter,

$32

million in potential loan requests

were

denied. Sincethedata

were

collectedduringaquarter thatistypicallyaslowbusiness period,itisreasonableto

estimatethatthereis

more

than

$130

millionin

unmet

smallbusiness loan

demand

overthe period ofayear.

Some

lenders

on

the

Task

Force notedthatevenhalfthis figure

would

representasubstantial

amount

of

poten-tialdevelopment.

The

Deal

StreamAnalysis

and

the preceding panel

discussions also

made

it clear to the

Task

Force that obstaclesotherthantheavailabilityofcapitalalso

con-strainedbusinessformation

and

development.

On

June

27,1990,the

Task Force adopted

a strategy toaddress a

broader range ofconstraints.

The

strategyincluded three

program components,

thefirstof

which

was

the

devel-opment

of

improved

educationalprogramstostrengthen

smallbusinessowners'capabilities inthe areasof

finan-cial

management

and

business planning. Institutional factors thatare inthe process ofbeingresolved have held

up

the

implementation

ofthisstrategy.

The

Small Business

and Technology Development

Center, partof theUniversityof

North

Carolinasystem,

and

theSmall BusinessCenters,basedinthe

North

Carolina

Depart-ment

of

Community

Colleges, are

working

to differenti-ate

and

articulate their responsibilities

and

functions.

These

negotiations areexpectedtobe

completed

during

1992,after

which

work

will

resume

on

developingthe typesoftraining

programs

calledforbythe taskforce.

A

second

component

calledfor

development

ofthe roleof

banks

aspointsofentry intothe business

forma-tion

and development

system, ratherthan simplyserving asdepositoriesfor,

and

allocatorsof,capital.

As

points

of entryinto thebusiness formation

and development

system,

banks

would

connectunsuccessfulloan

appli-cantswitha technical assistanceprovider

when

appro-priate. Considerable progress has

been

made

on

this

strategy.

The

Small Business

and Technology

Develop-ment

Center has

adopted

a

program

ofroutinelycalling

on

localbankersto increase

and

maintaintheir

familiar-itywith technical assistance services available to small businesses.

As

aresult,the

SBTDC

reportsasignificant increaseinthe

number

of smallbusinessclientsreferred to

them

by lending institutions.

The

SBTDC

is also

planningaseriesoflenders'conferencesto familiarize local loan officerswithservices availablethrough the

SBTDC.

The

third

component

calledfortheestablishment of

a high-riskloanfundto finance businesses thatcannot

meet

conventional underwritingcriteria.

The

task force

asked

Smoky

Mountain

Development

Corporation, a

SBA-sanctionedcertified

development company,

totake the lead role in putting thelending

program

together.

The

initialconcept

was

thatbanks,

and

perhapsutilities,

would

contribute to a free-standingloanpool

managed

by

Smoky

Mountain

Development

Corporation.

The

banks,however,indicatedduringdiscussions thatthey

would

prefer lending directly to the businesses.

The

banks could

commit

more

resources to adirectlending

program

thantheycouldcontribute to

an

independent

fund. In response to this preference, staffat

Western

Carolina University's Centerfor

Improving

Mountain

Livingdesignedaconsortium through

which

bankslend directly to small businesses

on

a rotation basis.

The

Mountain Commercial Lending Consortium was

estab-lishedinJuly 1992,witheight

banks

jointlycommitting

tolend$1millionthroughtheprogram,ina21 -county

area.

Smoky

Mountain Development

Corporation is

packagingthe loans

and

willclosely

monitor

perform-ance ofthe borrowers.

Loans

are expected toaverage

$50,000,witharange of $20,000to$150,000.

Solid

Waste Task

Force

The

public

forums

revealed

broad

concerns

among

citizensaboutthe

adequacy

ofthe region's infrastruc-ture.

The

most

urgent concern

had

to

do

with our

capacity to

manage

solidwaste. Inwestern

North

Caro-lina,the traditional

method

of

managing

solidwastehas

been

toburyitintheground.

But

growing concern about

protecting

groundwater

quality has led to changes in landfillregulations.

New

requirements

would

dramati-callyincreasethe costoflandfillconstruction

and

opera-tion.

Many

landfills in this region

were

nearing their capacity, a

problem

compounded

by relatively strong

population growth.

As

the costofsolidwaste

management

escalates,it

would

increasingly

compete

with otherfunctions

and

services for publicdollars.

The

new

sanitarylandfills

would be

too expensiveto fillwith wastesthat

do

not

reused or recycled. Toxic wastes

must

be kept out to

avoid expensive treatment oflandfill leachate.

Some

forum

participants felt that

problems

associatedwith

solidwaste

management

couldseverelylimit

economic

development.

Many

recommended

regional action to addressthisproblem.

The

Solid

Waste

Management

Task Force was charged withcreatinga regional strategytoreducesolidwaste

and improve

solidwaste

management.

The

Task

Force

had 30

members,

includinglocalpublicofficials,staffof

regionalcouncils

and

representativesofprivate

indus-try, public interest organizations

and

several public agencies.

Through

aseriesofdiscussions,the

Task

Force

deter-mined

thatthe lackof developed marketsforrecyclable materials

was one

ofthe

most

pressing

waste-manage-ment

problems

in this region. In collaboration with Regional Councils A, B,

C

and

D, the

Task

Force explored

ways

to

encourage

a regional

approach

tothe

development

of

market

infrastructure,

and

designeda strategy to

improve

the

market

forrecyclablematerials inthe region.

The

strategy calledfortheestablishment ofa regional material recovery

and

marketing system

that

would

consolidate the marketing

power

ofsmall ruralcommunities.

Under

the direction of the taskforce, staff of the

Centerfor

Improving

Mountain

Livingdesigneda proj-ect

and

securedfunding

from

the

North

CarolinaRural

Economic Development

Center

and

the

North

Carolina

Department

of

Environment,

Health,

and

Natural Resources.

Two

additional councils of

governments

(serving regions

E

and

I)joinedtheeffort,expandingthe projectregiontoinclude31counties.

The

Appalachian

Regional

Commission, which

routinely funds projects

of regional councils, provided additional funding to

supportthe councils' participationintheproject.

The

strategyinitially

proposed

involvedthe

develop-ment

of a regional material recovery

and

marketing

HotSprings,

NC

wasathrivingspainthelate19thcentury. HotSpringswasthefirst

communitychosenforRESP'stourismdevelopmentproject

systemthat

would

aggregatethe selling

power

oflocal recycling

programs

through regionally-coordinated

marketing services. This

proposed

system

would

not

physically agglomerate materials

from

31 counties in

one

placefordelivery tobuyers. Insteadit

would

manage

themarketing

and

deliveryofthe materials,

which

might bedeliveredto

one

buyerinseveralseparateshipments.

The

proposed

system

would

initiallyhandle

two

materi-als,

and

additionalmaterials

would

be

added

as feasible.

The

projectteam,

composed

of

one

staff representa-tive

from

each ofthesixcouncilsof

governments

and

a projectcoordinator

from

CIML,

exploredthefeasibility

ofa quasi-public materialrecovery

and

marketing

sys-tem

that

would

representanassociationorcooperative oflocalgovernments.

The

team

alsoexploredthe

feasi-bilityof a marketing cooperative of private recycling

companies.

For

a variety ofreasons both ofthese

ap-proaches

were

foundto

be

unworkable.

A

more

feasible

arrangement was

the

development

ofmaterial process-ing

and

marketing systems in the private sector, with

numerous

subregional

market

areasforprocessing

and

marketingservices.

Although

thissystem

had

already

begun

todevelop throughtheinitiativeofseveral privatecompanies,the project

team

observed that a couple of factors

con-trolledbythe public sectorarecriticaltothe successful

development

of privatesector material recovery

and

marketingcapacity.

The

firstisan adequate

and

depend-ablesupplyofmaterial that

meets

market-quality stan-dards.

The

otherfactorismitigationoftherisks,suchas

dramaticprice fluctuations,inherentinprivatematerial

recovery

and

marketingenterprises.

The

project

team

directeditseffortstothe publicly-controlledfactorscritical tothe

development

ofa pri-vate sector system.

The

project

team

facilitatedthe

de-velopment

of

improved

material collectionsystemsto

ensurea

dependable

supply ofmaterial.In

some

cases, this

work

involved assistance to local

governments

in theexaminationandformationofmulti-county systems. Inothercasesit involved

exchange

ofinformation

among

counties thatallowed

them

tolearn

from

theexperienceofothers furtheralongindeveloping their

own

recy-cling systems.

Near

the

end

of the project period,this

mechanism

forexchanging

infor-mation

and

experience

was

expanded

state-wide

when

the councilsof

governments

par-ticipating inthe projectorganizedan

infor-mal network

oftheirpeersto

meet

quarterly

withstate agencyrepresentatives to discuss current policy

and program

issues in solid

waste

management.

The

project alsodeveloped relationships

between

thepublic

and

privatesectors.

localgovernments

and

privaterecyclingcompanies

were

arrangedtodiscuss potential serviceoptions

and

condi-tions.Project

team

members

didnotengagedirectly in negotiations

between governments and

private

compa-nies, but they provided information

and

helped local

governments

analyzeoptions.

By

the

end

oftheproject,

all31 countiesinthe project region

had

access to

mar-ketsfor at least

two

recyclable materials,

and most were

marketingfiveor

more

materials.

The

most

commonly

marketed

materials are

aluminum,

glass, plastics,paper

and

cardboard.

Tourism Development Task

Force

As

employment

growth

slows ordeclinesinthe

indus-trialsectors that havetraditionally

dominated

the re-gion's

economy,

the tourism industry has

been

pro-moted

asastabilizingforceorpossiblyevenasan engine

forfuture

economic growth and

development.

Commu-nitiesinwestern

North

Carolinaare increasingly

drawn

to

economic development

strategiesthat focus

on

op-portunities intourism.

The

RESP

Tourism and

Recreation

Task

Force

was

charged with designinga strategy to build

on

western

North

Carolina's scenicbeauty

and

recreational

oppor-tunities in

an

effort to

enhance

the contribution of tourism

and

recreation to the region's

economy.

The

Task Force

included:operatorsoftourism-related busi-nesses; representativesof tourism

promotion

organiza-tions,publicresource

management

and

planning

agen-cies,

and

organizations interested in natural resource

management;

universityfaculty;

and

state legislators.

From

the outset, the

members

of the

Task

Force

acknowledged

the

many

existing efforts to

promote

western

North

Carolina as a tourist destination.

The

group

also recognized that far less effort

was

being

invested indeveloping, improving

and

protecting the region's tourism product (i.e., attractions, amenities

and

infrastructure).

The

Task

Forcethereforedecided

toconcentrate

on

development

effortsratherthan

pro-motion

efforts.

The

Task

Force defined tourism product

development

toincludeproduct

improvement

aswellas

establishmentof

new

product.It

emphasized

the impor-tance ofprotecting against

haphazard

or inappropriate development.

Afterayearof study

and

discussion,the

Task

Force

tentatively

adopted

an

initiativetoanalyzethe region's

tourism

and

recreation resources

and

markets

and

to identify strategic product-development opportunities forwestern

North

Carolina.

The

goalsoftheinitiative

were

as follows:

to

enhance

thewestern

North

Carolina regionasa tourist destination by protecting the

environment

and

other tourism resources

from

degradation or

depletion;

• _{tostimulate theregion's}

economy

_throughthe

devel-opment

of

new

tourism

and

recreation attractions

and

support services

and

infrastructure as well as

through

improvements

to existingtourism

and

rec-reationproduct;

• _to

deepen

understanding of_{theexistingtourism}

mar-ketsforwestern

North

Carolina

and

determine ways

to

expand market

opportunities;

to increasevisitor satisfaction

and

encouragerepeat visitation;

and

• to better integratetourism _into

community

_life

and

localeconomies.

Prior todevelopinga detailed

methodology

forthe

initiative, the

Task

Force presented the proposal to

independentreviewersinaneffortto

gauge

supportfor,

and

feasibilityof,the initiative. Included inthe

group

reviewingthe proposal were: a

chamber

of

commerce

executive;

two

executiveofficersofthe

Cherokee

His-toricalAssociation; the executive vice presidentofthe

Biltmore

Company;

a county planner; the executive directorofamulti-countytourism-promotion organiza-tion;the executive directorofacounty

economic

devel-opment

commission; asenior regionalplanner withthe

North

Carolina

Department

of

Economic

and

Commu-nity

Development;

the principal

owner and

a senior officerof

one

ofthe region's

major outdoor

attractions;

and

the

owner and

developer of

two

ofthearea'slarger resorts.

The

reviewersconcludedthata tightly-focused

initia-tiveconcentrating

on

product

development

atthelocal

level,butwitha regionalperspective,

would

havegreater potentialforsuccessthanaregionwideundertaking. All

ofthe reviewers recognizedthevalue ofa regionwide

initiative;however, theyalsopointedoutthe

enormous

cost

and

time required to

complete

a full-fledged re-gional analysisoftourism

and

recreation resources

and

markets. Furthermore, there

was

some

concern that substantial resources

would

be invested in analysisof

areas

where

there

was

insufficientlocal interest.

Conse-quently,theinitiative

was

modifiedtoconcentrate

on

a small

number

oflocationsin

which

leadership

and

inter-est

were

evident.

The

modified project

was

designed to: (1) develop

and

demonstratea participatorydecision-making

model

for

communities

consideringtourism

and

recreation

de-velopment

as

an

economic development

strategy;

and

(2)develop an information base

and

institutional

capac-itywithintheregiontoassist

communities and

clusters

of

communities

in theirproduct

development

efforts.

threestrategies,

which

were implemented

bytheCenter

for

Improving

Mountain

Living,the Divisionof

Com-munity

Assistanceofthe

NC

Department

of

Economic

and

Community

Development implemented

the

tour-ism

development

strategy.

They

were

supported bya project

team

thatincludedrepresentativesofa varietyof

public agencies with interests in tourism or natural

resourcedevelopment.

One

ofthe

communities

selectedforthe

demonstra-tion project

was

Hot

Springs, a very small

town

that straddlesthe

Appalachian

Trail.In addition to theTrail, the

town

isabaseforseveralwhite-waterrafting

compa-nies,

and

is thesiteof

an

historicresort

and

spa built

around

the geothermal springs for

which

the

town

is

named.

The

projectin

Hot

Springs

was

designedtobuild

on

these assets to

make

the

town

a

more

significant touristdestination.

However,

a

fundamental

change

of personnel

on

the

town board

of

aldermen

brought to

power

a

group

that

opposed

furthertourism develop-ment.

The

aldermen

dismantled the planning board,

which

was

coordinatingthelocaltourism

development

efforts,bringingthe project to ahalt.

Tourism

develop-ment

will continue in

Hot

Springs, driven by private interests

who

havealready investedinthe

community.

However, development

willnot

be

aswell-coordinated

and

probablywillnot

be

aswell-integrated intotherest

ofthelocal

economy.

The

seconddemonstrationsiteis

McDowell

County, a

community

eastofAsheville

known more

asa

manu-facturingcenterthanasatouristdestination.

The

county

has identified

Lake James

State Park as its primary

tourism asset.

As

is typical of

North

Carolina state parks, there is relatively little

development

on

Lake

James. Leaders in

McDowell

County

are examining other lake destinations togain ideas forthe

develop-ment

ofa resort at the lake.

The work

in

McDowell

County

does havethe potentialtoserveasa

model

of

community-based

tourism development.

Leadership

Development

Task

Force

The

issueofleadership

emerged

frequently during

theforums,primarilyindiscussionofstrategicactions to be taken in the region.

As

people confronted the

complex

issuesfacingtheregiontheyranheadlonginto the question:

"Where

willthe leadership

come

from

for dealingwiththeseimportantissues?"Recognizingthat

it

must

be supplied by the people of western

North

Carolina,

many

suggesteda regional

program

tofurther

developthe region's leadership resources.

Western North

Carolina has a strong tradition of

leadership. Significant

accomplishments

have

been

achievedthroughtheeffortsoflocal

and

regional lead-ers

who

recognized a challenge or opportunity

and

acted

on

it.Thistraditionhasfurthered

economic

de-velopment

in the region, but substantial leadership

resources arestillnotbeingused.

Throughout

western

North

Carolina,thereare potential leaderswithinsight

and energy-untapped

resources that could helpsolve local

and

regional

problems

inrapidlychangingtimes.

The

forums produced

numerous

recommendations

foranaction-oriented regionalleadership

development

program.

The

Technical

Committee

and

the Steering

Committee

agreedthat such a

program

could build a stronger"civicinfrastructure,"

enhancing

the region's capacity toaddressothersubstantiveissues.

The

Steer-ing

Committee

calledforafourth task force todesigna strategyfordevelopingleadership resources.This

Task

Force

had

27

members,

a diverse

group

who

areactively involvedinlocal

and

regional civicaffairs.

Some

were

elected officials, others

were

on

the staffof regional organizations,

and

othersserved

on

voluntaryboards.

The

Leadership

Development Task

Force heard

presentations

from two

expertsinleadership develop-ment,

and had

severalmeetingstodiscussthenecessary

functionsof

and

designcriteria foraleadership

develop-ment

program.

The

Task Force was

particularly

com-mittedtotheconcepts of

economic development

lead-ership

and

regionalism.

The

members

wanted

a

program

that

would

buildthe region's capacitytosolve

economic

development

problems. After six meetings,the

group

recommended

that

an implementation

committee be

establishedtorefinethe

program

design

and

to institu-tionalizeit.

The

Implementation

Committee

furtherdeveloped

thedesignofthe leadership

development program and

asked

Western

CarolinaUniversity toadministerit.

The

University agreed,

and

in

September

1991, the pilot cycleofthe

Western

CarolinaLeadership

Development

Program was

launched, inpartnershipwiththe

North

Carolina Rural

Economic

Development

Center, the

Tennessee

ValleyAuthority

and

MDC,

Inc..

The

initial

classof

40 emerging

leadersrepresentedallseventeen of

the target counties.Itincludedelectedofficials,business

owners

and

managers, nonprofitexecutives

and

manag-ers,educators

and

bankers.Itreflectedthediversityof

theregioninterms ofgender

and

race.

The

program

prepares

emerging

civicleaders to

be

effective players in regional

economic

development.

During

the program, participants apply the

methods

and

informationthey learnbydesigning

and

implement-ing

an

actualregional

development

project.

The

classof

the pilot cycle of the

program

selected

two

project issues,

and two

subgroups

were

established to

work on

them.

Although

the class graduated in

August

1992,

most

ofthe

members

have

remained

involved in the

implementation

oftheir projects.

One

group

hasdesigned

and

will

implement

a strategy toincrease citizenunderstanding of theregion'sworkforce

development

needs

and

problems,

and

toincrease

citi-zen involvement in addressing them.

The

group

will

commission

a reportdesigned to present a "citizens'

view" of workforce

development

issues

and

their

signifi-canceto the region's

economic

future.

The

reportwill describecurrentworkforce

development

efforts inthe

region

and

will explain

how

citizens can strengthen

theseeffortsorfillinstrategicgaps.

The

releaseofthe report will be followed by a series ofpublic forums designed to sparkgreaterlevelsof

community

activity

around

workforce

development

issues.

The

other

group

of participants has established a

strategyto

improve performance

(e.g.,job growth,

prof-itability, start-up rates,business

growth

rates

and

sus-tainment rates) of small businesses inwestern

North

Carolina.Thisstrategy involvesdeveloping

and

imple-menting

seminars to inform lenders,

CPAs,

attorneys

and

localbusiness

and economic development

groups aboutavailablebusinessassistance servicesandresources (training, technical assistance

and

special financing

programs).Historically,theseresourceshave

been

used mainly by individuals consideringestablishing a busi-ness.

The

strategy is intended to increase the use of

assistance resources by

more

established businesses.

Despite the fact thatthese technical

and

financial

re-sourcescansubstantially benefit established businesses,

theyrarelyuse them. Thisstrategywill

complement

and

reinforce the strategiesdevelopedby the

RESP

Busi-ness Capital

Task

Force.

Conclusion

The

Regional

Economic

Strategy Project has not

been

aquick-fix

approach

toregionaldevelopment.

The

project

was

launchedinearly 1988,

and

thefirstregional strategy

was

initiated in

September

1990.

The

pilotcycle

ofthe leadership

development program was completed

inJuly 1992,

and

that

same

month

eightbanks

commit-ted

one

million dollars to the

Mountain Commercial

Lending

Consortium.

The

RESP

has

borne

fruit,butthe processtook longer thaninitiallyanticipated.Itwillbe

several

more

yearsbefore any ofthe

programs

can be consideredsufficiently

mature

toevaluate.

The

leader-ship

program

hasgraduated onlyitsfirstclassof partici-pants,

and

their

performance

as regional

economic

development

leaders

must be

testedoverthe next sev-eral years.

The

lendingconsortiumwill likely

make

its

first loan inearly 1993. Itseffectiveness as a business

formation

and development

strategywill

become

clear

onlyafterseveral yearsoflending.

When

the

RESP

was

initiallydesigned,it

was

antici-patedthat the project

would be

a catalystforregional intervention.

The

resultingstrategies

were

to

be spun

off for implementation by organizations other than the

Centerfor

Improving

Mountain

Living. Infact, allbut

one

ofthe four resultinginitiatives

were implemented

throughthe Center.

Through

itsstaffsupport ofthe task forces,theCenter

became

quite familiarwiththe strate-gies

and

developedcredibility

among

keyregional

play-ers,

making

ituniquelysuited to

implement

the

strate-gies.Furthermore, throughthecourse oftheproject,the

Center

became

increasingly

committed

toensuringthat thestrategies

were

carriedout.

Providingstaffforthedesignoffour regional

devel-opment

strategies,

and

the

implementation

ofthree,has

been

extremely

demanding.

Inhindsight,it

would

have

been

prudenttolimitthe

number

ofstrategiesselected to two,orperhapsthree.

Any

organization

contemplat-inga projectliketheRegional

Economic

Strategy Proj-ectshould be preparedto

commit

substantialresources

over along period.

The

RESP

occupied

two

full-time professionalstaff

and

considerablesupportstaff.

Athird

full-timeprofessional

was

hired tocoordinatethesolid

waste project.

Other

professionalstaffat

CIML

have

also

committed

significant

amounts

of time to assist

withstrategyimplementation.

CIML

has

no

plansforanother

round

oftheRegional

Economic

Strategy Project.

However,

the process of

designing

and

initiating regional

development

strate-gies has not

been abandoned.

Indeed the process is

continuingthrough the

Western

Carolina Leadership

Development Program, which

can

be

considered the

second generation ofthe

RESP. The

leadership

devel-opment

program

hasthe capacity to

produce

strategies similar to those

produced

by the

RESP;

pilot cycle participants havealreadydesigneda strategy that

may

addressallthreeoftheworkforceobjectives that

were

on

thesecondarylistofthe

RESP.

Because

the

partici-pants inthe leadership

program

are giventraining in strategicanalysis

and

planning,theywill

be

able to take