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Before the Deal: Using Industrial Recruitment as a Strategic Tool for Manufacturing Development

Before the Deal: Using Industrial Recruitment as a Strategic Tool for Manufacturing Development. Nichola J. Lowe Assistant Professor Department of City and Regional Planning University of North Carolina, Chapel Hill. North Carolina Biopharma Manufacturing.

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Before the Deal: Using Industrial Recruitment as a Strategic Tool for Manufacturing Development

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  1. Before the Deal: Using Industrial Recruitment as a Strategic Tool for Manufacturing Development Nichola J. Lowe Assistant Professor Department of City and Regional Planning University of North Carolina, Chapel Hill

  2. North Carolina Biopharma Manufacturing

  3. Proactive and Paced not Hurried or in Haste • Upfront industry and firm analysis • Years ahead of manufacturing need • Information gathered at life science meetings and conferences • Community preparation and local practitioner education • Learn about technology and skill needs of industry • Learn about state supports • Workforce development agencies at the head table • Participate in first round of discussions/negotiations • Learn about and influence the firm

  4. How is this Achieved? North Carolina Life Science Sector Team biopharma firms NC Biotech Center strategic industry analysis relationship building Local Practitioner BioNetwork (NC Community Colleges) workforce development NC Commerce community preparation

  5. What this achieves? • Allows for better screening and match-matching • Helps to eliminate a bad fit between community and company • Emphasis on the quality of local labor and strength of workforce development supports • And also depth of R&D supports and dense industry networks • Shifts bargaining position from consultant to community • Reinforces state-wide standards • Ultimately reduces the importance of the incentive

  6. Why North Carolina? “Main reason for selecting (North Carolina) site (over Georgia) was the availability of a highly trained workforce.” -Quote in Atlantic Journal-Constitution from Novartis Chief Executive of vaccine and diagnostic division, 2006 “North Carolina was one of three states that were finalists in the company's search. The quality of workforce, training programs and understanding of biotech development models in North Carolina were important to the final decision to locate here.” -Quote in Durham Herald-Sun from Medicago President and CEO, 2010

  7. Quality Labor/Training vs. Incentive • Media study of 392 incentivized recruitment and retention deals (1996-2008) • 7% involve biopharma firms • Quality labor or training mentioned as key location factor in 71% of biopharma deals (but only 57% overall) • Overall incentive offer less important, but especially within the biopharma group • Only 1 biopharma deal mentions incentive as only factor

  8. Local Practitioner Perspective • Easy to “get giddy” and make certain allowances that may not be deemed advisable given local resource limitations and constraints. • Embeddedness with a broader institutional support network ensures you stay within reasonable incentive granting limits • Reinforces relative bargaining power by instilling the message that there was real value for a biopharma firm to locate in your community

  9. Lessons and Implications • Multi-agency/multi-scale partnership • Not just Commerce driven • Sectoral approach • Buffers against individual firm failure • Institutional supports benefit all firms, not just outsiders • Strong state role • State guides and monitors local recruitment activities • Encourages wise local decision making and investments

  10. Next Steps • Phase 1: document recruitment practice and institutional supports • Next phase: systematic examination of recruitment deals • Expand/extend C3E incentive database • Deal-level detail from state and local practitioners • Biopharma • Quality of deals • Are we more resilient? • Textiles: a second mediated case

  11. Beyond the Deal • Better ‘deal making,’ yes! • But also institution building for transforming recruitment into a better tool for long-range economic development planning • ‘Great Recession’ as turning point? • Need quality jobs, but also facing hard budget constraints • Open to alternative approaches and strategies

  12. Thank you! nlowe@unc.edu

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