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November 13, 2014 | Tom Ballard

Site selectors offer advice at annual Governor’s Conference

ECDBy Tom Ballard, Director of Innovation and Entrepreneurial Initiatives, Pershing Yoakley & Associates, P.C.

“The whole site selection process starts out extremely analytical . . . but it becomes subjective in the end,” Hartley Powell, a Principal with KPMG LLP, said yesterday during the opening session of the 61st annual “Governor’s Conference on Economic and Community Development.”

Powell joined three other site selection consultants in what has become a traditional start for the event that attracts community leaders, elected officials, and economic development professionals to Nashville for two days.

“The process (site selection) has changed more than 100 percent in the last 10 years,” Mike Mullis, President and Chief Executive Officer of J.M. Mullis, Inc., said. It is now a data driven process that has empowered the companies looking for new locations.

“Technology has absolutely changed the game,” Powell explained. “They (the clients of the site selectors) have data at their fingertips.”

The other panelists were Mark Williams, President of Strategic Development Group, and Don Schjeldahl, Principal in The Don Schjeldahl Group.

Mullis noted that site selectors are driven by data, both from the websites of local communities and a variety of other sources. Their ability to do what he called “desk analysis” translates into a much more compressed decision making process.

“We know exactly where we are looking,” Mullis said. As such, the typical turn on projects from the time the site selector contacts a community until a decision is made has been reduced to under six months.

“We have a number of databases we use,” Powell said, adding that his firm also relies on a benchmarking group based in India to quickly turnaround requests made one day so that the reports are ready by the next morning in the U.S.

Schjeldahl’s practice is much smaller, so he noted that he relies a good deal on local websites. If the information is not up-to-date and readily accessible, the site selectors quickly discard that potential site.

There was also a good deal of emphasis on the Request for Information document that a site selector will send to communities under consideration. The universal advice was to answer the questions completely, but from a strategic perspective. Equally important was the advice to not send attachments, since they are not read.

Other points emphasized were community preparedness ahead of a prospect visit, honesty to all questions asked during a visit, and immediate follow-up to any unanswered questions during a visit.

TVA Senior Vice President John Bradley moderated the panel and asked the four consultants about the importance of site certification programs.

“Site certification is important in terms of having sites vetted to a certain level,” Mullis said, but quickly added that it “is only the beginning of a total process. The site is just one factor in the decision.”

Powell echoed the point, saying, “Don’t think you’ve arrived just because you have something certified.”

Another topic of discussion was the matter of incentives and, as you might expect, the discussion drew many thoughts.

“Incentives should come near the end,” Schjeldahl said, a view held by the other panelists.

“You need to be in the ballpark on incentives, but decisions are made on other factors,” Powell explained, but offered some key advice. “I challenge you to understand what you are giving us.” He was referencing communities that offer incentives that have little, if any value to the prospect.

Williams observed that incentives have “two areas of value. The quantitative side is easy to recognize.” More challenging, but possibly more important is the subjective side, particularly for those companies looking for a partner.

In one of the more humorous comments on incentives, Mullis said, “We never want to draw blood, just get close to it.”

The conference ends today after the Governor’s luncheon.

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