Johnson: "Sustainability" is key
to winning the economic battle

TUESDAY, August 10, 2010 — With global competition and uncertainty everywhere, cities like Sanford can't count on doing business as usual. Creating a sustainable community, says Kenan-Flagler Business School professor James Johnson, may be the best way to survive.

"You are in a global war for economic development, whether you know it or not," he told the Committee of 100 Thursday afternoon. "If you don't know who you're competing with, you've lost the war already."

Johnson, who also serves as director of the Urban Investment Strategies Center at The University of North Carolina at Chapel Hill, says the most competitive communities are using the idea of "sustainability" to attract new companies and residents.

While a precise definition can be elusive, sustainability refers generally to the ability to survive over time. For cities, Johnson said, it means doing three essential things: protecting the environment, creating value for local stakeholders and promoting social justice.

Making progress on all three fronts — and getting that message out effectively to the public — can give any city a big edge in the battle for jobs and economic growth.

Site consultants are constantly sizing up cities using published statistics and official websites, checking to see which areas offer the sustainable environment their clients prefer.

"They don't come visit you every day," Johnson said. "And sometimes they size you up on information that's wrong about your community. But you know whose fault is that? It's yours."

Becoming "sustainable"

Though many cities are already touting sustainability, Johnson believes there's still time for places like Sanford to get out in front of the pack.

How? Many communities do well on the first two elements of the mix, he said, but fall flat on removing economic disparities. When all three are done well, everyone takes notice.

That means investing heavily in the educational system and what he called "community-building institutions" — organizations like the Boys and Girls Clubs. The problem, he says, is that when the economy gets tight, those are the organizations that suffer the most.

During his engaging and pointed 45-minute presentation, Johnson gave a long list of specific suggestions — including encouraging more-compact development, adapting and reusing existing buildings, protecting ecologically sensitive areas, viewing population diversity as a strength and aggressively forming economic and social ties with similar communities.

Sister city agreements are one example. Johnson cited Asheville, which has formed worldwide alliances with other locales emphasizing the same sort of tourism- and artisan-oriented economies.

Asheville's agreements include the typical cultural exchanges, but entrepreneurial events as well. Johnson mentioned an ongoing "handmade" conference with its sister cities that boosts tourism and creates business opportunities — including global marketing outlets for its own artists and businesses.

Even small business, he noted, operates in the global economy.

Becoming sustainable a long-term, never ending process, he says. But when it's done well, cities can expect big returns and come out on top.

More notes and advice

Weaving together a number of topics and advice, Johnson made dozens of other points about success as a sustainable community. Among them:

• Cities must think entrepreneurially by reducing regulation, creating a regulatory environment that helps generate new community wealth and being able to act quickly. "If you can't make decisions at the speed of business," Johnson warned, "you can't be competitive."

• Having a strong infrastructure — the ability to move information, goods and services, and people quickly and easily — is another characteristic of any sustainable community. It's what allows any community to become connected with the regional, national and international economies.

• Sustainable cities understand that we're living in turbulent times — something that's not likely to change. Not only do we face a truly global economy, but we've been hit by a large number of challenges just in the decade or so: 9/11 terrorist attacks; several public heath risks; the Gulf Coast natural disasters; our current global recession; earthquakes in Haiti, Chile and China; and the BP oil disaster.

• In an interesting side point, Johnson explained how businesses look at a wide variety of data to assess communities. One was obesity rates — which are relatively high in North Carolina and throughout the South — since those figures serve as a reasonable surrogate measure for what they may face in health care and productivity costs.

• "Soft skills" — proper manners and an understanding of customs — are critical to global success, but something few people develop. "My good friend sitting here with his legs crossed and his foot pointed at me, in a global society, in Thailand, he has just insulted his guest," Johnson used as an example "That's 'soft skills' and you need those skills to thrive and prosper in a global economy."

But the importance of soft skills is even clear in our own culture. "We have a 'soft skills' problem in America," Johnson said. "If you don't believe it, go to a fast food restaurant. It's not fast any more."

At the bottom line, Johnson says communities must understand that change is now the only constant, constantly gather information on the competition, adopt a flexible approach to policy and change the culture to react to opportunity with speed and agility.