West Michigan business publication MiBiz calls SBAM President “Gardener in Chief”

MiBiz’s article on SBAM’s economic gardening efforts notes the organization’s efforts to drive state policy toward growing entrepreneurial small businesses. Excerpt:

“Like plants in a garden, businesses of all sizes need to be tended to and nurtured in order to ensure a successful economy. Similar to crops, businesses’ needs are the greatest when they’re in the early growth stages. That’s not some hippie flashback from the 60s. Rather, it’s the Small Business Association of Michigan’s new mantra for the way the state should approach economic development in the 21st century. “The term economic gardening is what we’d like to put in the lexicon of public policy,” Rob Fowler, president and CEO of SBAM, told MiBiz.” 

Here is the complete article:

By Joe Boomgaard | MiBiz
jboomgaard@mibiz.com

LANSING — Like plants in a garden, businesses of all sizes need to be tended to and nurtured in order to ensure a successful economy. Similar to crops, businesses’ needs are the greatest when they’re in the early growth stages.

That’s not some hippie flashback from the 60s. Rather, it’s the Small Business Association of Michigan’s new mantra for the way the state should approach economic development in the 21st century.

“The term economic gardening is what we’d like to put in the lexicon of public policy,” Rob Fowler, president and CEO of SBAM, told MiBiz.

Gardening fills a pillar of SBAM’s strategic plan for the next few years. Capitalizing on the looming change in leadership in Lansing, the state’s small business advocate wants to seize the opportunity to help drive state policy to favor small business interests.

“It’s a thought leadership role we intend to take,” he said. “We have a window of opportunity, and we must strike during this time, which is (with the election of) the next governor.”

Regardless of who wins the race for the state’s chief executive, SBAM wants to bring the discussion of small business to the forefront. And that starts at the top.

“We’ve had no help from this administration — no help from the beginning. I don’t want to be overly critical because no one has embraced entrepreneurship as a strategy. It’s never risen to the level of strategic importance,” he said.

Fowler said he’s never met a lawmaker that was anti-small business, but he’s fed up with being patronized by too many legislators whose words and actions don’t match up. If he and SBAM have their way, the politicians won’t get to define what’s good for small business — that task will be up to the businesses themselves.

“This is a whole new way of taking the issues to our membership,” Fowler said.

The small business community in the state seems to be listening. In an 18-month period, SBAM grew from 5,000 members to 9,000 by early 2010, thanks to some new membership strategies and the organization’s new message, according to Fowler. Not only does the organization help small business owners save money through group purchasing, it also serves as their collective voice in the Capitol, he said.

“Owners are mad, and it’s palpable,” Fowler said. “They’re frustrated and angry about what’s going on in the state, and they want movement. They know they can’t be influential by themselves, that they have to work together to have an impact. And what we’re talking about with them today is to join the fight. We have a different stance when it comes to fighting. We’re not going to be polite and diplomatic. We’re going to take the gloves off and fight for small business.”

Hunting needed, but not exclusively

SBAM has been especially vocal since the first of the year that the state’s 15-year economic development hunting safari hasn’t worked. The Michigan Economic Development Corp. has tried to attract a few large companies to Michigan to create many new jobs, but the data show that strategy hasn’t worked.

“In a 15-year span, the net result of the hunting strategy has been negative,” Fowler said.

According to figures for Michigan between 1995 and 2007 compiled on YourEconomy.com, a Web site project by the Edward Lowe Foundation, Stage 1 companies with between two and nine people grew in number by 27 percent. The number of Stage 2 companies between 10-99 people grew by 5 percent. By 2007, there were more than 83,000 additional jobs in Stage 1 companies and more than 64,000 new jobs in Stage 2 companies.

The number of Stage 3 companies, those with 100-499 employees, grew by less than 4 percent, and added more than 18,000 jobs in that same period. But the number of large, Stage 4 companies — those employing more than 500 people each — shrunk by 15 percent. The loss of those companies claimed more than 230,000 jobs in the state.

“Mayors love to cut ribbons and governors love to have press conferences touting 1,000 jobs from one company, but not one job from 1,000 companies,” Fowler said. “While we’re not opposed to doing some of that — you’ve got to compete for those big ones — if that’s all you’ve got, you’re ignoring (your job growth engine).”

Fowler’s quick to note that he supports some of what MEDC has done over the years, specifically its funding of the network of Michigan Small Business and Technology Development Centers. He’s also a fan of current MEDC CEO Greg Main.

“I believe Greg Main’s a gardener, but he’s taken over a hunting agency, and all his tools are hunting tools,” Fowler said. “And he doesn’t have much time. He’s smart, and he’s the right guy to be there for the rest of this administration, and I think (the administration) did a nice job of filling the position. I want him to be thinking about ‘can you make some changes in this battleship and begin to turn it?’”

Fostering a new economic model

Noting the real growth has been in Stage 2 companies, SBAM is aiming its economic gardening emphasis at those companies. Fowler said the state should at least be paying as much attention on Stage 2 companies as it does on new business attraction.

For an example of gardening success, Fowler points to Littleton, Colo., home of economic gardening guru Christian Gibbons. Using an entrepreneurial alternative to economic development, the city was able to double employment and triple its tax base without ever recruiting a single company, he said.

While developing all the tools necessary for this model can be expensive for every community to bite off, Fowler advocates for a partnership between the state and local government to create “the full tool box.”

“There has to be some overall coordination and resource sharing,” he said.

SBAM wants to have the conversation about best practices with candidates for office in the 2010 election, and especially with the candidates for governor since that person will set economic development policy.

“Our hope is that some of them will embrace it and make it a priority,” Fowler said. “If they stake their claim on job creation, they can make it happen relatively quickly and have it be part of a 100-day plan. They could have legislation teed up and run fast.

“Gardening is good policy and good politics. When you speak to existing companies…there is a little bit of resentment. (The state) is courting out-of-state companies and your money is being used to court them. They compete with you for a labor force and scarce local resources.”

Engaging higher education

Key to any economic gardening strategy is ensuring a steady pipeline of entrepreneurs. As such, Fowler said Michigan’s colleges and universities need to step up and teach entrepreneurship and encourage students by providing them the necessary resources.

Education is key to starting to change the culture in Michigan, one that believes big companies — think automakers ­and suppliers — will always be around to provide jobs.

“Our challenge is the legacy of large companies,” Fowler said. “Generations have gone to work for these big companies and think they’ll be taken care of. That’s the antithesis of the entrepreneurial spirit. They have no risk for their whole life, just a pension, cars and toys and a place up north. They’re not entrepreneurs who put themselves in the marketplace every day and some you win, some you lose. The universities can play a big role in changing that culture.”

(Editor’s note: See the current issue of Knowledge, included with MiBiz print editions, for stories and a roundtable looking at how West Michigan schools are incorporating entrepreneurship into their business programs and across other disciplines.)

Mibiz.com – Published March 17, 2010