Utah Dept of Business and Economic Development

This Deseret News article on the Utah Department of Business and Economic Development details some of the fallout happening after the entire department was pretty much dissolved to make way for a new strategy.

As much as I’ve enjoyed my limited association with the department, I do have to wonder if what they’ve been doing for the state has been worth it.

I’ve been doing business in Utah for five years. I’ve been aware of and have observed the UDBED for most of that time. As nice as those people may be, I have to say I haven’t seen much in the way of results. Some positives have been:

- The technology@breakfast meetings. I think these have fostered networking and the sharing of information in the community. However, they were free for visitors, meaning the department footed the bill I suppose, and I’m not sure if the meetings were worth the money they cost (mostly because I don’t know how much they cost).

- …Well, I’m not really sure what else they’ve done that’s been positive.

But here are some things they were involved in that definitely make me think things could be done better:

- A lame advertising campaign. The department hired DSW to produce an advertising campaign to draw outside businesses to the state, specifically technology businesses. First of all, these ads were ill-timed in light of the tech fallout starting in 2000. Second, the ads weren’t very good. Oh, they looked nice enough, but they were stupid. For example, they had a photo of the arches in southern utah that morphed into a printer cable that was the same color and curved the same way as the arch. Essentially the arch formed half of the arch, and the printer cable completed the arch. The problem is that a printer cable is about as high-tech as an electrical outlet. Another ad showed a ski lift in which the cable turns into a cord leading to a computer mouse. Again, a mouse is about as high-tech as nothing. The ads stunk, but I’m sure the department paid DSW plenty to do them. By the way, I’m not necessarily blaming DSW for the poor ads. I’ve got enough experience in advertising to know that many, if not most, bad advertising happens because clients don’t let the advertising agency do what they know is best.

- Finditinutah.com. Oh, this was a sad one. The department budgeted $75,000 to build a website that would be a directory of Utah-based businesses. The idea was to create a one-stop place to find detailed information on local businesses so that companies could hire their neighbors instead of going out of state. Admirable intentions, but it was poorly executed. The main problem was that the website was hard to navigate, and you couldn’t even register your business for it online–you had to print out a PDF and mail it in. Plus you had to pay for it. And the spending didn’t stop at $75K. Novell sponsored it as well as some other companies and I heard that several hundreds of thousands ending up being spent on it before they finally just killed the website.

Around the same time, I started a website called Utah Firms which provided essentially the same services as finditinutah.com, but I was able to build it for about $1,000. It works much better, and it’s completely free. I’m waiting for the department to come offer me $75K for it, but I don’t think it’s going to happen.

But that’s all in the past. The real question is what should the state be doing in the future to promote economic development? Here are some ideas:

- Lower taxes. Make it cheaper for businesses to get started and run, which will end up creating more jobs.

- Outsource more to local companies. If you want to do something in the most expensive, low-quality, slow manner as possible, let the government do it. Yes, there are certain things only the government can do, but in most cases private companies can do it better, faster, and cheaper. So outsource more to local companies.

- Run a real advertising campaign. Advertising campaigns have been shown in other states to bring many times the investment to the state, especially when we’re talking about tourism. I would normally not want the state to foot the bill for bringing tourists to the state, but it appears to be a proven fact that other states like Colorado, which spends tens of millions advertising its ski resorts, end up making much more money back than what they spend.

- Create real incentives for businesses to move to Utah. Large businesses create jobs not only for their own employees, but for other businesses that provide services to those businesses or their employees. For example, you build a business with 1,000 employees somewhere, and it’s almost a guarantee that a few restaurants will pop up in the area to feed those employees during their lunch breaks. A company with 1,000 will need to hire local law firms, advertising and pr firms, etc. The beneficial effects spread far beyond just 1,000 more employees in the area. But the incentives have to be real, not superficial, in order to woo businesses to move here.

Those are just a few ideas. I’m sure the governor and Chris Roybal have plenty more. I just hope they and the people they select to manage business development in Utah don’t make the same mistakes their predecessors did.