1

SLraLeglc uolng": A new ulsclpllne for ueveloplng and lmplemenLlng

SLraLegy wlLhln Loose 8eglonal neLworks

Ld Morrlson
8eglonal Lconomlc uevelopmenL Advlsor
urdue CenLer for 8eglonal uevelopmenL
urdue unlverslLy
WesL LafayeLLe, ln
edmorrlson[purdue.edu

AusLralla-new Zealand 8eglonal Sclence AssoclaLlon lnLernaLlonal
Annual Conference, 3-6 uecember, 2013
unlverslLy of SouLhern Cueensland
Pervey 8ay, Cueensland

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$%&.#1&%+.':; &-,2,$: &./ +?1+%,0+.$&$,3.7



Any effecLlve sLraLegy answers Lwo quesLlons: Where are we golng?" and Pow wlll we geL
Lhere?" lL seems slmple enough. ?eL, noLhlng ls qulLe so muddled as Lhe process of bulldlng a sLraLegy
for reglonal developmenL. lew people who have gone Lhrough Lhe process wanL Lo repeaL lL. 1yplcally,
Lhe process ls long and exhausLlng. Many efforLs Lake a year or more. WhaL ls worse, mosL sLraLegles, lL
seems, do noL work. ln many reglons, Lhese sLraLegy reporLs appear unused, crowdlng shelves and
clogglng flle cablneLs.
ln a recenL case, clvlc leaders ln one reglon called Lhe urdue CenLer for 8eglonal uevelopmenL
wlLh a predlcamenL. 1hey had [usL lnvesLed over $600,000 ln Lhelr reglonal sLraLegy. 1hey recelved a
very deLalled serles of reporLs from a presLlglous naLlonal consulLlng flrm, buL Lhey were unsure of
2
whaL Lo do nexL. noL surprlslngly, glven sLorles llke Lhls one, a greaL deal of skepLlclsm swlrls around
Lhe effecLlveness of sLraLegy ln bulldlng prosperous reglonal economles.
lrusLraLlon and doubL are showlng up aL a bad Llme. We are faclng rlslng economlc complexlLy
and uncerLalnLy LhaL ls ouLsLrlpplng our ablllLles Lo ad[usL. 1he fuLure ls comlng aL us fasLer Lhan ever
before and demandlng hlgher levels of lngenulLy Lo confronL Lhese challenges (Pomer-ulxon 2000). AL
Lhe same Llme, deep shlfLs are underway ln Lhe way ln whlch wealLh ls creaLed wlLhln our economy.
1hese shlfLs undercuL Lhe effecLlveness of LradlLlonal approaches Lo how we plan for Lhe fuLure:
sLraLeglc plannlng.
As we shall see, we need new approaches Lo sLraLegy Lo keep up wlLh Lhe fasL and complex
changes sweeplng across communlLles and reglons. 1hese new sLraLegy dlsclpllnes wlll help us adapL Lo
Lhe fasL movlng world of open neLworks LhaL now characLerlze our economles.
1he good news: AfLer years of experlmenLaLlon, Lhe core dlsclpllnes Lo gulde sLraLegy ln loosely
[olned neLworks - Lhe Lype of neLworks LhaL drlve prosperlLy ln reglonal economles - ls emerglng.
1hls paper explores where we sLand wlLh Lhese new approaches and where we mlghL be headlng.
E3< /,/ <+ -+$ 6+%+F
Cur concepLs of sLraLegy for reglonal developmenL come dlrecLly from buslness managemenL.
SLraLeglc plannlng as a managemenL dlsclpllne emerged from Lhe remarkable loglsLlcal achlevemenLs
of Lhe u.S. mlllLary ln World War ll. ln Lhe 1930s, corporaLlons began applylng sLraLeglc plannlng Lo
manage Lhe challenge of allocaLlng caplLal lnvesLmenL across mulLlple organlzaLlonal unlLs. CuL of
Lhese early efforLs a LradlLlonal sLraLeglc plannlng process evolved. ln 1962, a Parvard 8uslness School
professor, ArLhur Chandler, argued LhaL developlng a sLraLegy represenLed a core dlsclpllne of
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managemenL. Companles could achleve superlor compeLlLlve performance by deslgnlng Lhelr
organlzaLlon Lo lmplemenL crlLlcal sLraLeglc declslons (Chandler 1962).
Chandler's work provlded Lhe foundaLlon for conLlnued academlc exploraLlon of sLraLeglc
plannlng. AL abouL Lhe same Llme, a managemenL consulLlng flrm, Lhe 8osLon ConsulLlng Croup (8CC),
aggresslvely moved Lhese concepLs lnLo Lhe markeLplace (SLern and uelmler 2006). 8CC's success led
Lo a growLh exploslon for corporaLe sLraLegy consulLlng flrms, such as 8aln & Co. and Mcklnsey.
Cver Llme, corporaLlons and Lhelr consulLanLs evolved dlfferenL formal processes Lo lmplemenL
sLraLeglc plannlng. new ldeas emerged, buL Lhe baslc one remalned Lhe same: a corporaLlon could
achleve superlor flnanclal performance across lLs mulLlple dlvlslons lf lLs Lop managemenL focused on
developlng and lmplemenLlng a sLraLeglc plan. Several key feaLures deflne Lhe process of LradlLlonal
corporaLe sLraLeglc plannlng.
llrsL, Lhlnklng and dolng are separaLed. A small group of Lop managers deflne Lhe
sLraLeglc plan. CLhers lower ln Lhe organlzaLlon execuLe lL. 1radlLlonal sLraLeglc plannlng
conforms Lo and relnforces Lhe hlerarchlcal, "command-and-conLrol" organlzaLlon charL.
Second, Lhe process ls llnear and sLable. lL assumes LhaL Lhe managemenL Leam loglcally
compleLes each sLep before movlng on Lhe nexL.
1hlrd, Lhe process assumes LhaL sLraLeglc plans, once drawn, can be rellable guldes for
years lnLo Lhe fuLure. ln oLher words, sLraLeglc plans, once bullL around vlslon and
mlsslon, are sLable, Lhey do noL need Lo change much.
lourLh, analysls musL be compleLed before declslons are made. ueveloplng Lhe plannlng
base - gaLherlng all Lhe facLs - represenLs a crlLlcal early sLep LhaL drlves Lhe quallLy of
Lhe plan. WlLhouL a Lhorough undersLandlng of opporLunlLles and LhreaLs or sLrengLhs

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and weaknesses, managemenL cannoL make senslble sLraLeglc cholces. CaLher facLs flrsL,
Lhen make declslons.
All of Lhese feaLures creaLe clarlLy and sLablllLy. AL Lhe same Llme, Lhey undercuL Lhe effecLlveness of
LradlLlonal sLraLeglc plannlng ln Lhe dynamlc markeLs we confronL Loday. 8efore we explore how
sLraLegy pracLlce has evolved, we should look back Lo see how Lhe LradlLlonal approach Lo sLraLeglc
plannlng mlgraLed Lo Lhe world of reglonal developmenL ln Lhe unlLed SLaLes.
!112:,.- #$%&$+-,' 12&..,.- $3 %+-,3.&2 +'3.30,' /+4+2310+.$
SLarLlng ln Lhe early 1980s, corporaLe sLraLegy consulLanLs began applylng buslness sLraLegy
concepLs Lo Lhe challenges of reglonal economlc developmenL. lL ls easy Lo see why. 1he 1970s was a
decade of economlc dlslocaLlon ln Lhe unlLed SLaLes. An oll embargo ln 1974 Lrlggered a global
recesslon. A prolonged perlod of "sLagflaLlon" followed LhaL comblned boLh hlgh unemploymenL and
hlgh lnflaLlon. 1he 1970s ended wlLh yeL anoLher oll crlsls. 1he decade saw Lhe worsL economlc
performance from lndusLrlallzed counLrles slnce Lhe CreaL uepresslon.
AL Lhe same Llme, Lhe exporL-led growLh of Lhe "Aslan Llgers" -- Pong kong, SouLh korea,
Slngapore and 1alwan -- slgnaled LhaL a rapld economlc LransformaLlon was Laklng place across Lhe
globe. 1o economlc commenLaLors and pollcy analysLs, lL was clear LhaL fundamenLal changes were
sweeplng Lhe u.S. economy. Accordlng Lo some, Lhe preemlnenL compeLlLlve poslLlon of Lhe u.S.
economy was erodlng (Magazlner and 8elch 2001).
Across Lhe counLry, some reglonal economles fared beLLer Lhan oLhers. ulsLressed reglons,
especlally ln Lhe lndusLrlal norLheasL and MldwesL emerged from Lhe 1970s as Lhe 8usL 8elL." AL Lhe
same Llme, sLaLes of Lhe SouLh and SouLhwesL - Lhe SunbelL" - experlenced conLlnued populaLlon
growLh LhroughouL Lhe decade. MosL lmporLanL, Lhe sLrong economlc performance of some "hlgh
Lechnology" reglons, such as Slllcon valley, 8osLon's 8ouLe 128 Corrldor, and 8esearch 1rlangle ark ln

5
norLh Carollna, suggesLed LhaL collaboraLlon among unlverslLles, governmenL and Lhe prlvaLe secLor
could successfully promoLe hlgher growLh, hlgh-Lechnology developmenL. 1he message Lo reglonal
leaders became clear: 8y repllcaLlng Lhe lessons of Slllcon valley, reglons could become globally
compeLlLlve (Cfflce of 1echnology AssessmenL 1984). 1he rlghL sLraLegy, lL seemed, could push a reglon
Lo Lhe forefronL of global economles.
noL surprlslngly, 8hode lsland, a sLaLe devasLaLed by Lhe mlgraLlon of lLs LexLlle lndusLry Lo Lhe
SouLh beglnnlng ln Lhe 1930s, launched one of Lhe flrsL large-scale efforLs Lo apply corporaLe sLraLegy
concepLs Lo economlc developmenL. ln 1984, Lhe 8hode lsland SLraLeglc uevelopmenL Commlsslon
underLook an amblLlous plan Lo developlng a sLaLewlde lnvesLmenL sLraLegy Lo spur hlgh-Lechnology
growLh. AfLer a year's work, Lhe Commlsslon's produced a sLraLegy reporL of nearly 1,000 pages.
1he analysls provlded exhausLlve deLall on vlrLually every dlmenslon of Lhe sLaLe economy from
Lhe buslness cllmaLe and lnfrasLrucLure Lo lndusLrles and educaLlon. ConslsLenL wlLh lLs amblLlons, Lhe
Commlsslon, led by Lhe prlvaLe secLor, developed a bold approach Lo guldlng boLh publlc and prlvaLe
lnvesLmenL Lo hlgh-value secLors of Lhe economy. 1he Commlsslon's undersLandlng of wealLh creaLlon
gulded Lhe process. 1he key: boosL producLlvlLy, as measured by value-added per worker (8hode lsland
SLraLeglc uevelopmenL Commlsslon 1983, volume 1, 3).
1he Commlsslon's sLraLegy relled heavlly on Lhe advlce and guldance of lLs consulLlng Leam,
drawn from a flrm of former 8CC parLners. 1he consulLanLs recommended a bold lnvesLmenL program
of nearly $200 mllllon Lo [olL Lhe sLaLe economy ouL of long-Lerm economlc doldrums. (ulsclosure: l
was parL of Lhe consulLlng Leam for Lhe 8hode lsland Commlsslon.)
noL surprlslngly, Lhe sLraLegy provoked a flerce, polarlzlng debaLe wlLhln Lhe sLaLe. CrlLlcs called
Lhe Commlsslon's work a sLaLe-level verslon of a naLlonal lndusLrlal pollcy. 1hey accused Lhe
Commlsslon of ln[ecLlng Loo much pollLlcs lnLo Lhe economy, of plcklng wlnners and losers," of

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lnLerferlng wlLh Lhe free markeL." 1he crlLlclsm hlL home. SLaLewlde, Lhe lnlLlaLlve deslgned Lo fund
Lhe sLraLegy falled ln a referendum 4 Lo 1 (leldman 1984).
Several lessons emerged from Lhe 8hode lsland experlence:
Successful economlc developmenL requlres broad-based supporL, and Lhls supporL depends
only parLlally on facLs. LmoLlons -- how people feel abouL Lhelr fuLure -- play an equally
lmporLanL role. Leaders cannoL generaLe Lhese poslLlve emoLlons by facLs alone.
ollLlcs maLLer. lf publlc money ls parL of Lhe plan, Lhe sLraLegy ulLlmaLely depends on
voLers, buslness leaders may have ldeas and money, buL Lhey rarely have enough voLes.
1herefore, Lhe process -- how an economlc developmenL sLraLegy ls developed -- ls as
lmporLanL, lf noL more so, Lhan Lhe flnal recommendaLlons. Agaln, Lhe facLs alone do noL
drlve Lhe process.
1he need for publlc consulLaLlon ls ongolng LhroughouL Lhe process, auLhenLlc engagemenL
ls noL saLlsfled wlLh an evenL, summlL, a hearlng or a forum. ubllc supporL emerges
gradually and can dlsappear qulckly. 1herefore, Lhe sLraLeglc plannlng process for reglonal
developmenL cannoL easlly be sLreamllned. 1aklng shorLcuLs wlLh clvlc engagemenL ls rlsky.
lL Lakes Llme Lo bulld a pollLlcal consensus behlnd each sLraLeglc lnlLlaLlve.
1he pollLlcal consensus supporLlng each lnlLlaLlve ls dlfferenL. 1he "Lop-down" model of
sLraLeglc plannlng LhaL operaLes efflclenLly ln a corporaLe envlronmenL does noL LranslaLe
well Lo Lhe clvlc envlronmenL of reglonal developmenL ln whlch Lhere are no hlerarchles.
8lunLly puL, nobody can Lell anybody whaL Lo do.
Soon afLer Lhe fallure of Lhe 8hode lsland Creenhouse CompacL, l had Lhe opporLunlLy Lo apply
Lhese lessons ln a sLraLegy ln norLhwesL Loulslana. 1hls sLraLegy ad[usLed for many of Lhe mlsLakes
encounLered ln 8hode lsland. 8y successfully guldlng publlc and prlvaLe lnvesLmenL ln a depressed

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reglon, Lhe plan won Lhe flrsL ArLhur u. LlLLle Award for Lconomlc uevelopmenL Lxcellence presenLed
by Lhe Amerlcan Lconomlc uevelopmenL Councll. 1he pro[ecL demonsLraLed LhaL reglonal leaders could
apply corporaLe sLraLegy models Lo reglonal economlc developmenL, buL only wlLh slgnlflcanL dlfflculLy.
ln norLhwesL Loulslana, Lhe reglonal leadershlp needed boLh Llme and money -- nearly 2 years and
over $130,000 -- Lo deslgn and launch a successful sLraLegy uslng Lhls LradlLlonal sLraLeglc plannlng
approach (Morrlson 1987).
C$%&$+-,' 12&..,.- 93% %+-,3.#( >6+ $%&/,$,3.&2 03/+2
ln Lhe years slnce Lhese early experlmenLs, a small consulLlng lndusLry has emerged Lo provlde
sLraLeglc plannlng servlces Lo clvlc leaders ln reglonal economles. 1he LradlLlonal economlc
developmenL sLraLegy model mlrrors Lhe LradlLlonal, llnear approach Lo sLraLeglc plannlng.
1he process ordlnarlly sLarLs wlLh deslgnlng a "plan for Lhe plan" ln whlch Lhe consulLanL guldes
Lhe reglon's leadershlp ln deslgnlng an approprlaLe sLraLegy process. 1hls preplannlng phase ouLllnes
Lhe sLeps LhaL wlll gulde Lhe sLraLeglc plannlng process. Much of Lhls early work also pulls LogeLher a
plannlng Leam capable of guldlng Lhe lengLhy process.
1yplcally, Lhe plannlng process launches by deflnlng a vlslon and mlsslon Lo frame Lhe sLraLegy.
1he nexL sLep focuses on bulldlng an exLenslve base of facLs from whlch Lo deslgn a sLraLegy. MosL
commonly, benchmarklng and some form of SWC1 analysls (SLrengLhs, Weaknesses CpporLunlLles and
1hreaLs) helps Lo organlze facLs, puLs Lhem lnLo a compeLlLlve conLexL, and LranslaLes daLa lnLo lnslghLs
and sLraLeglc lssues. ConsulLanLs add Lhelr own mlx of LargeL markeL analysls, clusLer analysls,
workforce analysls and so on.
AfLer Lhls sLage, Lhe publlc ls ofLen lnvlLed Lo conLrlbuLe ldeas Lhrough forums, or more
recenLly, a pro[ecL webslLe. 1he plannlng process Lhen moves Lo developlng a porLfollo of sLraLeglc

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lnlLlaLlves wlLh (ln some cases) budgeLs and lmplemenLaLlon plans. llnally, Lhe sLraLegy Lyplcally
proposes some form of evaluaLlon and monlLorlng.
1here are some lnherenL llmlLaLlons ln Lhls approach. 1he LradlLlonal sLraLegy model, as Lhe
examples ln 8hode lsland and norLhwesL Loulslana demonsLraLe, ls long and expenslve. Many
communlLles and reglons rely on an ouLslde consulLanL Lo deslgn and conducL Lhe process. ?eL, Lhls
approach has llmlLs. When lL comes Lo LranslaLlng words on Lhe page Lo acLlon ln Lhe sLreeLs, Lhe
process Lends Lo break down. 1he reason ls slmple. ConsulLanLs rarely have Lhe deep local knowledge
needed Lo gulde lmplemenLaLlon.
AnoLher llmlLaLlon: Larly ln Lhe process, sLraLeglc plannlng calls for developlng a vlslon
sLaLemenL. 1hls sLep ls nelLher slmple nor sLralghLforward. 1hls complex Lask ofLen absorbs more
energy Lhan lL ls worLh. 1o forge consensus, reglonal leaders ofLen drafL vlslon sLaLemenLs LhaL Lurn ouL
Lo be bland and confuslng. LxLenslve efforL ofLen ylelds surprlslngly llLLle.
CLher problems arlse along Lhe way. ln mosL places, Lhe pool of clvlc leaders ls relaLlvely Lhln.
AfLer a year or so of guldlng a sLraLeglc plannlng process, many clvlc leaders Llre. 1he challenge of
developlng successors Lo Lhe lnlLlal leadershlp Leam poses a ma[or challenge. WlLh so much efforL
belng focused on Lhe plannlng process, lmplemenLaLlon and execuLlon ofLen become dlfflculL Lo
susLaln wlLhln a small, engaged group.
llnally, Lhe presumpLlon LhaL Lhls small group of leaders can deslgn and lmplemenL a sLraLegy
also does noL hold ln mosL places. 1hls weakness hlLs aL Lhe core of why Lhe LradlLlonal approach Lo
sLraLeglc plannlng does noL work well ln reglonal developmenL. SLraLeglc plannlng models were bullL Lo
gulde hlerarchlcal organlzaLlons, ln whlch a relaLlvely small number of people aL Lhe Lop of Lhe
organlzaLlon dld all Lhe Lhlnklng, and Lhe resL of Lhe organlzaLlon dld Lhe dolng. ?eL, Lhese command
and conLrol mechanlsms do noL exlsL ln Lhe clvlc envlronmenL. 8eglonal developmenL sLraLegles are

9
formed and execuLed ln Lhe "clvlc space" ouLslde Lhe four walls of any one organlzaLlon. 1hls clvlc
space ls noL organlzed hlerarchlcally, as ln mosL prlvaLe corporaLlons. 8aLher, Lhe clvlc llfe of mosL
reglons lnvolves complex lnLeracLlons of organlzaLlons and personallLles LhaL defy slmple descrlpLlon
and qulck analysls. ln Lhls clvlc space, no small group of leaders can Lell anyone else whaL Lo do.
1he LradlLlonal model of sLraLeglc plannlng promlses a framework for ldenLlfylng opporLunlLles
for Lhe cooperaLlve lnvesLmenLs aL Lhe hearL of economlc developmenL (Lconomlc uevelopmenL
AdmlnlsLraLlon 2001). ?eL, lL dellvers relaLlvely llLLle ln pracLlce. 8ecause Lhe process lLself ls cosLly,
compllcaLed and cumbersome, Lhe LradlLlonal model remalns very dlfflculL Lo apply. More worrlsome,
by Lhe laLe 1990s, evldence conLlnued Lo accumulaLe LhaL a deeper economlc LransformaLlon ls
underway ln Lhe global economy. 1hls LransformaLlon, whlch conLlnues Loday, ls maklng Lhe LradlLlonal
model of sLraLeglc plannlng - never a parLlcularly good flL for reglonal developmenL - far less
effecLlve.
G6+%+ &%+ <+ 6+&/,.-F >6+ +0+%-+.'+ 39 .+$<3%=#
ln Lhe early 1990s, economlc commenLaLors undersLood LhaL a ma[or LransformaLlon was
underway ln Lhe u.S. economy (urucker 1992, 1hurow 1994). knowledge was becomlng a ma[or source
of new wealLh. 1he shlfL mosL clearly appeared ln Lhe growlng lncome gap beLween educaLed and low
skllled workers (u.S. Census 8ureau, 2002).
AL abouL Lhe same Llme, Mlchael orLer, a professor aL Lhe Parvard 8uslness School, drew Lhe
aLLenLlon of pollcymakers Lo Lhe lmporLance of clusLers - geographlc concenLraLlons of relaLed
buslnesses and supporL organlzaLlons -as a key drlver of reglonal prosperlLy (orLer 1990, 1998).
orLer emphaslzed how clusLers provlded flrms wlLh compeLlLlve advanLages Lhrough sLreamllned
access Lo knowledge, lncludlng lnslde markeL lnformaLlon and Lhe speclallzed skllls of experlenced
employee.

10
1he Lheory of clusLers goL an unexpecLed boosL from economlsL 8rlan ArLhur, who polnLed Lo
Lhe emergence of lncreaslng reLurns ln markeLs characLerlzed by knowledge-based producLs (ArLhur
1996). ArLhur explalned LhaL markeLs wlLh lncreaslng reLurns generaLe lnsLablllLy, noL equlllbrlum, as
predlcLed by classlcal economlc Lheory. 1hese markeLs are characLerlzed by mulLlple poLenLlal
ouLcomes. lL ls noL always Lrue LhaL Lhe besL mouseLrap wlns, and markeLs do noL necessarlly seLLle on
a slngle equlllbrlum polnL.
knowledge wlLhln markeLs ls consLanLly changlng as new lnformaLlon ls generaLed, new lnslghLs
emerge and new experlences are lncorporaLed. 8ecause Lhe compeLlLlve consequences of new
knowledge are dynamlc and uncerLaln, buslnesses compeLe dlfferenLly. 1hey look for new waves of
lncreaslng reLurns, and Lo do so, Lhey collaboraLe Lo compeLe (kelly 1998, Logan and SLokes 2004). ln
Lhese markeLs, successful sLraLegles value aglllLy, flexlblllLy, speed, collaboraLlon and conLlnuous
learnlng.
ln Lhls markeL envlronmenL, clusLers have become an lncreaslngly lmporLanL sLraLegy for
reglonal economlc developmenL wlLh good reason. ClusLers enable flrms Lo leverage Lhelr asseLs and
manage Lhe rlsks of rapldly shlfLlng markeLs. Lmbedded ln a clusLer, buslnesses can learn fasLer, spoL
opporLunlLles fasLer and locaLe parLners fasLer. 1hey can be more compeLlLlve.
All of Lhese facLors dlsrupL Lhe LradlLlonal model of sLraLeglc plannlng. ln 1994, Penry
MlnLzberg, a managemenL professor aL McClll unlverslLy and noLed auLhorlLy on corporaLe sLraLegy,
volced serlous doubLs abouL Lhe LradlLlonal model. Pe underscored a number of dlfferenL fallacles LhaL
made Lhe LradlLlonal approach Lo sLraLeglc plannlng unworkable (MlnLzberg 1994). 1o MlnLzberg,
sLraLeglc plannlng ls dlfferenL from sLraLeglc Lhlnklng. Whlle sLraLeglc plannlng ls prlmarlly analyLlc,
sLraLeglc Lhlnklng comblnes analysls wlLh creaLlvlLy, lnLulLlon and synLhesls. 1hls approach Lo sLraLegy ls
more flexlble and lnformal, more ln llne wlLh Lhe rapldly shlfLlng dynamlcs of markeLs drlven by
knowledge. MlnLzberg's wrlLlng provlded an lmporLanL lnslghL: 1o compeLe effecLlvely ln markeLs

11
drlven by knowledge, collaboraLlon and lnnovaLlon, we need Lo do our sLraLeglc Lhlnklng dlfferenLly.
We need Lo free ourselves from Lhe rlgldlLles of sLraLeglc plannlng.
As MlnLzberg was wrlLlng ln 1994, neLscape launched Lhe flrsL beLa verslon of Lhe web browser.
1he exploslon of popularlLy for Lhe lnLerneL furLher undermlned Lhe LradlLlonal model of sLraLeglc
plannlng. 1he lnLerneL, our flrsL lnLeracLlve mass medlum, enables companles Lo bulld more
sophlsLlcaLed neLworks wlLh Lhelr suppllers and cusLomers. WlLh Lhese neLworked buslness models,
markeL lnformaLlon has become more lmmedlaLe and dynamlc. As Lhe speed of markeL lnformaLlon
has acceleraLed, Lhe slow, llnear process of LradlLlonal sLraLeglc plannlng falls lncreaslngly ouL of sLep.
noL surprlslngly, oLher buslness school professors have Laken up MlnLzberg's call for new
approaches Lo sLraLegy (leLersen 2002, Ackerman and 8rown 2003, uuggan 2007). As eLerson noLes
(leLersen 2002, 12), ln an age when everyone has lnsLanL access Lo lnflnlLe lnformaLlon, sense-
maklng -- Lhe ablllLy Lo Lurn flows of lnformaLlon ln real knowledge -- has become Loday's scarcesL
and mosL valuable resource and Lhe key leverage polnL for value creaLlon. 1he company's prlmary
source of wealLh ls Lherefore derlved from lLs lnslghLs, knowledge, and ldeas. lLs success depends on
how lL leverages lLs lnLellecLual caplLal."
1hls world ls qulLe dlfferenL from Lhe economy LhaL led Lo Lhe LradlLlonal model of sLraLeglc
plannlng. As we have seen, Lhe LradlLlonal model emerged ln Lhe 1960s as a way for corporaLlons Lo
allocaLe caplLal across mulLlple buslness unlLs operaLlng ln relaLlvely sLable markeLs. ln Lhese markeLs,
cosL sLrucLures drlven by scarclLy and dlmlnlshlng reLurns deLermlned Lhe conLours of compeLlLlon. 1he
LradlLlonal model relnforced hlerarchlcal, command and conLrol organlzaLlons capable of managlng a
long, deLalled and cosLly sLraLeglc plannlng process. Whlle Lhe LradlLlonal model provldes some useful
frameworks for organlzlng lnformaLlon and generaLlng lnslghLs, lL ls unable Lo keep up wlLh lncreaslngly
dynamlc markeLs.

12
H+-,3.&2 +'3.30,+# &# 31+. .+$<3%=#
1he rlse of Lhe lnLerneL enables us Lo see more clearly LhaL knowledge drlves wealLh creaLlon
and LhaL markeLs operaLe as a seL of open neLworks embedded ln oLher open neLworks. Lconomles are
open neLworks of lnLeracLlons LhaL conLlnuously Lransform and ad[usL. Lrlc 8elnhocker provldes a clear
perspecLlve on economles as complex, open neLworks. Lconomles are noL [usL meLaphorlcally llke
open sysLems. 1hey llLerally and physlcally are a member of Lhe unlversal class of open sysLems"
(8elnhocker 2006, 71).
1o bulld prosperlLy ln reglonal economles, we need a more aglle sLraLegy process capable of
ad[usLlng qulckly Lo dynamlc, knowledge-based markeLs. ln parLlcular, Lhls process needs Lo be geared
Loward developlng clusLers of hlgher growLh, knowledge-based buslnesses. 1he LradlLlonal model of
sLraLeglc plannlng, lnvenLed for anoLher era, has llkely seen lLs day. We are lefL wlLh some lmporLanL
quesLlons. WhaL replaces Lhe LradlLlonal model of sLraLeglc plannlng? lf local and reglonal economles
conslsL of lnLerconnecLed neLworks, can we deslgn and gulde Lhese neLworks sLraLeglcally? ls sLraLegy
even posslble ln a fasL-movlng world of open neLworks?
lorLunaLely, we have a paLh forward. ln sLudylng how managers develop sLraLegy ln dynamlc
markeLs, kaLhleen LlsenhardL and uonald Sull came Lo an lmporLanL lnslghL. Successful sLraLegles ln
rapldly shlfLlng markeLs emerge from followlng slmple rules (LlsenhardL and Sull 2001). 1o capLure
opporLunlLles ln Lhese markeLs, LlsenhardL and Sull found LhaL companles large and small beneflL from
deploylng a seL of slmple rules Lo gulde Lhelr sLraLegles. 1hls approach Lo sLraLegy ls clear, focused,
dlsclpllned, adapLlve and lLeraLlve. WlLhouL Lhls slmple approach Lo sLraLegy, companles can become
qulckly confused and paralyzed by Lhe swlfLly movlng markeLs around Lhem. LlsenhardL and Sull
provlde an lmporLanL lnslghL. 1o manage Lhe complexlLy of sLraLegy ln fasL movlng markeLs, you cannoL
rely on a process LhaL ls slow, llnear, cosLly and compllcaLed.

13
uslng Lhls lnslghL, we can see LhaL Lhe search for an alLernaLlve Lo Lhe LradlLlonal model should
focus on slmple, clear frameworks and dlsclpllnes. Slmple rules can gulde members of Lhe neLwork
Loward LransformaLlve ouLcomes ln Lhe mldsL of shlfLlng markeLs and opporLunlLles. As we have seen,
Lhe burdensome LradlLlonal model does noL perform well ln local or reglonal economlc developmenL.
1he model does noL easlly supporL fasL-movlng knowledge-based companles or lnnovaLlve reglonal
clusLers. We cannoL layer a complex process on Lop of complex markeLs and expecL Lo accompllsh
much.
8ecall LhaL an effecLlve sLraLegy answers Lwo quesLlons: Where are we golng?" and Pow wlll
we geL Lhere?" lollowlng Lhls loglc, a new model for guldlng sLraLegy ln open neLworks and reglonal
clusLers wlll have Lwo core componenLs. llrsL, we need a slmple process or dlsclpllne LhaL can deslgn
and gulde sLraLeglc collaboraLlons qulckly. 1hese are collaboraLlon LhaL can move Loward measurable
ouLcomes by followlng a clear paLhway, whlle maklng Lhe lnevlLable ad[usLmenLs along Lhe way. nexL,
we need an undersLandable sLraLegy map LhaL can make sense of Lhe neLworks needed Lo Lransform a
reglonal economy, so LhaL we do noL geL easlly losL or overwhelmed.
>6+ #,012+ 1%3'+## 39 93%0,.- #$%&$+-,' '322&"3%&$,3.#
SLraLegy ln open neLworks requlres collaboraLlon, and collaboraLlon beglns wlLh conversaLlon. A
sLraLegy process for open neLworks wlll gulde Lhese conversaLlons, focus Lhem and LranslaLe words
lnLo acLlon. We need Lo answer Lhe flrsL quesLlon of sLraLegy !"#$%$ '%$ ($ )*+,)-. by deflnlng clear
and measurable ouLcomes. We need Lo answer Lhe second quesLlon !/*( (+00 ($ )$1 1#$%$-. by
deflnlng clear paLhways and acLlon plans. AfLer nearly a decade of developmenL, we have learned LhaL
parLlclpanLs ln open, loosely [olned neLworks can answer Lhese Lwo quesLlons lf we dlvlde Lhem lnLo
four. 1he flrsL Lwo quesLlons are deslgned Lo deflne a clear ouLcome. 1he Lhlrd and fourLh quesLlons
deflne paLhways, acLlon plans and a process for maklng ad[usLmenLs. 8y answerlng Lhese four

14
quesLlons, parLlclpanLs ln a collaboraLlon wlll generaLe all Lhe componenLs Lhey need Lo develop a
sLraLegy.
1he four quesLlons:
WhaL could we do?
WhaL should we do?
WhaL wlll we do?
WhaL's our 30/30?
!"#$% '()*+ ,- +(.! 1he flrsL quesLlon focuses parLlclpanLs on Lhe Langlble and lnLanglble
asseLs LhaL are embedded ln Lhelr neLwork. 1hese asseLs mlghL be faclllLles, money, people,
experlence, knowledge or passlons. ln explorlng !"#'1 2*304 ($ 4*-. parLlclpanLs flrsL llsLen Lo each
oLher and learn abouL Lhe asseLs LhaL
could form Lhe basls of a new
collaboraLlon. ln Lhls way, Lhey begln Lo
develop a menLal map of Lhe asseLs wlLhln
Lhelr emerglng neLwork.
Slmply llsLlng asseLs ls noL enough,
however. CpporLunlLles emerge when
parLlclpanLs llnk Lhese asseLs across
organlzaLlonal and pollLlcal boundarles.
So, for example, when reglonal leaders
llnk a research unlverslLy wlLh a
communlLy college, new opporLunlLles emerge Lo expand career paLhways. When a chamber of
commerce llnks Lo a llbrary, reglonal leaders can sLarL Lo see new ways Lo expand Lhe supporL provlded
Lo small buslness enLrepreneurs. When hosplLals llnk Lo prlmary and secondary schools, new

15
opporLunlLles emerge Lo promoLe good hablLs of exerclse and healLhy eaLlng. 8y explorlng whaL Lhey
could do LogeLher, parLlclpanLs ln an emerglng neLwork begln Lo see Lhe conLours of Lhe new economy
ln whlch collaboraLlon can generaLe greaLer reLurns. 1hese poslLlve reLurns represenL a dlsLlngulshlng
characLerlsLlc of Lhe knowledge economy (ArLhur 1996).
!"#$% /#()*+ ,- +(.! SLraLegy lnvolves maklng cholces, and Lhe nexL quesLlon of SLraLeglc
uolng focuses parLlclpanLs on Lhelr mosL promlslng opporLunlLles. Lach hlgh prlorlLy opporLunlLy musL
be converLed lnLo a shared ouLcome. ln LradlLlonal sLraLeglc plannlng, a "vlslon" provldes Lhe guldlng
llghL for a sLraLegy. unforLunaLely, vlslons do noL work well ln open neLworks. ln mosL cases, a vlslon ls
Loo vague or lmpracLlcal Lo move people. 1he bland language of vlslons sLaLemenLs does noL move
people emoLlonally. 1o engage people ln neLworks, we need clear, conclse and measurable ouLcomes.
ClarlLy enables people Lo LranslaLe an ouLcome lnLo Lhelr own menLal model. 1hey can Lhen engage
emoLlonally. eople ln a neLwork need Lo have a clear plcLure ln Lhelr mlnd of where Lhey're golng
before Lhey wlll commlL Lo movlng (8lack and Cregersen 2002, 77-78).
Answerlng Lhe quesLlon, 5"#'1 6#*304 ($ 4*-5 lnvolves deflnlng a conclse, engaglng ouLcome
wlLh measurable characLerlsLlcs. 1hls approach sounds counLer lnLulLlve. lL may seem LhaL as people
work LogeLher Lo deflne an ouLcome ln speclflc Lerms, Lhe probablllLy LhaL Lhey would agree would go
down. 8ased on our experlence, however, Lhe llkellhood of agreemenL goes up. A sLraLeglc ouLcome
represenLs a complex reallLy wlLh a varleLy of dlfferenL lmporLanL dlmenslons. As members of Lhe
neLwork explore Lhese dlmenslons and deLermlne how Lo measure Lhem, Lhey come Lo undersLand
LhaL Lhe dlfferenL characLerlsLlcs of Lhelr ouLcome are noL muLually excluslve. ln deslgnlng Lhelr
ouLcome, Lhey sLrengLhen Lhelr consensus and commlLmenL Lo work LogeLher.
A slmple example explalns Lhe polnL. Assume a frlend and you have had a long-held dream Lo
buy a cabln ln Lhe woods LhaL you could share for famlly vacaLlons. ?our spouse llkes Lo flsh and wanLs
a cabln LhaL ls close Lo a rlver or sLream. Concerned abouL havlng enough room for Lhe exLended

16
famlly, you also wanL aL leasL one bedroom blg enough for mulLlple bunk beds. ?our frlend, on Lhe
oLher hand, lmaglnes a cabln wlLh enough quleL room Lo wrlLe a greaL novel. llnally, your frlend's
spouse loves Lo cook and wanLs a large klLchen and eaLlng area. ?ou can see from Lhls slmple example
LhaL by deslgnlng a poLenLlal ouLcome ln deLall, members of a neLwork can become clearer abouL
where Lhey are golng. As Lhe shared ouLcome becomes more deflned, Lhey Lend Lo become more
deeply commlLLed Lo collaboraLlng Lo achleve a shared ouLcome.
1oo ofLen, sadly, our clvlc dlscusslons LhaL surround reglonal developmenL are noL very deep,
dlsclpllned or focused. Cur convenLlonal clvlc conversaLlons ofLen represenL a serles of monologues,
loosely sLrung LogeLher. Croups are noL fully engaged ln Lhe deep Lhlnklng requlred Lo deslgn
compelllng, shared ouLcomes. 1o break Lhls cycle, a dlsclpllned conversaLlon Lo deslgn aL leasL one
shared ouLcome becomes a crlLlcal sLep ln allgnlng a neLwork wlLh "llnk and leverage" sLraLegles.
0"#$% ,1** ,- +(.2 1ranslaLlng ldeas lnLo acLlon requlres an lnlLlaLlve and an acLlon plan. An
lnlLlaLlve ls a mulLl-sLep pro[ecL LhaL moves parLlclpanLs closer Lo Lhelr shared ouLcome. Members of a
neLwork may (and probably wlll) launch mulLlple pro[ecLs Lo achleve Lhelr ouLcome, buL Lhey are besL
Lo sLarL wlLh [usL one. Llke ouLcomes, pro[ecLs or lnlLlaLlves work besL Lo move a neLwork when Lhey
are can be descrlbed clearly and conclsely. 1he easlesL way lnvolves deslgnlng Lhe pro[ecL Lo lnclude
Lwo or Lhree ma[or mllesLones. MllesLones provlde some loglcal, pracLlcal evldence LhaL parLlclpanLs
can lndeed move Loward Lhelr ouLcome.
ln answerlng !"#'1 (+00 ($ 4*-. parLlclpanLs musL also LranslaLe Lhelr lnlLlaLlve Lo an acLlon
plan LhaL explalns who does whaL by when. ln SLraLeglc uolng, an acLlon plan serves Lhree lmporLanL
purposes. llrsL, lL makes commlLmenLs LransparenL. 1hls Lransparency helps members of Lhe neLwork
learn who ls rellable. 1ransparency helps bulld LrusL. Second, Lhe acLlon plan underscores Lhe
lmporLance of shared, noL delegaLed, responslblllLy. ln an open neLwork, Lhe responslblllLy for
LranslaLlng ldeas lnLo acLlon falls Lo each member of Lhe neLwork. ln Lhls way, members of Lhe neLwork

17
allgn Lhelr acLlons Lo shared ouLcomes. llnally, a wrlLLen acLlon plan also enables members of Lhe
neLwork Lo make ad[usLmenLs qulckly as clrcumsLances change. WrlLLen acLlon plans provlde
adapLablllLy and flexlblllLy Lo Lhe neLwork's sLraLegy.
!"#$%3/ ()4 56756.! 1hls
quesLlon asks Lhe parLlclpanLs, WhaL dld
you do Lhe lasL 30 days and whaL wlll you
do ln Lhe nexL 30 days?" AlLhough Lhe
slmplesL Lo answer, Lhe 30/30 quesLlon ls
Lhe mosL ofLen neglecLed. WlLhouL havlng
a clear commlLmenL Lo reconnecL,
evaluaLe and learn whaL's worklng,
parLlclpanLs ln a neLwork wlll fall ln Lhelr
sLraLegy. 1he 30/30 quesLlon enables Lhe sLraLegy Lo adapL and evolve. Crdlnarlly, ln Lhe early sLages of
a SLraLeglc uolng process, members of Lhe neLwork need Lo geL back LogeLher wlLhln 30 Lo 60 days.
uecldlng when Lo reconvene also opens Lhe door Lo connecLlng over Lhe lnLerneL. CollaboraLlon
onllne can expand Lhe producLlvlLy of Lhe neLwork. Answerlng Lhe 30/30 quesLlon acknowledges LhaL
sLraLegy ls never done, lL esLabllshes a slmple process of learnlng and ad[usLmenL, a learnlng loop."
SLraLeglc uolng ln open neLworks ls a conLlnuous process of adapLaLlon, a process of learnlng by dolng
! #,012+ #$%&$+-: 0&1 I&./ & $6+3%: 39 %+-,3.&2 $%&.#93%0&$,3.J
ueslgnlng and guldlng neLworks sLraLeglcally Lakes place Lhrough focused, lLeraLlve
conversaLlons. 8uL whaL klnds of neLworks are needed Lo Lransform a reglonal economy? lf reglonal
developmenL ls Lhe process of acceleraLlng collaboraLlve lnvesLmenLs Lo boosL producLlvlLy, whaL Lypes
of collaboraLlons does a reglon need? 1o answer Lhls quesLlon, we Lurned Lo Lhe ldea of sLraLegy maps.

18
A sLraLegy map ls useful Lo sorL ouL complexlLles (kaplan and norLon 2004). lL provldes
coherence, an lmporLanL characLerlsLlc for sLraLegy ln fasL movlng markeLs. lndeed, some have argued
LhaL coherence ls now more lmporLanL
Lhan vlslon ln guldlng sLraLegy (Llssack and
8oos, 2001). WlLhln an organlzaLlon, a
sLraLegy map explalns how an
organlzaLlon creaLes value from a varleLy
of dlfferenL perspecLlves. 1he map
ouLllnes Lhe sLraLeglc goals pursued by an
organlzaLlon and how Lhey are llnked. 1he
same ldea can be applled Lo reglonal
economles, as well as reglonal lnnovaLlon
clusLers.
A sLraLegy map for a reglonal
economy or clusLer conslsLs of flve componenLs or focus areas, each represenLlng a crlLlcal dlmenslons
of lnvesLmenL for a generaLlng wealLh ln a an economy drlven by knowledge. 1hese crlLlcal
lnvesLmenLs:
8ulldlng bralnpower,
CreaLlng supporL neLworks for lnnovaLlon and enLrepreneurshlp,
uevelop quallLy, connecLed places,
CreaLlng new narraLlves, and
SLrengLhenlng collaboraLlon.

19
As we explore Lhese dlfferenL dlmenslons, we wlll see how Lhey are llnked Lo a clear
explanaLlon of how reglonal economles and reglonal lnnovaLlon clusLers move Loward hlgher levels of
producLlvlLy.
8)1*+19: ;4$19<(,-4= As LesLer 1hurow noLed over flfLeen years ago, Lhe global lnLegraLlon of
markeLs places a premlum on bralnpower. WlLh everyLhlng else dropplng ouL of Lhe compeLlLlve
equaLlon, knowledge has become Lhe only source of long-run susLalnable compeLlLlve advanLage, buL
knowledge can only be employed Lhrough Lhe skllls of lndlvlduals." (1hurow 1996, 74).
1o be compeLlLlve ln Lhe 21sL cenLury, reglons, clusLers and companles musL sLarL wlLh people
who have 21sL cenLury skllls. Plgher levels of educaLlonal aLLalnmenL are closely assoclaLed wlLh hlgher
levels of lncome (CoLLlleb and logarLy 2003). 8ralnpower lnvesLmenLs lnclude baslc skllls,
lmprovemenLs ln S1LM (sclence, Lechnology, englneerlng and maLh) educaLlon and Lhe developmenL of
career paLhways LhaL connecL hlgh school Lo posLsecondary educaLlon.
>4-$%19: /)<<(4% 9-%,(4?/ @(4 199(A$%1(9 $9+ -9%4-<4-9-)4/#1< 9-%,(4?/= rosperous
economles supporL lnnovaLlve flrms and enLrepreneurs wlLh a wlde range of lnLerconnecLed lnlLlaLlves.
8esponslve neLworks LranslaLe bralnpower lnLo wealLh qulckly by ldenLlfylng and supporLlng hlgh-
growLh companles and acceleraLlng Lhe formaLlon of sLarLup companles. 1hese neLworks sLrengLhen
Lhe reslllence of reglonal economles, as markeL clrcumsLances change, companles and lndlvlduals use
Lhese neLworks Lo move asseLs Loward more producLlve uses (Saxenlan 1996). lnnovaLlon and
enLrepreneurshlp supporLs lnclude lnvesLmenLs such as lncubaLors, Lechnology commerclallzaLlon
lnlLlaLlves and angel caplLal neLworks.
B-A-*(<19: C)$*1%DE '(99-'%-+ <*$'-/= SmarL people and lnnovaLlve companles can locaLe
anywhere. 1hey wlll choose places LhaL are secure, healLhy and connecLed. lace-maklng"
lnvesLmenLs lnclude Lhe baskeL of acLlvlLles LhaL clvlc leaders underLake Lo remake Lhe places ln whlch

20
Lhey llve and work. 1hese place-based lnvesLmenLs creaLe hoL spoLs" LhaL are healLhler, more
lnnovaLlve, more creaLlve and more connecLed.
WlLh place-maklng lnvesLmenLs, communlLles and reglons can remake Lhemselves Lo aLLracL
and reLaln Lhe bralnpower and lnnovaLlve buslnesses needed Lo power an economy forward.
lnvesLmenLs ln quallLy, connecLed places lnclude physlcal developmenL, such as expanslons of
broadband, mlxed-use developmenL ln
downLown dlsLrlcLs and around unlverslLy
campuses, Lhe developmenL of connecLed
publlc spaces, such as parks and llbrarles,
and Lhe preservaLlon of naLural resources.
1hese lnvesLmenLs also lnclude acLlvlLles
deslgned Lo promoLe healLhy, safe and
creaLlve places Lo llve and work.
>4-$%19: 9-, 9$44$%1A-/= 1o
Lransform an economy, clvlc leaders need
new narraLlves Lo gulde Lhe
LransformaLlon. 1hese narraLlves provlde
coherence, and ln complex, shlfLlng envlronmenLs, coherence faclllLaLes allgnmenLs (8andall & Parms,
2011). Command and conLrol managemenL sLyles do noL work effecLlvely ln Lhe "clvlc space." Cn Lhe
oLher hand, sLorles can move loosely [olned neLworks ln new dlrecLlons. 1hese neLworks can be
expllclLly deslgned and gulded (8osen 2000, Cladwell 2002, uennlng 2003). new narraLlves boLh
connecL Lo Lhe pasL and charL a paLhway Lo a more prosperous fuLure, Lhey provlde boLh meanlng and
a sense of dlrecLlon.

21
F%4-9:%#-919: '(**$;(4$%1(9= LffecLlve collaboraLlon requlres new leadershlp skllls. Culdlng a
complex pro[ecL among a loose neLwork of people requlres sklll Lo lnsplre parLlclpaLlon, sharlng and
commlLmenL (Crlsllp 2002). As Lhese skllls develop and become more wldely shared, Lhe capaclLy of Lhe
neLwork Lo Lake on more complex Lasks grows. lnlLlaLlves Lo bulld collaboraLlon skllls lnvolve learnlng
experlences ln whlch leaders can lmprove Lhelr collaboraLlon skllls.
1hls slmple sLraLegy map helps reglonal leaders flgure ouL qulckly where Lhey sLand. WlLh Lhls
map ln hand, Lhey can map Lhe sLraLeglc focus of Lhe ma[or organlzaLlons, lnlLlaLlves and lnvesLmenLs
wlLhln a reglon. 1hey can qulckly ldenLlfy poLenLlal parLners for collaboraLlon. ln addlLlon, Lhe sLraLegy
map opens Lhe door Lo some lmporLanL quesLlons abouL how well asseLs wlLhln Lhe reglon are llnked,
leveraged and allgned. So, for example:
Pow well are dlfferenL organlzaLlons connecLed and allgned?
WhaL ouLcomes are dlfferenL organlzaLlons pursulng?
Can Lhese ouLcomes be measured and communlcaLed easlly?
Pow do Lhese meLrlcs relnforce a broader reglonal narraLlve?
Are we balanclng shorL Lerm and long Lerm ouLcomes?
Are Lhere slgnlflcanL gaps ln our porLfollo of organlzaLlons and lnlLlaLlves?
uo our collaboraLlve lnvesLmenLs reflecL our sLraLeglc prlorlLles?
WhaL ls Lhe approprlaLe balance of lnvesLmenL across our porLfollo?
C$%&$+-,' *3,.- ,. 1%&'$,'+
SLraLeglc uolng has evolved over Lhe pasL Lwo decades. 1he [ourney sLarLed ln Cklahoma ClLy
and conLlnues Loday. Pere ls a brlef overvlew of some slgnlflcanL mllesLones along Lhe paLh.
G4$9/@(4H19: I?*$#(H$ >1%D= 1he developmenL of SLraLeglc uolng for reglonal developmenL
began ln Cklahoma ClLy ln 1994. ln a coordlnaLed sLraLegy beLween Lhe ClLy and Lhe Chamber of

22
Commerce, Cklahoma ClLy Lransformed lLs reglonal economy over seven years uslng early verslons of
SLraLeglc uolng. now, Cklahoma ClLy ls regarded as a leadlng reglon for reglonal economlc
developmenL (1hompson 2010).
8)1*+19: $9 -9%4-<4-9-)41$* -'(/D/%-H ,1%# %#- >#$4*-/%(9 B1:1%$* >(441+(4= ln 2001, Lhe
CharlesLon ulglLal Corrldor launched uslng Lhe dlsclpllnes of SLraLeglc uolng. Led by a clLy employee,
Lhe Corrldor used Lhe sLraLegy map presenLed earller ln Lhls paper Lo deslgn a porLfollo of lnvesLmenLs
deslgned Lo supporL emerglng hlgh growLh Lechnology companles. now CharlesLon [olns AusLln and
Cklahoma ClLy as one of Lhe naLlon's leadlng reglonal economles for supporLlng Lhese emerglng flrms
(Seale 2011).
J''-*-4$%19: ,(4?@(4'- 199(A$%1(9 19 K(4%# >-9%4$* L9+1$9$= ln 2003, a collaboraLlon led by Lhe
urdue CenLer for 8eglonal uevelopmenL recelved $13 mllllon from Lhe federal governmenL Lo
acceleraLe lnnovaLlon ln workforce developmenL. 1he collaboraLlon focused Lhelr efforLs ln four areas:
LalenL developmenL, enLrepreneurshlp developmenL, clusLer developmenL and reglonal leadershlp. ln
Lhree years, Lhe SLraLeglc uolng process led Lo over 60 lnlLlaLlves ln Lhese four focus areas. 8emarkably,
over 80 of Lhe lnlLlaLlves conLlnued pasL Lhe lnlLlal fundlng. 1he federal governmenL esLabllshed
amblLlous goals for lLs lnvesLmenL, and Lhe collaboraLlon exceeded Lhese goals by nearly a facLor of
Lhree.
8)1*+19: $ ,$%-4 '*)/%-4 19 M1*,$)?--E "1/'(9/19= ln souLheasL Wlsconsln, economlc and
workforce developmenL professlonals used SLraLeglc uolng Lo help launch a fresh waLer Lechnology
clusLer. ln !uly 2008, Lhe Mllwaukee WaLer Councll conducLed a SLraLeglc uolng workshop Lo ldenLlfy
opporLunlLles Lo become a global leader ln fresh waLer Lechnologles. 1he workshop enabled
parLlclpanLs from buslness, hlgher educaLlon and governmenL Lo come LogeLher and ldenLlfy four focus
areas wlLhln whlch Lo launch sLraLeglc lnlLlaLlves. 1oday, Lhe WaLer Councll based ln Mllwaukee has
become a global leader ln fresh waLer Lechnology.

23
N$)9'#19: $ '*-$9 -9-4:D '*)/%-4 (9 %#- F<$'- >($/%= ln CcLober 2010, clvlc leaders ln 8revard
CounLy, llorlda clvlc leaders confronLed Lhe LermlnaLlon of Lhe nASA shuLLle program. 1o develop a
sLraLegy for LransformaLlon, leaders Lurned Lo a serles of SLraLeglc uolng workshops as a way Lo
ldenLlfy "reengagemenL neLworks". 1he dlslocaLlons LhaL arose from changes Laklng place aL nASA
swamped Lhe capaclLy of Lhe publlc workforce sysLem Lo ad[usL. ueveloplng new reengagemenL
neLworks enabled clvlc leaders Lo reallgn qulckly and move Loward new opporLunlLles. CuL of Lhese
SLraLeglc uolng workshops, a new clusLer of clean energy companles formed.
8)1*+19: $9 $-4(/<$'- '*)/%-4 19 O('?@(4+E L**19(1/= ln 2011, clvlc leaders used Lhe dlsclpllnes of
SLraLeglc uolng Lo form Lhe complex collaboraLlons needed Lo sLrengLhen a clusLer of aerospace
companles. ln Lhe flrsL year of Lhls collaboraLlon, 8ockford leaders, led by norLhern llllnols unlverslLy,
formed Lhe !olnL lnsLlLuLe for Lnglneerlng and 1echnology - Aerospace (!lL1-A), an lnnovaLlve
parLnershlp among aerospace buslnesses, hlgher educaLlon lnsLlLuLlons and sLudenLs for Lhe
advancemenL of Lhe aerospace lndusLry workforce.
O-;)1*+19: 9-1:#;(4#((+/ 19 P*19%E M1'#1:$9= ln 2011, Mlchlgan SLaLe unlverslLy began uslng
Lhe dlsclpllnes of SLraLeglc uolng Lo rebulld Lhe devasLaLed nelghborhoods of lllnL, Mlchlgan. uslng
neLworks LhaL moblllzed Lhe asseLs of nelghborhood resldenLs, Lhe new neLwork - nelghborhoods
WlLhouL 8orders - has focused on pracLlcal sLeps Lo regeneraLe Lhese nelghborhoods wlLh Lhe asseLs
aL hand. 1hls shlfL ln focus has fundamenLally alLered Lhe way ln whlch parLlclpanLs ln Lhe neLwork vlew
Lhelr work. 8aLher Lhan appeal Lo ouLslde funders for help, Lhe neLwork parLners are lnnovaLlng wlLh
Lhelr own resources.
G-$'#19: F%4$%-:1' B(19: %#4():# $ 9$%1(9$* 9-%,(4?= Slnce 2003, Lhe urdue CenLer for
8eglonal uevelopmenL (C8u, whlch has lncubaLed Lhe SLraLeglc uolng pracLlce, has conducLed
workshops ln over 30 sLaLes and AusLralla. 8ased on Lhe demand LhaL Lhese workshops have
generaLed, C8u lnLroduced a cerLlflcaLe course for SLraLeglc uolng. 1he CenLer ls also formlng a

24
naLlonal neLwork of unlverslLles Leachlng Lhls dlsclpllne. 1he lnlLlal parLners ln Lhls neLwork lnclude
Mlchlgan SLaLe unlverslLy and 1he unlverslLy of Akron. ln november 2013, C8u conducLed lLs flrsL off
campus cerLlflcaLlon Lralnlng aL Lhe unlverslLy of Alaska.
G6&$ <+ &%+ 2+&%.,.-( E3< %+-,3.# +4324+ $3<&%/ 31+. ,..34&$,3.
1he LransformaLlon of reglons Loward aglle sLraLegy Lakes Llme. SLraLeglc uolng ls a collecLlve
dlsclpllne LhaL musL become wldely shared before lL ls effecLlve. 1he LransformaLlon ln Cklahoma ClLy
Look abouL flve years. 1he LransformaLlon ln Lhe CharlesLon ulglLal Corrldor Look abouL as long.
8ulldlng and reflnlng a dlsclpllne around SLraLeglc uolng should collapse Lhe Llme for reglonal
LransformaLlon. We are only beglnnlng Lo map Lhls process, buL a clear paLLern ls emerglng. As reglons
bulld Lhe dlsclpllne, Lhey appear Lo cross flve horlzons.
ln Lhe flrsL horlzon, Lhe crlLlcal mass of clvlc leaders beglns Lo move forward wlLh new
conversaLlons abouL collaboraLlon. ln many communlLles and reglons, Lhe clvlc conversaLlons are sLuck
on old Loplcs LhaL lead nowhere. 1ransformaLlon beglns when enough people declde Lo change Lhe
prevalllng conversaLlons. So, for example, young professlonals ln ?oungsLown, Chlo, began a new
serles of conversaLlons abouL Lhe fuLure of Lhelr lndusLrlal clLy.
ln Lhe second horlzon, clvlc leaders reshape Lhelr Lhlnklng from hlerarchles Lo neLworks. 1hey
move Lhelr aLLenLlon from verLlcal relaLlonshlps Lo horlzonLal connecLlons. ln dolng so, Lhey dlscover
dlfferenL hldden asseLs LhaL are embedded ln neLworks wlLhln Lhelr communlLy or reglon. 1hey learn
Lhe lmporLance of lnLenLlonally bulldlng relaLlonshlps Lo sLrengLhen Lhelr neLworks and connecL Lhese
asseLs.
neLwork Lhlnklng dlffers from hlerarchlcal Lhlnklng ln some fundamenLal ways. A sLrong
neLwork has a dense core of relaLlonshlps and porous boundarles. 1he dense core enables Lhe neLwork
Lo accompllsh complex Lasks. 1he porous boundarles encourage new members Lo [oln and for learnlng

25
Lo conLlnue. A porous boundary enables a neLwork Lo adapL Lo new clrcumsLances. ln conLrasL,
hlerarchlcal leaders spend much of Lhelr Llme marklng and defendlng Lhelr boundarles.
ln Lhe Lhlrd horlzon, clvlc leaders develop Lhe skllls Lo gulde Lhelr neLworks sLraLeglcally. As Lhey
masLer Lhe dlsclpllnes of SLraLeglc uolng, Lhey learn Lo gulde conversaLlons Lo address sLraLeglc lssues.
1hey learn LhaL answerlng Lhese quesLlons generaLes all Lhe componenLs of Lhelr neLwork's sLraLeglc
acLlon plan. 1hey experlence sLraLegy ln neLworks as a fasL, lLeraLlve process, ln conLrasL Lo ponderous
sLraLeglc plannlng.
ln Lhe fourLh horlzon, clvlc leaders begln Lhe search for plloL pro[ecLs LhaL can be
LransformaLlve. ln Lhls search, Lhey apply a slmple, buL rlgorous process Lo ldenLlfy lnlLlaLlves LhaL
lnduce new lnvesLmenL, llnk and leverage" asseLs and offer Lhe promlse of LransformaLlon. Cnly
lnlLlaLlves LhaL are repllcable, scalable and susLalnable hold Lhe poLenLlal for Lransformlng a reglonal
economy.
llnally, ln Lhe flfLh horlzon, clvlc leaders focus on expandlng Lhe successful plloL pro[ecLs Lhey
have ldenLlfled. As Lhese lnlLlaLlves expand, Lhe LransformaLlon Lakes hold.
G6&$ <+ &%+ 2+&%.,.-( C$%&$+-,' *3,.-; '3012+?,$: &./ ",- 0+##+#
SLraLeglc uolng appears Lo be a promlslng approach Lo addresslng complex reglonal
developmenL challenges. 1hese challenges lnvolve a hlgh degree of componenLs coupled wlLh a hlgh
number of lnLeracLlons (Sheffleld eL. al. 2012). lor Lhe mosL parL, reglonal developmenL lnvolves
deflnlng collaboraLlve sLraLegy ln Lhe conLexL of Lhese complex, hlghly lnLeracLlve sysLems, or whaL
some have called messes."
>6+ C$%&$+-,' *3,.- /+#,-. $+&0
1o asslsL urdue ln developlng SLraLeglc uolng as a dlsclpllne for handllng complex messes, we
convened a SLraLeglc uolng ueslgn 1eam" composed of pracLlLloners from around Lhe counLry. 1he

26
deslgn Leam, whlch has a floaLlng membershlp of beLween Len and flfLeen, meeLs every slx monLhs Lo
deslgn Lhe nexL seL of prlorlLles for developlng Lhe dlsclpllne. 1he work sLarLed ln 2008. ln 2011, Lhe
ueslgn 1eam adopLed a seL of bellefs, a credo, Lo gulde Lhe developmenL of Lhe dlsclpllne.

C$%&$+-,' *3,.- A%+/3
78 "$ 9$0+$:$ ($ #':$ ' %$6;*,6+9+0+1< 1* 93+04 ' ;%*6;$%*36=
6361'+,'90$ >313%$ >*% *3%6$0:$6 ',4 >313%$ )$,$%'1+*,68
?8 @* +,4+:+43'0= *%)',+A'1+*, *% ;0'2$ 2', 93+04 1#'1 >313%$ '0*,$8
B8 C;$,= #*,$61= >*236$4 ',4 2'%+,) 2*00'9*%'1+*, 'D*,) 4+:$%6$
;'%1+2+;',16 +6 1#$ ;'1# 1* '22*D;0+6#+,) 20$'%= :'03'90$= 6#'%$4
*312*D$68
E8 "$ 9$0+$:$ +, 4*+,)= ,*1 F361 1'0G+,) H ',4 +, 9$#':+*% +,
'0+),D$,1 (+1# *3% 9$0+$>68
I1%'1$)+2 J*+,) J$6+), K$'D
K3%G$< L3, I1'1$ M'%G= N,4+','
C21*9$%= ?O77
G6+%+ <+ &%+ 6+&/,.-( C30+ 1%+/,'$,3.#
ueveloplng new models of sLraLegy approprlaLe for open, loosely connecLed neLworks
represenLs a new fronLler for reglonal developmenL. ln Lhe years ahead, we wlll llkely see Lhe pracLlces
of SLraLeglc uolng boLh spread and develop. Pere are some predlcLlons:
1. A growlng number of colleges and unlverslLles wlll embrace SLraLeglc uolng as parL of Lhelr
engagemenL mlsslon. Plgher educaLlon ls bullL around Lhree core mlsslons: research, Leachlng
and engagemenL. WlLh a move Loward a more open, neLwork-based economy, Lhe engagemenL
mlsslon offers colleges and unlverslLles exclLlng new roles Lo play ln reglonal economlc
LransformaLlon. SLraLeglc uolng provldes a convenlenL, slmple plaLform for hlgher educaLlon Lo
convene and develop more exLenslve neLworks wlLhln Lhelr reglonal economy.
2. CommunlLles and reglons wlll use SLraLeglc uolng Lo adapL promlslng pracLlces. lor a number of
years, researchers have been complllng promlslng besL pracLlces ln reglonal developmenL. 1he
challenge comes ln adapLlng Lhese pracLlces Lo dlfferenL clrcumsLances. 1rylng Lo apply a case

27
sLudy wlLhouL modlfylng Lhe local condlLlons ls llke Lrylng Lo planL cuL flowers: lL does noL work.
SLraLeglc uolng provldes a convenlenL, low cosL approach Lo adapLlng promlslng pracLlces Lo
local clrcumsLances.
3. WlLhln reglons, Lhe llnes among economlc, workforce, communlLy and rural developmenL wlll
conLlnue Lo blur. ln SLraLeglc uolng, neLworks maLLer more Lhan boundarles. arLlclpanLs
volunLeer Lhelr asseLs Lo Lhe neLwork and Lhen work Lo deflne new opporLunlLles by llnklng and
leveraglng Lhese asseLs wlLh oLhers. 8oundarles do noL dlsappear, buL Lhey become more
porous and less conLrolllng.
4. Clvlc leaders ln reglons wlll lnLenLlonally develop Lhelr "clvlc spaces." A democracy demands
complex Lhlnklng among lLs clLlzens. ?eL, we have leL our clvlc spaces deLerloraLe Lo Lhe polnL
where mosL communlLles and reglons do noL have esLabllshed places and rouLlnes for
addresslng Lhe complex challenges of economlc LransformaLlon. A clvlc space deslgned for
SLraLeglc uolng ls an open, welcomlng physlcal locaLlon bounded by clear rules of behavlor. ln
Lhe years ahead, we wlll llkely see clvlc leaders undersLandlng Lhe sLraLeglc lmporLance of
malnLalnlng Lhese clvlc spaces ln colleges and unlverslLles, llbrarles, communlLy cenLers and
oLher locaLlons where people can feel safe Lo have complex conversaLlons.
3. 1he nexL generaLlon of naLlonal developmenL pollcles wlll be more producLlve, open and
flexlble. WlLh SLraLeglc uolng as a framework, naLlonal governmenLs can move Loward a more
unlform approach of lnvesLlng ln open lnnovaLlon neLworks wlLhln reglons. ln Lhe u.S., Lhe
currenL approach of bolLlng LogeLher dlfferenL agency programs does noL work very well. 1hese
programs - each deslgned separaLely decades ago - cannoL meeL Lhe needs of Loday's
compeLlLlve reglons. new approaches wlll be far more producLlve by leveraglng neLworks.
urdue has already demonsLraLed how Lhese pollcles can be sLrucLured.

28
6. SLraLeglc uolng wlll lead Lo a LlghLer lnLegraLlon of onllne and ln person open lnnovaLlon." We
are sLlll aL Lhe early sLages ln our undersLandlng of Lhe power of Lhe lnLerneL. As people become
more comforLable wlLh Lhe lnLeracLlve and collaboraLlve Lools avallable, we wlll see a mlgraLlon
of reglonal developmenL acLlvlLy Lowards Lhe Web. 1hls mlgraLlon wlll, ln Lurn, creaLe
opporLunlLles for reglons Lo connecL far beyond Lhelr borders. 1he organlzaLlonal and pollLlcal
boundarles LhaL so carefully deflne Lhe currenL scope of reglonal developmenL acLlvlLy wlll
become less relevanL.
7. CrganlzaLlonal forms for reglonal governance wlll shlfL. vlrLually every reglonal organlzaLlon
follows Lhe organlzaLlonal form of a LlghL hlerarchy: a board dlrecLors and a sLaff LhaL ls
organlzed along funcLlonal deparLmenLs. lncreaslngly, we wlll see new organlzaLlonal forms LhaL
wlll blend hlerarchy wlLh neLwork-based organlzaLlon and more flexlble Leams. 1hese new
organlzaLlonal forms wlll be more aglle and less cosLly. All of Lhese developmenLs wlll lead Lo
new forms of collaboraLlve leadershlp. 1he leadershlp of open neLworks ls dlsLrlbuLed and
shared. Leadershlp responslblllLles and roles shlfL as clrcumsLances change. Lxplorlng
collaboraLlve leadershlp wlll Lake us Lo an undersLandlng LhaL each of us should be prepared Lo
be boLh a leader and a follower. Cur [ourney wlll dellver us a deeper undersLandlng of how our
democracy can lnnovaLe Lo meeL Lhe challenges ahead.
8. nonproflL leaders and local governmenLs wlll flnd LhaL SLraLeglc uolng helps forge new
collaboraLlons Lo address mounLlng soclal challenges amldsL lncreaslng flscal pressures.
llscal and operaLlonal pressures are lncreaslng on non-proflL organlzaLlons and local
governmenLs. 1o address Lhese challenges, Lhey wlll need Lo form collaboraLlons more
qulckly and monlLor Lhelr progress carefully. 1hese new arrangemenLs wlll enable Lhem Lo
make beLLer use of funds and Lo move Lhem more dlrecLly Lo shared and measurable
ouLcomes. SLraLeglc uolng provldes a slmple dlsclpllne Lo forge Lhese parLnershlps.

29
9. 8uslnesses wlll flnd SLraLeglc uolng an aLLracLlve alLernaLlve Lo sLraLeglc plannlng, buslness
schools wlll begln ad[usLlng Lhelr course work Lo move Loward aglle sLraLegy dlsclpllnes as a
way Lo manage open lnnovaLlon." Cpen lnnovaLlon leverages lnnovaLlon asseLs ouLslde an
organlzaLlon (Chesbrough 2003). As buslnesses move Loward more open, neLworked
buslness models, Lhey wlll move Loward more sophlsLlcaLed collaboraLlons wlLhln Lhelr
reglonal economles. 1hey wlll become more acLlve players ln reglonal developmenL. uslng
SLraLeglc uolng as a dlsclpllne Lo form and gulde Lhese collaboraLlons, Lhey wlll flnd new
opporLunlLles Lo creaLe shared value" (orLer and kramer 2012).
1he dlsclpllne of SLraLeglc uolng wlll conLlnue Lo evolve ln Lhe years ahead, as we learn more
abouL how Lo form and manage lnnovaLlon ln open, loosely connecLed neLworks. 1hls much ls
clear: Cur approach Lo sLraLegy wlll never be qulLe Lhe same.
H+9+%+.'+#
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