onducting a site selection project for a research and development facility requires a unique set of criteria to be analyzed in order to be effective. Typically, factors that play secondary roles in locations of BPO facilities such as call centers and data centers, and logistics-centric projects such as manufacturing and distribution have a much larger impact on the overall location analysis. To effectively locate one of these research facilities, or to successfully recruit one to your community, it is important to understand the critical drivers necessary to make the project a success.
Isn't it always about the labor? Quite possibly so, but this factor becomes exponentially important when the backbone of your entire business function is highly dependent on the contributions of individuals. One may argue that when boiled down to its simplest form, every business is dependent on individual contributions, but it is important to understand that while the work force is critical to success in a BPO or manufacturing environment, it is highly dependent on the training programs, work ethic, and process that is put in place by corporate and local leadership. With a research facility, however, one does not have the luxury of being able to train and mold the top scientists that drive breakthroughs. Often times a lead scientist or team of scientists are targeted before the site search begins, and the inputs of these key personnel are taken seriously into consideration when choosing a location.
So what makes these individuals tick, thus driving the site location process? Kate Higgins, the associate director of human resources at Meda Pharmaceuticals Inc., feels that attracting this type of talent requires a unique process. Higgins points out that that the search area for the top talent that it takes to be successful is "a global one," and that "recruiting to an area where people want to reside" can give you a key advantage over your competition. This emphasis on the quality-of-life factors that are analyzed during the site selection process is something unique that is seen typically only in major headquarters relocation projects. This may be why the emphasis on these tech-heavy locations has shifted to cities such as San Francisco, where creativity blossoms, quality of life is high, and partnerships with academia are prevalent. In a recent USA Today article by Jon Swartz, Colleen McCreary, chief people officer for Zynga, noted that "[A popular city location] is not the No. 1 factor [in recruiting talent], but when you put the whole picture together it certainly comes into play."
This may be why clustering is more evident in the R&D facility environment, as these high quality-of-life areas reap the reward of attracting high-income earners. As well as the quality of life draw, there are also other benefits that result from clustering, both from the employee's and the employer's perspective. One of the largest benefits of the clustering effect comes in the form of shared research capabilities that stem from collaboration. This can be a shared center for one company managing multiple business segments and/or products, or just general (non-proprietary) information sharing. On the employee side, Higgins points out an interesting phenomenon among smaller R&D company recruitment efforts. "It's all about the stock options," she notes. With these start-up companies and even fledgling divisions within larger organizations, the employee needs to have the ability to jump from project to project should the company not be able to sustain operations or if the product fails. Having employment options available nearby gives one a larger sense of comfort. She also noted that industry trade group attendance in the R&D field was typically higher than in other fields, so this sense of community is further exemplified.
But not all successful R&D locations are tied to a major city. Autumn Braase, a business attraction specialist with the Idaho Department of Commerce, notes that "Since 1949 the Idaho National Laboratory has been a keystone in the U.S. Dept. of Energy's R&D arm, employing over 6,000 people and offering their extensive science and engineering to other R&D companies in the state." With this anchor providing a flourishing collaborative environment, many smaller R&D firms have been able to thrive without the draw of a major metropolitan area.
From a financial perspective, many of the traditional cost requirements of a facility are not taken into consideration. Factors such as labor rates, real estate rates, unemployment insurance, etc., that are a major part of a traditional site selection analysis, are weighed much less heavily. This division of philosophy has led many companies to consider the separation of their R&D operations from their manufacturing operations. Where once it was expected to have your R&D and manufacturing tied together, in today's environment that is not always the case.
Regarding incentives, creativity is the key to success. Many of the "old-line" incentives such as non-refundable tax credits based upon heavy job creation requirements just don't add value to the bottom line, making them virtually worthless to the site selection process. Quite a few of these R&D operations are not designed to be profitable, so incentives based on profit (such as income tax credits) don't add value.
Brian Corde is a Managing Partner at Atlas Insight, LLC, a New Jersey-based firm that specializes in site selection and incentive procurement.
trategic Planning" or "Visioning" have long been economic development buzz words and Harnett County has prepared for the future and developed a plan to encourage job growth while enhancing quality of life. Today, Harnett County not only has water and sewer lines through 90% of the county, it has enhanced roads, highways, and interstate to move traffic easily, and an advanced technology infrastructure.
Proximity Plus Preparation
The County recently celebrated a planning milestone with construction starting at the new LEED Silver Harnett Health System's Hospital in the 120-acre Brightwater Science & Technology Campus. Launching the hospital's construction marks the start of development planned to attract other companies in the life sciences disciplines as well as medical offices and training facilities, and research and development firms.
Also locating in the campus are branch facilities for Central Carolina Community College (CCCC) and Campbell University where students can attend classes/training and walk to the hospital for clinical training.CCCC's main county campus is located just 1.5 miles down the highway and the nationally recognized medical school at Campbell is just 3.5 miles away.
Also located across the highway is the 19-acre Brightwater Business Park. Both properties are within an hour's drive of Research Triangle Park, the NC Biotechnology Center, three major research universities, two teaching medical centers, and two pharmacy schools.
Starting Your Opportunity
To get started with your next successful business opportunity, experienced staff at the Economic Development Commission are empowered and prepared to assist you. Visit our website, www.harnettedc.org, or call the commission at (910) 893-7524.