The Stoic philosopher Zeno is credited with saying, “We have two ears and one mouth, so we should listen more than we say.”
In addition to recruiting companies to the state, the Economic Development Corporation of Utah (EDCUtah) works to support local companies looking to grow. The Know the Customer (KTC) program allows us to better understand the challenges and plans of existing businesses. It is an exercise in listening to help us more effectively support their goals.
The KTC program began last year as an initiative to engage with some of Utah’s key employers to ensure they receive the economic development support they need. The KTC program also provides an “early warning system” to identify Utah companies considering moving jobs outside Utah.
Conducted by EDCUtah and the Governor’s Office of Economic Development (GOED) staff, these hour-long interviews often lead to insights about growth plans, affording “Team Utah” an opportunity to help companies in a timely manner.
Collectively these interviews have the goal of informing state leaders. Aggregate data can prove useful to any party looking to improve the business landscape in Utah.
What follows are trends and observations from the first 74 company interviews we have conducted.
NPS: The perception of Utah as a place to do business is high. With a rating above 60, Utah has an excellent net promoter score (NPS) - a benchmark organizations use to measure customer loyalty. To provide context, Amazon has an NPS of 62, and Netflix of 68 (source: Retently.com).
The top two factors driving Utah’s favorable ratings are the quality of our workforce and affordable costs of doing business. Both of these factors were selected by 21% of respondents. A majority believe the quality of Utah’s workforce is better than in other regions.
When asked about Utah’s advantages compared to other markets, respondents cited Outdoor Lifestyle (21%), Cost of Doing Business (20%), and Business and Tax Climate (18%).
Has their opinion of doing business in Utah changed in the last two years? Some 59% of respondents say it has stayed the same, 19% say it has worsened, and 22% say it has improved.
Side note: Companies that have moved operations to Utah have a higher NPS on average (67.6) than companies that began in Utah (61.1). When looking at different industries, the outdoor products and manufacturing industries have higher scores than other industries in Utah.
Growth plans and hurdles: Two-thirds of surveyed companies are looking to expand in the next year, but there are obstacles. For one thing, a shortage of available talent is seen as the top challenge the state faces in the next five years (28%). This perception crosses all industry sectors and company sizes. In other words, Utah workers are of high quality, but finding and keeping talented individuals can be difficult in the current economy.
Further, many companies struggle to recruit and retain women and diverse talent; they consider this issue a greater challenge in Utah than in other locations in which they do business.
Other top challenges facing Utah include Population Growth / Cost of Living (17%) and Air Quality (15%).
Side note: A quarter of respondents say they had been offered business incentives by economic development organizations outside of Utah.
Policy implications: What are some ideas state leaders can glean from these preliminary results?
Create better connectivity between business and public sectors to increase NPS of existing companies. Retain the Utah “value proposition” through a focus on controlling costs, and supporting a quality workforce and business-friendly environment.
Organize around diversity and inclusion - Infuse this into economic development and other public policy objectives.
Maintain what makes Utah great and which gives us a unique talent attraction strategy. In other words, our superb outdoor environment and recreational opportunities. Recognize the importance of air quality to the business community.
Continue supporting public education and programs that align education and industry. While evaluating incentives in general, consider workforce incentives for all companies as a means to support Utah’s positioning vs. other regions. Competition for growing companies is real, constant, and no respecter of state boundaries.
Follow @edcutahorg on Twitter or visit www.edcutah.org for the full KTC report.
Theresa A. Foxley is president and CEO of the Economic Development Corporation of Utah. This is the second in a five-part series to inform discussion entering this election year.