(Author’s note: This is only my opinion and does not represent the editorial position of Insider Louisville.)
Nature abhors a vacuum, and for the moment, Louisville has a stunning leadership vacuum.
Greater Louisville Inc. president and CEO Craig Richard has been on indefinite leave for more than two weeks.
Before there was a public confirmation of his absence, our sources tell us Richard had kept a peculiarly low profile for the leader of the city’s economic development effort. In the last three years, GLI’s finances and standing have declined precipitously to the point sources tell us his successor inherits a crisis situation.
Our internal GLI sources tell us the staff has been notified by the board of directors that Richard will not return. GLI’s annual meeting is scheduled to begin Tuesday at 5 p.m. at the Galt House, so our sources are convinced there will be an announcement beforehand. But even our internal sources say they have no information … the identity of Richard’s replacement is a tightly held secret known only to a handful of people.
Now, the questions becomes, “Who will lead?” Because this is a scary time for Louisville, and whoever gets the GLI job is going to have to act quickly and decisively.
Speaking last week to the Association for Corporate Growth Kentucky meeting, Chuck Denny substituted for Richard, giving Louisville’s deal makers one of his statistical breakdowns as a prelude to discussing GLI’s Advantage Louisville report.
Chuck does his best to accentuate the positive, but it ain’t pretty.
President of PNC Bank’s Kentucky and Tennessee operations, he knows this region’s economy better than just about anyone, having worked with Kentucky businesses big and small, first with National City Bank, then PNC.
He’s one of the good guys, accessible and candid. And Chuck has a unique perspective.
During his presentation, he mentioned his son Joshua, a genetic researcher, moved to Nashville for a position at Vanderbilt University, “and he’s not coming back.” A lot of talent has left Louisville since the 1970s. Only now are we seeing that trend reverse.
Chuck also is a member of the Nashville Area Chamber of Commerce. He’s close to Vanderbilt University Chancellor Nick Zeppos and he sees first-hand the progress Nashville is making.
Chuck’s ACG talk touched on a statistical comparison that he’s given before, most recently at the October Real Estate Venture Exchange meeting. In one and only one category is Louisville – a city that not too long ago was the most important in the South – competitive with 17 cohort cities including Indianapolis, Nashville and Raliegh, N.C.
In IT jobs, research, media and publishing, and telecom, Louisville is fifth on the list of 17 in this science, technology, engineering and math, or STEM, sector, which has some of the highest paying jobs. (In the highest paid career sectors such as engineers and architects, Louisville trails the most competitive cities such as Raleigh, which has three major universities including Duke University.)
Last week, Chuck also discussed the new Advantage Louisville studies GLI officials commissioned last year from Atlanta-based consulting firm Market Street Services. Market Street benchmarked Louisville against some of the hottest cities in the nation, including Austin and Nashville.
The good news? “We’re not Cleveland,” Chuck said, which lost 130,000 people over a 10-year period.
The bad news is we trail every other city in the region in important economic-development markers such as STEM jobs. Yet, GLI was paying former president and CEO Joe Reagan more than $300,000 per year along with a supplemental salary amount paid by business leaders to run a chamber with a 40-person staff.
A chamber that lost one-third of its members between 2009 and 2011.
Reagan’s two big victories were bringing P.F. Changs to Louisville along with Jefferson National Financial, which bills itself as “a financial services company,” but in reality sells insurance policies called annuities.
Chuck just touched on the the Market Place report. But he made one curiously revelatory statement:
Focus, consensus and alignment are what we’re all going for. I think the secret sauce for us to is align (economic development) to what the mayor’s doing, to what the university is doing. That’s an editorial comment, by the way.
Chuck went on to say the theoretical goals are in place, but Louisville hasn’t developed an implementation plan: “That’s when you get into the weeds. The implementation plan is the next hardest, and execution is everything. Otherwise, the plan sits on the shelf and is referred to as ‘The Market Street’ report 16 years from now or whatever.”
But an alignment implies a single omnipotent, focused, consensus-building leader for what are now disparate economic-development efforts at GLI, the Greater Louisville Convention and Visitors Bureau, Louisville Downtown Development Corp. and other agencies.
The preface of the latest installment of the Market Street report states this:
A strong and visionary Steering Committee from the public, private, and non‐profit sectors will guide the Advantage Louisville planning process from start to finish. In addition, a group of key regional community leaders and top GLI staff will provide insights and technical expertise at critical points in the development of the Advantage Louisville Strategy.
What if Mayor Greg Fischer took this moment to refocus economic development and chose someone to execute, as Chuck said?
So, we decided to put names out there we’d choose (in lieu of another $30,000 global talent search) to move Louisville forward, aggressively pursuing clearly articulated goals in pursuing the right companies with the right jobs.
And for fun, we’re handicapping the candidates:
• Chuck Denny. An instant game changer. Admired. Respected. Analytical. He could raise money, refine strategy and motivate without breaking a sweat. But there’s the whole issue of having that banking job. And, frankly, as a major GLI donor and board member, Denny did not intervene when it was clear the organization was insolvent. Odds: 100-1.
• Ted Smith, chief, economic growth and innovation at Metro Louisville government. Ted Smith is an unusual amalgam of tech genius and gregarious networker. We’ve seen him directly, deeply connect with rooms full of people, which is a rare trait among the typically introverted tech genius crowd. But can he raise money a la former GLI CEOs Doug Cobb and Steve Higdon? Does he have the quality that our insiders say is most important at econ-dev org/chamber: Salesmanship? A contender, any way you look at it: 1-to-2 odds.
• Which brings us to Doug Cobb, the first GLI CEO. We talked with Doug recently, and when asked, he pulled out the old LBJ saw: “If nominated, I will not run. If elected, I will not serve.” Sounded like “no” to us. But his personal friends say Doug has a sense of civic duty that might override any reluctance to jump into what surely is a politically charged dynamic. Would he come back for one year to revive GLI? Let’s put it this way: We’re giving 5-to-1.
• Cobb’s successor at GLI was Steve Higdon, who came to GLI as an executive on loan from UPS. Steve was probably at least the equal to Cobb in fundraising and building community support for GLI in the name of advancing the city, rather basing support on a quid pro quo of buying access to companies, or to the city’s business elite. Again, this is a guy who has a serious job at QSR Automation. But he may have the same motivation as Cobb to take an interim position to help stop the bleeding. So, we’re paying 5-to-1 odds.
• Kent Oyler is an entrepreneur and civic leader who has the personality and contacts to instantly reverse GLI fortunes. Also, Kent is chairman of EnterpriseCorp, the entrepreneurial side of GLI. (The side that actually works.) Oyler told us Friday an interim position “would be interesting. But on a permanent basis, they need someone with chamber-building experience. Someone who will deal with hard problems.” He could think of several people, he said, “maybe me among them ….” That doesn’t sound like “no.” But other factors make him a long shot including his investments and his day job at OPM Financials. We’ll say 20-to-1.
• Kerry Stemler, the current GLI chairman. We nominate him under the Colin Powell rule of “you broke it, you own it.” Under Stemler’s watch, GLI’s demise accelerated, apparently without the board exercising any sort of oversight. Two issues with him: He has successful businesses to run, and he has a successful business to run in Indiana. Odds are 100-to-1, though Stemler could pay off big as a long-shot interim CEO. And we have no objection to a person with proven leadership skills as well as a regional outlook.
• Mark Crane, the former senior vice president of enterprise development for EnterpiseCorp, has the confidence of Cobb and other community leaders. Crane was instrumental in creating the business plan for Velocity Indiana, the Louisville area’s first seed accelerator. Crane said he’d consider the position “if I talked to people I trust, and they convinced me that I have the skills …that it was in the best interests of the community.” Crane, like Oyler, said GLI needs someone now who knows how to run a chamber. Odds: 20-1.
• Eileen Pickett. From what we’re hearing Pickett, a former top GLI executive and current consultant, is the likely interim. But our sources tell us she’s unlikely to want to be CEO long term because her strength is policy, not public speaking, fundraising and arm twisting. Odds: 1-1.
• Darryl Snyder. A dark horse, but there is no one who works harder at GLI than its VP of economic development, schlepping around prospects and entertaining. A big personality. Like Cobb, Snyder has connections to Louisville businesses and community institutions such as Southeast Christian Church, where a number of CEOs including David Novak are members. But does he want to emerge from behind he scenes?
Finally, here’s our custom job description from 2011 when GLI was trying to replace Reagan:
- Has a realistic understanding of what sort of assistance successful business owners and executives need most from small-city economic-development officials. Where the property parcels are and can be assembled. What the problems are for each area. Does this man or woman have a working relationship with the CBRichard Ellises and TRIOs of the world, the commercial real estate brokerages with the expertise to do deals quickly?
- Has excellent contacts among the big deal maker groups such as Association for Corporate Growth, which has chapters in every major city
- Must have a big, cool friend at each of the big national developers such as RedRock Developments and Commercial Real Estate Advisors.
- Has excellent contacts among the global tech community. Has Erik Brynjolfsson’s number under their iPhone “favorites” star. Or should at least have talked to Rob May about the frustrations that led him to move Backupify out of Louisville.
- Understands finance down to how debt placement works. Should have at least an MBA, and maybe a little time working in high-finance. Oh, and a law degree will get you $50,000 per year extra.
- Must have the ability to work with state government, where the real incentives are. And shouldn’t have a Googleable record of claiming credit for touchdowns when they were actually the water boy.
- Must have the people skills to make every prospective employer considering Louisville think they’re special and loved.
- Must have the ability to sort the wheat from the chaff. We don’t want every company, just the good ones.
- Expects to earn a reasonable amount of money, with realistic performance bonuses. New York State and several large cities such as Baltimore pay their chamber/economic development CEOs half of what Joe Reagan was getting. (We will not say ‘earning,’ because he wasn’t.) And these people are proven stars, making $200,000 per year, not $400,000. Just because Bill Samuels can’t make it on less than $500,000 per year doesn’t mean you‘re going get half-a-mil, Chuck.
- Must know the world doesn’t end at the Oldham County line. That means more than being able to find Dubai on a map. Candidates must have a working understanding of U.S. policy in regards to foreign visitors receiving permanent residence status while investing in American businesses.
- Must work nights and weekends.