Seattle Must Address Key Competiveness Challenges to Become a Leading Medium-Sized Global Economy

SEATTLE, WA--(Marketwired - Oct 24, 2013) -  The greater Seattle region is a sophisticated, diverse, and vibrant international metropolis with the potential to become one of the best medium-sized economies in the world if leaders address core challenges to its competitiveness. This is one of the findings of a recent study presented by The Boston Consulting Group (BCG) at the 2013 Seattle Metropolitan Chamber of Commerce Regional Leadership Conference.

BCG, in partnership with the Seattle Chamber of Commerce, studied the global competitiveness of the greater-Seattle region compared with eight peer regions selected for size and economic profile (San Francisco, Boston, Vancouver, Singapore, Amsterdam, Stockholm, Hamburg, and Melbourne) as part of the broader five-year Global Cities Initiative sponsored by JPMorgan Chase and the Brookings Institute. BCG assessed Seattle and peer city regions using its global competitiveness framework, which includes more than 50 metrics across five broad drivers that BCG believes are good predictors of future city-region competitiveness. BCG also identified a set of imperatives for any city region looking to drive future competitiveness. 

"Seattle starts from a position of strength, and its future is quite bright," said John Wenstrup, a Seattle-based partner at BCG and coauthor of the study. "However, regional leaders know there are issues to address. Thankfully, there appears to be a groundswell of support among area leaders in both business and government to overcome emerging challenges to the region's competitiveness in areas like education, infrastructure, and global brand."

Five Drivers of Global City-Region Competitiveness

Working with a set of economic and development experts, BCG has identified the following five drivers of regional economic competitiveness:

• Human Capital. A city region must be able to generate, attract, and retain high-quality human talent. Talent drives innovation, enables growth, ensures adaptability, and is the single most important ingredient in long-term regional competitiveness.
  
  
• Business Environment. It is necessary to have a robust and diverse economic base supported by a reliable regulatory and institutional environment with low direct and frictional costs. 
  
  
• Capital and Innovation Ecosystem. The region needs entrepreneurial activity -- and the financial institutions required to spur entrepreneurship -- in order to create new areas of competitive advantage and to renew existing industries.
  
  
• Global Connectedness. It is essential to have a strong presence and influence in global markets related to goods, services, information, and talent.
  
  
• Infrastructure. A city region needs the ability to support sustainable regional growth with cohesive local transportation systems, high-speed communications, and basic services.
  
  

Competiveness Imperatives

Compared with its eight peer cities, Seattle ranks fifth in overall competitiveness. The most significant challenges to Seattle's future competitiveness are emerging gaps in education; the growing shortage of skilled science, technology, engineering, and mathematics (STEM) workers; the reliance of regional employment on a few large companies; limited global connectedness; and the growth-limiting impact of transportation gridlock.

Perhaps more pressingly, Seattle faces the broader challenge of how to move forward. Many of the issues raised during BCG's interviews with local leaders and highlighted by the benchmark study are well known to Seattle-area residents. Yet action is still elusive. To move forward, the study recommends that leaders in the greater Seattle region pivot their focus toward coordinated action. BCG has identified five competitiveness imperatives that Seattle-region leaders must address to make sustained progress:

• A Regional Vision and Strategy for the Future. Leaders must develop a coordinated private-public strategy that cuts across city and municipal boundaries and tackles regional issues such as transportation, education, and growth.
  
  
• Strong Leadership with the Ability and Courage to Make Tough Decisions. Effective leadership requires prioritization and direct action. With limited resources and time, leadership must be willing to make decisions that will be unpopular with some interest groups and constituents.
  
  
• Active Engagement in Shaping the Region's Future. Business leaders must take an active role in addressing regional issues through direct political engagement and strong business-led organizations. They must identify opportunities to build cross-business partnerships and invest in setting the regional agenda.
  
  
• Active Management of the Talent Pipeline. The area needs to build, attract, and retain the best human capital by investing in K-12 and university education and ensuring that the number of STEM graduates meets the growing needs of local businesses. Build private-public outreach programs to attract the best domestic and international talent.
  
  
• Targeted Engagement with the Global Business Community. Leaders must create a compelling global brand for the Seattle region. This includes investing in programs and incentives that promote emerging regional businesses internationally and encourage foreign investment in the region.
  
  

The fluid nature of international business requires that city regions proactively manage their global competitiveness in order to secure and build economic prosperity. "As the home to notable Fortune 500 companies, a thriving innovation engine, and cutting-edge advanced manufacturing, Seattle is a medium-sized economy with all the prerequisites to effectively compete on the global stage," concludes study coauthor Joel Janda.

For more information about this study or to arrange an interview with the authors, please contact Eric Gregoire at +1 617 850 3783 or gregoire.eric@bcg.com.

About The Boston Consulting Group
The Boston Consulting Group (BCG) is a global management consulting firm and the world's leading advisor on business strategy. We partner with clients from the private, public, and not-for-profit sectors in all regions to identify their highest-value opportunities, address their most critical challenges, and transform their enterprises. Our customized approach combines deep insight into the dynamics of companies and markets with close collaboration at all levels of the client organization. This ensures that our clients achieve sustainable competitive advantage, build more capable organizations, and secure lasting results. Founded in 1963, BCG is a private company with 78 offices in 43 countries. For more information, please visit bcg.com.