Industry Featured Articles

By Dennis J. Donovan, Wadley Donovan Gutshaw Consulting

This article addresses the locational dynamics associated with high technology. While the focus is on the U.S., observations for the global scene are provided as well.  At the outset, a definition of the classic high-tech sector is provided. This includes strategic drivers that shape site searches for high-tech. Next we look at geographic concentrations of high technology. This is followed by a listing of factors of importance to high technology operations.

Definition
There is no widely accepted definition of the term. But drawing from several sources, one or a combination of the following would comprise a high-tech entity:

• Manufacturing process involving either a heavy engineering content or an above average proportion of revenue devoted to R&D
• R&D labs/centers of excellence
• Any business that employs an above average proportion of scientists and engineering (including IT)

Communities that want to attract freight facilities should examine themselves as corporate site selectors do before engaging in a full-scale business recruitment process. If a community is going to successfully compete in attracting a freight facility, it is to its advantage to understand what needs a company is seeking to satisfy and what kind of criteria they will use to select a site. What are the key things a planner, economic development strategist, or elected official should know to develop potential or develop competitive advantage for a good freight facility project?

Freight facilities will only consider locations that fulfill the primary objective of moving goods in the most efficient manner from point of origin to destination. This trumps most other considerations. Companies and carriers rarely base location decisions on personal relationships, government incentives, or regional promotions. These factors are only a consideration after a location meets the required criteria for the business to be successful. Local officials can make their communities more attractive to freight facilities by providing a hospitable climate through appropriate zoning, compatible land use, transportation infrastructure, and community support. When companies evaluate sites, some criteria are far more important than others. The ability to access key markets, availability of efficient transportation, sufficient qualified labor, and total costs are considered key criteria. Proximity and/or access to markets is the most important driving factor that determines the region or community in which a freight facility will locate.