sense of order to any ambiguity you face . They can help you with your planning and your responses .
One framework that can be used to think through the complexity and uncertainty is the PESTEL framework . It ’ s a strategic tool that is used to understand macroenvironmental factors . And for the context before us , we can further develop our understanding of the macro-environment by asking the question : “ what seems to be happening ” ( not the more concrete “ what is happening ?”, but rather the more open “ what seems to be happening ?”).
Thus , the first set of questions are :
1 . P - What seems to be happening in the political world ?
2 . E - What seems to be happening economically ?
3 . S - What seems to be happening in society ?
4 . T - What seems to be happening in the arena of technology ?
5 . E - What seems to be happening to the environment ?
6 . L - What seems to be happening with the law ?
Legal
Environment
Political
Local Economy
Technology
Fig 1 . The PESTEL Framework
Economic
Social
Answers to these questions will help you to start laying the foundations for long term success . Through the responses gathered you will start to discover different ways the future may unfold for your local economy . There may even be ideas that surface that are uncomfortable , that are challenging . On the other hand , you may discover opportunities and possibilities that release local potential .
The second framework to use is a PBA framework ( PBA = place-based approach ; discussed in detail in the following section ). We can use a PBA framework to categorise economic development activity . And , in a similar fashion to how we used the PESTEL framework to understand the macroenvironment we can use a similar question to outline potential place-based economic development activities .
The question to be used for the second framework is this : “ what might we need to do ?” ( not the more pedantic “ what will we need to do ?”). The form of this question invites discussion about a range of potential actions . By using the responses from the first set of questions as inputs to the second set , you can start to form a view of what could be done for your unique locale . Used together , these questions help with surfacing a range of ideas for a plan ’ s strategic objectives .
And so , the second set of questions are :
1 . What might we need to do with respect to the business ecosystem ?
2 . What might we need to do with respect to entrepreneurship and innovation ?
3 . What might we need to do with respect to local institutions ?
4 . What might we need to do with respect to external stakeholders ?
Answers to these questions will start to strengthen the foundations laid from the answers to the first set of questions . This second set of questions will help you to develop , or renew , a vision for what could be . They will help you develop a strategic plan that is based on what could be , rather than what has been . About handling future uncertainties rather than responding to the challenges of the past .
DESIGNING YOUR PLACE-BASED ECONOMIC DEVELOPMENT STRATEGY Fabrizio Barca , who played an influential role in reforms to the European Union ’ s Regional Cohesion Policy over ten years ago had this to say about place-based economic development strategy :
Business Ecosystem
Local Economy
Entrepreneurship and Innovation
Fig 2 . The Pillars of Place-based Economic Development Strategy
“ It is a long-term development strategy whose objective is to reduce persistent inefficiency ( underutilisation of the full potential ) and inequality ( share of people below a given standard of well-being and / or extent of interpersonal disparities ) in specific places ”.
He stated that the factors of place-based policies are an integrated set of goods and services tailored to a specific context . Where the set of factors either originate in the local economy ( endogenous ) or are external to it ( exogenous ). Where the outcomes from the policies should : improve the productivity of business and the quality of life , strengthen formal and informal institutions , and should promote entrepreneurship and innovation . And where non-local bodies should improve their knowledge of the local economy and its preferences , its nuances and its linkages with other economies .
Although there are many other practitioners and academics who have much to say about place-based economy development strategy , the common thread to all discussions are these four factors :
- The business ecosystem ( e . g . workforce development , business attraction , regulations , etc )
- Entrepreneurship and innovation ( e . g . new businesses , new products , startup culture )
- Local institutions ( e . g . local government , business groups , networking events ) - External stakeholders ( e . g . higher levels of government , industry and special interest groups )
It ’ s all about mobilising the locale ’ s potential .
So far so good . We have seen that in order to navigate complexity and uncertainty it is good to use a structured approach . Where we ask sets of open questions to do two things : 1 . help make sense of the dynamic macro-environment ; and 2 . bring direction to our emerging responses .
Local Institutions
External Stakeholders
VOL 14 NO 1 2020 12 www . edaustralia . com . au