Local Economic Development
readiness
LED MATURITY ASSESSMENTS
FINDINGS, INSIGHTS AND IMPLICATIONS
11 JUNE 2013
JOHN LAWSON
Structure of presentation
Our perspective on what LED is
LED maturity assessments
1.
2.





3.
4.
5.
What is it?
Who is behind it?
How does it work?
Municipal benefits?
Provincial benefits?
Observations about differing LED readiness. Consequences of state of
readiness.
Improvements observed – fast learners, slow learners, degenerates & why
differences
Factors found to be most critical to success
Unintended consequences of decisions that perpetuate poverty
Local Economic Destruction
A mayor of a town dependant on high level income property investors decided to relocate
the squatters right next door to high income property development – within one week,
10%+ investors disinvested, sales slumped and growth was stifled.
A Mayor of a Metro instructed his officials to establish non-sustainable urban farming
project in prime development area of a township centre. High density housing instead
would provide the economic impetus the township centre requires.
A Metro councillor championed the removal of the successful ICT FET college out of a
vibrant ICT cluster, and relocated it to a township. The College failed, and the locational
advantage was lost.
The Municipal Manager and Head of Technical Services of a Metro denied a request by
LED unit to provide an access road to a sound property development that could have
resulted in +100 jobs, because it was not planned for execution at that stage.
A small town almost loses 60% of their economy because they don’t change light bulbs.
National government department chases investment targets …..
Great LED work goes unnoticed, unrecognised

Mere intuition from LED facilitator introduces a particular local business to an Indian
investor that was merely looking for premises to establish foothold in Africa. Net result
that SA business becomes instant distribution network into Africa for Indian firm. Indian
firm becomes distributor for local business into South-east Asian markets.



+- R240 million p.a. GGP contribution & +40 jobs
Took LED facilitator only 2 hours
LED facilitator and MM convince Water Affairs to raise dam wall in arid area.
Substantial agriculture sector to expand by 30 – 40 %.

but result only visible 7 years later
Our take on LED
Stakeholders cooperate to improve the economy to benefit society:
 Initiatives that improve the economy (pro-active)
 Reduction of damage to economy (unintended consequences )
 Utilise (don’t waste) opportunities that knock-on-the-door (reactive)
Our perspective of LED
 Based on international good practice,
specifically on the work by Jorg Meyer-Stamer & Gabriele Trah
Key concepts:
 LED asset: motivated stakeholders, not just “economic potentials”
 Places differ, so bottom-up approach
 Locals must drive sustained improvement
 Requires new competencies
 Mobilising private sector and public sector cooperation
 Strict market- and business-orientation.
Structure of presentation
Our perspective on what LED is
LED maturity assessments
1.
2.





3.
4.
5.
What is it?
Who is behind it?
How does it work?
Municipal benefits?
Provincial benefits?
Observations about differing LED readiness. Consequences of state of
readiness.
Improvements observed – fast learners, slow learners, degenerates & why
differences
Factors found to be most critical to success
The Assessment Tool

Endorsed by e.g.
 120+ municipalities benchmarked across 7 provinces
 Currently in its 5 cycle of refinement
Purpose of LED Maturity Assessments
Before we make assumptions, let’s measure to determine what is already in place……
The “LED Maturity Assessment” is a practical way to
rapidly assess/ benchmark (in 3 hours)
the state of maturity of a municipality
in the field of local economic development.
Rationale:
Systematic
LED maturity
assessment
Sound LED
capacity and
practices in
localities
Local economies
improve
Poverty is
reduced
Municipal & Tax
revenues increase
LED maturity assessments look for “LED systems” capacity
Performance
Development
of sustained Local / Region
multi-stakeholder
capacity to
execute LED LED system
Institutional
Municipal
Development
LED system
Human
Resource
Teams /
Development (e.g.LED unit)
Individual
roles
LED process
integration
across various
organisations
Municipal process
Integration skills
Functional
unit skills
Individual skills,
role dependant
Competencies
LED Framework: Systems perspective
Local
society
LED Leadership &
governance
LED
system
facilitation
system
Local
economy
Local Economic
Development
(LED) system
LED Framework: “Picture on the jig-saw puzzle”
Value of the economy to citizens:
Sustainability and growth
of investment returns,
jobs, income levels,
cost of living and
tax revenues
Local
society
Leaders invest
in LRED
cooperation,
efficacy &
good
governance
LED
Leadership &
LED
governance facilitation
system
system
LRED experts
establish systems
to facilitate processes
of economic development
Private sector competitiveness:
Ability of key sectors to
retain and grow
market share.
Efficacy of local
markets
Local
economy
Local Economic Stakeholders champion
initiatives which unlock
Development
new opportunities
(LED) system
in the economy
Stakeholders
participate in
LRED processes and
contribute insight,
ideas and resources.
Local
Start state
society
Point of leverage #8: Elect good leaders who
know what to do and how to get LED results
Leaders invest
in LRED
cooperation,
efficacy &
good
governance
LED leadership
& governance
system
LED
facilitation
system
LRED experts
establish systems
to facilitate processes
of economic development
Point of leverage # 2: Focus resources
on areas with best prospects for success
End state
Value of the economy to citizens:
Sustainability and growth
of investment returns,
jobs, income levels,
cost of living and
tax revenues
Value addition / Impact chain
Private sector competitiveness:
Ability of key sectors to
retain and grow
market share.
Efficacy of local
markets
Local
economy
Point of leverage #4: Utilise the good opportunities
Point of leverage #6: Mobilise an
“army” of stakeholders
Points of leverage
LED
system
Stakeholders
participate in
LRED processes and
contribute insight,
ideas and resources.
Stakeholders champion
initiatives which unlock
new opportunities
in the economy
33 Critical Success Factor questions
Weight
1 Insight and Strategy
1.1 Shared vision and focus
Social context: Status and trends understood
LED focus
1.2 Understanding the local economy
A good place for business
Competitiveness of key sectors
Key local markets
Business environment
Inter-firm effort to improve and cooperate
Competitive location for key sectors / clusters
Economic, political and regulatory framework conditions
Development orientation of local society
Good place to live
Good place for the poor to access economic opportunity
Good for the environment
1.3 Strategic decision making
Reliable planning process / methodology
Smart selection of interventions
Alignment to leverage support, power and resources
Follow-through to implementation
100%
10%
5%
5%
60%
5%
10%
8%
5%
5%
5%
2%
5%
5%
5%
5%
30%
10%
10%
5%
5%
33 Critical Success Factor questions (continued)
2 Ability to Execute
2.1 Municipal service delivery proficient
Utilisation of municipal resources
Municipal ability to execute
2.2 Public- and Private-sector champions implement LED initiatives
LED results to date
Process of LED initiative implementation
Organisation of capacity to implement LED initiatives
Leveraging more resources for LED implementation
2.3 Stakeholders participate and contribute to sound LED decisions
Results achieved from stakeholder participation to date
Processes of stakeholder contribution to LED decision making
Organisation of stakeholder contribution to LED decision making
2.4 Facilitate LED
LED facilitation process
Organisation of capacity to facilitate LED
What resources are available for LED facilitation
2.5 Governance of LED by business and political leaders
Results of LED governance
Process of LED Governance
Organisation of LED Governance Capacity
Learning to do LED better
100%
20%
10%
10%
20%
5%
5%
5%
5%
20%
7%
7%
6%
20%
8%
7%
5%
20%
5%
5%
5%
5%
How does the assessment process work?
 Information gathered by interviewing the chief LED decision makers in a
municipality:

Mayor, LED portfolio councillor, Municipal Manager, Head of Development Planning, Head of
LED (Ideally also: all heads of departments, Leaders of business Chambers)
 The belief is that LED success depends ultimately on the way these leaders
make decisions. If strategy and planning documents are taken seriously, they
inform decisions.
 33 carefully designed questions probe progress on the LED learning curve. The
tool explores the factors most critical to success in LED
The Assessment Scale (0 – 5)
The assessment scale guidelines are based on assessing progress down a
learning curve on each topic. Six key milestones have been chosen on
this learning curve, and are listed below:
0. Don’t know, don’t care about.
1. Aware of need to.
2. + Trying something.
3. + Now know what to do and how.
4. + Now starting to do the right things.
5. Consistently performing = excellence, best practice.
0/5
1/5
2/5
3/5
4/5
5/5
Structure of presentation
Our perspective on what LED is
LED maturity assessments
1.
2.





3.
4.
5.
What is it?
Who is behind it?
How does it work?
Municipal benefits?
Provincial benefits?
Observations about differing LED readiness. Consequences of state of
readiness.
Improvements observed – fast learners, slow learners, degenerates & why
differences
Factors found to be most critical to success
Overall Performance: Result compared to previous year results
Theewaterskloof
LED Maturity
Stellenbosch
5
Mosselbay
Eden
Oudtshoorn
Leading
Academic
4
Langeberg
Knysna
George
Insight & Strategy ....
West Coast
Cape Winelands
Confidential
Swartland
Promising
3
Overstrand
Breede Valley
Saldanha
Cape Aghulas
2
Matzikama
Laingsburg
Hessequa
Committed
1
Bitou
Witzenberg
Emerging
Central Karoo
Prince Albert
Bergrvier
Drakenstein
0
0
1
2
3
Ability to Execute
4
5
Beaufort West
Kannaland
Overberg
Nov 2012
Cape Town Metro
LED Maturity
Theewaterskloof
5
Mosselbay
Leading
Swartland
Breede Valley
2
4
Insight & Strategy ....
Matzikama
Position
vs other
George
Academic
Eden
West Coast
12
Promising
Drakenstein
Cape Winelands
3
Stellenbosch
Oudtshoorn
8
Knysna
Overstrand
Saldanha
2
Cape Aghulas
Witzenberg
4
1
Bitou
Committed
Hessequa
Emerging
Laingsburg
Bergrvier
3
Langeberg
Prince Albert
Central Karoo
0
0
1
2
3
Ability to Execute
4
5
Cederberg
Kannaland
Beaufort West
Overberg
Performance in Key Areas
Shared vision and focus
5.0
Learning to do LED
better
4.0
Understanding the local
economy
3.0
Governance of LED by
business & political
leaders
2.0
1.0
Strategic decision making
-
Municipal service delivery
proficient
Facilitate LED
Stakeholders participate &
contribute to sound LED
decisions
Public- & Private-sector
champions
implement LED initiatives
Nov 2012
Learning priorities
 Formalise LED governance structures and processes
 Participatory planning processes – e.g. PACA.

Clarify unique competitive advantage

Identify initiatives to strengthen this further
Municipal Feedback
 Face to face presentation to leadership next day
 Findings and preliminary recommendations
 Individualised confidential report
 Findings and preliminary recommendations
 Includes who they can learn from
 Face to face cross learning events
Structure of presentation
Our perspective on what LED is
LED maturity assessments
1.
2.





3.
4.
5.
What is it?
Who is behind it?
How does it work?
Municipal benefits?
Provincial benefits?
Observations about differing LED readiness. Consequences of state of
readiness.
Improvements observed – fast learners, slow learners, degenerates & why
differences
Factors found to be most critical to success
Year to year improvements
Year 1
Year 2
Var
.
Strong
1
2
+1
Functional
5
12
+7
Progressing
11
8
-3
Weak
8
4
-4
Dysfunctional
2
3
+1
Year 1
Year 2
Theewaterskloof
LED Maturity
Stellenbosch
5
Mosselbay
Cape T
LED Maturity
Theewa
5
Mosselb
Eden
1
Oudtshoorn
5
Matzika
Eden
George
George
West Coast
Promising
Swartland
3
Overstrand
2
Draken
Cape W
3
Stellenb
Oudtsh
8
Breede Valley
11
West C
12
Promising
Cape Winelands
Insight & Strategy ....
Insight & Strategy ....
Breede
Academic
4
Knysna
Swartla
2
Langeberg
Leading
Academic
4
Leading
Cape Aghulas
Knysna
Saldanha
Overstr
Matzikama
Saldanh
2
Cape A
Laingsburg
8
1
Witzenb
Hessequa
Committed
4
Bitou
Witzenberg
Emerging
Central Karoo
2
1
Bitou
Committed
Hesseq
Emerging
Prince Albert
Laingsb
Bergrvie
3
Langeb
Bergrvier
Prince A
Drakenstein
0
0
1
2
3
Ability to Execute
4
5
Beaufort West
Kannaland
Overberg
0
Central
0
0
1
2
3
Ability to Execute
4
5
Cederb
Kannala
Beaufor
Overbe
Strengths and weaknesses
Shared
Under
Munic
vision
standing
pality
and
the local
focus
economy
Public- &
Strategic
decision
making
Municipal
Private-sector
service
champions
delivery
implement
proficient
LED
initiatives
1
2
3
4
5
6
7
8
9
10
11
12
Municipality
names 13
14
confidential
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
5%
4.5
4.3
4.3
4.3
4.0
4.5
3.3
4.0
3.8
4.5
4.3
4.3
4.3
3.0
3.5
3.5
3.5
3.0
2.3
3.3
3.8
2.8
2.3
2.3
2.0
1.0
1.5
1.0
1.3
30%
4.2
4.1
3.9
4.3
3.6
3.5
3.4
3.5
3.2
3.5
3.7
3.5
3.8
3.2
3.3
3.0
1.9
2.4
2.4
2.8
2.3
1.9
1.6
1.2
0.9
0.5
0.9
0.8
0.8
15%
4.3
4.4
3.8
3.5
3.9
4.3
3.7
4.0
3.8
3.8
3.4
3.6
3.4
3.3
2.7
2.3
2.6
1.9
2.8
2.1
2.8
2.4
1.8
1.7
1.9
1.1
0.9
0.8
-
10%
4.5
3.5
5.0
5.0
2.3
3.5
4.5
3.5
5.0
3.5
4.0
2.5
2.5
4.0
5.0
2.5
2.3
4.0
3.5
4.5
3.5
4.3
3.5
3.5
0.8
1.5
0.3
2.5
-
10%
4.5
4.5
3.8
4.3
4.3
4.1
4.3
3.3
2.6
3.5
2.3
4.4
2.1
3.0
1.5
2.5
3.8
2.4
3.8
1.0
2.3
2.0
2.3
1.1
1.5
2.0
1.8
0.9
-
Stakeholders
Governance
participate &
of LED by
contribute to
sound LED
Facilitate
LED
decisions
10%
4.5
3.7
3.5
2.7
4.9
3.8
3.4
3.3
2.7
3.2
2.7
2.2
3.0
2.4
1.4
2.9
2.5
2.3
2.5
1.7
2.0
2.0
1.4
1.3
0.5
1.5
0.3
0.2
business &
political
leaders
10%
4.4
4.3
3.8
4.2
3.4
3.9
2.8
3.1
3.2
2.7
3.4
3.1
2.8
2.7
2.2
3.0
3.0
2.8
2.5
2.0
2.3
2.0
2.0
1.7
1.3
2.0
1.7
0.1
0.5
8%
4.0
4.5
4.0
2.3
2.5
0.9
2.5
2.6
2.1
1.4
1.4
1.6
2.0
2.0
1.1
1.5
2.5
2.0
2.4
2.5
1.0
0.6
0.9
0.9
0.6
0.5
0.1
Learning
to do
LED
better
3%
3.5
4.0
4.0
2.0
0.5
0.5
3.0
3.0
0.5
0.5
0.5
0.5
4.0
4.0
0.5
0.5
1.0
0.5
2.0
3.0
1.0
0.5
0.5
0.5
0.5
0.5
0.5
DEDAT objectives
The objectives of assessment of LED capacity is to:
 Identify and highlight cases of sound LED practices,
 Identifying gaps at municipal level,
 Enable municipalities to identify areas for improvement, and
 Establish a structured pattern of support to improve LED practices.
Systematic
LED maturity
assessment
Sound LED
capacity and
practices at
localities
Local economies
improve
Poverty is
reduced
Municipal & Tax
revenues increase
Structure of presentation
Our perspective on what LED is
LED maturity assessments
1.
2.





3.
4.
5.
What is it?
Who is behind it?
How does it work?
Municipal benefits?
Provincial benefits?
Observations about differing LED readiness. Consequences of state of
readiness.
Improvements observed – fast learners, slow learners, degenerates & why
differences
Factors found to be most critical to success
Cape Town Metro
LED Maturity
Theewaterskloof
5
Mosselbay
Leading
Swartland
Breede Valley
Clusters of
differing
levels
Eden
of maturity
George
West
Coast
/ readiness
2
Academic
4
Insight & Strategy ....
Matzikama
12
Promising
Drakenstein
Cape Winelands
3
Stellenbosch
Oudtshoorn
8
Knysna
Overstrand
Saldanha
2
Cape Aghulas
Witzenberg
4
1
Bitou
Committed
Hessequa
Emerging
Laingsburg
Bergrvier
3
Langeberg
Prince Albert
Central Karoo
0
0
1
2
3
Ability to Execute
4
5
Cederberg
Kannaland
Beaufort West
Overberg
Structure of presentation
Our perspective on what LED is
LED maturity assessments
1.
2.





3.
4.
5.
What is it?
Who is behind it?
How does it work?
Municipal benefits?
Provincial benefits?
Observations about differing LED readiness. Consequences of state of
readiness.
Improvements observed – fast learners, slow learners, degenerates & why
differences
Factors found to be most critical to success
Fast learners – typically have good leadership in place, utilise good practice quickly
Theewaterskloof
LED Maturity
Stellenbosch
5
Mosselbay
Eden
Oudtshoorn
Leading
Academic
4
Langeberg
Knysna
George
Insight & Strategy ....
West Coast
Cape Winelands
Confidential
Swartland
Promising
3
Overstrand
Breede Valley
Saldanha
Cape Aghulas
2
Matzikama
Laingsburg
Hessequa
Committed
1
Bitou
Witzenberg
Emerging
Central Karoo
Prince Albert
Bergrvier
Drakenstein
0
0
1
2
3
Ability to Execute
4
5
Beaufort West
Kannaland
Overberg
Nov 2012
X
Slow learners – not open to learning, leaders not really committed to LRED performance
LED Maturity
5
Insight & Strategy ....
Leading
Academic
4
Promising
3
2
Committed
1
Emerging
0
0
1
2
3
Ability to Execute
4
5
Theewaterskloof
Stellenbosch
Mosselbay
Eden
Oudtshoorn
Langeberg
Knysna
George
West Coast
Cape Winelands
Confidential
Swartland
Overstrand
Breede Valley
Saldanha
Cape Aghulas
Matzikama
Laingsburg
Hessequa
Bitou
Witzenberg
Central Karoo
Bergrvier
Drakenstein
Beaufort West
Kannaland
Overberg
Nov 2012
Degeneration: Change of leaders, unconscious incompetence
- organisation memory purged
X
Theewaterskloof
LED Maturity
Stellenbosch
5
Mosselbay
Eden
Oudtshoorn
Leading
Academic
4
Langeberg
Knysna
2008
George
Insight & Strategy ....
West Coast
Cape
Winelands
Confidential
Cederberg 2008
Promising
3
Overstrand
Breede Valley
Saldanha
Cape Aghulas
2
Matzikama
Laingsburg
Hessequa
Committed
1
Bitou
Witzenberg
Emerging
Central Karoo
Prince Albert
2012
Bergrvier
Drakenstein
0
0
1
2
3
Ability to Execute
4
5
Beaufort West
Kannaland
Overberg
Nov 2012
Structure of presentation
Our perspective on what LED is
LED maturity assessments
1.
2.





3.
4.
5.
What is it?
Who is behind it?
How does it work?
Municipal benefits?
Provincial benefits?
Observations about differing LED readiness. Consequences of state of
readiness.
Improvements observed – fast learners, slow learners, degenerates & why
differences
Factors found to be most critical to success
Insight after benchmarking LED at 120 municipalities
The three most common determinants of success from the data are:
• LED leadership and governance,
• LED facilitation and
• a participatory approach.
New when we found this in 2008. In hindsight is hardly rocket science.
LED results = F(Governance)
LED results = F(Participatory approach)
LED results = F(facilitation)
5
5
5
R² = 0.7613
R² = 0.5093
R² = 0.7602
4
4
4
3
3
2
2
2
1
1
1
0
3
0
0
0
1
2
3
4
5
0
1
2
3
4
5
0
1
2
3
4
5
Evidence of causality in four layer model of LED system capacity
LED outcomes:
The economy improves
Pearson
0.82
R squared
67%
Improved
understand
ing of the
economy
Pearson
0.79
R squared
62%
Improved
strategic
decision
making
Pearson
0.79
R squared
62%
Stakeholders improve the economy
Pearson
0.77
R squared
59%
Pearson
0.85
R squared
72%
Stakeholders participate in and
contribute to decision making
Pearson
0.85
R squared
72%
Facilitation
Pearson
0.73
R squared
54%
Pearson 0.79
R squared 63%
Pearson 0.75
R squared 56%
Governance & Leadership
Pearson correlation
R squared
Pearson product moment correlation: the degree of linear relationship between two variables. 1=perfect, 0=nil
Correlation coefficient squared (R squared) - the proportion of the variance in y attributable to the variance in x
Theewaterskloof
LED Maturity
Stellenbosch
5
Mosselbay
Eden
Oudtshoorn
Leading
Academic
4
Langeberg
Knysna
LED success is very unlikely whilst LED
leadership and governance is not effective.
George
Insight & Strategy ....
West Coast
Promising
Cape Winelands
Swartland
3
Overstrand
Breede Valley
Cape Aghulas
Saldanha
2
Matzikama
Laingsburg
Many leaders:
- still don’t take LED seriously
- don’t understand why they should, what
LED is and how to fulfil their role
Hessequa
Committed
1
Bitou
Witzenberg
Emerging
Central Karoo
Prince Albert
Bergrvier
This is the single most critical issue, which
can be rectified systematically if there is will.
Drakenstein
0
0
1
2
3
4
5
Beaufort West
Kannaland
Overberg
Ability to Execute
0
LED Leadership and Governance
5
4
3
2
1
0
Municipal names confidential
Questions?
Dominant themes emerging
from the LED readiness work
and their implications for UKZN
Structure of presentation
1.
2.
3.
4.
5.
6.
7.
8.
9.
Value of strategies not implemented? Reasons for?
Most common pitfalls
Why do we repeat the same errors so often?
Importance of: LED leadership & governance
Shifting development thinking and behaviors
Support measures: Keeping things simple. Getting the basics right. Systematize.
Invisibility of LED value addition
Managing stakeholder expectations
Regional integration
Structure of presentation
1.
2.
3.
4.
5.
6.
7.
8.
9.
Value of strategies not implemented? Reasons for?
Most common pitfalls
Why do we repeat the same errors so often?
Importance of: LED leadership & governance
Shifting development thinking and behaviors
Support measures: Keeping things simple. Getting the basics right. Systematize.
Invisibility of LED value addition
Managing stakeholder expectations
Regional integration
LED strategies not being implemented
 < 10% of LED strategies implemented in SA. Why?
 What is the value of strategy not implemented?
 Where is the problem – implementation or planning?
Identifying economic potentials without

competence to make it happen, or

funding required
= wish list
Structure of presentation
1.
2.
3.
4.
5.
6.
7.
8.
9.
Value of strategies not implemented? Reasons for?
Most common pitfalls
Why do we repeat the same errors so often?
Importance of: LED leadership & governance
Shifting development thinking and behaviors
Support measures: Keeping things simple. Getting the basics right. Systematize.
Invisibility of LED value addition
Managing stakeholder expectations
Regional integration
Common pitfalls















LED perceived as silly, unsustainable projects
Lip service commitment to LED
Unconscious, incompetent leadership. Think they know.
Spatial- or Social-development approaches
Subordinating LED to Spatial- or Social-development
Focussing work directly on the poor
Government trying to do LED without the private sector
Top down planning / 2040 master plans …..
Leaders pulling in opposing directions
Trying to do too much . .. . . Not saying NO to distractions
Experts to save the day / poor participatory approach
Consultants deliver pretty plans, instead of changing behaviours
Identifying economic potentials without anybody to make it happen, or funding required
= wish list
Opportunities wasted – due to slow responses, gatekeeping, poor decisions
Promises not kept / expectations not matched  mistrust
Structure of presentation
1.
2.
3.
4.
5.
6.
7.
8.
9.
Value of strategies not implemented? Reasons for?
Most common pitfalls
Why do we repeat the same errors so often?
Importance of: LED leadership & governance
Shifting development thinking and behaviors
Support measures: Keeping things simple. Getting the basics right. Systematize.
Invisibility of LED value addition
Managing stakeholder expectations
Regional integration
Strengths and weaknesses
Shared
Under
Munic
vision
standing
pality
and
the local
focus
economy
Public- &
Strategic
decision
making
Municipal
Private-sector
service
champions
delivery
implement
proficient
LED
initiatives
1
2
3
4
5
6
7
8
9
10
11
12
Municipality
names 13
14
confidential
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
5%
4.5
4.3
4.3
4.3
4.0
4.5
3.3
4.0
3.8
4.5
4.3
4.3
4.3
3.0
3.5
3.5
3.5
3.0
2.3
3.3
3.8
2.8
2.3
2.3
2.0
1.0
1.5
1.0
1.3
30%
4.2
4.1
3.9
4.3
3.6
3.5
3.4
3.5
3.2
3.5
3.7
3.5
3.8
3.2
3.3
3.0
1.9
2.4
2.4
2.8
2.3
1.9
1.6
1.2
0.9
0.5
0.9
0.8
0.8
15%
4.3
4.4
3.8
3.5
3.9
4.3
3.7
4.0
3.8
3.8
3.4
3.6
3.4
3.3
2.7
2.3
2.6
1.9
2.8
2.1
2.8
2.4
1.8
1.7
1.9
1.1
0.9
0.8
-
10%
4.5
3.5
5.0
5.0
2.3
3.5
4.5
3.5
5.0
3.5
4.0
2.5
2.5
4.0
5.0
2.5
2.3
4.0
3.5
4.5
3.5
4.3
3.5
3.5
0.8
1.5
0.3
2.5
-
10%
4.5
4.5
3.8
4.3
4.3
4.1
4.3
3.3
2.6
3.5
2.3
4.4
2.1
3.0
1.5
2.5
3.8
2.4
3.8
1.0
2.3
2.0
2.3
1.1
1.5
2.0
1.8
0.9
-
Stakeholders
Governance
participate &
of LED by
contribute to
sound LED
Facilitate
LED
decisions
10%
4.5
3.7
3.5
2.7
4.9
3.8
3.4
3.3
2.7
3.2
2.7
2.2
3.0
2.4
1.4
2.9
2.5
2.3
2.5
1.7
2.0
2.0
1.4
1.3
0.5
1.5
0.3
0.2
business &
political
leaders
10%
4.4
4.3
3.8
4.2
3.4
3.9
2.8
3.1
3.2
2.7
3.4
3.1
2.8
2.7
2.2
3.0
3.0
2.8
2.5
2.0
2.3
2.0
2.0
1.7
1.3
2.0
1.7
0.1
0.5
8%
4.0
4.5
4.0
2.3
2.5
0.9
2.5
2.6
2.1
1.4
1.4
1.6
2.0
2.0
1.1
1.5
2.5
2.0
2.4
2.5
1.0
0.6
0.9
0.9
0.6
0.5
0.1
Learning
to do
LED
better
3%
3.5
4.0
4.0
2.0
0.5
0.5
3.0
3.0
0.5
0.5
0.5
0.5
4.0
4.0
0.5
0.5
1.0
0.5
2.0
3.0
1.0
0.5
0.5
0.5
0.5
0.5
0.5
Why do we repeat errors so often?

LED is a new competency not yet established properly

Leaders do not know what they do not know – force poor practices

Spatial development paradigms dominate

No command control like in institutions, only influence

New batch of political leaders every 5 years

Appoint persons who have never succeeded before

Poor practices promoted from the top

Policy often formulated by persons who have never succeeded in LED themselves
Capacity building support seldom address the root causes
 We don’t measure systematically and learn from mistakes


Don’t want to make our errors visible

Inability to see which parts of LED work and which cause failures
Education & training fails to match the actual work in the field
 Partial solutions, not holistic, not sustainable
 No management of institutional memory.
 As soon as LED facilitators succeed well, they move to a better job.

Structure of presentation
1.
2.
3.
4.
5.
6.
7.
8.
9.
Value of strategies not implemented? Reasons for?
Most common pitfalls
Why do we repeat the same errors so often?
Importance of: LED leadership & governance
Shifting development thinking and behaviors
Support measures: Keeping things simple. Getting the basics right. Systematize.
Invisibility of LED value addition
Managing stakeholder expectations
Regional integration
Theewaterskloof
LED Maturity
Stellenbosch
5
Mosselbay
Eden
Oudtshoorn
Leading
Academic
4
Langeberg
Knysna
LED success is very unlikely whilst LED
leadership and governance is not effective.
George
Insight & Strategy ....
West Coast
Promising
Cape Winelands
Swartland
3
Overstrand
Breede Valley
Cape Aghulas
Saldanha
2
Matzikama
Laingsburg
Many leaders:
- still don’t take LED seriously
- don’t understand why they should, what
LED is and how to fulfil their role
Hessequa
Committed
1
Bitou
Witzenberg
Emerging
Central Karoo
Prince Albert
Bergrvier
This is the single most critical issue, which
can be rectified systematically if there is will.
Drakenstein
0
0
1
2
3
4
5
Beaufort West
Kannaland
Overberg
Ability to Execute
0
LED Leadership and Governance
5
4
3
2
1
0
Municipal names confidential
What happens when leadership fails ….
Value of the economy to citizens:
Sustainability and growth
of investment returns,
jobs, income levels,
cost of living and
tax revenues
Local
society
Leaders invest
in LRED
cooperation,
efficacy &
good
governance
LED
Leadership &
LED
governance facilitation
system
system
LRED experts
establish systems
to facilitate processes
of economic development
Private sector competitiveness:
Ability of key sectors to
retain and grow
market share.
Efficacy of local
markets
Local
economy
Local Economic Stakeholders champion
initiatives which unlock
Development
new opportunities
(LED) system
in the economy
Stakeholders
participate in
LRED processes and
contribute insight,
ideas and resources.
What happens when leaders want to work directly with the poor ….
End state
Value of the economy to citizens:
Sustainability and growth
of investment returns,
jobs, income levels,
cost of living and
tax revenues
Local
society
Start state
Leaders invest
in LRED
cooperation,
efficacy &
good
governance
LED leadership
& governance
system
Private sector competitiveness:
Ability of key sectors to
retain and grow
market share.
Efficacy of local
markets
Local
economy
LED
system
LED
facilitation
system
LRED experts
establish systems
to facilitate processes
of economic development
Stakeholders
participate in
LRED processes and
contribute insight,
ideas and resources.
Stakeholders champion
initiatives which unlock
new opportunities
in the economy
Characteristics of different planning approaches to regional economic
development
(Source: Mesopartner)
ANC guys here
No planning
and / or
No cooperation
ANC guys not her
DA guys here
DA guys not here
Strategic Planning

(top down,
Economic potential
without capacity to execute)
Planning
Implementation
Evaluation
Participatory
planning
processes
Initial diagnostic
Review
Review
An iterative process of continuous improvement
Structure of presentation
1.
2.
3.
4.
5.
6.
7.
8.
9.
Value of strategies not implemented? Reasons for?
Most common pitfalls
Why do we repeat the same errors so often?
Importance of: LED leadership & governance
Shifting development thinking and behaviors
Support measures: Keeping things simple. Getting the basics right. Systematize.
Invisibility of LED value addition
Managing stakeholder expectations
Regional integration
Shifting development thinking and behaviors

If we believe that locals must drive sustained improvement, and they are not currently
succeeding, technical solutions are necessary but not sufficient.

Development thinking and behavior of leaders need to change.
In most cases:

Few leaders yet see the opportunity, and are therefore not really motivated

Local rivalries and manipulation for vested interests, breaks down trust

Different development paradigms cause conflict

Neither municipal leaders nor organised business are competent in LED yet

Unconscious incompetence leads to poor decisions with unintended consequences

Strategy realised is mainly the consequence of leadership decisions (unless they don’t steer)
So until behaviours shift, strategy realised and documented plans will differ vastly
Structure of presentation
1.
2.
3.
4.
5.
6.
7.
8.
9.
Value of strategies not implemented? Reasons for?
Most common pitfalls
Why do we repeat the same errors so often?
Importance of: LED leadership & governance
Shifting development thinking and behaviors
Support measures: Keeping things simple. Getting the basics right. Systematize.
Invisibility of LED value addition
Managing stakeholder expectations
Regional integration
Value of the economy to citizens:
Sustainability and growth
of investment returns,
jobs, income levels,
cost of living and
tax revenues
End state
Local
society
Private sector competitiveness:
Ability of key sectors to
retain and grow
market share.
Efficacy of local
markets
Local
economy
Start state
Leaders invest
in LRED
cooperation,
efficacy &
good
governance
LED
Local Economic Stakeholders champion
Initiatives to unlock
Leadership &
LED
Development
Reliable LED
new opportunities
governance facilitation
(LED) system
in the economy
process
in
place?
system
system
LRED experts
establish systems
to facilitate processes
of economic development
Stakeholders
participate in
LRED processes and
contribute insight,
ideas and resources.
Holistic support from provincial level
- not just important parts
WE KNOW WHAT THEY MUST DO.
LETS HELP THEM TO PUT THE MISSING
BUILDING BLOCKS (FUNCTIONS) IN PLACE.
THEN SUPPORT LED PROCESS INTEGRATION,
AND HENCE PROCESS PERFORMANCE.
SIMILAR TO HOW ONE WOULD ACHIEVE
BUSINESS PROCESS IMPROVEMENT.
Key roles and functions in LED organised in 4 layers
Key role players
Version: 6 Aug 2010
Functions / activities
Municipal
manager
Leaders of
Chambers of
(represent
business
in places)
Leaders of
Sector bodies
LED
unit
Sector/cluster 1 facilitator
Sector/cluster 2 facilitator
F1: Ensure LED Governance
Establish system of ongoing LED facilitation
Mayor,
portfolio councillors
(represent citizens
in places)
John Lawson
F2: Facilitate LED processes
Municipal
departments,
Other public
sector investors
& public service
providers
F3: Key stakeholders combine their insights to develop a
shared understanding of economic development priorities
Sector/cluster 1 stakeholders
Sector/cluster 2 stakeholders
Sector/cluster 3 stakeholders
Civil society
LED Initiative champions
LED Initiative champions
LED Initiative champions
LED Initiative champions
LED Initiative champions
Develop the local economy
LED-systems layer
Sector/cluster 3 facilitator
F4: Key stakeholders execute prioritised LED initiatives
to strengthen competitive advantages for local sectors
Support measures
 Keeping things simple.

Few leaders of LED are educated in economics.

Remove jargon. Use semantics they already understand.

Getting the basics right first.

Stop the damage.

Don’t waste opportunities that knock on the door

Systematically look for new opportunities and utilise them
 How many persons in a large organisation understand everything?

Making things easier enables more to succeed

Reduce the complexity of LED jobs / roles

Systematize. Management systems for information, knowledge, quality
Structure of presentation
1.
2.
3.
4.
5.
6.
7.
8.
9.
Value of strategies not implemented? Reasons for?
Most common pitfalls
Why do we repeat the same errors so often?
Importance of: LED leadership & governance
Shifting development thinking and behaviors
Support measures: Keeping things simple. Getting the basics right. Systematize.
Invisibility of LED value addition
Managing stakeholder expectations
Regional integration
Invisibility of LED value addition
– even when things are working
 Reasons

Indirect leveraged value addition not credited to LED.

Value added not visible, not valued.

Stakeholders don’t appreciate that things take a long time
(like a dam-wall make a massive difference over many years)
 Implications

“out of sight, out of mind”

Resulting in Low investment, low confidence in LED. Low salaries.
 Make it visible

Systematically record results pipeline and publish widely
Structure of presentation
1.
2.
3.
4.
5.
6.
7.
8.
9.
Value of strategies not implemented? Reasons for?
Most common pitfalls
Why do we repeat the same errors so often?
Importance of: LED leadership & governance
Shifting development thinking and behaviors
Support measures: Keeping things simple. Getting the basics right. Systematize.
Invisibility of LED value addition
Managing stakeholder expectations
Regional integration
Managing stakeholder expectations
 Ward dynamics
 IDP approach – asking what the needs are …
 Unrealistic economic expectations
 Actual LRED value add not visible, slow, indirect
 Stakeholder tension ………. Ward councillor pressures
 Blind spot?
Fix this by:
 Systematically managing expectations to what is possible
 Making the result pipeline visible
 Systematic marketing and PR for LRED
 Build stakeholder awareness and affinity systematically, else they lose faith &
force change …..
Structure of presentation
1.
2.
3.
4.
5.
6.
7.
8.
9.
Value of strategies not implemented? Reasons for?
Most common pitfalls
Why do we repeat the same errors so often?
Importance of: LED leadership & governance
Shifting development thinking and behaviors
Support measures: Keeping things simple. Getting the basics right. Systematize.
Invisibility of LED value addition
Managing stakeholder expectations
Regional integration
Thoughts on regional integration
 Layers of development



Town vs economic space, F(sectors)
Municipality vs district vs province roles
Schools of thought
 Self-goal-seeking, self-organizing, self-maintaining systems



Build & work with reliable systems (and leaders)
Like the internet, modern software, traffic ……. Flexible, adaptive, robust
Collaboration around mutual opportunity
 Locals must drive sustained improvement ….

If they cant yet ….. What do we do?



How do we shift behaviors at municipality
How do we shift behaviors in organised business
If they can be reliable partners ……. What do we do?
 What is the role of provincial level stakeholders


Additionallity
Capacity support . . . . . . Addressing the root causes, holistic support
What is the change we seek in SA LED
(May 2013)
Leadership perspective
Away from:
Towards:
Leadership with limited insight, without
requisite skills, assume they know.
Use big words, no experience.
Leaders with appropriate insight, trained to
function professionally. Know what they don’t
know.
Economy taken for granted
Conscious appreciation of the value added by the
economy, to society and to municipality
View business as the enemy, profit is
bad
Businesses create the jobs, pay the salaries. Can
create more. Sustainability requires profitability.
Side-lined LED
Mainstream work of municipality and chamber
LED complexity overwhelming. Jargon.
Misleading info. Blind leads the blind.
LED complexity framed simply, to understand
fundamentals quickly. Clarity to steer well.
Manipulation & stifling politics
Transparency and cooperation efficacy
Role confusion
Role clarity, clear-cut accountability &
professionalism
What is the change we seek in SA LED
(May 2013)
Facilitation perspective
Away from:
Towards:
Re-inventing the wheel, repeating errors
Use of reliable good practice
Disjointed LED activities
Coherently integrated LED processes
Unreliable/unstable LED processes
Reliable /stable LED processes
Institutional silos, mistrust
Cooperation efficacy, efficient networks
Required best core information not easily
accessible, unreliable information overload.
Structured information & knowledge
management – required info at fingertips
M&E talk
M & E systematized
What is the Change we seek in SA LED
(May 2013)
Citizen and Business perspective
Away from:
Towards:
LED talk shops with seemingly no results
Clearly visible LED results
Business loss of confidence
Business trust & enthusiastic contribution
Citizen exclusion and frustration
Large scale citizen LED awareness and
affinity
Job entitlement
Appreciation of the vulnerability of jobs,
earned only through competitiveness
What to do about it?
LRED is a new competency  establish it properly










Gain commitment from leaders and capacitate to understand the basics
Capacity building support to address the root causes of failures
Education & training to match the actual work and situation in the field
Holistic support, establish reliable LED systems/processes
Measure systematically and learn from mistakes
Appointment of persons that are likely to succeed
Disciplined management of institutional memory (information & knowledge)
Make LED results pipeline visible
Actively promote LED awareness and affinity with stakeholders
Recognise and celebrate LED successes
Questions?