The Importance of Ecosystem Thinking in Economic Development
In today’s fast-paced and complex world, regional cooperation is more crucial than ever for successful economic development. This is particularly true in rural areas, where professionals often find themselves dealing with multiple overlapping responsibilities and constant challenges. Economic developers in these areas must navigate grant administration, childcare meetings, new development concepts, and pressing political issues, often feeling like they are constantly putting out fires but never truly in control of the narrative. With the incredible complexity of these challenges, no amount of project management tools or life hacks can provide a comprehensive solution.
To address these challenges effectively, economic developers need an economic development ecosystem that embeds them in a supportive network of partnerships. Ecosystem thinking acknowledges the complexity of the economic development landscape and provides a lens through which professionals can make sense of the deluge of information in today’s media-saturated era. It also offers a regional scale that is large enough to provide reasonable resources while still retaining a human touch.
In many places, a loose framework for cooperation already exists. Mandated regional plans and foundations that think across boundaries, along with state and federal resources flowing downward, are starting to recognize the advantages of scale. However, robust ecosystem thinking takes this framework further by reviewing existing assets, strengthening informal connections, building cross-sector strategies, and ensuring that plans do not remain on a shelf.
One of the greatest benefits of an ecosystem becomes apparent when everything goes wrong. The response to the COVID-19 pandemic demonstrated how economic developers can quickly mobilize and respond to a crisis. Despite occasional mistakes, the collective action taken by economic developers prevented a long-term economic crisis, showcasing the strength and effectiveness of the ecosystem.
However, the true strength of an ecosystem lies in its ability to react to more localized crises that may not affect the entire community but have a significant impact on vulnerable members. It is in moments like these that the ecosystem’s support and collaborative efforts can make a crucial difference.
Northspan, a private nonprofit organization, has long served as an incubator for regional programming in Northeastern Minnesota. Recently, they took over the management of Northeastern Minnesota’s Launch Minnesota affiliate, rebranding it as DAWN (Driving Access to Wealth and Networks). Northspan aims to collaborate with regional business-support organizations, such as the Entrepreneur Fund, Small Business Development Center, and LISC Duluth, to build a new ecosystem. This ecosystem, adopting the Kauffman Foundation’s framework, will create clear tracks for entrepreneurs at every stage of support they need.
To further support this ecosystem, Northspan received $2 million over four years from the Department of Commerce’s Minority Business Development Agency. This funding will be used to implement a two-track approach to capacity-building, access to capital, and access to networks for underserved populations in Northeastern Minnesota.
An effective ecosystem allows economic developers to build a collective identity for their region, turning around negative narratives about small-town America and putting them on a more competitive footing with economic development infrastructure in major metropolitan areas. Without an ecosystem, economic developers can easily feel lost in the jungle. Although sporadic wins and individual high achievers may occur, long-term success requires a more comprehensive system that doesn’t rely on heroic efforts to achieve meaningful victories.
With the right framing and a broader collective effort, the pieces for sustained growth and success are within reach. By embracing ecosystem thinking, economic developers can navigate the complexities of their work, establish strong partnerships, and create a thriving environment for economic development in their regions.
Karl Schuettler is the Vice President at Northspan, a nonprofit community and economic development consulting firm based in Duluth. This article is adapted from a white paper titled “Ecosystem Thinking: The Path to Survival in the Economic Development Jungle,” published by Northspan in coordination with this commentary.