Its been a long, cold, snowy winter, and we are all tired of lake-effect blizzards. You have probably seen a blizzard of television commercials touting the Start-Up NY program recently announced by Gov. Andrew M. Cuomos office. It sounds promising and is aimed at creating jobs and economic growth in the state. That would be nice.
Start-Up NY is aimed at encouraging entrepreneurship, linking employers to the higher-education community in the state (especially State University of New York campuses) and focusing on manufacturing and high-technology companies. Like the old Empire Zone program, it promises tax breaks to companies that qualify and locate in approved spaces (near SUNY campuses for the most part).
SUNY Potsdam and SUNY Canton already have submitted a plan for participating spaces, and a team of economic developers is working on a plan for Jefferson Community College. Clarkson University in Potsdam also is applying, although it is not part of the SUNY system. The odds are good that Clarkson will get into the program, if not on its own then in partnership with SUNY Potsdam.
For qualifying businesses, the deal looks sweet. Not only do they get substantial breaks on state taxes, but so do their employees. The idea is to attract innovative companies that employ innovative and productive workers the kind who might not want to live in a place with winters like ours.
The offer is open only to high-technology and manufacturing companies that start in New York or choose to locate or expand here. Retail, hospitality and tourism, and some service industries are specifically excluded.
The targets are those companies that will create exports goods and services that will leave the state and generate fresh cash inflows. Retailing, which is vital to a modern economy, tends to move money around within a community, rather than exporting value-added products. That is tough news for our hard-working retail and hospitality sectors here, but it does make some economic sense.
The initial guidance suggests that the plan is to avoid the kind of corporate reflagging that occurred under the older Empire Zone program, where existing local businesses renamed themselves, sometimes with a corporate reorganization and the cooperation of local economic developers, and located in Empire Zones to get the tax benefits. That plan certainly makes sense in Albany, where reflagging is seen as a net reduction in taxes for existing businesses that would otherwise pay the full tax rate into the states empty coffers.
Unfortunately, it means that locally we will have to deny benefits to our longtime manufacturers while lavishing them on new arrivals and startups. The existing businesses can reasonably wonder if we really value them for their contributions to our economy and whether we understand how difficult it can be to operate a profitable business in Northern New York.
Maybe it is time to relocate to a warmer climate with lower tax rates and lower costs for doing business? Certainly other states have similar programs to attract new producers, so why not go where we can be treated like the newbies in New York? Swords often cut both ways.
The program is open only in approved spaces on or within three miles of SUNY campuses. The thinking is to build a link between SUNYs intellectual and educational resources and promising startups in emerging sectors. It is also, I suspect, part of the governors interest in getting some serious economic benefits in return for the state budget invested in the SUNY system.
SUNY Potsdam is hoping to attract entrepreneurs interested in its cultural products music and the arts as well as green industries that might be attracted by its life and environmental sciences programs. Clarkson is certainly interested in technology startups fueled by its strong engineering programs.
It is really not clear how much success either can expect in those endeavors, but they can at least let their alumni know that they can get some tax benefits if they return to the north country to launch a business.
The program at JCC is a bit more exciting, given the connection to local wineries and distilleries. Food processing, including making wine and liquor, counts as manufacturing and should easily fit into the program. That is a growth industry in our state and is one of the most promising economic opportunities before us, in my opinion. It also fits into our tourism industry and can generate increased revenues there, even if they dont get a tax break.
High-visibility tax incentive programs to attract new business are popular in the economic development community and with the politicians who fund them. Properly managed, they have little direct cost to the state and can be credited with lots of new jobs, even if the relationship is sometimes a bit murky.
The targets of manufacturing, high-technology and green industries are enduringly popular for all the obvious reasons. Connections with higher education and entrepreneurship have been fashionable since the connection between Stanford University and Silicon Valley became the stuff of legend.
While Start-Up NY represents little in the way of new thinking and is probably not going to do much for most of us in the north country, it is worth trying. Years of working in economic development have left me skeptical but not cynical. Instead of flashy targeted programs to attract certain businesses, I would prefer broader tax reductions and reduced regulation that trim the burden on all businesses and their employees, but Ill take what I can get.
Most successes from the program are likely to occur near larger SUNY research centers where there is already a well-established technology workforce and the availability of angel equity investors.
Up here, we will probably find that reduced taxes dont often offset the challenges of recruiting and retaining a highly skilled and marketable workforce, the high costs of energy, transportation to distant markets and the lack of equity investments for young companies.
Still, if you have an idea for a new business that can draw on the talents and capacities of a local SUNY campus, now is as good a time to launch as any. Check out the Start-Up NY benefits and see what they do to your business plan.
Greg Gardner is an associate professor of business at SUNY Potsdam. Email him at firstname.lastname@example.org.
It has been months since I had a column in this paper. Much of that time has been spend in military deployments. I know that is an excuse that is wearing thin, but I am looking at retirement from the National Guard and I promise to do better from now on.
In the past, when I wrote my first column after a deployment, I usually tried to summarize the changes I saw since I left. Ill do a bit of that, but I really want to tell you what it is like to be back in Northern New York and how I know that I am home.
Being gone for months at a time, in places that are very different from our region, gives me a greater appreciation for the north country and its businesses and people. If you dont get a chance to get away from the area now and then, you may not realize how good it can be.
In October, driving to SUNY Potsdam on a sunny Tuesday morning, I had a sudden reminder of how good this place can be. As I passed through the town of Governour, I noticed smoke coming out from under the hood of my car. That is never a good sign, so I pulled off the road right away.
I could not think of a soul I knew in Governour, but my wife knows everyone, everywhere, and can remember all their phone numbers, so I called her. She called a former colleague from the Jefferson Rehabilitation Center who lives in Governour. The colleague gave me a phone number of a mechanic; he could not help me, but he gave me the number of one who could. Ten minutes later, my smoking car was in Mr. Mandigos lot and he was promising to get it fixed as quickly as he could. By tomorrow, he promised.
But how to get to Potsdam, where my students would be waiting expectantly for me to teach them something about management and international business? Mr. Mandigo gave me some names and numbers of businesses in town that might have a car to rent me for local use. Within half an hour, I was renting a car from Spillmans Auto Dealership and made it to Potsdam in time for my afternoon class.
The next day, my car was ready at a significantly lower cost than I had expected (or would have been charged in many places) and all was well that ended well, with apologies to William Shakespeare.
So what was the lesson in all of this? If you are going to experience a disaster and need rapid and committed customer service from multiple businesses to get out of trouble, try to have the disaster in a place like Gouverneur.
The thing that most impressed me was not that they could fix my car or rent me another, but that everyone I spoke to that day immediately and sincerely wanted to help me. Where one business could not help, they were ready to point me to someone else who might. With that first phone call, I was able to mobilize a network of related businesses and professionals who were able to resolve the problem end to end. And they were friendly about it.
Superior customer service has been hailed as the killer app of the 21st century, and businesses all over the planet have spent billions of dollars trying to train employees and improve processes to provide that service. Advertisements trumpet great customer services at businesses of all sizes, in every industry, and optimistic entrepreneurs target superior customer service as the competitive advantage that will make their new business successful.
Perhaps the managers of some of those businesses should get their cars fixed in Gouverneur.
I doubt that any of the businesspeople who helped me had ever hired a consultant to design an improved service model or had read the latest articles and books on the subject in the academic press. Instead, I think they just treated me the way they would want to be treated if they were broken down in a small town where they were strangers.
You cant teach that kind of approach in a college program. It comes better from an upbringing in a rural region where people have had to depend on one another to survive harsh winters and challenging economic times.
I knew I was back in the north country when I got my car fixed in Gouverneur, and I remembered the strengths of living in and doing business in a place like ours. The world is an increasingly complex place, but we manage to hang on to some simplicity and common sense that carries us through recessions, banking crises, government shutdowns and lake-effect snowstorms.
Certainly we are capable of some pretty dismal customer service in the north country. I have described plenty of examples in this column, and we all have stories of our own that end badly. None of that, however, is reason to lose hope. When we do it right, we do it REALLY right.
If you grew up in the north country and find yourself interviewing for a job at a business in a major city, I suggest you avoid trying to sell your sophistication and the courses you have taken and the books you have read on customer service. Instead, just explain that you grew up in a place where people have learned to help one another as part of life, and that you know how to bring that simple but amazingly powerful approach to their business.
If you are a business manager trying to improve your businesss service offerings, consider searching for employees from small towns and rural communities where the culture demands that people be helpful and where a reputation for being unhelpful can last for generations.
If you have some stories of great service from a business in the north country, please send them to me in an email. I have spent lots of time talking about bad service and would like to spend some time celebrating good service instead.
I have spent the last few months in places where I was not always liked and not always treated well or trusted and where I was occasionally attacked. As a stranger, I had to learn caution and the need to withhold my own trust at times. It is good to be home.
Greg Gardner is an associate professor of business at SUNY Potsdam. Email him at email@example.com.