WESTERN HIGH TECHNOLOGY COUNCIL

 Business Plan (2/29/00)

1.0 INTRODUCTION

The world economy is undergoing extraordinary changes. Advances in technology are changing every aspect of business, education and government at a faster pace than ever before. In response to this development, the Western High Technology Council was created December 3, 1999 at the winter meeting of the Western Governors’ Association. The Council is an alliance among business firms, state governments, research institutions and universities with the purpose of advancing the region’s ability to succeed and prosper in the knowledge-based, global economy. When the governors created the Council, they directed the staff to work with the prospective members of the Council to create a business plan. The business plan was reviewed and adopted at the Western governors’ breakfast meeting in Washington, D.C., on February 29, 2000.

The creation of the Council followed a year of consultation with public and private institutions to consider changes in the economy and how they may affect the West. WGA Chairman Governor Ben Cayetano, whose state of Hawaii is extremely sensitive to both U.S. and Pacific Basin economic changes, was concerned that the characteristics of the "knowledge-based economy" were not sufficiently imbedded in state economic development planning and strategies. Anticipating economic recovery in the Pacific basin, Governor Cayetano has asked WGA to focus on how states should carry out their economic development roles in the new economy. He is particularly concerned that states recognize how the economy is changing so they may adopt more suitable policies, programs and strategies as we enter the new millennium.

Underlying the Chairman’s theme is the concept of "clusters," cooperative groupings of economic players within and across industry and public sector organizations. While clusters usually comprise economic actors in a single community or state, WGA has adapted this notion of local public-private alliances to region-wide cooperation, in order to address larger scale issues of workforce development, education and health.

2.0 NEEDS

In the last decade of the Twentieth Century there was a convergence of many factors that influenced the economy and quality of life in the Western region. A continuing factor is the impact changing demographics have on the demands for new and different public services, and for maintaining existing services in areas such as health care, education, and public infrastructure. Challenges come from dramatic growth in some places contrasted with static or declining population in nearby counties or states. The changing characteristics of the region's population, including immigration and the growth in the size of the elderly population also affect public services and the region's economy.

Another factor is the explosion of information technology development and utilization in Western firms, creating employer demand for a highly skilled, technologically proficient work force. Skill levels in demand range from electronic and health technicians to highly trained engineers, scientists and doctors. This same explosion has affected mass communications and information gathering, raising serious policy questions about ethics and the privacy, security and confidentiality of records.

A third factor is the growth of electronic commerce, which is changing the nature of customer- vendor relations. The opportunities and challenges of e-commerce are just now becoming apparent in the public and private sectors. For example, over the past year Forester Research, Inc. estimates on-line retail sales reached $13 billion. Technographics Data & Analysis expects the this number to grow to $184 billion by 2004.

A fourth factor is the apparent divergence in society between those who understand and can capitalize on new technologies and those who do not have access. This problem exists in both public and private systems where access to affordable high speed digital telecommunications services is currently limited primarily to urban areas, and within those areas to the larger firms and organizations that can afford the services. The Internet changes the nature of competition and tends to eliminate the competitive advantage smaller firms enjoyed due to their flexibility. "In the past, if you were a small business, you could compete because you were more agile. But it’s different in an Internet-based world," according to Sol Trujillo, CEO of US West. In the future, success may revolve around innovation, knowledge and being connected rather than size. 86% of the Internet capacity in the U.S. is concentrated in the 20 largest urban centers. What this means for rural education, workforce development and community vitality is a major concern to governors.

A fifth factor is the complex and counterintuitive nature of the knowledge economy itself, as product lifetimes diminish, corresponding product development cycles compress, and value is increasingly derived from ongoing research and development, rather than from more efficient manufacturing and sales of existing products. Stanford Economist Paul Romer has studied how wealth and value are created in the knowledge-based economy, postulating that knowledge as a factor of production along with capital, labor and raw materials is essential to effective economic strategies for the future.

It follows that the success or failure of both the public and private sectors is increasingly intertwined in a knowledge-based economy. For high tech companies to succeed, factors of production within state and local control, such as a skilled and well educated workforce have become critical. By the same token, for communities, states, and regions to succeed, high tech public solutions (i.e. smart highways) are needed to help manage impacts of growth and maintain the quality of life attractive to high tech companies. Furthermore, public policies must be rethought to accommodate this new economy. For example, will the policies used to regulate voice transmission over copper wires work in a high bandwidth fiber and wireless environment?  How will privacy and security be assured without limiting access and opportunity for people and businesses?

These and other factors all combine to create an incredible array of opportunities for Westerners, as well as difficult challenges for policy-makers. How states are able to meet these challenges within their education, training and health delivery systems will have a tremendous impact on a region’s ability to compete in the world economy and to maintain and improve the quality of life for all of its citizens.

3.0 VISION

The governors and their governments will be the prime beneficiaries of the Western High Technology Council. Through the work of the Council, governors and their advisors will receive timely insight into developments in the knowledge based economy. This insight will help keep the governors and their legislatures ahead of rapid technological change and result in high quality services, well invested tax dollars and smarter policies.

Furthermore, the Western High Technology Council will help connect the Western states and their citizens with the promise and opportunities of the knowledge based economy and the advanced technologies that are driving it. This connection will manifest itself in three ways: through more rapid learning and adoption of new technologies by peoples and organizations; the timely adoption of policies that advance principles of equity, efficiency and opportunity applicable in the new economy; and the realization of private sector goals of growth, profit, and a level playing field.

4.0 MISSION

The Western High Technology Council, a strategic alliance among Western states, technology firms and universities, will recommend public and private policies, programs and practices that will advance the region’s knowledge-based, technology-driven economy, increase the quality of life for its citizens, and improve the quality and efficiency of state government. In this regard, the term "high technology" refers to industries which are based on complex products and services built on a foundation of skilled people, knowledge, and innovation.

5.0 GOALS AND PRINCIPLES

5.1 Goals

The goals of the Western High Technology Council would be to ensure that:

5.1.1 Both public and private sectors understand and implement the policies, programs and practices necessary to maintain world leadership and regional competitiveness in high-technology, knowledge-based industries. These actions will increase investments in technology development and utilization in the region, create greater wealth for its citizens at all levels, foster economic growth across all sectors of the economy, and provide other economic and social benefits for the region and its citizens.

5.1.2 The public and private sectors are working together to infuse the benefits of high technology products and services, as well as "high tech culture," into all communities and interests in Western states. These actions will make the benefits of these technologies more available to citizens in the West through better public and private services, better employment opportunities, and greater public understanding of the implications and importance of the knowledge-based economy;

5.1.3 Western governors’ technology advisors, task forces and commissions are linked together on issues of interstate and national significance.

5.2 Principles and Project Selection.

The WGA project selection criteria are proposed for use by the Western High Technology Council in its activities.

5.2.1 WGA Principles. Projects and activities undertaken at WGA are selected with four principles in mind: Is the task relevant to the governors’ policy interests and concerns; for example, does the task address reauthorization of an important federal law or budget category or create a model solution to a problem shared across Western states? Does the task or project help create wealth in the region, broadly defined as the capacity of the public and private sector to provide goods and services of value to people? Does the task or project solve problems for constituencies in the region; for example, ease the burden of complying with state or federal laws? And/or, does the task or project improve the capacity and efficiency of states to deliver services, and does it improve the quality of the services?

5.2.2 Project Selection: If a proposed project meets one or more of the WGA criteria, it is further tested for its feasibility. A standard criteria screen is used: Will the project or activity likely have real and measurable impact; that is, will people change their behavior or redirect their thinking and activities based on the activity? Will the impact or change occur now and will it induce additional benefits by serving as a model? Are the costs and time required for the activity reasonable, given the impact, and commensurate with available resources? Is someone willing to bear these costs?

6.0 ORGANIZATION

6.1 Description and History

6.1.1 Western Governors’ Association. WGA is an association of 18 western state and 3 Pacific Flag Island governors, organized as a non-profit Colorado Corporation. For tax purposes, WGA is classified as an Instrumentality of the States. Its staff act as agents for the governors when specifically directed to do so by resolution, letter or workplan duly adopted by the governors. WGA also maintains a sister organization, the Western Governors’ Foundation which is a 501(c)(3) corporation eligible to receive and make charitable contributions. WGA maintains a staff of 15 people at its headquarters in Denver, Colorado, and a staff of 2 in its Washington, D.C., office. WGA has three official affiliates; the Western Interstate Energy Board, the Western States Water Council, and the Western Interstate Commission on Higher Education.

6.1.2 WGA Projects. In addition to the work of its staff and affiliates, WGA carries out many of its projects and tasks through task forces and working groups. These organizations are formed formally or informally to address concerns of significant interest to Western states. For example, the Western Regional Air Partnership (WRAP) is a formally chartered partnership of 10 governors, 10 tribal chairs and three U.S. Cabinet Secretaries addressing air quality issues in the West. On the other hand, the Enlibra Advisory Committee is an informal group of 28 representatives of businesses, environmental organizations, universities, legislatures and state, federal and local agencies that advised the governors on environmental policy.

It is recommended that the Western High Technology Council initially adopt the latter, more informal organization as its activities are developed and its mission is refined. WGA would serve as the administrator of the Council.

6.1.3 Initial Structure. It is recommended that the Western High Technology Council be an informal partnership of Western information technology, bio-technology and health technology businesses, universities, think tanks, and governors. It is recommended the Council comprise 15 to 20 business and academic organizations as well as the participating governors or their designees. Council members shall have significant interests in the West. The initial founding partners are the Western governors through their Association; the Intel Corporation; Silicon Graphics, Inc.; the Morrison Institute of Arizona State University; and the Milken Institute of Santa Monica, California.

Other firms in the information, bio and health technology sectors that have expressed interest in joining the Council are: Cisco Systems, Glaxo-Wellcome, Hewlett Packard, IBM Corporation, MDvista Corporation, Micron Technologies, Microsoft Corporation, Oracle, Siemens, US West Corporation. Because of the high level nature of activities of the Council, participation of an organization in the Council shall have the approval of its Chief Executive Officer. WGA will work with its corporate Council members and the Western Interstate Commission on Higher Education to find additional partners.

6.1.4 History. The Association was formed in 1984 through the merger of the Western Governors’ Conference and the Western Governors’ Policy Office. The Council was formed in December, 1999, and the initial business plan will be adopted February 29, 2000.

6.2 Recommended Organization for Western High Technology Council. The Council will comprise 15-20 private members as well as participating governors. The Council shall meet one or two times a year, usually in conjunction with meetings of the Western Governors’ Association. The initial term of the Council shall be three years, after which its value and continuance will be evaluated.

6.2.1 Working Groups. The Council will conduct its activities through working groups and teams formed around issues of interest to the respective members.

6.2.2 Issue Selection. Issues will be raised by consensus of the governors and addressed to the Council for advice. The Council may also raise issues by consensus and address these to the governors for their consideration. The work of the Council will be limited to one or two policy issues per year, as well as outreach activities. The initial issues under consideration by the Council will be work force development for the knowledge-based economy and K-12 education. Delivery of high quality health services will also be a topic of consideration over the first three years of the Council.

6.2.3 Funding. WGA will seek funds from appropriate sources for activities of the Council that require this additional support. Members will contribute staff and facilities to the efforts of the Council.

7.0 PRODUCTS AND SERVICES

7.1 Products and Services Description

7.1.1 Speakers and Forums. One of the goals of the Council is to educate leaders and citizens in the West about the new economy and technologies and related policy issues. This goal will be achieved through speaking engagements before state business, academic and government organizations and forums of the same interests. The purpose of these speaking engagements and forums will be to inform and inspire leaders in Western states to take advantage of opportunities the knowledge-based economy provides for their citizens and institutions. Senior executives of Council members will be called upon to participate in these events. For example, it is recommended that each CEO of a participating organization agree to one speaking engagement per year in a Western state that would not otherwise be likely to hear from the CEO of a world leading company.

Forums would be organized around an important policy or program issue such as work force development and skill sets necessary for success in the knowledge economy. For example, these might be one day interactive workshops organized by state and local agencies for their planners, training developers and career counselors. Teams from member companies would provide this training, perhaps delivering 5 - 6 workshops per year in convenient locations.

7.1.2 Policy Support. Working groups will analyze policy issues and develop briefings and briefing papers on one or two high priority issues selected for consideration each year.

7.1.3 Technology Briefings. The Western High Technology Council will work with existing state technology organizations to brief existing and newly elected Western governors on new, cutting edge technologies and their implications for state services.

7.1.4 Governance Systems. When appropriate and upon request, the Council will provide governors with brief technical assistance visits on new technologies and their implications for state policy and programs. These visits may focus on potential new election systems, Web based services, etc.

7.1.5 Rewards and Recognition. The Council may consider establishing rewards and recognition programs that further its goals.

8.0 PRELIMINARY MARKET ASSESSMENT

8.1 Target Audiences. The target audiences for the Western High Technology Council are the governors, their senior technology advisors, senior executives in education, training and health agencies of state government, and legislative leaders.

8.2 Competition. State level organizations, national technology associations, academic institutions and others may perceive the Western High Technology Council as a competitor. It is not designed to compete with these interests. Rather, it is to bring the unique resources of Council members to bear on issues and challenges in ways that amplify the work of state and national organizations concerned with economic development.

8.3 Keys to Success. The primary activity of the Western High Technology Council will be to inform and inspire leaders and citizens in the region. Therefore, the key to success will be to establish and maintain the interest and commitment of the governors and other senior participants, the most effective communicators of the Council’s messages. The second key to success will be to conduct credible research and achieve consensus on analyses and recommendations developed by the Council. This consensus will indicate that the recommendations are accepted and likely to be long lasting if they are adopted.

8.4 Market Forecast. The "market" for the ideas and recommendations of the council are the target audiences for the Council listed in 8.1 as well as other educators and trainers in the region. Specific market information will be developed for any projects undertaken by the Council.

9.0 IMPLEMENTATION STRATEGY

9.1 Communications & Promotional Strategy. WGA develops tailored communications plans for all important governors’ initiatives in consultation with the participants.

9.2 Product Distribution and Marketing. Specific product distribution and marketing plans will be developed as necessary for products and services of the Council.

9.3 Milestones. To be determined after the first Council meeting.

10.0 ORGANIZATION

10.1 Organizational Composition. Each member of the Council shall name a representative to participate in its deliberations. This person shall be a senior executive authorized to represent the interests of the company, governor, university or think tank by the governor or CEO.

10.2 Management Team. The initial management team of the Council shall include the Executive Director of WGA, representatives of the Chair and Vice Chair of WGA, and representatives of the founding members.

10.3 Loaned Executives and Contributed Hours. Member organizations will be expected to contribute staff to working groups and teams to carry out activities of the Council.

11.0 FINANCIAL PLAN

11.1 Revenues and Sources of Funding. The Council will operate on in-kind resources for the majority of its deliberations and activities. WGA will seek funding from appropriate external sources for projects that are beyond the capacity of its in-kind resources.

11.2 Expenditures. Expenditures for Council activities will be made by participating organizations in accordance with their own finance and accounting practices. WGA and, when appropriate, the Western Governors’ Foundation will serve as the financial manager for any funds raised from external sources for Council Activities.

Page last updated 10/10/1999