In 2010, city leaders in Portland, Oregon, sought to produce an economic development plan that would create jobs to enhance the city and region’s economy. Rather than using the typical model that relied on hiring a consulting company, however, Portland took a pioneering “community-sourcing” approach. Portland officials believe that this approach not only produced a more effective economic development plan for a lower cost, but also improved citizen engagement.

Leaders of this economic development initiative identified four local industry clusters: clean technology, athletic and outdoor, advanced manufacturing, and software. Because of the number of high-income jobs it produces and its ties to the other clusters, leaders decided to focus on creating jobs specifically in the local software industry.

Portland, the third most populous city in the Pacific Northwest, is not only known for being one of the most environmentally friendly cities, but also for being home to a large software industry. One thousand five hundred software companies are located in the metro area, more than half of those of those companies are based in the city itself, including Webtrends, Mentor Graphics, WebMD, and McAfee.

Creating a plan for the development of Portland’s software industry required a collaboration among business, nonprofit, and government representatives, including municipal officials, the Portland Development Commission, survey specialist FUSE Insight, PR and ad firm McClenahan Bruer, network service provider ViaWest, and the Software Association of Oregon. Working together, this team created a community survey and subsequent economic development plan.

The “community-sourcing” process included systematically getting feedback from over 500 individuals via Internet surveys. Project leaders developed a system in which they first compiled survey results from the community to understand the needs being expressed, then held a town hall meeting to discuss these findings, and finally conducted an updated online survey. This process was completed a total of three times and provided a clear focus to project leaders. The surveys culminated in a large, standing-room-only meeting with 250 attendees at city hall in early December. Based on the information gathered, project leaders tapped three networks of resources: user groups, financing for companies, and mentoring. According to Thompson Morrison, CEO of FUSE Insight and leader of this project, the “community-sourcing” phenomenon was able to “unleash creative initiatives.”

Morrison noted that the use of “community-sourcing” generated many measureable benefits as opposed to hiring a consultant, such as keeping the costs lower by avoiding costly focus groups and gathering more opinions through online surveys than they would have through focus groups.

Morrison also asserted that the initiative improved citizen relations. Before this initiative, the project team used Net Promoter Score, a tool commonly used by industries to quantify the relationship between customers and companies, to measure the relationship between citizens and the government. In this initial evaluation, individuals reported that Portland’s software plan would be ineffective because education and the city government did not align with the actual needs of the community. When measured again six months later, not only did those polled raise Portland’s overall rating significantly, but also said that based on the listening process in this initiative, the city government and education system was in complete alignment with the needs of the city. Citizens also went from seeing a scarcity of resources in the area to an abundance of resources based on these communications.

Through the “community-sourcing” process, Morrison found that a key challenge to overcome was the disconnect citizens felt about their role in public policy development. He asserted that in order to be successful, they had to create a “validating and inclusive process” to overcome the lack of trust individuals had in the government, often based on feelings of being marginalized. Morrison and his team attempted to create a process where each citizen’s voice was heard in relationship to all other opinions. “ Leadership needed humility and to listen, reflect, and guide to gain trust.”

For more information on Portland’s experience community-sourcing economic development, visit:

 http://www.pdc.us/new/releases/2010/news-release-2010-12-03.asp. and

http://pdxeconomicdevelopment.com/cluster-software.html.