Companies & Industries

Will the Sun Shine Bright on Kentucky Innovation?


The ambitious new mayors of Louisville and Lexington believe stimulating entrepreneurship starts at the city level

Posted on Harvard Business Review: February 11, 2011 3:59 PM

My friend Eric Patrick Marr, a passionate social entrepreneur, has been working to promote entrepreneurship in the Bluegrass Region of Kentucky. At his invitation, I went this week to the state's two largest cities, Lexington and Louisville, to talk with local entrepreneurs and community leaders about what it takes to spur more innovation and entrepreneurship in a region.

It's a goal that nearly every locale seems to have these days, but here there's a particular sense of urgency given the recent election of new mayors in both towns. Lexington Mayor Jim Gray and Louisville Mayor Greg Fischer are both first-time office holders coming to public service directly from successful private sector business careers. Both new mayors ran and won on economic development platforms. Like me, they believe it's vital to think about the challenge of fostering entrepreneurship and innovation at the level of the city—and that their cities have the potential to lead the way by becoming innovation hotspots.

Each has a deep and rich economic heritage to draw on—and to overcome—in that quest. Louisville's economic legacy is that of a classic industrial-era city; Lexington, only 75 miles north, has a predominantly agrarian heritage, centered on the region's many beautiful and expansive horse farms. In both cities, even as people take pride in the past, some worry that it hasn't equipped them to build new engines of regional prosperity and job creation. It's a concern I see in cities in every mature economy that once lived in high-growth prosperity but no longer do. Like Dorothy in The Wizard of Oz, they yearn to get back to it, but think it might take something magical, the economic equivalent of ruby red slippers, to effect the change.

My take is that they already have the power within them. I'll admit this is based on a quick impression. But in my 24 hour visit I met individually with Mayor Gray and Mayor Fischer, talked with the Lexington City Council, taught a class on business model innovation at the University of Kentucky, and met with over 150 local entrepreneurs at several sessions bouncing back and forth between Lexington and Louisville. Talk about total immersion. It was incredibly energizing.

What I perceived was a critical mass of entrepreneurs and innovators who are passionate about the local community and stand ready to co-create their region's economic future. This really hit me during that class session at the University of Kentucky. When I asked, "How many of you are from Kentucky?" every hand in the room went up. These students constitute a network with deep roots in the community and deep commitment to it. Soon to be part of the local workforce, they are also trained to be entrepreneurial in whatever they do, and eager to make a difference. They are the net-generation, with an unprecedented ability to self-organize, mobilize social change, and create their own economic opportunities. They don't need ruby red slippers.

My message to them, and to the entrepreneurs and innovators I met, was this: don't wait for local institutions to clear a path. You have to lead. And once you demonstrate real progress, the institutions will get on board. They will not want to be left behind.

Meanwhile, my advice to community leaders was to play a catalyst role. What does that mean? I like to think of the work of the catalyst as having three parts:

Connect. Winning communities enable random collisions among unusual suspects. They know the most important value-creating opportunities are found in the gray areas between sectors, silos, and disciplines. So, get better at enabling the cross-community connections that will give rise to productive collaborations.

Inspire. People love to be inspired—and they'll need to be inspired if anything is to change. In my experience, a well-told story is the most inspiring way to describe the triumph over adversity every successful innovator must achieve. Think about the forms an "Innovation Story Studio" for the community could take. Then build the capacity for creating, packaging, and distributing those stories.

Transform. Think of the city itself as a laboratory for innovation, and get entrepreneurs and innovators working on real social challenges in health care, education, energy, and workforce development. Not only will it build the innovators' capabilities to take on other challenges, it may just yield some truly transformational solutions. And there's even another bonus: as the word gets out about the city's new approach to a social problem, and its general willingness to experiment, capital and talent will be attracted to it as an innovative place.

I left Kentucky excited about the potential demonstrated by new leaders who seem to get it, and optimistic that the community is headed toward a brighter economic future. While it won't be as easy as tapping heels together three times, it will be as easy as tapping into the passion of local entrepreneurs and innovators, and using it to connect, inspire, and transform.


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