Tag Archives: Edmonton

Edmonton’s Greatest Decade is Now

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As the year comes to a close and we look ahead with our resolutions, let’s vow to leave behind our criticism and resignation and commit to building a place of distinction, prosperity, and character.

Edmonton is on the cusp of its greatest decade – filled with unprecedented opportunity for youth and overflowing with unlimited prosperity for those willing to shift to a growth-oriented mindset. The next decade will see Edmonton as Canada’s:

  • Epicenter of artificial intelligence and life science innovation;
  • Nexus of the traditional and circular economies;
  • Heart of resource production and upgrading;
  • Hub for immigration and inclusion;
  • Centre for education and research excellence;
  • Archetype for affordability and social mobility; and
  • Leader for philanthropy and community connectedness.

Massive capital investments will continue to be made in the Edmonton region, building on Dow’s $11.5 billion net-zero ethylene cracking facility, Air Products’ $1.6 billon hydrogen facility, and paving the way for some of the largest Carbon Capture Utilization and Storage (CCUS) investments in North America. Net migration into the province will continue to drive consumption and the availability of labour. And our universities and colleges are accelerating the commercialization of highly skilled talent into the market.

No wonder the Conference Board of Canada anticipates that Edmonton’s growth will double the national average.

But wait.

Canada’s GDP is expected to drop from a paltry 1.2% growth in 2023 to a moribund 0.7% growth in 2024. Outperforming the national average can no longer be our goal. We can’t wake up every day and strive for mediocrity. This is our opportunity to lead, excel, and outperform.

To do so requires a shift in mindset – a 4% growth mindset – in everything we do. And an economic strategy that gets everyone pulling together in a unified direction.

I look forward to using this forum for some new thinking and writing – brainstorming and engagement – about opportunities and initiatives as to how Edmonton can take advantage of its greatest decade ahead.

The Urge to Compete

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Every morning for almost six years I woke up with a single purpose in mind – to make Edmonton remarkable. We rallied the business community around opportunities to attract major events like Red Bull Crashed Ice or industry leaders like Aurora Cannabis and Hello Fresh. We also rallied the business community when our city was under threat from reckless cuts to post-secondary funding, vindictive elimination of direct flights, and policy changes that crippled our economy.

I loved the chase and I loved the fight. And my love for our city is forever in my heart.

Today, as we all witness the brutal combination of an energy price war, a COVID-19 economic collapse, and a global liquidity crisis, my urge to compete has never been greater. This recent threat to our economy and livelihood has exposed the fragility of our economy, our capital markets, our supply chains, and our manufacturing capacity. Although the response has largely been targeted at social distancing policies, income and wage supports, and PPE procurement, our national response will eventually start to focus on our points of fragility.

And we, as a city, need to be ready … ready to invest in transition.

As people are eventually allowed to return to work, the first wave of government stimulus will be on infrastructure and construction projects. This is predictable and Edmonton will benefit greatly from this first wave of stimulus spending.

It’s the second wave that is much more important and requires our city to think strategically, collaboratively, and well … differently.

As the federal government launches incentive programs to build manufacturing capacity for essential products, Edmonton should be ready to position itself as western Canada’s advanced manufacturing hub. Edmonton has an integral foundation of traditional manufacturing capacity, talent & trades, education & training institutions, and a competitive tax environment. Layer on our leadership in artificial intelligence, machine learning, nano-materials, and robotics … plus our jurisdictional advantage as the transportation, logistics, and service centre for western Canada’s primary industries … and what you have is a winning combination that cannot be ignored.

Our organization, BGE Indoor Air Quality Solutions, is western Canada’s largest manufacturer/distributor of air filtration products – essential products and services regardless of economic and pandemic conditions. However, we rely on imported raw materials and products that could be made locally, as part of an advanced supply chain and manufacturing cluster deemed critical to our economic future.

We are one of many manufacturers that should be rallying together at this time, to share our opportunities and needs, and collectively position Edmonton for that second wave of economic incentive – the one that builds essential manufacturing capacity, localized supply chains, and thousands of well-paying jobs for generations to come.

It’s time to rally.  It’s time to be remarkable.

Absence of Rankings

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In the private sector, it’s pretty easy to know whether your organization is outperforming the others in your industry sector. It is easy to find out if you have better margins, or lower employee turnover, a lower costs structure or a better return on shareholder investment. Many private sector organizations are publicly listed companies that require transparency in financial performance and risk.  Many private sector organizations have articles written about their leaders, their techniques and their performance.  And, many private sector organizations strive hard to be included in published rankings that evaluate them on a multitude of performance metrics, including best performing, fastest growing, best places to work, and best corporate cultures.

As well, there are CEO learning forums like EO Entrepreneurs Organization, YPO Young President’s Organization, the MacKay Forums, TEC, Tiger Forums and many others that are all designed for CEOs of small, medium and large organizations to share their experiences, share performance data, and share tools and techniques with the sole goal of making each other better.

Does such a thing exist for leaders in the public service?

I know many public service leaders who join the organizations listed above, but they do so with a huge sense of guilt and consciousness, as they know that they are using taxpayer dollars to pay for the membership – a membership that includes a peer-to-peer platform for management education, leadership discovery, performance measurement sharing and implementation accountability.

Shame on them.  Shame on the President of the College, the General Manager of the Conference Centre, the Deputy Minister of the Department of Energy and the CEO of the Healthcare system for wanting to learn from the best, compare performance and techniques, and be accountable to one another for getting better. Shame on them for using part of their budgets for improving performance.

Madness. Madness I tell you.

We have dumbed down our public service, and we have done it to ourselves. We have scrutinized budgets, provided harsh opinion on expenditures, demanded lower salaries, and trashed public service leaders all over the front pages of the newspaper for doing anything slightly unusual.

We now live in an environment where elected officials condemn the actions of the administration, independent Boards of Directors are fired en masse. CEOs are held under “investigation” for months based on conjecture. Ombudsmen and whistleblower protection allow everything to be questioned. And senior executives have lost their privilege of an appropriate severance.

And what have we created? Not only a public service culture that is risk adverse, but also a culture in the public service which is scared to spend money on things that could actually improve performance. We have punitively and intentionally dumbed down our public service leaders to a level where all we should expect is mediocrity.

How sad.  How very, very sad.

You get what you pay for, I say. If you are not willing to pay a bit to take risks, to strive for performance improvement, to enable an award-worthy leader, then why would you ever expect to see anything different than what we are getting. Our current fascination with frugality is maybe constricting us to an era of underwhelming performance.

It’s time to bring out the rankings and allow our public service leaders to compete for awards, recognition and rankings. Yes, sometimes people roll their eyes at these accolades and dispute the methodology, the objectivity or accuracy of the assessments. I get it. But that cynicism should not stand in the way of the benefits, as I’m looking at the value of these awards and ranking for what they positively accomplish:

  1. They clearly identify the performance measures that matter, based on years of comparing company performance against one another;
  2. They objectively rank each company’s performance on individual measures, such that the company can learn areas of excellence and weakness, and what it will take to be best-in-class;
  3. They are often accompanied by an education and awards session for the finalists, where leaders can learn from leaders about how they achieved higher levels of performance;
  4. They allow organizations in a wide range of sectors to identify top performers, read about their stories, understand the leadership philosophies used to achieve the results, and compare their own organizations to the winners; and
  5. They allow the winning organizations to use these awards and rankings as badges of honor, to create pride within their own organizations and to create interest in potential employees who want to work for the industry’s best.

To improve performance, to be ranked, to show vulnerability, you have to put yourself out there – and that takes courage. Public sector leaders need rankings and forum groups, and they need them today.  Our public sector leaders need to start putting themselves out there, comparing themselves to their colleagues, making themselves better leaders, and improving performance.

That’s what we should expect of all our leaders, shouldn’t it?

Too Big To Function

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Go back to early Chinese history, the Roman Empire, the writings of Karl Marx or Max Webster and you will find that bureaucracy has always existed. It exists at the family level with parental hierarchy. It exists in military regimes through command and formation. It exists in manufacturing plants with process and controls. And it exists in public service organizations through rules and risk management.

And it exists for good reason.

Traditionally, a bureaucracy establishes the most efficient and rational way to organize human activity through a series of standardized rules and processes deemed necessary to maintain order, control risk, limit irreverence and control messaging. It has been the administrative system that governs pretty much every large institution in our country. And until about 30 years ago, it was a relatively effective organizing mechanism and management structure.

But then our population curve and our technology adoption curve started to turn upwards, and our bureaucracies expanded to meet the needs of the expanding bureaucracies instead of meeting the need of their customers.

And the criticisms heightened. Bureaucracies were frequently blamed for longwinded processes, slow decision-making, unnecessary approval steps, inflexible procedures, absence of creativity, lack of organizational personality, lack of individual empathy, convoluted practices, political interference, and the inability to empower front line staff to solve problems.

Bureaucracies are a control-based and rules-based operating system, like Microsoft, when really the whole world just wants to be working with Apple.

Don’t get me wrong, Microsoft will always exist and bureaucracies will always exist. Microsoft had its day in the sun, and bureaucracies have had their day in the sun. Microsoft loosened its control, and bureaucracies must loosen their control. Microsoft underwent an excruciatingly painful and costly re-inventive change process, and it is time for bureaucracies to do so as well.

Yes, it is time.

The fundamental tenants of bureaucracy are rules, process, hierarchy and control – the very essence of centralized conformist management theory – and the antithesis of creativity, innovation, customization and flexibility demanded by today’s informed customers.

Most bureaucracies follow a standard formula: policy gets announced by politicians, strategy gets set at the top, directors control risk, managers supervise a portfolio of projects, tasks are given to front line workers who deal with the customers, and administrative coordinators schedule and record the activities. The whole bureaucratic system is set up to control power and authority, centralize knowledge and decision-making, eradicate all risk and invention, trickle down responsibility without authority, govern through processes and rules, and discount any accountability for results.

No wonder bureaucracies are riddled with ego, drama, politics, blame, turf and a large dose of CYA (cover your arse). Although bureaucracies are the most rational means for carrying out imperious control over human beings, left unfettered, bureaucracies create a work environment where tremendous human emotion is channeled toward internal energy-draining survival activities as opposed to toward external facing services.

Control environments have the ability to completely emasculate public service motivation.

This background needs to be understood by our elected officials that want change to happen, but are stumped as to where to start. Change cannot start from within, from someone who grew up in the bureaucracy, as that is all they know. Perpetuating the status quo is in their best interest, especially if they are nearing retirement, and culture will always suffer.

This is the unfortunate reality for some of our cities, government departments and institutions these days. And that is why I am writing about it. The system needs a leadership and cultural overhaul – and we have a generational window to start making it happen.

More to come …

Where Credit is Due

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Every time I tell the Edmonton story, from Hangzhou to Helsinki, from roundtables of 10 to audiences of 1100, people are fascinated how we evolved the Edmonton brand and engaged our whole community in the process. They ask, “How did you guys do it? How did Edmonton manage its way through the recession so well? How did you evolve the brand in such a short period of time? How did you grab the attention of the media? How did you rise so fast in the rankings?”

Every time I’m asked, I stop and give pause, and I share an important story that seems to be forgotten – a story that gives credit to those who took the risk to fundamentally change the face of our city.

Five years ago, our city was at an impasse. City Council was divided over whether a downtown arena would generate the economic benefits that were being claimed, and Edmontonians were divided as to whether a partnership with Daryl Katz could be trusted and whether it would be in the best interest of our city.

Five years later, we should all be celebrating. What’s been accomplished in downtown Edmonton is a model for public / private partnerships that has attracted envy from cities across North America, and has transformed the mindsets of local and institutional investors looking to invest even more into the Edmonton economy.

Edmonton has forever changed.

And, no one wants to change back.

The partnership between the City of Edmonton and the Katz Group sparked $5.5 billion in new investment, created over 30,000 new jobs, generated over $750 million in new taxes, increased residential density by 20%, added 15% more restaurants and bars, all while improving the brand and reputation of our city and the pride of Edmontonians.

And Daryl Katz delivered. What was originally a $100 million commitment (subject to commercial efficacy) in the Arena Master Agreement has now turned into more than $2 billion of personal investment in our downtown. And he kept investing in Edmonton while oil prices plummeted and margins were squeezed, building confidence in our city as we told this story around the world. Katz Group delivered the tallest tower in western Canada (Stantec Tower), the Edmonton Tower, the JW Marriott Hotel, Rogers Place Arena, the Winter Garden (Ford Hall) with excellence, and they continue to invest with more buildings planned in our near future.

Yes, these investments result in a return for the Katz Group, but they also carry significant commercial risk. The bigger winner in this partnership has been the City of Edmonton. With the ICE District development already at 75% of the original 20-year projection, and trending better than ever expected, the Community Revitalization Levy (CRL) has generated property tax revenue from new development and rising property values that has allowed the City of Edmonton to green light more than $230 million in new capital investment projects in the downtown core – a direct result of the arena partnership. That’s huge after only three years, and it puts the City’s investment of public tax dollars in the downtown arena project into a very positive view.

But we are not done. Downtown is not done. Edmonton is not done. Partnerships like these need to continue in order to accelerate our growth, to create a city that is built on excellence and to position us as an exciting city to watch. Additional partnerships are needed to continue investing in our public spaces, like a world stage Plaza in front of Rogers Place, public art on our streets or new hotels attached to our conference centres. Partnerships work, the CRL works, and they should form the foundation for the next phase of our downtown vision.

City of Edmonton and Katz Group is a partnership between City Builders. No party could have created what’s been created on their own. It took cooperation, trust, wisdom, vision and courage. And we need more as we keep growing.

So, as I reflect back on the past five years, on the shoulders which carried us through the recession and on the foundation which helped us shape our brand, I give credit to the City Builders behind the City/Katz Partnership, and I encourage us all to continue investing in, and honouring, these partnerships for years to come.