How does Arizona grow its knowledge economy?

Technology | 23 May, 2016 |

You don’t hear many people in Arizona use the C-words these days. It’s become archaic.

We are talking, of course, about Arizona’s economy and the fact that there was a time when it was defined by the five Cs — copper, cattle, cotton, citrus and climate. They were the forces that drove Arizona’s economy and students even learned about them in school.

Times have certainly changed.

The C-words that drive Arizona’s economy today are computers, chips, cancer research, the Cloud, cutting-edge technology.

And it’s a proven fact that a knowledge-based economic is good business for Arizona.

“As proven over the past 14 years, the State of Arizona’s investment in the biosciences has provided a solid return,” says Dr. Jeffrey Trent, president and research director of the Translational Genomics Research Institute (TGen). “TGen’s (return on investment) provides an annual economic impact that now exceeds $174 million. Over the next decade, we will see unparalleled advances in the biomedical sciences, due in great part to the seed money provided by the Arizona Legislature.”

But how does Arizona bury those archaic C-words for good and make sure success stories like TGen drive Arizona’s knowledge-based economy into a more stable future?

“Only when we can claim measurable graduates in STEM fields, who then choose to stay in Arizona, can we attract the number and caliber of high-paying jobs to the state,” says Ed Zito, president of Alliance Bank of Arizona.

To make that happen, Zito says this is what companies need to do:

• Support STEM programs in local schools with both dollars and corporate projects.

• Offer high school internships to draw clear road maps to career pathways.

• Act as brand ambassadors for the state as you deal with out-of-state customers.

“It is also important to recognize that funding education needs to be considered an investment, not an expenditure,” Zito says. “This all starts with the needed passage of Prop 123, which provides $3.5 billion to K-12 education over 10 years.”

Another way to continue building the base for a knowledge-based economy, business leaders say, is for industry leaders and public institutions to be open to working together for the advancement of Arizona’s future economy.

“An example of this is the 30-year academic affiliation agreement established between the University of Arizona and Banner Health,” says Kathy Bollinger, executive vice president or academic delivery for Banner Health. “This historic public-private partnership, that just completed its first year, supports cutting edge teaching, research and patient care while creating a supply of new physicians for Arizona for decades to come.”

Az Business talked with other leaders in HEAT — healthcare, energy, aerospace, technology — to get their take on what needs to be done to boost Arizona’s knowledge-based economy.

Healthcare

Kenneth Briggs, associate, Polsinelli: “Stakeholders in healthcare need to understand how to analyze and use healthcare data collected from payors, patients, and providers. Data generated from healthcare services is increasingly becoming the basis for payment and a basis for change in the way services are delivered. Arizona healthcare stakeholders can improve their position by expanding opportunities for collaboration and integration with providers across the healthcare spectrum. The Arizona Biomedical Corridor is a great step in the right direction. Opportunities from increased collaboration and integration will leverage data to provide more efficient services, improve quality, and increase the likelihood of receiving payment for the full range of their services.”

Michele Finney, Market CEO, Abrazo Community Health Network: “As we move to Population Health Management rather than just caring for the patient who presents himself or herself in front of us, the healthcare industry will need to rely on data and technology to both understand the health needs of the population as well as to address them. Technology in healthcare, in communications and in analyzing data are all going to be essential elements to successful population management.”

Jake Golich, administrator, Tempe St. Luke’s Hospital: “As the healthcare environment and industry is rapidly changing, it will be key to disseminate information on a real time basis. With consumers becoming increasingly more involved in their personal healthcare decision making, they want to see meaningful and real data that can translate into making appropriate decisions. Currently, the majority of data is retrospective and unfortunately often times many changes in care have occurred that skews that data.”

Becky Kuhn, executive vice president of community delivery, Banner Health: “Arizona can bolster its knowledge-based economy through the development of a stronger technology industry. Using electronic medical record, teleHealth and other technological advancements Banner Health has improved patient safety and mortality, delivers better patient outcomes and can provide more advanced care in remote areas of our state. Health care will continue to benefit from technology that allows us to improve patient outcomes while reducing the cost of delivering health care.”

Alan Nelson, PhD, founder, chairman and CEO, VisionGate: “Because companies like VisionGate are often hiring for jobs that don’t exist anywhere else today, I think the business leaders should work alongside the lawmakers to help ensure candidates with the right training and education are available to be sourced locally. To keep the brightest minds here, they need innovative companies in which to work. And to keep, grow and attract the most innovative companies, we need to think about what those ‘jobs of tomorrow’ require of us today.”

Energy

Mark Bonsall, general manager and CEO, SRP: “While we all play different roles, one common theme we should continue to follow is enhance Arizona’s brand as business friendly, entrepreneurial, strategically located and a terrific place for your business and your employees to be domiciled. It’s also critical that we continue to promote a vibrant and highly respected higher education infrastructure.

There are a lot of good things happening – business expansion, businesses moving here, support for education (Prop 123), a governor with an excellent business mind, and a business community that deeply wants Arizona not only to succeed, but succeed robustly. SRP has one of the most high-tech electric grids in the nation, and a world-renowned system of water storage, delivery, and management mechanisms. We are funding ground-breaking research on forest management through NAU and are working with businesses across the state to secure stable and productive watersheds. We encourage others to continue doing their part to help grow Arizona’s economy.”

Michelle De Blasi, director, Fennemore Craig and co-chair of the Arizona Energy Consortium: “True civic leadership will continue the growth of Arizona’s knowledge-based economy.  This means taking decision making out of the political realm and bringing together both public and private sector leaders at every level to roll up their sleeves and make some difficult decisions for the benefit of all Arizonans.  We’ve seen past examples of this successful collaboration, such as the creation of the Bioscience Roadmap that led to 30,000 new bioscience and hospital jobs and the addition of 200 new firms in the first decade.  To be successful, the discourse must be one that respects differences and seeks common ground.”

Aerospace

Rick Kettner, Gilbert site director, Orbital ATK: “The key to growing Arizona’s knowledge-based economy centers on a tighter partnership between Arizona’s academic, business and government institutions. There are currently a number of challenges along the path that takes a young STEM student all the way to being a contributing member of the economy.  These three pillars — government, business, education — of the community need to look at this pathway as a collaborative effort, all working together to produce an individual capable of innovating and challenging the future of Arizona.”

Shawn Linam, co-founder and the CEO, of Qwaltec: “When I first came to Arizona, kids who were interested in science and technology tended to leave the state and we were losing our knowledge base. The STEM emphasis in the state is important to maintaining that knowledge base, but they need to know that there is somewhere to go in Arizona. In the past, all they saw was real estate and construction, but if they can see that there are local technology start-ups and employers, that the universities are focused on technology transfers and technology start-ups, that works together and flows down to the high schools and middle school and allows us to retain talent and attract new talent.”

Kjell Stakkestad, president and CEO, KinetX Aerospace: “If we had a vibrant advocacy group fighting for the aerospace industry, you would see commercial space and space work in Arizona grow dramatically. Arizona is a place where people want to come. The only drawback is that we have to do something about the education system. When people come and we try to attract people here, they say, ‘You’re 49th in education.’ I remind them that we have small pockets that are the best in the country. The problem is you want the statewide education system to work that way.”

Peter Vedder, director of strategic development, KinetX Aerospace: “There are two tiers where Arizona’s aerospace industry needs help — the first is the advocacy and the visibility side and the second is the economic front. There has been a very disjoint set of philosophies as to where the (aerospace) industry advocacy should come from. Should it come at the state level? Should the state as an entity, through something like the Arizona Commerce Authority, be the organization that is the focal point for representing aerospace to the world? Or should it be a private, nonprofit organization that represents the industry. Colorado and Florida both have successful nonprofits which advocate for the industry.  We need a consistent vision for what the state should do. On the economic side, what types of programs could cities, counties, the state offer? Is it matching grants, R&D tax credits, zones that are designed for lower taxes based on the types of research you’re doing? That’s what is needed for this industry to flourish.”

Technology

 Jacob DiMartino, founder and CEO, RAADR, Inc.: “I think we need to work as an ecosystem more closely. We should be helping everyone elevate his or her businesses. We can do this by working together through partnerships and competing for bringing more dollars into Arizona for all sizes of businesses alike. This would really strengthen our economy in Arizona. More than that, we need to proactively get others outside Arizona to start recognizing the state as a hub for certain industries such as technology. This will bring a lot of positive attention to Arizona and as well create more jobs and revenue.”

Tomas Gorny, CEO, Nextiva: “I believe it’s less about policy, and more about providing opportunities that challenge and excite people. Arizona is a great place to live and a friendly state for doing business. We need keep a pulse on what businesses are doing both locally and across the country so we can stay competitive and keep top talent here to grow with us. Bringing national awareness to the innovative companies and career opportunities right here in Arizona is going to be vital to our growth and success.”

Nate Reis, founder and CEO, Railway Technologies: “The future of Arizona’s knowledge-based economy will be a direct correlation of our ability to attract, develop and retain talent which is largely dependent upon access to capital.  Community support for our startup community is growing.  It’s critical we put a few wins on the board to develop a reputation for investors and entrepreneurs that Arizona has what it takes to build companies with a high probability of success.”

Want to hear about what’s going on in Arizona’s healthcare, energy, aerospace and technology industries? A panel of experts will be talking aerospace and more on Oct. 5 at the HEAT Forum.

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