State of the Industry Report 2007-2008

Chapter Eleven strategIC role of plaCe/loCatIon strategIes Strategic management at the portfolio level certainly defines industry drivers and CoRE 2010 domains like Solutions Delivery and Portfolio Optimization, but it overarches corporate location strategies, too. Location decisions are increasingly linked to real estate and workplace portfolios that are managed on a holistic level. In effect, they are part of the now-predominant model surrounding the globally integrated CRE supply chain. For some CRE departments, tying location, and now talent, strategies to the business growth of the company is their ‘bread and butter,’ but more need to start doing this to play a leadership role inside the corporation in what is turning out to be another path to enterprise-wide CRE impact. Companies and their CRE departments are responding to the War for Talent in several key ways: • Aligning enterprise talent strategy to CRE location strategy • Integrating workplace and sustainability practices with location strategy • Using long-term planning to address workforce, labor supply and demand needs by market globally The result is that talent, workforce and location functions are also undergoing big changes. • The elevation of the location strategies and talent functions is a huge question globally Our research in 2007 on Trends in Corporate Real Estate Location Selection validates the CoRE 2010 expectation that “resource portfolio configuration will become more important to multinational corporations than traditional site-by-site strategies.” • Location decisions, like CRE strategies themselves, are increasingly linked to global business plans • The globally integrated portfolio is now a prime decision factor versus individually selected sites • Access to markets, customers, suppliers and talent is more important than lower-cost labor and markets • Talent is a new driver of location • Sustainability could become more of a driver, too Click here to view Location Selection Trends survey results. Here’s what CoRE 2010 said would happen: • “The portfolio will be viewed as a network of places embracing physical and virtual space. Because business activities will be in constant flux, the portfolio will demand scalability and flexibility.” • “CRE’s leadership in right-sizing and right-locating the real estate portfolio amid the evolution of a more integrated infrastructure will be a crucial part of bestpractice location strategies.” here’s where we are today: The three driving forces shaping the global location strategies of multinational corporations are market entry, cost reduction and knowledge acquisition, according to CoRE 2010. For the most part, this is holding true, as reflected in our 2007 data. what will it look like in 2010? • CRE departments will need to increase the linkage between location and the global business plan from the nascent levels of 2004 – 2007. • CRE will also have to “step up” its ability to integrate location with talent, sustainability practices, workplace management and other areas. • From the economic development side, “Communities will have to stay on top of the global dynamics required to attract workforces and multinational companies,” as CoRE 2010 predicted. eConomIC deVelopment perspeCtIVe The integration of real estate and workplace on a global scale is also affecting location decisions and the approach economic development corporations (EDCs) must take. This new direction in turn underscores the new reality of economic development: To compete for jobs and investment that result from larger-scale corporate strategies, EDCs now need to take a portfolio perspective and understand the much higher-level needs of their corporate clients. Our 2007 survey, however, shows a wide gap in how EDCs view the changing needs of corporate clients. The importance of the quality versus the cost of labor is one. Another is that corporations are prioritizing brownfield redevelopment more so than EDCs. Plus, corporations place more emphasis on finding innovation in the markets they select than do EDCs. related Cases see special report on Economic Developers Roundtable from the Atlanta Global Summit, October, 2007 see special report on Economic Developers Roundtable from the Denver Global Summit, May, 2007 chapter eleven State of the Industry 2007-2008 49 http://www2.corenetglobal.org/home/index.vsp http://www2.corenetglobal.org/dotCMS/kcoAsset?assetInode=1152096 http://www2.corenetglobal.org/dotCMS/kcoSearch?search_type=advanced_search&keyword=keywords&search_field=2007%2C+atlanta&kwPublicationMonth=-1&kwPublicationYear=-1&assetTopicsInodes=40453&assetTypesInodes=46590 http://www2.corenetglobal.org/dotCMS/kcoSearch?search_type=advanced_search&keyword=keywords&search_field=denver+summit%2C+roundtable+session&kwPublicationMonth=-1&kwPublicationYear=-1&assetTopicsInodes=40453

Table of Contents Feed for the Digital Edition of State of the Industry Report 2007-2008

State of the Industry Report 2007-2008 Contents Chapter 1: Introduction : CoRE 2010 Framework and Report Structure Chapter 2: The Changing Business Environment Chapter 3: Executive Summary of Key Findings and Conclusions Chapter 4: CoRE 2010 Adoption Rate Chapter 5: Sustainability/Corporate Social Responsibility Chapter 6: Global Sustainability Survey and Roundtable Findings Chapter 7: Workplace Practices/Work Environments Chapter 8: Workplace Related Issue: The War for Talent Chapter 9: Asset Management/Portfolio Optimization Chapter 10: Solutions Delivery Chapter 11: Location Strategies/The Strategic Role of Place Chapter 12: Location Related Issue: Site Selection Morphs to Portfolio Alignment Chapter 13: Strategic Competencies/Enterprise Leadership Skills Chapter 14: Competencies Related Issue: The War for Talent in Corporate Real Estate (CRE) Chapter 15: Integrated Resources Infrastructure Solutions – IRIS Chapter 16: Technology and the Web Chapter 17: Technology Related Issue: Removing the Obstacles to Industry Data Standards Acknowledgements and Sources

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