1. How have location strategies changed in the past five years?

2. What do companies look for in a potential workforce?

3. What do you look for in a good IPA? How do successful agencies attract and retain investment?

4. How could IPAs improve aftercare programmes?

5. What are your greatest frustrations when dealing with an IPA and how might these be avoided?

1. In terms of geographical orientation, companies have strongly expanded their scope. For many expansion or consolidation projects, locations around the globe are now being evaluated as options. Also, new emerging markets are being considered more often than before (particularly areas such as China and India). Competition for attracting new investment has definitely become global now.

As far as location drivers are concerned, there is clearly more focus on costs as a location factor and cost reduction in general as a driver for new location searches. Also, there is a growing recognition that access to talent is a key requirement for selecting a successful location. Finding the appropriate skills in frequently very competitive labour markets has become a real challenge in various parts of the world. Finally, since September 11, many of our clients have put the safety factor high on their requirement list.

2. The answer to this question depends on the type of operation being considered. For example, manufacturing operations, call centres and R&D centres have hugely different workforce requirements.

Generally, for manufacturing and distribution operations companies tend to look for a productive and loyal workforce at competitive costs. Technical engineering skills are important, and the motivation and reliability of staff is important.

For call centres and other types of (shared) service centres, service attitude is a specific need. For centres that serve clients in a specific language market, language skills are obviously important and the distinction between native speakers and non-native speakers is critical. Specific technical skills (such as finance, IT, etc) are required regularly for specific service centres. Generally, a large proportion of staff in these centres is relatively young.

Finally, R&D operations and headquarters require highly qualified staff. Management skills and availability of university graduates in the required disciplines are important requirements. Since this staff is more mobile, the attractiveness of a location is also important since staff may have to be recruited (or transferred) externally. This attractiveness not only relates to quality-of-life factors, but also to the financial attractiveness of a location (personal income taxation, housing costs, pension schemes, etc).

3. IPAs should show an understanding of what an investor needs. They should be prepared to answer the specific requirements that companies in their selected target sectors have, and be able to introduce them to the right local partners. Surprisingly often there is a large unfamiliarity with these needs. IPAs with sector & functional experts responsible for the selected target sectors have a strong advantage, since such experts speak the same language as the investor. Also, IPA officers should be honest and realistic. Trying to win projects that are doomed to fail will hurt both the region and the agency in the long run.

4. Aftercare programmes should be based on an understanding of the investor’s concerns. This is best organised by making sector experts central to an aftercare programme.

The sort of customer service agent who doesn’t understand what is going on in the investor’s market and does not foresee the challenges that companies will be facing will hardly be able to help an investor to solve specific problems or identify opportunities for additional investment in the region.

IPAs that don’t yet have an aftercare programme and have limited resources for such programmes should not be too ambitious. First, make sure you have all your other marketing tasks well organised, and start with just a few key companies as part of the programme. Don’t try to reinvent the wheel either: there are good examples of aftercare programmes that have been implemented by other IPAs.

5. As a consultant, one of the difficulties is that we frequently are requested to keep the identity of our clients (the investors) confidential, not just to IPAs and other service providers, but even within our own consulting firm. There are various examples of IPAs who refuse to assist consultants if the investor’s name is not revealed or if there is no direct contact possible yet with the investor. These IPAs do not recognise that it’s not the consultant who chooses confidentiality, but the investor. They are not professional enough to respect that choice. The result is that their location is evaluated without their support, and fact finding trips take place without their control. Luckily, the reality is that most IPAs are willing to work on a confidential basis if they feel comfortable that the consultant is representing a realistic project.

It is the consultant’s responsibility and obligation to communicate with the IPAs once the outcome of a location study and/or the investor’s identity can be released. I know such follow-up is not always on top of a consultant’s list of priorities, but I consider it unprofessional not to provide that service.

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