What is the single most important rate-limiting factor when it comes to economic development?

If you live in Northeast Ohio and have been following the Avon exchange controversy, you might think it was highways and roads.  Proponents argued the new highway exchange will be a much needed stimulus to the economy; opponents argued that it contributes to sprawl and negatively affects efforts to revitalize downtown.

Both arguments contain some truth–and yet both also miss the single most important factor that enables economic development to occur in the first place:  access to cheap, potable water.  There could be no economic development in the area surrounding the Avon exchange if there weren’t also easy access to abundant fresh water.

Why was it that places like Cleveland, Pittsburgh, and even Chattanooga became major industrial centers?  Water.  And lots of it. 

Most attention these days is placed on developing alternative energy resources, yet even here water plays a critical role.  Water plays a major role in removing carbon from the atmosphere.  The quality of our water has been adversely affected by the choices we’ve made with respect to the fuels and other energy sources we use.

(Historical note with no small amount of irony: When Rockefeller first set up shop in Cleveland he developed a process for extracting kerosene, the fuel of the day, from oil.  A by-product of the cracking process was gasoline.  Since there was no use for gasoline at the time, Rockefeller and team simply dumped the gasoline into the Cuyahoga River…)

Everything eventually comes back to water.  Our manufacturing processes depend heavily on water, and in the process have damaged the quality of our water, air, and land.  Precipitation draws pollutants out of the air and puts them into our water table.  It also pulls them out of the ground and deposits them in our rivers and streams.

We certainly can and need to develop alternative fuels–indeed, we have to if we want to survive–but what we can’t develop is an alternative to water.

As a result Northeast Ohio has two critically important assets that, despite continued industrial use, are woefully underutilized: Lake Erie, part of the chain of lakes that make up the largest remaining source of surface fresh water in the world (the five lakes combined account for nearly 20% of the world’s surface fresh water), and the Cuyahoga River Valley watershed–once the source of late night TV jokes but today one of the most important watershed testbeds in the world.

In our 2005 report on the possible futures Northeast Ohio might face, green/sustainable systems and new energy sources were identified as key global drivers of importance to the region.  Increasingly, access to fresh water is becoming a key driver for other regions around the world.  While we currently explore the feasibility of offshore wind as one possible energy solution, have demonstration solar setups at the Great Lakes Science Center and Progressive Field, have projects in the Valley focused on fuel cells, green bulkheads, alternative storm water treatments, and even a nanotechnology-based filtration company in the region, we don’t have a highly visible, focused effort around fresh water issues and solutions.

With the Port of Cleveland contemplating a move–the kind of thing that happens in a region once every hundred years or so at best–with a LEED certified development going up in the Flats District, the potential to develop offshore fresh water wind in Lake Erie, with the 50th anniversary of the river catching fire coming up in just over a decade, and with the region as a whole sitting right on the edge of the shallowest of the Great Lakes with one of the three most critical dead zones in the country, the opportunities for Northeast Ohio to be the testbed for critical fresh water research and solutions development is enormous.  

And this is the most important economic development lesson I learned from my visit to Chattanooga.  Water–access to it, its quality, and how it is used–is the single most critical factor to the amount of productive economic development that can take place in a region.  Does that mean I think we should run out and build an aquarium? No, but we should learn from the Tennessee Aquarium’s efforts to focus on the freshwater econsystem and the watersheds that run from Chattanooga down to the Gulf. 

While fresh water fish will always be fascinating to flyfishers like me, they don’t make for the most exciting aquarium exhibits, and so Chattanooga had to build on a salt water addition so people could see “all the pretty colors.” Given Chattanooga’s emphasis on developing downtown as a tourism destination, this made sense.  The same for their River Walk, which is far more people-friendly than our Towpath Trail, with well-designed convenience centers that incorporate recycled materials from the region’s major industries every two miles, and exceptionally good signage that ties the city’s industrial past to its present and future direction. 

We should certainly do more with design than we do (another of the key global drivers identified in the 2005 report), plagued as we are with a plethora of Soviet-era style architecture that is almost as much of a turn off in our wonderful summers as it is in our more Soviet-like winters. But the main things I took away from Chattanooga that are important to Cleveland are the following:

We know we need to boost the amount of R&D that takes place in our region.  We also need to pay greater attention to design as well.  The two can be done together.

We know water is the ultimate rate-limiting factor on economic development and that, while we have it in abundance today, tomorrow may well be a different story.

We know that water touches or is touched nearly every major sustainable technology in some way or another: nutrient loading from and diversions for agricultural use and neighborhood development; pollution from industrial processes; dredging to keep shipping channels open; green bulkheads to help repopulate depleted fish stocks; permeable concrete to minimize stormwater runnoff; filtration to remove contaminants; alternative energy that uses offshore wind and water movement to generate clean power; diminishing sources of fresh, clean drinking water sufficient to support growing populations…the list goes on and on.

And so it isn’t an aquarium we need, but rather a Fresh Water Institute–not a building, but a way of organizing and increasing the amount of academic research that takes place here focused on near shore and watershed loading issues in Lake Erie and the Cuyahoga, things that have universal applicability and growing importance over time.  An organization that is able to focus attention on that research and raise its visibility the way Woods Hole and Scripps do for oceanic research.  But even more the organizational capacity to convert what we learn from this increased academic research into commercial solutions that serve the global marketplace but are based here in Northeast Ohio. 

We also need to make sure that as part of the marketing and educational pieces of this Institute that the public outreach and K-12 educational components are thoroughly integrated, so that people in the community understand the importance of these resources and our children grow up with an enthusiasm for both water and the science of making sure there will be enough fresh water for all of us in the future.

Lastly, because so much depends on how we use this essential resource, having a policy group within the Institute–a mix of legal, research, commercial, and governmental expertise–is essential.  It not only can help change how we use water here, but how water is used around the world, and it also helps to elevate the visibility of both the research and the commercial development occuring in the region.  Not to mention reinforcing the image of Cleveland as a “Green City on a Blue Lake,” an attractive, clean place to live and raise a family.

There were lots of other lessons I learned in Chattanooga, but for purposes of the economic development in Northeast Ohio, this is it: make better use of water as the key factor necessary for robust, successful economic development.

As reported in Crain’s:

 A Florida medical imaging company has committed to move to Northeast Ohio to take advantage of government financial incentives and the region’s health care resources.

ViewRay Inc. of Gainesville, Fla., plans to move to the area as soon as it finds a location, said CEO William Wells. He said the company is particularly interested in Solon.

The company holds an exclusive license to University of Florida technology that uses magnetic resonance imaging to guide radiation therapy used in treating cancer.

Click here to read the full story.

From BioEnterprise:

Ohio health care start-ups attracted a record $296 million in venture capital last year, sharing top honors in the Midwest with Minnesota.

Click here to read more.

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IBF Conferences and BioEnterprise are proud to present the 2nd Annual Global Healthcare Investing Conference, scheduled for April 30-May 1, 2008 in Cleveland, Ohio.

Click here for more information.

Annette Ballou
Director of Strategic Marketing and Communications
BioEnterprise Corporation
(216) 658-4525

What will a new presidential administration mean for NASA and the space program?  More parochially, what will the impact be on NASA Glenn Research Center?

www.SpaceRef.com reports that “Some of the most influential leaders of the space community are quietly working to offer the next U.S. president an alternative to President Bush’s ‘vision for space exploration’–one that would delete a lunar base and move instead toward manned missions to asteroids along with a renewed emphasis on Earth environmental spacecraft…

“There would be some different ‘winners and losers’ compared with the Bush vision. If the lunar base is deleted, the Kennedy Space Center could lose additional personnel because there would be fewer Ares V launches and no lunar base infrastructure work that had been assigned to KSC. On the other hand, the Goddard Space Flight Center and National Oceanic and Atmospheric Administration near Washington, along with the Jet Propulsion Laboratory (JPL) in California, would gain with the increased space environmental-monitoring goal.”

NASA Glenn does have a role in the current Bush vision, but the Center’s history has focused on aeronautics, “spaceflight systems, propulsion, power, communication, microgravity science and human research.”  The Center has also played a pivotal role in the development of fuel cells and in icing studies.  A shift in focus away from the current vision will inevitably impact NASA Glenn–the question is, how can we best adapt to that shift outside the NASA gates? 

A renewed emphasis on space-environmental monitoring could open up new opportunities for NASA Glenn to interact more closely with community efforts to develop a sustainability roadmap, establish a fresh water institute, and other environmental R&D and technology development efforts.

It’s far too early to say with any certainty–the election is still months away–but clearly there will be changes coming down the road (yet again) for NASA Glenn.  Those involved in sustainablity and environmental technology impacts should pay close attention to opportunites  that might emerge for closer ties with NASA in 2009.

From BioEnterprise:

 Aeromics, a biotechnology company founded at Yale, is the latest in a series of companies moving to Cleveland in conjunction with star faculty recruitments by Case Western Reserve University and University Hospitals.  Other recent biotech relocations include Retinagenix and Polgenix (both from Seattle) and Thromgen (from Ann Arbor).Click here to read more.

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IBF Conferences and BioEnterprise are proud to present the 2nd Annual Global Healthcare Investing Conference, scheduled for April 30-May 1, 2008 in Cleveland, Ohio.

Click here for more information.

Annette Ballou
BioEnterprise Corporation
(216) 658-4525

From BioEnterprise:

iNetworks, a Pittsburgh-based venture group focused on investing in life sciences and healthcare technologies, has opened a Cleveland office. The neighboring metros boast a combined $1 Billion in research, 700 companies, and $300 million in annual venture investment in the health care sector. iNetworks is currently investing from its $100 million BioOpportunity fund.

Click here to read more.

NorTech, Northeast Ohio’s leading technology-based economic development organization, recognized winners of the 2007 Innovation Awards yesterday during the NorTech Summit at LaCentre in Westlake, Ohio. NorTech hosts the annual Innovation Awards to honor individuals, companies and organizations producing innovative products and processes in Northeast Ohio. The Summit was keynoted by Dr. Stanley Gryskiewicz, a consultant and an international authority with over thirty- five years of experience in leadership, creativity, innovation and change management.

The 2007 Innovation Award winners were selected based on the theme “breakthrough innovation”–technologies that have the potential to dramatically impact a specific industry or market sector. A distinguished panel of judges chose seven companies/organizations in Northeast Ohio with inventions in a variety of technical fields including: nanotechnology, robotics, cancer diagnostics, medical imaging, air filtration, electronic sensory technology, and advanced energy (fuel cells).

“At the turn of the century Northeast Ohio was a primary location for entrepreneurs, industrialists, and inventors. So it’s important for our region to continue that legacy of innovation to remain globally competitive in today’s marketplace,” said Dorothy C. Baunach, President and CEO of NorTech. Baunach continued, “That’s why NorTech celebrates our region’s innovators and their accomplishments–to encourage and foster a ripe environment for technology, innovation and entrepreneurship.”

Below is a complete list of 2007 NorTech Innovation Awards winners and a brief description of their innovation.

AnalizaDx is a Cleveland-based cancer diagnostics company. The company has developed a proprietary platform technology that is capable of distinguishing changes in the structure of proteins in common biological fluids such as blood, urine, etc. These changes, when connected to an underlying disease process, could then serve as sensitive detection method for cancer. AnalizaDx’s technology offers important advantages compared to other biomarker approaches, in particular, its inherent insensitivity to the natural biological variation in the amount of protein that can complicate reproducibility and interpretation of most conventional technologies.  Furthermore, the technology platform is performed in a highly cost-effective, high-throughput manner, affording an economic basis for early diagnosis and screening. AnalizaDx has already demonstrated a clear feasibility to identify promising biomarker candidates for ovarian and breast cancer in preliminary clinical studies, and is also performing advanced studies with prostate cancer. The Company has formed multiple clinical collaborations with leading institutions, including the National Cancer Institute, University Hospitals of Cleveland, and The Cleveland Clinic Foundation. 

EyePlusPlus‘ lightweight, fully functional system provides rich, dynamic information to individuals with blindness or impaired sight. The Forehead Sensory Recognition System (FSRS) is an electronic travel aid that is for use by appropriately trained individuals to supplement existing travel aids (e.g., white cane, guide dog, etc.) by providing additional sensory information via electrical stimulation regarding the user’s physical environment.  The FSRS converts video images captured by a miniature sunglasses-mounted camera into electro-tactile stimulation patterns applied to the user’s forehead through an array of stimulation electrodes, which allows the user to perceive objects.

MemPro Ceramics has combined polymer processing with ceramic production to make a new filtration technology using ceramic nanofibers to capture/filter undesirable particles while removing gaseous pollutants from the environment. The innovation will dramatically reduce the costs of using catalysts in the production of pharmaceutical and biotech products, fine and bulk chemicals, as well as food and beverages. Recently, a working prototype was built in partnership with the University of Akron to demonstrate the efficacy of the filters and the benefits of employing ceramic nanofibers to take advantage of large surface/volume ratio these nanostructures offer. 

Nanomimetics Inc. is focused on the development and commercialization of its unique nanocoatings for a variety of medical and industrial applications. Founded in 2004, Nanomimetics has demonstrated that its patented technology can improve medical device efficacy by increasing compatibility with the human body. In addition, the company is actively developing coatings that will prevent biological fouling in aqueous environments.

SpineMatrix®, Inc. (SMI) is an Akron, Ohio-based spinal imaging company that has developed the CERSR® (Computerized Electrophysiological Reconstruction of Spinal Regions) device for evaluating low back physiology related to the origin of low back pain (LBP) and injury.  CERSR® aids the neuro or orthopedic surgeon in accurately diagnosing the true source of LBP non-invasively with the real potential to significantly reduce total healthcare cost by directing the LBP patient to the appropriate diagnostic, therapeutic and surgical procedures.  CERSR is the first and only FDA cleared device to do this.  SMI has completed clinical efficacy studies at the Texas Back Institute, The Cleveland Clinic, Ohio State University College of Medicine and others.  Two thousand, nine hundred patients were studied, with 581 under blinded protocols.  There have been 10 published, peer-reviewed clinical effectiveness of the CERSR system.  The system utilizes 4 CPT reimbursement codes.  The system currently has 10 US and 5 foreign patents and 2 registered trademarks.  The Company is led by Ben Shappley, a twenty-five-year veteran of the orthopedic and spine industries.

TeamCASE has partnered with both local and national corporations such as Goodyear, National Instruments, Roadway, ENSCO, Inc., Argon ST, Bendix, Innovative Engineering & Consulting and has been supported with donations from the Gund Foundation, Case Alumni, and others to produce a world-class autonomous robot capable of bringing high-technology recognition to Cleveland. DEXTER, a full-size robotic, self-driving vehicle is the creation of Case Western Reserve University engineering students, faculty, and corporate sponsors.  DEXTER is short for Deployable Extreme Environment Robot.   DEXTER has not only caught the eyes of young, aspiring engineers at the 2007 Cleveland Auto Show, but DEXTER and TeamCASE will compete in the 2007 DARPA Urban Challenge, a 60 mile race on city streets without any human intervention and will also be featured in documentary about the Urban Challenge to be aired in February 2008 on the The Discovery Science Channel. 

Technology Management, Inc. (TMI), Ohio’s oldest independent fuel cell systems developer, was organized in 1990 for the sole purpose of commercializing a modular, multi-fuel Solid Oxide Fuel Cell (SOFC) system into mobile, rural and remote markets using multiple strategic alliances.  Today, with over $25MM invested, TMI is among less than a dozen companies in the world to have publicly demonstrated a kilowatt class fuel cell system operating on ordinary fuel.  TMI is now engineering systems for initial field tests and pre-commercial manufacture.  Early funding by the U.S. Department of Defense for mobile military applications provided the basis for TMI’s current systems, which can be shipped overnight by common carrier, field maintainable by one person without special tools or equipment, and operate on a wide range of common fuels.  These include natural gas, propane, military JP-8 kerosene, diesel and renewable fuels such as ethanol, biodiesel, digester biogas, and (soy) vegetable oil. 

Following up on our earlier post about an educated workforce and the need for more innovation in our educational system comes this article from the Financial Times proposing that instead of (essentially meaninigless) internal training certificates, companies might actually provide recognized degrees for training provided to their employees:

“To educational protectionists an employer’s degree would doubtless be as worthless as a mail-order diploma from a mid-west correspondence college. But to most Britons, a masters in jet propulsion from Rolls-Royce would carry more clout than honours in media studies from Humber University (née Scunthorpe Poly). The currency of degrees is already debased. The inclusion of suitably vetted employers among awarding bodies could raise, rather than lower, their value.”

It’s an intriguing idea, and one our larger companies should give serious consideration.  Sure, they might want to partner with an existing institution first, they way Timken and Rolls Royce partner with Stark State.  In fact, that seems to be the right approach, at least the way this model is unfolding in the UK:

“Unipart, the engineering logistics company, would be well placed to exploit this opportunity, since it already has its own ‘university’. I visited one of its colleges earlier this week. It was not the kind of ivy-clad establishment where Sebastian Flyte, the gilded undergraduate of Evelyn Waugh’s Brideshead Revisited, would loiter with his teddy Aloysius. It was located within a components factory in Coventry. Forklift trucks performed a noisy ballet outside the training rooms, dubbed the “Faculty on the Floor”.

“But proximity to the workplace is the whole point, according to Unipart. Too often, staff instantly forget what they have learnt in the bubble of offsite training. Unipart U is geared to adult learners, teaching them skills they will use quickly and therefore remember. Students work together in mixed-ability groups to crack problems. Touchy-feely skills were the focus of the course I observed. “Drinking at work is frowned on in the UK,” one would-be logistics consultant pondered, ‘but in some eastern European countries factory managers start the day with vodka.’ Should the visiting contractor accept or decline a shot, he wondered?

“Unipart requires all of its 9,000 staff to complete some training. About three-fifths are taking vocational courses from a curriculum whose upper level equates to a university degree. The company hopes to award a logistics NVQ2 – equivalent to a GCSE – under the oversight of a local college.”

Now that Rolls Royce has a fuel cell facility in Canton, imagine what the pedigree of a Rolls Royce degree in solid oxide fuel cell development could mean, both as an attractor of talent to the region and as a way to position the region as the place to be to get the skills you need to succeed in today’s economy.  The could hold for companies like Sherwin-Williams, whose CEO already jokingly claims he lowers the IQ in his Cleveland R&D center 100 points just by entering the building.  Why not use that talent, paired up with one of our local universities, to offer a Sherwin-Williams degree in solar collecting or other advanced coatings technologies?  Fears about brain drain (people taking that degree and using it to get a good job somewhere else) would be more than offset by the brain gain potential such degrees would create–after all, if a Rolls Royce degree in fuel cell development has so much value outside the region, doesn’t it also say Northeast Ohio is where you have to be if you are serious about being in the fuel cell industry?

The best way to know what’s happening inside a ragion is to see it from the outside.

For years, an argument has raged within Northeast Ohio’s economic development and investment circles over whether our region’s strengths in healthcare are simply a part of the local economy, or whether they also offer a chance to build out exportable industries.  Some have argued we should focus on making healthcare and healthcare devices the centerpiece of any regional development strategy; others argue–glass half empty–that while we mave some of the top ranked hospitals in the world here, we are behind other regions when it comes to capitalizing upon opportunities in the device space.

So it gave me great pleasure this morning to pick up my copy of the Financial Times of London and read about a group of US doctors who performed pioneering surgery recently that might give head injury victims new hope:

“Doctors in the US have transformed the life of a minimally conscious patient by implanting electrodes deep into his brain. The 38-year-old can eat, drink and communicate with his family for the first time since 1999 when a savage assault left him with severe brain injury.

“This first successful use of ‘deep brain stimulation’ or DBS to treat the effects of serious brain damage is published on Thursday in the journal Nature. It will offer thousands of families the hope that they may be able to communicate again with loved ones who have lived for many years as little more than human vegetables.

The operation was carried out at the Cleveland Clinic in Ohio, in collaboration with Weill Cornell Medical College in New York and the JFK Johnson Rehabilitation Institute in New Jersey. DBS is used to treat Parkinson’s and other neurological disorders, but had not been tried before on a patient with severe head injury.” 

This is an amazing story, and you can read the rest of the FT’s coverage of it here.

And while the article doesn’t mention Intelect Medical by name, followers of TechFutures will recognize that company as one of last year’s NorTech Innovation Award winners for their pioneering work in Deep Brain Stimulation.  Since Intelect was a spinout from the Cleveland Clinic (ably assisted by local economic development group BioEnterprise), the argument about whether or not this region can turn its healthcare expertise into a profitable, global device-based industry as well would seem to be moot.  The story about the young man coming out of a minimally conscious state through a procedure performed at the Cleveland Clinic should be seen as a “wake up call” in more ways than one…

It seems a no-brainer: a region rich in health care assets and a burgeoning medical devices industry ought to be (and have) a showcase for the industry.  People from around the world come to the Cleveland Clinic and University Hospitals not only for the best possible care, but also to see and learn first hand about the latest in new medical equipment and techniques.  Why wouldn’t we want to expand on the opportunity those visits create by building a center where all the latest medical breakthroughs might be showcased?

To hear the perspective of some of our region’s business and civic leaders on the Medical Mart, click here.  Read on to get the perspective from Joe Roman, head of the Greater Cleveland Partnership: