Doug Hall (left) with Elvises. Photo by Gary Michael, exposuresltd.com

What would an opening session in Las Vegas be without five Elvis impersonators? The five Elvises who opened Monday's General Session made perfect sense here in Sin City. And the two Vegas showgirls who introduced Board Chairman, Jeff Elie, were just another part of the show.

The main event, keynote speaker Doug Hall, provided the substance for the session, with valuable insights on intellectual capital and the importance of big ideas.

Hall, founder of what is today known as “America's #1 Idea Company” (Inc. Magazine), the Eureka! Institute, is a marketing and intellectual property expert.

In bare feet and a hawaiian shirt, Hall told the audience of nearly 3,000 to become significant intellectual partners with their businesses and their clients.

The key to success is to focus on the future, he said. “Look out into the future that paints a vision of where your organization is supposed to be.” To understand the future, you must brainstorm – come up with ideas and try to act on the right one from the beginning. He stressed that businesses or products that fail do so because the idea wasn't good in the first place. He also challenged the practice of building business through customer loyalty.

The data speaks for him, Hall said. And, the data says that building a successful business means you must constantly search for new customers. To do that, you must bring new value to the situation. But what is the right idea to act on?

Hall's Three Laws of Marketing Physics, or How to Know a Big Idea When You See It. The customer must be able to clearly understand the following:

Photo by Gary Michael, exposuresltd.com

The world of 2010 will happen by 2007. That’s the forecast of Corporate Real Estate 2010 (CoRE 2010) consultant Barbara Hampton, who oversaw the development of a full line of published research on the changing nature of work and the shifting role of corporate real estate (CRE). The research reports on how those roles will evolve by the year 2010 are based on the globally- and digitally-networked enterprise now, the predominant business model of most corporations.

Barbara Hampton’s review of the corporate real estate and workplace management landscape shows a robust adoption rate of CoRE 2010 among global companies. Photo by Gary Michael, exposuresltd.com

The CoRE 2010 update took poll position among the 30 Education Sessions offered here, and appropriately so, because the CoreNet Global research and leadership initiative, shaped by many of the world’s most respected companies, clearly places the group as the industry thought leader in the strategic area of Integrated Resources Infrastructure Solutions (IRIS).

Hampton’s review of the corporate real estate and workplace management landscape shows a robust adoption rate of CoRE 2010 among global companies.

“It’s a tremendous value that can be added,” said Hampton, who emphasized the idea of transformation while surveying CoRE 2010 practices and findings that companies are deploying.

“But 2010 is really 2007,” she advised. “The businesses we support are moving that fast. The future is not what will be but what (already) is . . . Before, the technology wasn’t there. Now it is.”

Referring to the concept of “enterprise” as a key term denoting the networked organization and the creation of value, Hampton offered case examples of numerous CoRE 2010 applications. “The enterprise is how we are going to work, and the organization stretches across the value chain like a global society,” she said in delineating the chief characteristics of how companies are using CoRE 2010.

Drivers toward 2010 are technology, globalization and the nature of work. These are influenced by innovation, new CRE-based enterprise models, and corporate social responsibility (CSR) tying to sustainability. The hallmarks of the new models are integration of CRE with HR and IT, web and other digital technologies, and a constant core focus on internal service delivery, or Customer Relations Management (CRM).

“It’s all about enabling work on a global level,” stressed Hampton, the former head of real estate for Southern New England Telephone before its merger with SBC Communications.

Much of that work will be performed by knowledge workers, reflecting the emergence of intellectual capital as a primary corporate asset of the future. “There will be a large shortage of knowledge workers by 2010, so retention is critical to enterprise success,” she cautioned, citing a statistic from CIO magazine showing that 75% of productivity gains come through knowledge management.

Turning to specific examples of companies that are making effective use of CoRE 2010 practices, Hampton drew immediate attention to one of the latest winners of the CoreNet Global’s H. Bruce Russell Global Innovators Award: the Royal Bank of Scotland.

RBS was recognized during the Las Vegas Summit for its best-in-class work in the area of corporate real estate management for its Embedded Culture of Innovation. “Process management is the centerpiece of the RBS initiative,” Hampton noted.

She associated the key term “workplace strategist” with the RBS award-winning case. “Business process combines with network design and IRIS,” she continued. These elements blend and equate to productivity. They are tracked and managed by key metrics surrounding productivity via balanced scorecards and other measurement tools.

“It’s a complex interaction to support core business and optimization of resources,” Hampton related.

She listed other applications:
• Bank of America, which has transformed workplace into a competitive advantage and realized a 33% savings on the cost of office space
• CISCO Systems, a Global Innovators Award finalist, which launched its Connected Workplace initiative and saw 37% decrease in the real estate requirements
• Herman Miller’s ‘front door’ concept, a way to invent solutions that build team collaboration in the increasingly dispersed work models of this and many other enterprises
• Sprint for its Enterprise Location Optimization platform, another Innovators finalist, and a resource for strategic business, location and other decision support
• The San Diego EDC and its Partnership for the New Economy, winner of the 2005 CoreNet Global Economic Development Leadership Award and an example of how communities are responding to the growing strategic role of place by developing workforce talent instead of recruiting new companies
• Intel’s global asset configuration, for its understanding of the strategic role of place
• USAA’s Sustainable Village in Phoenix, making it an employer of choice with both a CSR and workplace flexibility aspect built into it
• Interface, which has set an example for sustainability across all of dimensions of the so-called ‘triple bottom line, including a rare Platinum LEED designation for its Atlanta showroom
• KeyBank with JCI, another Innovators finalist, for its Ohio LEED-certified campus and a nine-month payback on the investment in it
• NOKIA’s ‘N-Scope’ space cost management program enabling people, technology and higher productivity with the use of technology standards as seen through OSCRE, the rapidly emerging industry alliance developing an open platform for global interoperability
• Microsoft for its Workplace Advantage focus on systems security
• Capital One for its Future of Work program
• GSA for its 2020 productivity measurement initiative
• And others like JCI Solutions Navigator (winner of the Service Provider category of the Innovators award); as well as IBM, EDS, USI and Agilent.

Hampton also shared considerable detail on other forces shaping and morphing the CRE and workplace executives of tomorrow. Sarbannes-Oxley, speed to market, cross-functional solutions and productivity measurement, mobile and dispersed work models, the triple bottom line and other issues or trends are challenging tomorrow’s professionals to be more than corporate real estate people. They are requiring them to become enterprise leaders, and to reach the world of 2010 at least three years sooner than expected.

In this packed session, moderator Ann Althoff (Senior Vice President, HOK) set the stage for attendees hear about two innovative Leadership in Energy and Environmental Design or LEED-certified commercial real estate projects while learning about the variety of opportunities available, the manageable levels of risk, and the rewards of “green” or sustainable design.

On every seat in the room was a color handout with pictures of the stunning Interface Atlanta Showroom, a LEED CI (commercial interiors) Platinum project that grew out of green initiatives in their manufacturing plants, offices, and showcases. In this case study, Melissa Vernon (Manager of Sustainable Strategy, Interface Flooring Systems) and Steve Clem AIA (Principle, TVS Interiors) walked the audience through the process of gaining the showroom's platinum certification. Achieving top levels of points in each category (sustainable sites, water efficiency, energy & atmosphere, materials & resources, indoor environmental quality, and innovation & design process), the project includes features such as high-efficiency lighting, daylight response controls, occupancy sensors, low-emitting furniture and building materials, bamboo flooring, Energy Star fixtures, recycled and reused materials, reduced parking with easy access to several transportation alternatives, and a huge variety of additional sustainability factors.

Further, the Interface Atlanta Showroom's design concept is based on pedestrian exposure with a mixing of residential and commercial application. The showcase demonstrates that you do not have to compromise design for the sake of sustainability. Indeed, the color handouts of the showroom depict stunning residential, conference, and reception areas.

The next case study was presented by Ronald B. Keller (Senior Vice President Corporate Real Estate, KeyBank), Lee Arbegast (Customer Business Director, Johnson Controls), and John Schmid (Project Development Engineer, Johnson Controls who partnered to achieve KeyBank's LEED EB (existing building) Silver certification. Located in southern Ohio, the KeyBank campus is located on a former Brownfield site. In addition to achieving the points they needed for certification while saving energy and contributing to the health and quality of their community, KeyBank engendered community and employee buy-in by making them a fundamental component of their building process. Employees were assured by efforts such as daily air quality testing and reporting and played an active role in environmental stewardship by participating in education programs, recycling, turning off their computers and lights at the end of every day, and so forth.

By their participation in the project, Johnson Controls feels confident that they will better be able to serve all of their clients in the future. For example, by observing and monitoring photocopy usage on the KeyBank campus, Johnson Controls may improve upon the location and usage of bins throughout a building they service.

Key to both LEED certifications was the teamwork achieved on all levels of the process. Before the process began and all along the way, each group from the architects to the housekeeping services and from the furniture and fixings suppliers to the contractors worked together toward a unified goal. As a result, the triple bottom line remains healthy as do the employees of each building, the communities in which they are located, and the overall environment.

For economic developers, the constant fight for new investment and jobs is being taken to a new level by the changing global business models of the companies that EDC’s pursue.

In Monday’s Education Session on location strategies, it was abundantly clear that economic developers who best understand the rapidly evolving needs of their corporate prospects and clients stand the best chance of winning or keeping their business.

As session moderator Jay Biggins noted, “Economic developers must find more creative, strategic ways to compete for opportunities in a very cost-sensitive environment.”

For an increasing number of global enterprises, those sensitivities are not based on traditional ways of making location decisions, starting with the fact that companies today are viewing site selection on a holistic basis as part of their integrated global business and operating plans.

Biggins, whose firm SBB Strategies is an economic development incentives advisor to corporations and economic development groups, listed a range of factors that are adding pressure to companies’ site selection decisions. One of them is not only the threat but reality of litigation – as seen in the Cuno Case challenging the use of economic development incentives that is now before the U.S. Supreme Court for its review.

Other factors are raising the stakes for companies to make the right decisions, such as uncertainty of appropriations by state governments to fund their EDC’s to competitive levels, growing demand for local and state EDC’s to prove the value of the incentives granted to companies, the challenge of demonstrating a ‘win-win’ value proposition to the companies and communities involved, and ensuring a ‘win-win’ on compliance by companies to the requirements of their incentives.

By comparison, the pressures economic developers must learn to respond to are corporate cost control, time to market of new or expanded sites, and the real-time delivery of key information and data to support their corporate clients’ site decisions.

On top of it all, Biggins pointed to the “relentless competition” associated with virtually all corporate and related location decisions today.

The Las Vegas panel, featuring location cases of two corporations and their economic development partners, provided a way to examine the types of creative strategies that make EDC’s competitive.

“There are 50 states, hundreds of local and regional economic development organizations,” Biggins observed, “and each is a lab for innovation in economic development.”

The two innovations chosen for the panel offered contrasts. One focused on Dell Computers: large, well known, global, and publicly traded. The other examined Alien Technology Corporation, an emerging enterprise funded on venture capital.

The Dell case looked at its recently completed global manufacturing center in Winston Salem, NC. The $40-million, 527,000-square-foot plant received one of four 2005 CoreNet Global Economic Development Awards, and was one of two winners in the Project of the Year category.

CoreNet Global recognized the work accomplished by the Piedmont Triad Partnership in successfully landing the 1,500-employee plant, Dell’s largest in the world. The leveraging force behind it all was Piedmont Triad’s ability to meet the key demand of speed to market. It delivered a strategic manufacturing site on an almost unrealistic timeline of seven months, fully built.

Dell’s confidence in choosing the location was based partly on Piedmont Triad’s central location on the Eastern seaboard of the United States and resulting proximity to multiple markets globally, consumers and a trainable, skilled workforce.

According to Piedmont Triad CEO Don Kirkman, the region’s “diversified economic base could also offer a manufacturing competency” inherent from the area’s historical focus on the now-waning textile and tobacco industries. “The available production workforce,” as Kirkman termed it, encouraged Dell that it would find enough people to work in the plant.

“Transportation infrastructure and distribution advantages of the region were also key factors,” Kirkman recalled.

The stakes were indeed high for North Carolina and the Winston Salem metro region with long-term state economic impact projected at $24.5-billion, an added $150-million in capital investment in machines and equipment, $743-million net 20-year tax impact, and 8,000 direct and indirect jobs, as Kirkman recounted.

Incentives were also part of the mix in Dell’s decision to bring the plant to the Tar Heel state. Kirkman reported the state offered Dell a total of $247-million in tax credits but made it clear that the incentives “are hooked to Dell’s (future) growth and output,” and that the “up-front state investment is only several million dollars.”

Regional cooperation also counted with the high level of coordination between the state Department of Commerce, Piedmont Triad, Winston Salem EDC and surrounding community colleges all blending to increase Dell’s comfort level that it had found a place where it could quickly complete a reliably built global facility but also find the local support it needed to meet such a challenging schedule.

“In every corner of North Carolina, it was well-orchestrated leadership,” commented Kip Thompson, the Dell VP who oversaw the build-out and now runs the plant day-to-day.

“Incentives played a role but other factors came into play,” Thompson said. “The community proved it could deliver under an arduous timeline, and they have.”

That timeline was the result of urgency felt by Dell - the only company still manufacturing computers in the United States according to Thompson - to remain competitive with its “deal direct” business model and to respond to emerging markets and new customers.

He explained how the community developed a “significant strategic advantage with its focus on cost, production, quality of labor, infrastructure, the customer experience and speed.” Piedmont Triad’s response to Dell’s supply chain needs, and the resulting recruitment of seven suppliers to the region, added even another dimension to the project’s wide scope.

Ultimately for Dell, the choice of the actual site in February, 2005, came after its decision to locate the plant in North Carolina. The method reflects the growing practice that more economic developers recognize: to have key information on the availability of other strategic resources such as suppliers, distribution, workforce, incentives and other factors even before an exact location is identified - but to have an inventory of “certified” sites when that time comes.

Alien Technologies’ case offered some similar views, albeit from a totally different perspective since the company is a fast growth enterprise. Its choice of Dayton, Ohio, came - in part - as a result of the Dayton Development Corporation’s packaging of “a clear value proposition,” as described by the group’s VP and Executive Director, Donna Buchheit.

Taking the philosophy that sees location decisions as a part of an overall portfolio optimization strategy of company, the Dayton EDC focused on a partnership with local business and the community to present a strong case for Alien’s selection of a location to increase and speed the manufacture of RFID tags used increasingly over bar codes by retailers and product suppliers everywhere.

“It’s no longer just about real estate and incentives,” Buchheit said. “It requires an integrated region. It’s now about integrated economic development,” a reference to the positive results communities often see when they work throughout their metro regions in unison to inform, sell and serve their corporate prospects.

The need for a centrally-located production center in the Eastern U.S. triggered Alien’s site search, according to Dr. Paul Drzaic, VP of Advanced Development at Alien.

Drzaic cited the open support and encouragement by the metro Dayton existing industry base as one of the reasons that the West Coast-based company went there. “Local business leaders’ support was important, and included NCR, Procter & Gamble, Lockheed Martin and the U.S. Air Force,” he told the audience.

Alien was already producing up to seven billion RFID tags for major retailers like Wal-Mart, Target and Albertson’s, but when Gillette placed a record order for 500-million of the tags, the need for a new manufacturing and supply resource became another fast-growth priority for the company.

Dayton’s targeting of key industry segments also payed off, he recounted. The EDC focuses on advanced materials, Alien’s segment, along with IT and aerospace.

The key factor - in keeping with the increased emphasis on tying location to overall company strategies - was Alien’s “selection criteria (as) tied to our growth strategy and venture capital return,” added Drzaic, who listed proximity to customers, financial incentives, access to a quality workforce, and local business and political support as the other deciding factors.

Gayle Matthei-Meredith, Managing Principal, Meredith Realty Partners LLC
Anne Joyner Sheehan, President, Real Property Tax Advisors

Lynne O'Brien JD, Director, Corporate Real Estate, The Coca-Cola Company
Meredith Leapley, President, Leapley Construction Group
Leann Simmons, Vice President, Supplier Diversity, Wachovia
James E. Royal, Vice President Development, The Delta Organization
Michael McQuarry, Program Manager, Multicultural Procurement
and Sales Support Program, Hewlett-Packard Company
Derrick Banks Mashore, Executive Managing Director, Cushman & Wakefield
A. Ivan Boone, Co-founder, Concordis Real Estate, and President, Frontier Commercial,
a Concordis Company

Supporters of CoreNet Global's diverse supplier database, Diversity on Demand, spoke of the benefits of forming partnerships with companies who place a high priority on women- and minority-owned businesses. The partnership not only shows that your company wants to accurately represent the work force, it also exemplifies that your company looks to do business with corporations that share the same key beliefs.

Moderator Leigh Stringer (Senior Associate, HOK) opened this standing room only session by explaining that the speakers representing city and federal governments would take the session beyond LEED and “green” design to address many of the wider interests in sustainable design. This session's speakers covered new procurement policies, new standards for leasing, how to encourage or require LEED certification, and how to develop more livable cities.

First up was Mark Palmer (Green Building Program Manager, Department of Environment, City and County of San Francisco) who convinced the audience that the cities are where the action is both in terms of worldwide population shifts and green movement. Silver LEED certification is now standard for all municipal buildings in San Francisco and the city is incorporating a variety of initiatives including living roofs (planting roofs with plant habitats) that adds insulations, free evaporative cooling in summer, roof membrane protection, dust and particles filtering, storm water run off reduction, storm water runoff quality improvements, habitat building, and more.

Next, Daniel Leclair (Director, Strategy & Planning, Office of Greening Government Operations, Public Works and Government Services Canada) discussed Canada's very new Office of Greening Operations. Opened in April 2005, the office was created to provide leadership and fulfill strategic policy and operational functions. Major initiatives include green procurement, legal and regulatory compliance, remediation of contaminated sites, climate change (reduction of greenhouse emissions), green building facilities (at least 15% more efficient) and land use, Green Citizenship, and others.

The third speaker, CoreNet Global Innovators Award winner Kevin Kampschroer (Director of Research & Expert Services, Public Buildings Service, U.S. General Services Administration (GSA)) spoke on how GSA is helping federal agencies better serve the public by offering–at best value–superior workplaces, expert solutions, acquisition services, and more. Created in 1949, GSA is leading the way in moving from talking about square feet to talking about people. At the center of the green movement lies the desire for healthy internal buildings that minimize their imprint on the environment. GSA seeks LEED silver certification for all buildings but achieves gold level on occasion.

While studies indicate that building green on the silver LEED level costs 2.5 percent more initially, oftentimes the cost increases do not materialize. In any case, building sustainable, green buildings is a great investment for governments as they seek to protect their workforce, create vibrant cities, and serve as stewards of the environment.