Build off your strengths – diversification is a long game

Bruce Graham talks about the competitive advantages Calgary needs to promote to attract business investment

Bruce Graham is president of BKCC Enterprises Inc., senior business advisor with Osborne Business Advisors and former president and CEO of Calgary Economic Development.

Bruce Graham

Tell me what you’re doing today?

Graham: I have my fingers in a few different pies. I just finished reviewing a chamber strategy for a B.C. interior region and I’m with the general partner of a limited partnership working to complete a significant financing for an irrigated farmland project in Saskatchewan.

Finally, I recently joined Osborne Interim Management, which is composed of a diverse group of business executives offering business advisory services in addition to interim and fractional management mostly to the SME and not-for-profit sectors.

And I shouldn’t forget – I’m still recovering from a mid-October knee replacement operation, so I’m spending lots of time on the stationary bike. One of the pleasures of getting old.

What’s your feel of where the Calgary economy is at currently?

Graham: Well, I liked the economy much better when I was leading Calgary Economic Development up until 2015. Today it’s pretty clear from the economic indicators that we’re still struggling economically – four years later. While that’s most evident in the energy sector, I’m also seeing it in the construction and development industry in Calgary.

And while economists may be telling us that we’re growing again, I’m not used to seeing Calgary with the highest unemployment rate amongst major cities in Canada.

All that said, I believe that in this market when people are forced out of their comfort zone (including me), entrepreneurial activity takes hold, more focused business development is required and good customer service matters and in the long run that will serve us well.

What’s the mood of people in the business community considering the struggling economy?

Graham: In short, it kind of stinks – and maybe for good reason with all the self-inflicted policies that are preventing us from getting our resources to market. It’s an unfortunate reflection of a prolonged period of economic difficulty for many Calgarians and has been further inflamed by political leadership at all levels that don’t seem to have their s–t together.

I believe this lack of government alignment had a significant role to play in the ‘No’ result in the Olympic plebiscite. Calgary had an opportunity to redefine the Olympic Games for 2026 but the mood in this city, along with the political bungling, played a big role in costing us that opportunity, the billions of dollars that go with it and a much-needed win for the city.

Yes, Calgary needs some therapy. We’re not the ‘can-do city’ we’re known to be.

What do you think it will take for things to turn around?

Graham: Maybe a good Stanley Cup run by the Flames will make a difference.

Unfortunately, our lead industry energy, which also happens to be Canada’s leading export, needs more time in recovery before we can expect capital investment to return to levels that will drive down our high downtown office vacancy and high unemployment rate.

On that note, I’m pleased that we’re starting to see a more balanced discussion in Canada about the importance of pipelines and the energy industry. With that, I’m hopeful that we’re going to get the infrastructure we need to be built – eventually. When it does get built, our energy industry with the efficiencies and cost-cutting it has deployed will be ideally positioned for longer-term growth.

Until then, I think we need to come up with a game changer. Something that will turn heads and drive attention to our city. I’m a big believer in marketing what makes you different and taking risks to be aspirational. The Olympics could have been the stage for that – we just need to come up with another stage.

Speaking of marketing, today Calgary represents a great value proposition across a variety of industry sectors. We have an educated labour force, we’re experiencing net migration principally from immigration as opposed to the interprovincial migration we have experienced in the past. Our housing stock is far more affordable than Vancouver or Toronto, making Calgary an ideal destination for young families. In contrast to Toronto, where downtown office vacancy is near zero and office rents have skyrocketed, Calgary is a bargain and has a lot to offer from a lifestyle perspective in comparison to our larger more congested megacity to the east.

These are a few of competitive advantages that we need to promote to attract business investment and turn things around.

How important is economic diversity for Calgary as it moves forward?

Graham: Economic diversity helps soften the blow when there is a downturn in any sector of the economy for the same reason that your financial planner will advise you to diversify your investment portfolio. I also believe that economic diversity is naturally occurring and a function of the size. Calgary is far more diversified today with twice the population than it was in the early 1980s.

As difficult as this recession has been on Calgary, I think that we’ve been better able to manage the downturn because of the economic diversification that has occurred in our economy since the 1980s.

Moving forward, I’m not as hung up on trying to diversify the economy of Calgary as I am at focusing on economic opportunities that have good growth prospects for Calgary. We have natural strengths in transportation and logistics, film and television, food processing and technologies that improve energy production and provide value-added products.

I think the best strategy for diversification is to focus attention on industries that have good growth prospects for the Calgary economy, recognizing the industry growth trends both locally and nationally.

I do believe there are merits in supporting early-stage growth companies and creating an environment that supports innovation and risk-taking. Helping those companies will naturally diversify the economy.

Linking that ecosystem to our post-secondary institutions makes natural sense to me as risk-taking is naturally embraced by our younger demographic. Just remember to build off of your strengths and that economic diversification is a long game, don’t expect changes overnight.

– Mario Toneguzzi for Calgary’s Business

calgary economy diversification

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