Thursday, December 30, 1999
High tech key to future
City built on innovation
BY CLIFF PEALE
The Cincinnati Enquirer
The innovation and creativity that built Greater Cincinnati's business community since its 1788 founding are in high demand once again.
But instead of that innovation producing supermarkets, soap, machine tools and department stores, 21st century entrepreneurs here will need to produce technical expertise, high-speed networks and tools for electronic commerce, say experts who have studied the Tristate.
That means pooling resources among politics, universities and business to tap those “new economies,” said Michael Gallis, the North Carolina consultant who completed a two-year study of the region last summer.
Time to move on
“The steamboat era was great because Cincinnati was the frontier city,” Mr. Gallis said. “But Cincinnati has never returned to the foundations that would do that again.”
Some argue that the Internet companies springing up in the Main Street area of Over-the-Rhine demonstrate the kind of cooperation needed to help form those “new economies.”
“There are so many chal lenges that come with trying to get to market quickly and getting the right resources behind a dot-com initiative,” said Chris Evans, president of Ethos Interactive, a developer of high-end Internet sites operating on Main Street.
“I'm running into more and more people on the street,” he said. “It's great, because it seems to be achieving some critical mass down here.”
Cooperation urged
Mr. Gallis argued that examples like the Main Street Ventures group are few and far between. Competition between different governments and institutions in Greater Cincinnati has hurt the region in the global marketplace, he said.
His theory is simple: To take advantage of new economies, companies must work with universities and political leaders to improve research, transportation, education and other building blocks.
There have been few coordinated efforts here, leaving Greater Cincinnati a fragmented competitor in a new world economy that leaves regions as the primary units of competition, he said.
Another example of the potential is the cluster of fledgling biotechnical companies around the University of Cincinnati, Mr. Gallis said. While that industry is driven by research at UC, Procter & Gamble Co. and others, there is no central program to fund growing companies.
The examples of innovation in Greater Cincinnati's history are impressive, said Charlie Mechem, chairman of Convergys Corp. and head of the old Taft Broadcasting Co. He said Cincinnati companies have a history of “prudent, careful” decisions.
But those same companies have been far ahead of the curve on big changes, he said.
He cited Taft's development of what is now Paramount's Kings Island, and P&G's redrawing its entire corporate structure earlier this year.
Reaching further back, that same innovative spirit drove Barney Kroger to start the first supermarket chain in the 1880s, buying in volume and underselling his competitors.
And when Cincinnati-based Federated Department Stores bought direct-marketer Fingerhut Cos. last spring, it laid the groundwork for a revolutionary blending of brick-and-mortar department stores and Internet sales.
“I think we're a little more cutting-edge than we get credit for,” Mr. Mechem said.
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