EMSI CASE STUDY (See Full Archive)
Data put in the proper context and communicated the right way can have a huge impact. That’s what the Portage County Business Council discovered recently when its region (and the state of Wisconsin) found itself poised to lose a growing local company.
Skyward, Inc., a provider of student information system software, was founded in 1980 in Stevens Point, Wisconsin, where it employs 300 people. Skyward expects to add hundreds of employees locally in the next 10 years, and plans to build a new $20 million to $30 million headquarters in the Portage County Business Park. But until recently, its future in Wisconsin appeared short-lived.
In 2011, Wisconsin began taking steps to move to a single source for its statewide K-12 school information system (SSIS). The state contract went up for bid, and a Minnesota company won. This had major ramifications for Wisconsin school districts, more than half of which used Skyward’s system. It had even deeper significance for Skyward, which began making plans to leave Stevens Point for Texas, a state in which it also had a big presence.
With the impending departure of one of central Wisconsin’s major employers, officials in Portage County met with Skyward executives to see what could be done. What county officials learned from the meeting was that they needed to help state decision-makers understand the damage it would do to the regional economy if Skyward pulled up stakes and left.
Challenge: Getting People to Understand Skyward’s Impact
Lori Dehlinger is the executive director of the Portage County Business Council, which serves as the region’s economic development council and chamber of commerce. Working on the front lines of business recruitment, expansion, and retention efforts, she knew how important Skyward was to Portage County because of its long history in the area as a key employer and its potential for growth.
As the tenuous situation developed, Dehlinger and other local leaders pushed for the best possible outcome: “To get the state to see a multi-vendor system would be the best way to go,” she said. “Avoid the monopoly and allow us to retain Skyward.”
“The EMSI reports provided solid data that we could use as a tool to show the negative ripple effect and put things in perspective. Considering the outcome, EMSI was a great investment that helped keep Skyward, jobs, and families in Wisconsin.” — Lori Dehlinger, Portage County Business Council
But the challenge, in her words, boiled down to “how do we get people to understand this message?”
In a meeting with a local legislative committee, Skyward president Scott Glinski asked if there was a way the Portage County Business Council could show the economic impact if Skyward left. Dehlinger’s first thought was to turn to EMSI.
Approach: Using EMSI’s Input-Output Model
Dehlinger had used EMSI’s input-output model to estimate the effect of construction projects and business expansion or closure on the county economy. She also recalled how the Fond du Lac EDC had turned to EMSI to help retain Mercury Marine – a prominent business retention success story in Wisconsin (see EMSI case study).
For the Skyward project, she asked EMSI customer service representative Sam Knittel to run two impact scenarios in Analyst, EMSI’s labor market data tool:
- The first showed the negative ripple effect on the software publishers industry in the three-county region (Portage, Marathon, and Wood) with Skyward gone. EMSI showed the direct loss of 825 software-publishing jobs, both in the short and long run, would lead to an additional 1,804 lost jobs elsewhere in the economy. That amounted to more than $120 million in lost earnings.
- The second looked at the impact on the commercial and institutional construction industry if Skyward completed its $20-plus million expansion. EMSI showed this infusion of money into the region would lead to an estimated $20.4 million in additional earnings.
The numbers from EMSI were powerful enough that the Portage County Business Council created a two-sided flyer (see image to the left) that went out to school districts, businesses, and state and local agencies across the state. The flyer resonated immediately, in large part because the data in it came from a third-party source.
“What was nice is we were able to cite EMSI as the source of this information; it wasn’t just us making up these numbers,” Dehlinger said. “And when people started to see the millions of dollars of impact and we started to explain where those numbers came from, that’s when heads started to turn.”
She also found it helpful to mention the data came from the same tool Fond du Lac used to retain Mercury Marine. “People remembered that. So there was that success story behind this one that gave it more credibility.”
Result: State Defunds Single-Vendor System; Skyward Stays
The economic impact flyer was critical, Dehlinger said, in informing legislators and the general public about Skyward’s critical importance to the region. Local legislators used the data to help other legislators understand the value of retaining the software firm, while TV stations and other media outlets latched on to the impact numbers, too.
In mid-2013, Wisconsin’s joint finance committee voted to take the single-vendor school information system out of the budget, allowing Skyward to retain its business with school districts. Skyward announced it would stay in Stevens Point and build a multimillion-dollar new building in Portage County. It plans to add 1,000 jobs in the next 10 years, 450 of which will be in Wisconsin.
“The EMSI reports provided solid data that we could use as a tool to show the negative ripple effect and put things in perspective,” Dehlinger said. “Considering the outcome, EMSI was a great investment that helped keep Skyward, jobs, and families in Wisconsin.”
While the data that EMSI provided was important, Dehlinger said she also valued the help from EMSI in understanding the economic impact numbers.
“An issue like this that took over 21/2 years, that was a lot of back and forth,” she said. “I think what’s been really nice for me is to be able to call someone up and get some help on this. I can look at different things, but to have someone to help me interpret the data has been really helpful.
“To me, it’s more than just the numbers; it’s being able to translate that.”
Emsi turns labor market data into useful information that helps organizations understand the connection between economies, people, and work. Using sound economic principles and good data, we build user-friendly services that help educational institutions, workforce planners, and regional developers (such as WIBs, EDOs, chambers, utilities) build a better workforce and improve the economic conditions in their regions. For more information, email Josh Wright (email@example.com) or visit www.economicmodeling.com.