Do Business Executives See A Benefit To Locating A Company In An Area With A High American Dream Composite Index?
The Burghard Group recently ran a survey among CEOs to better understand the role the American Dream Index could play in site selection. The survey had 82 respondents, 44% were CEOs, 54% were senior managers and 2% were mid-level managers. For perspective, 26% of respondents were executives of manufacturing companies.
The American Dream Composite Index (ADCI) represents the first measurement that quantifies the American Dream in its entirety. It is a survey-based index that gauges the level of how well people living in the U.S. are doing at achieving the American Dream. The ADCI is based on a scale from 0 to 100. The research method has been statistically validated and the ADCI score is updated monthly. There are 5 dimensions (or sub-indicies) that are reported to help provide additional insight into the level of achievement for different aspects of the American Dream. The five dimensions are the 1) economic index, 2) well-being index, 3) societal index, 4) diversity index and 5) environmental index.
The ADCI was created by Xavier University. It is currently published on their website as a national index. I believe the ADCI is a good measure of the authenticity of Brand America’s promise. It is that belief that motivated me to initiate a discussion with the team at Xavier University and led to the monthly publication of the ADCI on a multi-state regional basis on the Strengthening Brand America website.
I also believe the ideal measure of success in economic development is the degree to which you enable more people in your community to achieve more of the American Dream. This would be reflected as an improvement of your community’s ADCI score. Importantly, work is underway to provide the ADCI score at the state and eventually major MSA level. Once available, it will allow capital investors to compare the ADCI score of communities in different states or different cities to help determine which location would be the best choice for a company. If your community is in a state with a higher ADCI score, it will provide you a competitive advantage (and visa versa).
The Burghard Group survey was run to validate the hypothesis that the ADCI score matters in site selection.
Do Business Executives want to know the ADCI score for the location(s) where their employees work and live?
88.5% of executives indicated YES.
This suggests ADCI rankings of states and/or major MSAs will be of interest to business executives. So, when the data is available at that level, states (or MSAs) with high rankings will be able to use their score to positively differentiate their location from the competition. States (or MSAs) with low ADCI scores will need to understand the performance gaps and implement strategic plans to address them.
Here are two previous blog posts that illustrate how the ADCI data can be used to better understand the hurdles to achieving the American Dream in a given location.
Are there perceived business benefits to employees feeling like they are achieving the American Dream?
89.0% executives indicated YES.
This suggests a higher ADCI score will be seen as the location itself providing the potential to positively impact a company’s bottom-line. The implications of this on capital attraction are obvious. But, if your state (or MSA) has a comparatively high ADCI ranking versus competing locations, it can also have a positive impact on your retention and expansion efforts.
Three benefits were seen as possible if their employees live and work in an area where it is easier to achieve the American Dream.
- Increased employee retention (75.6%)
- Better work-life balance (73.2%)
- Increased productivity (72%)
Each of these perceived benefits have a direct link to improved P&L performance and delivering improved shareholder value. Consequently, realizing these benefits is important to companies looking for a sustainable competitive advantage.
In my next post, I will share the survey results for the following two questions –
- Can a higher ADCI score be a deal closer?
- Does a higher ADCI score offer protection from a competitor offering an incentive package as an inducement to relocate?
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