I remember driving through Northwest Arkansas (NWA) as a kid to vacation in Bella Vista. Our family drove through piney woods, gentle green hills, flowing streams and a string of small communities. The topography and colors in the summer and fall were a stark contrast to the flat, hot, and brown dominating northern Texas. I still remember visiting nearby Bentonville in the mid-1970’s and seeing the Walmart distribution hub and wondering – “What is a Walmart?”
Funny how life has you revisit childhood experiences. For the past year, I had the opportunity to lead a project funded by the Walton Family Foundation to help the communities of NWA develop a nationally distinctive strategy and ecosystem for entrepreneurship. Returning to NWA was fascinating! A multi-lane freeway linking Fayetteville with Bentonville replaced the country highway and the quiet rural communities I remember have blossomed into small cities. NWA is now home to three Fortune 500 headquarters, a tier-one research university, and over a half million inhabitants.
During the many visits to NWA, our team at the IC2 Institute interviewed over 100 residents and students and engaged with more than 200 community leaders. From our conversations, we learned that the region has a rich history of innovation, expressed through world-class fine art museums, the anchor companies of Walmart, J.B. Hunt and Tyson Foods, and outdoor amenities to experience the natural beauty of the region. These are excellent resources, but the distribution of those assets across five small cities along a ~30-mile corridor poses significant challenges as the region seeks to compete with other innovation hubs in the U.S. Resources, finances, and people are diluted by distance. Communities can be tempted to act as separate actors – competing with each other for talent, business, tourists and economic future.
In NWA, we found something different – a collaborative spirit connecting five major communities. In many innovation hubs around the globe, “coopetition” is the dominant attitude – where competing companies create larger market opportunity through mutually beneficial cooperation rather than exhibiting a “winner take all” approach. Further, it is expressed as seasoned entrepreneurs support newcomers to enhance opportunities for all – often in incubation or acceleration settings. In NWA, we noted coopetition not limited to individuals or companies, but among the communities making up the region.
Community leadership and anchor companies link through a collaborative body, the NWA Council. They spearhead initiatives that benefit all communities – such as the creation of a regional airport, a multi-lane highway, and educational initiatives – to name a few. At the grassroots of the community leadership, we also noted a strong sense of coopetition. Each community seeks to build its own economy and quality of life, but it does so through holistic vision as part of a larger region. This is exemplified by location strategies to recruit companies into the Walmart supplier ecosystem, the University of Arkansas educational centers and the distribution of arts and entertainment resources throughout the region. This may be why NWA is consistently listed as a US News and World Report top place to live!
Competition to grow local economies is more intense than ever. Economic incentives for company relocation, workforce recruitment and even access to trendy beer label names can create enemies out of friends. However, most aspiring regions lack the resources to compete with the established ecosystems (Silicon Valley, New York, Austin, Seattle, etc.) that dominate U.S. innovation and entrepreneurship. This has led to the spiraling disparity of established innovation centers compared with regions characterized by traditional economies.
Regional collaboration aggregates resources, talent and funding to create increased differentiation and advantages to stimulate birth, recruitment and growth of new business. Coopetition is one mechanism for smaller cities to link together to grow the economic “pie” rather than competing over individual pieces. NWA provides an instructive model for regions to engage through coopetition and grow the collective economic “pie.”