On 1st March 2023, the Financial Times Group (FT Group) acquired the product and consulting assets of Wavteq Group Limited (Wavteq). The Wavteq brands; including Amplify, IncentivesFlow, InvestmentFlow, InvestmentMap, Influencers, Institute and their strategy and advisory services have joined the fDi Intelligence portfolio.
FT has not acquired the lead generation division of Wavteq, which can still be found here.
For further information visit; newproducts.fdiintelligence.com or read press release.
Simply put, Investment promotion agencies (IPA’s) and Economic Development Organizations (EDO’s) are responsible for stimulating new investment projects, including the attraction of new investment projects namely through foreign direct investment (FDI), and assisting in the growth and expansion of existing companies in a locality.
An IPA that is well equipped to fulfill these tasks is reliant on a technical staff with the capacity to implement the strategies it has formulated to attract and retain FDI. Building the technical skills of an organization involves acquiring knowledge and experience required to work effectively in a certain field, including specialized training and qualifications towards this end.
This is incredibly important for FDI and economic development practitioners; who are responsible for the attraction of inward investment; a very competitive process that also has significant implications for local economic development. Through the generation of employment, capital investments, technology transfer and training; FDI has the potential to promote economic diversification, higher wages for local employees, improve infrastructure and increase tax revenues.
To reap these benefits of inward investment; foundational knowledge on strategies for the attraction and retention of FDI are required by the staff of an IPA or EDO; reflecting the increasing importance of capacity building through upskilling and training in a highly competitive industry.
IPA’s and EDO’s all over the world are facing the same core economic issues today which have had significant impacts on global FDI; the dual effects of the lingering global pandemic and the global commodities crisis fuelled by the Russian invasion of Ukraine. These two phenomenon have led to increased uncertainty in the international economy after an initially positive outlook in 2022; including difficulties associated with inward investment attraction for many areas of the world.
Investors have identified commodity price increases, geopolitical tensions, tightening of business regulations and rising inflation as key risks in 2022. These are key challenges facing many IPA’s and EDO’s for the foreseeable future; with investor anxiety leading to limited capital investment projects and heightened competition between similar locations. The proliferation of remote working across the majority of industries and the implications for talent attraction and corporate location decision making has also been difficult to adapt to for many IPA’s and EDO’s.
In addition to this; significant disparities remain between the number of FDI projects attracted by traditional FDI destinations (often in regional hubs and capital cities) compared to periphery countries, regions and cities; in large part due to the obvious differences in factors such as institutional quality, market size, natural resources, physical infrastructure, skilled labour etc. which investors cite as major locational endowments.
Clearly most of the factors mentioned previously are beyond an IPA’s or EDO’s control; either they are a result of government policy, economic conditions or geography. However, these are not the only determinants of where an FDI project will be located.
The reputation and efficiency of an IPA or EDO can go a long way towards mitigating some of these disparities. A new, professional image for a location is a key factor in attracting at an accelerated rate the foreign capital needed for development, and image-building activities play an important role in influencing investors’ decisions; even compared to location factors such as labor, infrastructure and incentives.
What is within the control of an IPA or EDO is to ease the process of investment and doing business; including the promotion and marketing of a location, effective market intelligence gathering, strong lead generation campaigns, investor facilitation and dedicated aftercare programs. These activities can be done by any IPA or EDO, regardless of location, and are critical in strategically promoting a relatively marginalized location by highlighting it’s attributes and competitive advantages.
Any professional from a smaller IPA or EDO in particular, can give their success stories of attracting investment projects from companies who may never have considered their location before being contacted directly by the IPA or EDO. A proactive approach to lead generation and dissemination of quality information in relevant target sectors goes a long way towards achieving these investment successes; which is by no means an easy feat for many IPA’s and EDO’s to carry out.
Capacity building in an IPA or EDO; which can strengthen the skills, resources and abilities of staff to effectively attract inward investment, is key to performing these tasks in an increasingly competitive investment landscape, with both internal and external training contributing to this.
A major factor of an IPA’s or EDO’s effectiveness is the calibre of its staff, particularly those in the middle and lower levels occupying managerial and technical roles who are on the front lines of marketing, market research, investor outreach and facilitation to nurture a broader set of relationships with potential incoming investors and convert leads into successful projects with tangible effects on the economy.
IPA and EDO staff often come from a wide range of backgrounds, bringing both industry experience relevant to the target sectors of a region, and skillsets across business development, marketing, research and consulting. However, specialized knowledge on the investment attraction process and best practices is a crucial supplement to this existing skillset in an economic development context.
For capacity building to eventually be effective; an IPA or EDO must have a strong sense of which activities require improvement in their organization, with an end goal of giving its staff the ability to carry out attraction and retention strategies. If an IPA or EDO is in the early stages of implementing a location brand and marketing campaign; clearly a focus on value proposition development, location benchmarking and marketing is required. In the later stages of investment attraction; skills in lead generation, investment facilitation and account management will be needed. Finally, as an IPA or EDO seeks to encourage existing businesses to expand and retain investments, a focus on aftercare best practices and embedding an investor into the local economy are needed.
Each IPA or EDO will be at different stages of strategy development, with an associated skills gap that can be filled with an appropriate capacity development programme. Both external training programs utilizing specialized FDI consultants and internal training programs developed by an IPA or EDO can help fulfil these goals; combining both outside expertise in FDI skills and local knowledge on the structure and focus areas of the organization.
An example of one such internal training programme is that of ProColombia’s University; a Knowledge Management platform for best practices in economic development used by the organizations staff. For an organization that focuses not only on attracting FDI, but also promoting exports and tourism; an internally developed training programme is a vital development in strengthening the organizations capacity building in these various activities, as well as allowing ProColombia to take ownership of the process themselves and shape the staff training to the Colombian context with which they are familiar more than anyone else.
All of these points may seem obvious to any economic development practitioner; of course capacity building through effective training programs is important for developing the skills of an IPA’s staff. What is less obvious is how this process can take place in different contexts.
Every IPA will differ in terms of the resources at their disposal, including the governance of the organization and the size of the staff; highlighting the clear fact that some IPA’s are more able to invest in capacity building than others. As demonstrated in the WAIPA-WBG’s survey on the State of Investment Promotion Agencies; the two most significant challenges respondents have experienced over the last decade have been inadequate financial resources and human capacity; and so the key question is in what ways can IPA’s with fewer resources invest in their own capacity building in a smart and cost-effective way to overcome these challenges?
In response to COVID-19 related travel restrictions and lockdown measures there has been an acceleration in the adoption of alternative education and training tools; most notably that of EdTech platforms, particularly e-learning. The global e-learning market is projected to be valued at $325 billion by 2025; double the value that it was in 2014, and corporate e- learning is projected to grow by over 250% from 2022 to 2026.
The pandemic has in many ways been the catalyst for the digitization of a number of core services; with the need for remote working/learning forcing organizations to overcome the initial hurdle of the upfront development costs of implementing e-learning training programs and technology. In the long-term; this will prove to be a massive money-saving mechanism; cutting out significant cost outlays for training and development budgets by largely removing the need for instructor led curriculums.
This significant growth of e-learning is not only driven by remote learning from home and reducing expenditures on travel, equipment and instructors; but also because digital learning is effective. E-Learning programs for organizations and schools have been shown to raise the knowledge retention rates of employees to 25%-65%, compared to face to face learnings retention rate of just 8%-10%. This is in addition to reducing the average period of training programs by up to 60%; a significant benefit for both productivity and cost-saving that every organization should be putting resources towards.
Taking advantage of this technology; IPA's can invest a lot more in both the internal and external training of its staff due to e-learning, which can be done from home, is available 24/7, is cost effective and encourages staff to put in the effort to upskill in the organizations key activities. In terms of capacity building; e-learning programs could be the best way of ensuring that an IPA’s staff has quick and ready-access to key knowledge areas of FDI attraction in the most productive and cost-effective ways.
Utilizing external resources can be an effective strategy for bringing outside perspectives and expertise to an organization; including the use of externally developed training platforms. Wavteq is a global leader in FDI Technology and Strategy services which has developed Wavteq Institute Knowledge & E-Learning Platform for organizations devoted to attracting FDI; with features including Learning programs, market intelligence resources and an information center that includes 20 Investment toolkits.
One of the components of Wavteq Institute is an e-learning platform for economic development professionals; offering courses in Inward Investment and Trade across 14 modules in key FDI knowledge areas. These courses have benefitted over 500 IPA’s and economic development organizations worldwide, ranging from the Nigerian Investment Promotion Commission to the Quebec Ministry of Economy and Innovation. This offers critical knowledge for an IPA’s staff for all stages of the investment attraction process; including strategy and value proposition development, marketing and lead generation programs, investor facilitation and aftercare projects.
Wavteq institute goes further than this in providing the extra knowledge for an IPA to stand out amongst regional competitors and keep up to date with evolving corporate location trends; with a positive effect on the number and quality of FDI projects attracted. This includes Wavteq’s 20 investor toolkits; with such titles as how to do Road Shows, Supply chain development programs and how to do Investor Outreach which provide standardized and field-tested processes for improving an IPA’s effectiveness in carrying out practical FDI attraction activities.
Additionally; Wavteq Institute focuses not just on any sectors; but in Smart Capital and High- Value sectors that are among the fastest growing in the world. Advanced industries including Emerging Industries (e.g. Biotechnology), High Tech Manufacturing (e.g. Semiconductors) and High level services (e.g. Financial and professional services) have specific location criteria in regards to Labor skills and costs, Government support, infrastructure, existing clusters and market access. This is especially relevant for IPA’s, as sector training is one of the key skill gaps in current capacity building programs according to Wavteq’s organizational survey of IPA’s in 2022, and Wavteq Institute’s industry blueprints and FDI sector training programs are well-placed to fill this gap across IPA’s of all sizes and levels of development.
Wavteq's eLearning & intelligence platform Institute releases continuous and exclusive intelligence to subscribers. Over 30+ national & regional economic development and investment promotion agencies rely on our platform to upskill & gain competitive intelligence for their investment attraction experts.
Learn more about the platform or contact us now to arrange a demo.