State economic chief David Gibson discusses his role and the challenges of promoting sustainable growth in Montana

David Gibson, 41, will mark his second anniversary as Gov. Judy Martz’s chief business officer this August. Gibson, a Kalispell native with degrees from Harvard and Dartmouth, was president of Dynetherm, a Weyerhaeuser company, when Martz tapped him to play a leading role in reviving Montana’s economy.

By MIKE MCINALLY Western Montana InBusiness

In this wide-ranging interview with Western Montana InBusiness, the discussion started with a discussion of the pros and cons of his easily accessible office, just down the hall from the governor’s office in the state Capitol Building.

Western Montana InBusiness: So do people come and wander into the office and grab you, and they’ve got ideas for how to boost Montana’s economy?

David Gibson: Oh, yeah. All the time.

InBusiness: Really?

Gibson: You have to control it a little bit. … I’ll tell you, it’s a lot of work but it’s the real advantage to being in this Capitol building, especially when the Legislature’s here. I mean, people need help, they have a question, they want information on something, they go to whoever’s in closest proximity and that’s you. And sometimes, that’s a real pain in the rear, but at the end of the day, it gives you a chance to work with them a lot more than if you’re halfway across town and a little more isolated. So … overall it’s been a good thing and very interesting.

InBusiness: Is there a common tenor to the thoughts of people who just wander in out of the hall and have some thoughts about business and economic development?

Gibson: No. And to be brutally frank – although you’re always respectful and you always want to listen because you never know where you’re going to get the next nugget – generally people who have thought about the issues (understand that) there’s no silver bullet. (T)he people who wander in here tend to be, although not exclusively, the people that have the, well, “if you only did this one program or this thing” (approach). … So I wouldn’t say that the hit rate is real high from people who just wander in. But I would also tell you, it’s not zero. And you never turn down an offer to help until you’ve fully explored what it could do for you.

InBusiness: So do you have anything that is a typical day? Surely you don’t get up and look in your Day-Timer, and it says, “boost Montana’s economy, develop Montana’s economy.”

Gibson (laughing): But I do (develop the economy). Every day.

InBusiness: Yeah. But is there a typical day?

Gibson: No. Not even close. Although I guess in a very broad sense, I don’t spend a lot of time in the office – clearly the exception being the legislative session. … So, a “typical” day – three days out of five or better, I try to be out on the road, not just sitting in here. But what you do on the road is completely different. I’m on a lot of boards, really good boards. I’m involved in a detailed, worker-bee level, with some projects. … You just have to travel. You’re meeting people on various projects and various organizations. You give a lot of speeches, which is a good way to get your message across. I don’t consider that to be laborious, although it takes time and energy. And you always find time to meet with people who are in town. So, a typical day is not typical, but it does involve not sitting around here in the office, just sort of dreaming about blue sky and green pasture.

InBusiness: In fact, that had to be one of the attractions of taking the job, when you thought about it. Is it true, the story I heard, that you were on the road and your wife called and said, in essence, there’s a job open in Montana, you can save the state’s economy and we can move back there?

Gibson: Not quite. … It’s actually a funny story.

InBusiness: Go ahead and set me straight.

Gibson: You know, I was at the point with Weyerhaeuser – great company – but my next move, realistically, might have been back to the Seattle area, which is their headquarters, but probably (it was going to be) another field assignment. Weyerhauser’s got headquarters in Washington but not a lot of assets there. So it was probably going to be someplace like Los Angeles or Cleveland, and we were, is that where you want to go with your kids? So we kind of were generally thinking (about a change), but you’re not really doing anything about it. I mean, I’m well-paid, I’ve got a great career. My wife said, “Hey, honey, my sister or uncle or something saw this ad for this job.” My job. And my first (reaction) is, “Honey, you know how your dad feels about government?” He hates it. I said, “Well, I feel the same way.” So there’s no way on God’s green earth that I’m going to work for the government, I don’t care where it is. She wasn’t pushing; that’s not fair to say. But I do think she kept saying, “You ought at least check it out. You ought to explore it. It might be kind of interesting. They’ve got this new governor. They’re trying some new things.” It was just an evolutionary process basically amounting to every time there was a deadline in the application process, I’d procrastinate up to the last minute and then I’d work all night to get it done, just to see what the next step would be. … I kind of got sort of pushed one step at a time down the process, sitting in Mobile, Ala.

InBusiness: It’s interesting what you say about government, because certainly a lot of Montanans feel that way – the government can’t do any good, the Legislature really should meet for two days every 90 years, etc., etc.

Gibson: That would be my father.

InBusiness: Sure. And you hear it all the time. What do you think drives that?

Gibson: I think there’s a lot of things. Number one, there just are some things that are easy to believe, OK? And that government’s a bunch of big lazy bureaucrats – I don’t know, it’s evolved for 250 years in this country and every country. Every time we run into a bad apple – we’ve got 30,000 people. You’re going to have some great performers and some poor performers. … But I think the big reason is that government just has a different role from business and people don’t understand that. I mean, there is a regulatory aspect to government. Overregulating and nonsensical regulations are a bad thing. But nobody’s suggesting that we should not have any environmental laws, we shouldn’t have police, we shouldn’t have a court system. So it’s a different role, and most people don’t think about, what is good government and it isn’t, in fact, business. You don’t have a profit motive. You have different objectives. Not that you shouldn’t be efficient and well-organized and responsive to people. … That said, government in various aspects has been unresponsive and bloated. It takes as long to break down stereotypes as it does to build them, and you can measure that in decades. So you do the best you can, you affect the areas you can affect and you make them as good as they can be. You can’t save the world.

InBusiness: So there’s a limit to that notion you keep hearing, that government needs to run like a business. That’s true to a certain extent, but if you push it to a logical extreme, it kind of starts to fall apart?

Gibson: Well, absolutely. Government should operate like a business – by the way, you’ve got real bad businesses, too, so it’s not, say, a perfect model. But should you be efficient? Should you be responsive to your customers? All of those things – absolutely. We should be as good as business in those areas. And, I’ll tell you, parts of government are. I’ve been in big companies and small companies in my career and I’ll tell you, parts of government are better in some of those experiences and some are worse. … But, you know, we don’t have the option of saying, “We’re going to refocus the government and we’re only going to focus on this market segment or that customer group. The heck with the rest of you.”

InBusiness: Right. Government doesn’t have the option to, say, sell off the police force to another company.

Gibson: So if you have a company that’s mandated to be responsive to the entire population of the state and provide reasonable regulation and reasonable oversight and secure the safety – that is a completely different role from business. You can’t be motivated by the profit motive. And you can’t pick and choose. You can’t say, “Gosh, I love eastern Montana, to heck with you boys in the west.” You have to serve everybody. That just makes it an entirely different animal and you have to do things a little differently. …

In Business: Now, you talked earlier about how much time you spend on the road, and you’re probably in as good a position as anyone to take a look at just the sheer amount of work that’s going on, under the radar, at the grass-roots level, to build business in Montana, to build the economy. Would people be surprised if they saw the whole picture, the way you’ve had a chance to look at it, at just the sheer amount of activity that’s going on?

Gibson: I think they would. I mean, I was. And there are people who work statewide who wouldn’t be surprised at all, because they understand it. I think most people focus on what programs they use and what’s in their communities. I mean, that’s what I’d do.

InBusiness: How has the diversity of the state’s economic problems shaped your job? The issues in the eastern part of the state are different from the issues in the west. And the issues facing rural areas are different from the issues facing our more-populated areas.

Gibson: It’s enormous diversity. … It’s enormously difficult. … I believe that the state is much better off if we can find common ground or find ways to address the needs in the rural, agricultural nonurban areas versus the urban areas. And, by the way, the urbanized west has a lot of these problems. I mean, go to Libby. The highest unemployment in the entire state right now is in Lincoln County. It’s not Bighorn or Glacier, it’s in Lincoln. And 20 years ago, that wasn’t true. They had the mills. … You never know where the world’s going to turn. So you have a moral obligation, and also, I think, in a strategic, long-term sense you have to bring all the major segments of the state along together. If you can do that, you’re much better off.

InBusiness: What are some of the big pluses for the state as it tries to pump up its economy?

Gibson: A big opportunity for the state is the education system. … I think that the university system has done some really good things. But, I’ll say this, I’ve said it before, I think we have an enormous opportunity to improve the way we do two-year education and distance learning. … If you’re doing things that reach out to the workers in Billings through the Billings College of Technology, those kinds of things are also going to work at Miles City Community College and (Flathead Valley Community College) and Great Falls and Havre. The education issues are different in different parts of the state but there are some common things that could be done that I think would benefit people, urban and rural.

In Business: Talking specifically about the university system, you have seen the university system come to the Legislature and make the case, that in addition to offering education to students, it is an engine of economic development for the state. But legislators seem not quite willing to buy into that case. Do you think that’s true?

Gibson: I do think that’s true.

InBusiness: Why?

Gibson: I don’t know if I’m right with this, but … When we set the constitution that we currently have, that was designed to insulate the university system from political finagling, we may have inadvertently created a problem for ourselves, which is if the Legislature ever doesn’t like the direction of the university system, they’ve only got one tool. And that tool is whack funding. They don’t have, they just don’t have any other control. … We’ve given ourselves very limited tools to express our displeasure with the direction of the university system. I think that’s an issue. … You can fix that over time, try to make sure you get people who just develop better relationships with the Legislature. But you can also affect the kind of direction that you give to the university system. … I would ask you, what coherent recommendations or directions, I mean, be it subtle or with a hammer or whatever, have we given the university system, which we’ve said wants to be a part of economic development? But when the question comes back, OK, fine, what do you want us to do, “well, uh, we’re not really sure. Just kind of do it. Just go do economic development.” And consequently, at pretty much every campus, you have some wonderful things going on. You have business incubators that are affiliated with or run by the universities in Billings, in Butte, in Bozeman, in Missoula. How much do they interact? Not much. How much do they share best practices? How do they think about what they’re doing? I mean, they’re all very bright people and they’re all doing a very good job in isolation, but are they working together? And the answer is, I have to tell you, no. I’m not saying they have time, money or energy to do it, but don’t you think the state ought to say, if it’s something that’s important to this state, we ought to think about the best ways to do it and we ought to make sure that we’re all sharing ideas.

InBusiness: Your reputation among economic-development directors in the state is that of someone who’s basically enthusiastic about the possibilities that higher education has for building the economy. Does your boss share that enthusiasm, your enthusiasm?

Gibson: She absolutely understands the importance of the university system. … I don’t think it’s a lack of shared vision. We both, I mean, absolutely we understand the university system’s got to have more of a coherent vision. We can help with that.

InBusiness: When you were building the roadmap (the document that lists the priorities for Gibson’s office), why did you end up focusing on these specific points?

Gibson: (If) you look at the fundamentals of the economy … I can give you kind of the theme of why we did this. You want to increase wages, right? Ultimate goal. Improve the standard of living for the people you have in the state. Well, there are two ways you’re going to do that: You’re going to give people more skills. You’re going to give them more technology. Those are the fundamental ingredients of productivity, and productivity’s the absolutely only way to sustain an increase in wages. Right? So, work force and technology. So there’s two. And you go, you know, we’ve got a bunch of state groups, things we do, programs, organizations, agencies, OK – how you organize to accomplish those things is important. … you’ve got to organize what you have under your control in the best possible way to affect changes that you want to make to increase productivity. Because that’s it. At the end of the day, if you increase productivity, you win. Now, then there’s a couple of (other issues) that you have to concern yourself with. One is, do you have a competitive environment … you’ve got to have a business climate that’s competitive. … You’ve got to at least be in the ball game or businesses won’t come here. It’s kind of like, good workers, good technology, you’ve still got to have the businesses that can prosper in this state to make it work. So that leads us to business climate. … Two other things that are important. One is business attraction, the recruiting, the marketing. … The quickest way to get new jobs, the quickest way is actually to throw a bunch of money at ’em and bring ’em in. Second-quickest way is to find some other way without throwing a bunch of money at ’em to bring them in. Because, you know, you can’t create 100 new jobs overnight with a business that’s growing. Not with the businesses starting the size we have. It’s much harder to grow them. …. We said, you know, that is important for Montana but there’s a context for that, so we felt that was sort of a singular issue that we needed to address, that we didn’t want to address in the context of these other initiatives. … And then the last thing, because there’s only six of them, was this idea of building our clusters, which is fundamentally how do you grow the economy you already have. … This is an issue that cuts across all the other initiatives you have. You’ve got to understand your own economy, what you have and how you grow it. … It’s actually not all that hard when you actually get to the fundamentals. Doing it is hard.

InBusiness: When you look at the clusters that are starting to form, are there sectors of the economy that sort of get you thinking, now that has some real potential, that’s going to grow?

Gibson: Yes. But I’m pretty careful. The reason is, we’ve identified six clusters that we consider the largest, but they’re not the only ones. The cluster strategy works pretty well, if you understand its limitations. One of the limitations is, government’s not going to drive it, government’s not going to force a bunch of businesses to get together. … (It’s) absolutely, who steps up to the bar and wants to get involved, and buys into the vision that by doing these things that you talk about when you talk about economic clusters – collaborating amongst businesses, collectively working to affect access to suppliers to marketing resources to changes in the government, how you reorganize government – it is 100 percent a function of who’s interested in doing it and who’s not. … We’re not picking winners and losers. We are absolutely not saying, that industry’s good for the state and that industry’s bad for the state. You can’t do that. Economic forces will sort all of that out. In 20 years, the world changes, and you’re dead. What if we had picked our industries in 1955? Well, you know what, we didn’t even have computers in 1955. … You can’t pick winners and losers. What you can do, is you can figure out the best way for government to organize around what sectors need, if those sectors will get organized to tell you. … Do you want to encourage businesses to work together? And unequivocally, I’ll tell you the answer is yes. Yeah, you can’t force competitors to sit down, you’re not talking about sharing trade secrets and all that, but I’ll tell you, with the changes in the global economy, that are being forced on businesses to evolve, to change, to keep up with technology, if you’re isolated, you’re dead. Period. … Could the state government say, you know, we do lots of things for businesses, should we give bonus points or more money or develop all our grant and loan programs around businesses coming to us jointly? And I’m here to tell you, absolutely. Why would we not want to give more money or more support to a collection of businesses that came to us and said, we need work force training money and, oh, by the way, we’re going to figure out what the common themes are for a few businesses. And we’re going to come to you because we want support for something that’s going to be more than just our company. It’ll affect other companies and we’ll work together. … Company X might need something. That doesn’t help you. Because unless Company X is huge, you can’t design customized training programs very often around just the needs of one company. Now, if you’ve got companies that in aggregate covered 1,000 workers or you found some common things that they needed, then you could really go to the state or the university system and say, I need these programs.

InBusiness: That gets back to the rap you hear sometimes against government economic development, that it tends to focus on larger businesses to the exclusion of smaller businesses. But in a situation like that, it’s a matter of smaller businesses, medium businesses, larger businesses, pulling together. And that ties into the vision of this office saying, here’s a table, we’re having a discussion, here’s your seat, if you want to sit here.

Gibson: You might cajole and encourage and create incentives to work together. But you can’t force business X to sit down with business Y. You can darn sure say if you’re going to do that, we’re going to give you more support. I mean, that is an appropriate policy decision. And it starts small and it gets big. You can’t start globally and say, we’re just completely reform the way everything’s done. I view the cluster work as the ideal starting point for getting it going, just starting it. … We’ve got to get it started in Montana. And then I’m hoping it gets infectious, contagious, whatever. Industry X is going to go, you know, those guys over there in, whatever, log homes or value-added ag or tourism, whatever – they’re getting stuff done. I mean, they’ve got special programs at the universities, they have enterprise centers, they’ve got work force training, state government has actually reorganized some teams around supporting just what those businesses need, cross-agency teams. Well, you know, a few successes go a lot farther than trying to ram a universal change down people with just a “trust-me” attitude. … And it will sustain itself. It’s the kind of thing that if you get it going, then you’ll change administrations, you’ll have changes in the legislature, who knows what political ideology, the winds will shift, but if it’s working and creating jobs and industry is supporting it, then it’s going to live on.

InBusiness: Talk a little bit about the attitude of Montanans toward the economy and economic development. Sometimes I think, watching the debate over the last five or 10 years, that Montanans would rather complain about the economy than do anything about it. Do you think that’s true?

Gibson: I think it’s absolutely true. The thing that I also know to be true, having talked with lots of economic-development people around the country is, it ain’t unique. Although I’ll tell you, you know, if you think about the fundamentals, it isn’t actually all that hard. Now, doing it, where you affect change, that’s harder. It’s still thinking about the economy and about how you grow it over a sustained period of time is something that you’ve got to study it. You don’t just wake up one morning and say, “I’ve got a brilliant idea on how to fix the economy.” I’m not saying I have got all the answers. You don’t have to be a economic development professional to have all the answers. You’ve got to have spent some time studying it, and thinking about it. … There are no silver bullets. … A lot more people have complaints than answers. That’s true everywhere. The other thing that’s also true in every economy – I mean, this is just a human trait – there are a lot of people who bemoan change. … The point is, things are in fact going to change. You can affect how they change, but you will not ever be able to stop change. And a lot of people, it’s easy to be nostalgic and reminiscence and, oh, wouldn’t it be great if wheat prices doubled and steer prices doubled and the Butte mines were running at full bore. There’s always that element. That’s never going to happen. The economy, the forces of economic change, are here, and there are things you can do to help those respective areas of the economy grow and flourish and change. But you can’t go back, to the 1940s and 1950s.

InBusiness: So what has surprised you in your tenure on the job?

Gibson: Personally, I think the biggest surprise for me was just sort of the amount of public engagements. And I think it surprised the governor and her staff too, because, I mean, nobody ever asked me, can you stand up and give a speech? I’m not saying I’m great, but I mean, it wasn’t even on the list. In retrospect, that probably should have been on the list and it’s a very important aspect of what you do – you’ve got to communicate the message, over and over and over and over again. … But, I have to tell you, I took the job, I knew it was going to be hard, I knew there weren’t going to be any easy answers, I knew it was going to take time. I can’t honestly tell you that those things surprised me. If you didn’t figure out that this was going to be fairly contentious, and you weren’t going to be able to make everybody happy, then – you know – then you’re pretty stupid.

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