By Gigi Wood
CEDAR RAPIDS — The Corridor Business Journal sat down with Chuck Peters, president and CEO of The Gazette Co., March 22 to discuss his thoughts on a number of issues. A well-known community leader, Mr. Peters is a member of a number of boards of directors, among them the Iowa City Area Development Group, of which he is chair.
Outspoken about the need for increased community collaboration, Mr. Peters spoke about regionalism and the recent hiring of Mark Nolte as Iowa City Area Development Group’s president, as well as facility and strategic changes at the Gazette.
Q: What are your thoughts about regionalism in Eastern Iowa? Do you consider the Corridor to be the seven-county Kirkwood Community College service area?
A: I’m particularly hot in this because I just came from the latest release of the laborshed study, which is just calling individuals, asking them where they live, where they work and ask them a few questions. Then they map what people are actually doing. And that map doesn’t follow any political boundaries. It’s obviously a tight circle around Cedar Rapids and Iowa City, but then the tentacles go out in kind of odd ways, depending on where roads are. It’s interesting to me, there’s actually a little hub in Marshalltown, because there’s easy access for people to get on Highway 30.
So my view is, that is the natural economy. Where do people actually live, work and play. And when you map that you certainly see a pattern. And it doesn’t follow traditional political boundaries, the seven-county region is the closest that maps to it, which also maps to the Kirkwood service area and the Grant Wood AEA (Area Education Agency). The way we’re organized today, that’s the best way to try to capture that natural economy.
We’re in the process of changing, or expanding, the game we’re playing. (We have a) strong agricultural background, which also enabled a strong manufacturing background and to some extent financial services and things like that. We have a strong economy, which is the envy of the state and many people in the U.S. right now. So, we could just rest on our laurels and say, ‘aren’t we great?’ But we also have an opportunity to extend that strong economy by really becoming better networked within the region and extending that network to the world. In the last five to 10 years there has been an explosion of individuals around the world working on things that they care about and actually creating value and making money and transferring money, that are outside traditional political boundaries and outside institutions. Being known to the world as a place that can make new ideas happen and bring them to life and have them practically implemented is a differentiator in the world economy.
Not only do we have enough people to give us the quality of life and ease of access to amenities, but we actually have a diverse range of experiences within that region from university town in Iowa City, new commercial city in Coralville, the town square of Marion, the near-urban environment of Cedar Rapids and then all the smaller municipalities amongst those major ones, as well as all the exurban and rural opportunities. Within a 30-minute drive, there’s quite a diverse set of opportunities. But we’re certainly not as networked as we could be and we do not have a sense of place as much as we could be and we don’t promote ourselves to the world as much as we could. While we’ve got all these kinds of wonderful things going, there are these opportunities we should also be exploring.
Q: When we talk about bringing new businesses to Iowa, attracting new workers when the unemployment rate is really low and sustaining the economy long-term, do we need to work together as a region solely or is it also Cedar Rapids/Linn County, Iowa City/Johnson County working on a smaller scale?
A: I’ve been giving speeches on this for over 10 years so I know the reaction and particularly early on, many people’s reaction when you talk about regionalism is a sense of loss. ‘I worked really hard to make Marion a great place.’ ‘I worked really hard to make downtown Iowa City a great place.’ ‘What is this regionalism, it’s just going to dilute my effort.’
I actually take the reverse view that we want extraordinarily strong neighborhoods. We want lots of strong neighborhoods and we want those neighborhoods to nest into municipalities and counties and all of that. The real issue we face as a region is, how do we most effectively do those things, which should be done regionally and how do we most effectively do those things, which really should be done on a local level. We have that issue a lot; we have it in government, we have it in education, we have it in healthcare but we’re focusing now on economic development. But they are very different tasks.
Getting the people in the world generally interested in the region is a regional activity, regional marketing. Getting Eastern Iowa to stand out from the rest of the world is a regional activity. Once you have someone interested, working on specific sites, you want somebody focused on that locally. Working with local particular political issues, you don’t want some regional entity messing in that. So how do you structure and focus the efforts to make that happen?
Q: That brings us to Mr. Nolte’s promotion. While he is a nice guy, does an effective job and it’s fun to cheer on the local applicant, we were surprised to hear former ICAD President Joe Raso’s departure last May wasn’t used as an opportunity to create a more regional economic development group. (Read more at www.corridorbusiness.com/news/noltenamedicadpresident/.)
A: You hit on the key points of the dialogue. Before you can talk about combined activities, you have to have a good sense of yourself. And ICAD had just gone through literally years of environmental analysis, strategic planning, operational focus and all that was coming to a head right when Joe departed. We did have conversations with potential regional partners, the Iowa City Chamber of Commerce and Cedar Rapids Metro Economic Alliance. Both said there were things to explore but there wasn’t anything that just immediately was apparent.
The Cedar Rapids Metro Economic Alliance was in a very different place. They were forming their organization, moving to a new building and there were strong proponents of, ‘this is the opportunity to merge things together now.’ It’s interesting that some of those proponents said that the opportunity was to merge ICAD with the Iowa City chamber. In other words, create a comparable organization to the north end, that’s what should be done.
There were other people who said, ‘absolutely not, it should be regional now.’ And there were others who said, ‘there is a reason why ICAD is an individual entity and don’t even talk about merging it with anybody because there’s a reason to have ICAD as a single entity.’ So you have these strong opinions on multiple poles.
The (ICAD board of directors position statement) said we know that things can be done in many areas and whoever is hired as president of ICAD will have as part of their work plan to figure out how to do that. That was our official position that went through the board and we asked all investors for feedback, as well, trying to be as open as we could be. When you have these very strong opinions, how we resolved it was, ‘let’s get a leader and then task the leader.’
Q: What are your personal thoughts on the matter? Are you thinking the Corridor or Eastern Iowa needs one regional group to promote the area?
A: We need one regional effort on some key things. I really liked Dan Reed’s global exposition of the issues at the Cedar Rapids Metro Economic Alliance (annual meeting Jan. 24.). He does a great job of laying it out. The organization is not as important as the effort. We really do need to have a regional identity that can be celebrated, that can be promoted and there are certain activities that are best done regionally for the benefit of the entire region. The ones that come to mind for me are the outreach to the world and the laborshed.
Between ICAD, the economic alliance, the Iowa City chamber, they all need to work to develop. You’ve got, I believe the statistics were close to 15 percent, of the Iowa City workforce works outside of Iowa City and 15 percent of the Cedar Rapids workforce works outside of Cedar Rapids. Most of those are going up and down (Interstate) 380. So workforce development seems to me to be a regional issue, as well. That’s my view, after knocking around these issues for nearly 30 years.
Q: What are a few priorities the Corridor needs to accomplish; that we need to promote ourselves or attract workers here or create more jobs?
A: All the three things you said, we need to continue efforts on that. But for me, the three would be a sense of place, a sense of identity and better economic narratives.
For people who are in this regional branding thing, it’s a no-brainer. And if you read the literature, it’s just absolutely, you have to do it. But the questions I get every day, ‘why a region? What is the region? Why would creative be important? There’s a big kick-off event on April 19, which will make it even more manifest in people. But you can’t just flip the light switch and get 500,000 people to understand the importance. It takes iteration and a lot of different ways to engage people. I would say living and appreciating the brand are the two big things.
Q: What do you mean when you say ‘a sense of place?’
A: Most people’s sense of place today is their neighborhood, their school district or their town, sometimes a combination. And that’s wonderful. That’s great to have a primary sense of place. But the fact that all these neighborhoods and towns join together to be a natural economy, there really is a natural economy and that networking within that natural economy is important, that’s what I mean by that.
Q: And by sense of identity do you mean the Creative Corridor?
A: To be proud to be part of a group that is known to for the ability to make new things happen; makers at the edge of the frontier.
The whole idea is, let’s have more fun now. To join with a group of people to make something new happen; it’s a great thing to do. It’s fun.
Q: And what do you mean by ‘better economic narratives?’
A: From my experience from working on lots of boards, as a community we do not have a good sense of the whole. We ought to get a view of the whole every once in awhile and be able to convey that.
We (The Gazette) do reports. Somebody hires somebody, somebody fires somebody, Rockwell gets a contract. How do you put that into context? How do you understand the particulars of it and how do you make connections to the people who are involved? If you want to get involved in some way, it makes it easier if you do that. We could be better at developing that narrative but we need to work together at it.
Q: Can you give me an example?
A: Last year, people would get into a tizzy on the street because the drought was going to destroy farmers, it was going to destroy the local economy and the world was coming to an end because of this drought. That was the word on the street.
I happened to be with U.S. Secretary of Agriculture Tom Vilsack and the head of the Iowa Corn Growers Association in late July/early August. So I said, ‘ok guys, you are the people that should know, what’s the effect of the drought going to be?’ And their response was, ‘we don’t know.’ Because people plant at different times, they plant different varieties, we don’t know what the yields are going to be and we don’t know what the prices are going to be because we don’t know what the world markets are going to be. But we have hundreds of media outlets asking us to serve up a destroyed farmer. That’s what I’m talking about.
Let’s at least have a narrative that is grounded and of course you know what happened, it was actually a great year for farmers. Most farmers’ income went up. But yet people were wringing their hands.
Another example, people don’t understand the difference between money coming into the economy and money churning in the economy. What really became apparent when ICAD did their campaign and they used that graphic to show that there’s only four major ways money comes into the system: from us selling agricultural products, from tourism, from government (primarily research) grants and interstate commerce. Well, ICAD can’t do anything about the farm economy, we’re not focused on that. We do focus on value-added processing, but not the straight farm economy. We don’t do convention/tourism, that’s the convention and visitors bureau, the people who are writing the grants are writing the grants. The only thing we can affect is interstate commerce; helping people who are already here grow and trying to get new people in here.
That basic concept was not well understood by many business leaders. The idea is if more people have better contacts, better understanding and better connections, we’re more resilient and more able to make new things happen.
Q: With that example, interstate commerce, do you think we should tell that narrative differently?
A: I think first of all, getting a general sense out there. And then, when we’re talking about specific things, referencing general and pointing people back to a narrative that we’re creating as a community. We did what we could with the tools that we had. We now have better tools and yet we’re not taking advantage of them. We’re like toddlers with the tools.
I’m talking about the connectivity of the Internet. If we could create a local knowledge wiki, which then our publications, whether they’re print or online, could reference, be pointers to, we could be stronger as a community.
But frankly, (the Corridor Business Journal) going to an event and us going to an event and writing different reports of the same event, yes, it might be helpful to get those different points of view but it’s not as helpful. Most institutions don’t want to talk to us. If we could help the institutions craft their information better so that it was more accessible and more capable of co-creation, then we would have better information as a community. But we don’t do that. We all fling these articles at each other and it’s hard to put them into context.
Another example, Greene Square Park right on the corner here and the library’s going to go in on the south, well the kitty-corner block is called the Banjo Block. If I’m coming from out of town and I’ve never heard about the Banjo Block but now I see I’m kitty-corner from Greene Square Park, I might want to know what the plans are for Greene Square Park. But I might prefer not to read 15 articles about that. That will take many of us to work on.
Q: At The Gazette, you’ve had some facility changes, staff changes, an increased focus on digital and you seem to be maybe moving in a new direction. Are we still going to have a daily newspaper from Cedar Rapids? Are we still going to be able to rely on that kind of news?
A: Yes and yes. You didn’t mention one of the biggest changes, which was in a blurb at the bottom of our business page one day, for a lot of reasons. We had a major transaction in December, when we became a 100-percent ESOP (Employee Stock Ownership Plan) and we have not talked in detail about that yet because we have not been able to talk to our employees.
Why would that be? Because we have been advised not to talk to the employees in detail, the employees know the transaction occurred, but we could not explain the transaction in detail until we had our audited financial statements. So we’re hoping to do that (in April). And then we’ll talk more publicly about it.
But, I believe that there is a function of a daily news organization to be that intellectual backbone for the community. I would use the casino vote as a recent example. It went personal and negative very quickly and we tried valiantly to highlight the relevant issues, get the facts out there. I was really proud of how we laid out the issues so there was a coherent exposition of what the issues are, which helps the whole community at least have reasonable conversations about it.
Yes, we want that to continue for as long as possible. And I personally don’t believe that is going away and so does Warren Buffet. Of course the other aspect we know, which is helpful, is newspaper advertising is really effective. It moves the needle on retail better than anything. That’s why people still do it. So our advertisers are rooting for us to continue, as well.
And we’re doing fine. The national press is heavily dominated by the entire industry, which is heavily dominated by major metros and major metros are in a whole different world. They don’t have a tight community that they’re serving and they’re under much more pressure from national advertisers, so they’re playing a completely different game.
Given that, we’ve been in business for 130 years and the business model for those 130 years has been pretty much the same, reports and interruptive advertising, whether it’s newspaper, radio, television, online, mobile; it’s the same basic deal.
We want to develop better methodologies for developing context, understanding and connection and referencing that in our existing products. And we want to develop the capabilities for way better targeted messaging and transactions with Fusionfarm (SourceMedia’s advertising agency).
So, we’re working on a lot of changes at the same time and plan to be very open about those but we like to talk to our employees first.
Q: Do you think The Gazette will remain a daily print product?
A: Right now, we’re a daily product and we’re making money every day and we don’t have any plans to change that.
We learn, when people don’t get (the newspaper) in the morning, if we have a carrier problem or a snow storm, we hear about it.
Q: Is there a mission shift at The Gazette?
A: Well, we’re not going away from anything, but we’re trying to expand.
We would like to expand the way we cover key topics. Our first experiment on this is Iowa TransformEd and that’s an experiment and we’re learning a lot from that. We’d like to experiment with a few other things.
Q: What are the facility changes?
A: So, in December, we owned the whole block (500 Third Ave. SE, Cedar Rapids) and the south half of the block was four buildings, now it’s three.
There’s the original 1923 building, which is right on Fifth Street and at the time, that housed everything. Every aspect of the newspaper was in that little building. Then in 1954, they wanted a bigger press, so they built the press building along the alley and in 1969, they built the office building and in 1985, they built a building for the inserting equipment and to hold the inserts. That’s the heavy manufacturing building that was knocked down.
Steve Emerson bought all those buildings at the end of the year and it was his decision to knock the 1985 building down because it was never designed for people; he had his own reasons. It was designed for machinery and paper.
And we have four operating divisions, The Gazette Co. is the company that is owned by the trust for the benefit of the employees, the operating division that is most familiar is Iowa SourceMedia Group, which is the Gazette and KCRG and Hoopla. And then we have Color Web Printers, which is on Bowling Street. And we have a new division called Fusionfarm, just started last year, which is a digital services firm and then we have a sales organization. Color Web is out on their own on Bowling Street. Iowa SourceMedia Group is going to be in the old KCRG building and Fusionfarm is going to be on the first floor of the original Gazette building. The sales organization is going to be on the second floor.
Q: Is there anything else you would like our readers to know about?
A: We’re looking for all kinds of people to play with us.
April 19: Creative Corridor Project Launch, 11:30 a.m.-1 p.m., Kirkwood Center, 7725 Kirkwood Blvd. SW, Cedar Rapids. The many collaborators behind the Iowa’s Creative Corridor initiative will unveil how this big idea will redefine the region and make the region one of the top performing places in the nation. Doors open at 11:30 a.m. Program starts at 12:15 p.m. Lunch provided. Cost $40. To register, visit http://bit.ly/12azA23.