The Kalamazoo-Battle Creek region has an adequate set of assets to build its next generation economy. There is no doubt that our region's economic infrastructure can be "tuned up" to perform better and more responsively. However, the more difficult task will be to establish long-term and fruitful communication linkages between and among the region's cluster industries and its service providers.

The strongest challenge facing the area is in human resource development, labor shortages and quality issues. The region's human resource/training system may not have adequate involvement of businesses that are knowlEDGEable about changing workforce requirements; educators are constantly trying to catch up. Many lament that our college graduates leave the region. The fact that the area is perceived as being unattractive to young professionals who are in the national labor market is a problem. The region does not provide the type of environment sought by young, high-in-demand professionals, and this may be a factor in out-migration. Unfortunately, this is a disadvantage that most small metropolitan areas face especially if they are not adjacent to a major metropolitan area.

Although the region possesses university R&D capacity, there is a lack of integration between local companies and Western Michigan University. Moreover, the region's large companies are not a source of technology spin-offs, despite their capabilities. The region is not leveraging its technology base as well as it could.

The region's physical infrastructure assets are a good match to the industrial requirements of the majority of the region's industries. The region's energy costs, while higher than those of competing regions, are not dramatically at variance. Water and waste service and infrastructure issues have yet to be resolved, the efficiency and high capacity of Kalamazoo's waste water facility and the superior quality of the treated water could be a drawing card for new industry. However, air transportation is a perceived problem, and Kalamazoo's situation is shared with that of other small metropolitan areas. Industries that are becoming more aggressive in international markets need more ease of access to major destinations on a convenient basis. The recent Boyd Group/ASRC Inc. report shows that the Kalamazoo Battle Creek region's service is better than most small areas but is not competitive with major hubs.

As for the region's business climate, the region has an equitable tax rate but has a legally complex multi-jurisdictional regulatory system for land use and permits. This unevenness and complexity is likely to be perceived as a serious barrier to existing and relocating companies unless managed through some coordinated system.

Quality of life is one of the region's major strong points. Housing, health care, and recreation are all affordable and abundant. Companies rooted in the region recognize these resources as do newcomers once they become familiar with the region. This asset, in combination with other strengths, suggests a large capacity to create more advantages for both existing firms and future arrivals.

Part Two of the Regional EDGE report presents the action initiatives developed by our region's clusters. These strategies show the priority challenges facing each cluster and how they propose to take action on common regional economic infrastructure issues. Specifically, each chapter analyzes the competitive position of the cluster, summarizes the competitive challenges they have identified, and describes the collaborative actions that teams from each cluster proposed and those actions taken so far.