Boston, sorry about that corporate hub, but learn from Baltimore

Your Money

February 06, 2005|By JAY HANCOCK

TO: BOSTON

From: Baltimore

Re: How to go gracefully from corporate hub to branch-office burg, by a city that's still working on it.

Sorry about Procter & Gamble buying Gillette. The sainted Fortune 500 razor company that gave $5 million to Boston hospitals a few years ago is about to get a major shave and perpetual supervision from Cincinnati.

That's even worse than taking orders from Charlotte, N.C., whose Bank of America just swallowed FleetBoston, the city's biggest bank, or Toronto, whose Manulife bought Boston's John Hancock Financial.

Join the East Coast Lonely Hearts Club for the Corporately Jilted. Listen to some free counsel: Big-business defections don't have to send your economy back to whaling and silversmithing. And feel Baltimore's misery, circa 1993-1998.

Maryland National Bank, our biggest bank and financier to generations of local employers, was engulfed by NationsBank, now Bank of America. USF&G Corp., our huge insurer and another downtown anchor, was bought and dismembered by St. Paul Cos.

Alex. Brown, an investment bank that punched above its weight in local economic impact, engaged in relations with Bankers Trust, which was then bought by Deutsche Bank.

There have been other Baltimore incursions by out-of-town buyers, including Allfirst Financial's takeover last year by M&T Bank and Noxell's purchase in 1990 by ... Procter & Gamble. But why beat ourselves up?

This is about your humiliation, Boston. And we bring advice, which we should heed more ourselves. When corporate headquarters grow scarce, try to:

Lay ground for future dynamos. The likes of Fidelity Investments and Boston Scientific help fill the crater left by Gillette, Hancock and FleetBoston just as T. Rowe Price and Legg Mason have advanced in Baltimore's leadership. But such companies don't emerge overnight. They can't be willed into being, but they can be encouraged.

Focus development efforts. Economically challenged regions frequently flail for jobs across every standard industrial code, accomplishing little. Aim resources at sectors with the biggest promise. In Massachusetts' case, this is biotechnology. In Maryland's case, this is biotechnology. May the best state below the Mason-Dixon Line win.

Don't obsess over competing with New York or Georgia. Your competitors are Maryland, California, Switzerland and their like.

Keep lavishing attention on higher education. MIT, which educated the engineer who developed King C. Gillette's disposable blades, is why the company grew in Boston. Former Maryland Gov. Parris N. Glendening and current Gov. Robert L. Ehrlich Jr. understand the economic blessings of universities.

Impress on remaining titans the importance of finding successors for community leadership roles. Kidnap the regional vice presidents running your former headquarters. Scour real estate, the law, health care or other sectors not always involved in local business groups. Baltimore bosses who have stepped forward include land baron Wally Pinkard and lawyer Frank Burch.

Worry about high taxes -- and you have something to worry about, Boston. But worry more about quality of life. Part of the business-leadership imperative is to perpetuate funding for symphonies, the environment, museums, theater and other cultural lures for future employees and CEOs.

Address the affordable-housing problem. All the resident CEOs in the world won't do any good if employees can't afford to come work for them.

Continue wooing immigrants -- something Boston and its Office of New Bostonians have done much better than Baltimore. Immigrants have renewed this nation again and again; they can do the same for cities and regions.

Place your city a few miles up I-95 from Washington, if you can. The spinoff from $2 trillion in federal spending does marvels for putting a floor under your economy.

Repeat self-affirmation drills daily. Here in the Baltimore region we stand in front of a mirror and say, "We're home to McCormick, Black & Decker, T. Rowe Price and Legg Mason; a couple of famous writers once lived here; and, darn it, this year the Orioles might play over .500."

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