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SLO

HUN

IT

GER

Region in the south-east of Austria

Graz

Vienna

Steirisches Vulkanland

Steirisches Steirisches VulkanlandVulkanland

region covers an area of 1.100km² in the south-east of Austria population: about 96.000 inhabitantseconomically weak rurally orientated region lowland area with lovely and calm hillsseveral mineral springs are a result of the former volcanic activitysteep remnants of volcanoes are the sites of medieval castlesmild climate south of the Alps is a good precondition for wine, agriculture, forestry and tourismenterprises in industry, trade and tourism are small-sizedunemployment is low; average income is the lowest of Styria

Status Quo Ante – 1998Status Quo Ante – 1998• Depressed atmosphere• Poor image• No future vision• Resignation• Not much cooperation• Poor economic prospects• Low level of belief in the region

2

The downside / business – before 2003

• Continued trend of businesses closing in the villages; loss of businesses = loss of income, employment, services and training positions (-130 jobs/year)

• Drain of purchasing power from rural areas was getting faster (-250 jobs per 1% loss; we still have 30% = 10.200 jobs)

• Service companies work mainly for customers outside the region, if the regional economy is not improved, these companies will follow their customers (-3.500 jobs)

• The service sector has high growth rates - consultants come from outside - if well-qualified young people move away, this chance will have been wasted (+520 jobs)

Downside / Agriculture - before 2003

• Continued closing of full-time farms (-130 farms / year = -220 jobs)

• Pressure on agriculture & forestry due to climate change• Harvest failures had risen over the previous 3 years;

approx. 1.000 farms in danger (-1.700 jobs)• Falling prices for unprocessed agricultural products

(Milk, Cattle, Fruit, ..)• Pressure on communities grows• Constant depopulation of the villages, loss of people to

the cities

EvKOEvKO• Creeping loss of employment (!!!)• 1% of purchasing power = 250 jobs

30%

35%

40%

45%

50%

55%

60%

1980 1985 1990 1995 2000 2005 2010 2015

VulkanlandGraz und Graz UmgebungSteiermark

Ziel Vulkanland 2011

Arbeitsplätze pro Einwohner in %

!!!

EvKOEvKO• Highest rate of growth in commuting lifestyle• € 160 million /year for “global economy” (= donation of € 1900 per citizen;

= 650 years for regional development project; 32 impulse centres/year (with 5.000 m² floor area) - effectively enormous wastage of money and time of over 24,000 Vulkanlanders)

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1981 1991 2001

Vulkanland

Graz und Graz Umgebung

Steiermark

Auspendler pro regionalen Arbeitsplätzen

??

3

Sunrise at the Riegersburg castle, build on and with volcanic rocks.

Driving Force for ChangeDriving Force for ChangeA way must be found to develop the region based on the talents

of the people, the natural resources and the economic

potentials of the region.

Three development concepts1. power driven: money, political power & know-

how/consultant (you give me money, and I will act/vote – transactional)

2. identity & talents: values, staying power & know-how/staff (theses are our values/visions, you can be part of a great process/a big picture – transformative)

3. slow change: honorary work, skills & time (these are our goals, if you have time or money left, you should act – natural dynamic)

Development concepts1. power driven – transactional: economic networks,

city regions, technology cluster, flagships, ..

2. identity & talents – transformative: regional (rural) development, open source enterprises, building public consciousness, ..

3. slow change – natural dynamic: NGOs, ecological or cultural projects/heritage, non-profit associations, ..

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What is authentic development?1. development by orientation from outside: e.g.,

creative industries & nanotechnology are a global trend. Thus our region will focus on these issues(we want to become, what the other want us to be).

2. development by identity: search for authentic talents & resources that form our identity. Develop the specific regional character first, afterwards others will be attracted by our outstanding profile (we want to develop ourselves, according to our inner, authenticcommitment; we are looking for markets that benefit from our identity & talents).

(1) Vulkanland thesis• Character & identity are the only starting points for

long term economic development. It is about to develop a USP in the global economy.

• The human identity strongly depends on landscape and living space.

• To work on regional economic development, means to work (at least) 5 years on building consciousness first.

• Worn out, old or dusty identities cannot be reanimated by regional development.

(2) Vulkanland thesis • The economical growth rates in rural areas with a well

designed regional development process will be higher than those in big cities.

• Money and funding is not enough for long term development & motivation. Power driven, transactional development is a strategy for industrial economy, whereas transformative development by identity is the strategy of the knowledge society.

• Beyond sound strategies for economy, regions need “sense-tanks” for steering by visions. Valuable & strong visions lead to long term, motivated and human development.

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Concerted Developmentwith 75 Communities

in 4 Districts

Concerted Developmentwith 75 Communities

in 4 Districts

Decision 1

Transformation from a region without opportunities

to the region of the future “Steirisches Vulkanland”.

Transformation from a region without opportunities

to the region of the future “Steirisches Vulkanland”.

Budgets – money is not a problemThe budget for the regions exists in Styria in many categories. It’s not the total amount, it’s a question of the right investment decisions.

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6

61

26

88

311

455

0 100 200 300 400 500

L+ Förderung

Gde Rotes Kreuz

Kirchenbeitrag priv.

Tourismuswerbung TL

Wohnbauförderung Gde

AMS Budget

Gde Ortsbild, Strasse

€/EW

Clear decision for a holistic development

process

Clear decision for a holistic development

process

Decision 2

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Increase in value policy:

“Share value” of the region is a function of• living culture (lebenswerte und gesunde

Region)• regional business (gute

Regionalwirtschaft)• development options (Möglichkeiten in der

Zukunft)

Principle: “increase in value” is basis for 1. capacity to act (of private and business)2. willingness to take action (positive mood and

strong vision)3. disposition to innovate (longing for competence,

personal transformation)4. readiness to invest (guaranteed future, know-how,

capitals)5. strong regional economy

= a ten years process

„technology transfer/diffusion“

„investment support/projects“

Enter the 4th or 3rd floor?

Building on existing valueStyria is a wealthy area with expensive infrastructure. What we do with that defines its value. Regional development secures the “share value” of Styia. Figure: value levels in Vulkanland.

-30.000

-25.000

-20.000

-15.000

-10.000

-5.000

-

5.000

10.000

15.000

Stand 2000 Stand 2010 Top und Flop 2030

Vom Grenzraum zum Vulkanland

Trend wie bisher in FB/RB

Mio. Euro Wertbestand

42.000 Mio. €

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Wertbestand?Der Ländliche Raum der Steiermark macht ca. 2/3 der Aktie Steiermark aus.

Wir können nicht soviel fördern, wir können nicht einmal soviel Einkommen erwirtschaften, als ein Preisverfall an Beständen (Wert) vernichtet.

Entspricht -830 Mio. € pro Jahr im Vulkanlandmit Einkommen bei ca. 750 Mio. € pro Jahr!!

Eine kurzfristige Änderung steht dem unmittelbar Rationalen entgegen

Überwindung der Ratio

© Krotscheck/Ober/Schmidt

Neues Denken überwindet die vorherrschende Ratio – durch tägliches Leben und Gestalten aus

der gewünschten Zukunft heraus.

Langfristige Änderung

Vision

10 Jahre

Überwindung der RatioÜberwindung der Ratio

© Krotscheck/Ober/Schmidt

What, if someone says that

• the best employment policy is policy for the regional economy

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4 Projekte einfaches Management,lokale Wirkung, Neid, Konkurrenz

kurzfristig entstehen ca. 3 Firmen daraus

Maßnahmenmanagen

EIN ProzessVerändert denOrganismus – dieSeele der Region

Bewusstsein, LandschaftZukunft, Innovation, Wirtschaft & Kompetenz, Echtheit und Kultur, ..viele Akteure, die Stimmung machen

langfristiglangfristig

Ein ganzheitlicher Entwicklungsprozess

InWERTsetzung statt

InNEIDsetzung!

Entscheidung 2 Unterscheidung

Projekt• einfach, definiert

(Personen, Aufgaben)• kleine Gruppe• klarer Nutzen &

Kosten von Beginn an• maximal 3 Jahre• Start: Ziele,

Maßnahmen- & Kostenplanung

Prozess• komplex, flexibel,

laufende Anpassung• Akteursmix, große

Zahl von Spielern• diverse Ziele &

Werte, regionaler Nutzen „als Aktie“

• mindestens 10 Jahre• Start: Vision & Werte

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Ergebnis qualitativ

Projekt• nach ca. 3 Jahren• Maßnahmen

umgesetzt, Ziele erreicht

• großer lokaler (privater) Erfolg

• Neid der anderen 4.400 Betriebe

• Wettbewerbs-verzerrung

Prozess• nach min. 7 Jahren• Vision & Wertegerüst für

neue Kultur, starkes Zukunftsthema & Image

• viele Akteure, die Stimmung machen

• regionale Marke • viele Erfolge ergeben

einen großen Regionserf.

flagship development increase in value

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> 50% Mehrheit

Projekt A1 bis RTherme xy

100 FF Häuser

projektorientiert prozessorientiert

Kulinarische Region

Europäische Handwerks-

region

Lebenskraft

Regional-wirtschaft

© Krotscheck/Ober/Schmidt

CONCLUSIO

Die Inwertsetzung findet immer seine Resonanz im

Außen.„Charakterstärke bauen statt prostituieren“ Gradual loss of purchasing power over more than 40

years, region is supplied 78% from outside (& therefore controlled from outside). Can we regain economic stability by building the regional market?

0%

20%

40%

60%

80%

100%

1960 1980 2000 2020 *)

Extern/Global

Regionalwirtschaft

?

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Economic strength of the region:Consumer purchasing power: 770 Mio. €/a For Styrian products: 170 Mio. €/a

The other € 600 million /year amount to 15.100 (lost) jobs in Vulkanland(times 10 for the whole of Styria)

Dynamic and tough; entrepreneurs in VL survive longer on the market; constant 200% of Graz = double the growth (net = start-ups - closures)

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2

4

6

8

10

12

14

1999 2000 2001 2002 2003

Vulkanland

Graz - Stadt

Steiermark

Netto Unternehmenszuwachs pro 1.000 Beschäftigten

The innovation budget provides the Vulkanland with a higher level of venture capital than in Germany and even the Netherlands

0,00

0,05

0,10

0,15

0,20

0,25

0,30

0,35

0,40

0,45

NL 99 NL 00 D 99 D 00 AUT 99 AUT 00 FIN 99 FIN 00 VL 04 VL 05

Frühphasen- und

Spätphasenfinanzierung

Risikokapital in % vom BIP

Unternehmen

Gemeinden

The Vulkanland process is a job motor – in 3 years, 55 jobs per 1000 existing jobs were created - a total of 932 jobs for 920.000€ in subsidies for the process.

0

5

10

15

20

25

2001 2002 2003

Vulkanland

Steiermark

geschaffene Arbeitsplätze pro 1.000 bestehenden pro Jahr

Wirtschaftsoffensive Vulkanland

norm. Niveau

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What, if someone says that

• you can forget EXPORT, but concentrate on regional ecomomy & regional supply

Regional development in community context:

Only business pays!• Business is the fulcrum of all demographic movements.• Business lives on investments in future prospects. • After the start-up financing over the first 5 years, the

economic campaign refinances itself (from the view of communities).

Economic campaign2004-2010

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Conference of lay peopleThe work in the region ha changed a lot in recent years in the Vulkanland:

The Vulkanland is no longer a project, it is reality, and for most people a positive one. Business start-ups and jobs in the region are the result.

The effects of everyday decisions on the region must be explained better (Effects of consumer choices, personal involvement, personal activities to support the community…)

State of the Region

1. The new identity of the region has turned out to be the most valuable aspect and will be the biggest factor in the long-term development.

2. The Vulkanland is now a region of quality of life, a “motivating and inspiring” region; a region of cooperation. Young people have been given prospects to keep them in the communities, as the carriers of the future.

3. Three core competences of the country have been defined: craft trades, food and authentic tourism.

4. The Vulkanland became a new identity, the strengthening of self-confidence and the emotional attachment are visible in all levels of society. The symbol for this is the brand.

EvKOEvKOMain Products of the Regional Development1. From the border region without prospects to the innovative

Steirisches Vulkanland = an event of historic proportions2. Strengthening of identity - and self-awareness lead to

formation of a region from 4 districts3. The brand Steirisches Vulkanland becomes a symbol and

anchor for people and products.4. An autonomous culture of work, living, and business and

three fields of business competence, with innovation budgets for communities, were created.

5. Future with youth and education in Steirisches Vulkanland

Process of Regional Development

Change and Vision

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• The support of everyone is most important at the BEGINNING.

• Activation is done together.• If you don’t get over the hill because of too

little money or hard work, you can forget about trying again.

Start the ball rolling!

??

What, if someone says that

• industry is out and regional owned SME are in? Do not support global player!

Starting point:Rural economic development needs new methods and concepts. The new businesspeople and business ideas keep it simple. Average size of the businesses is 5 people.Innovation happens as an integral part of the business practice. People have endurance, have hardly any venture capital but support from their families.

Beginn log-Dynamik bei Kulinarikim Vulkanland

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Business location VulkanlandAreas of competence

Culinary RegionEuropean Craft RegionRegion of vitality

The Vulkanland became aBusiness Location• craft & creative talent• climate of innovation• close to nature, honest and authentic• high-value products and services• autonomous values and culture• together: business and communities

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• Food & drink = 23% of value creation• Food & drink = 28% of employment • Food & drink = 45% of the businesses

(including full-time farmers)• Food & drink = 65% of the cultivated area• Additionally 5.600 part-time farms

.... all the businesses are small enterprises.

Eating & drinking (incl. agriculture) plays an important role in Vulkanland

Location goal: create products of 1st and higher orders

220

180

110

76

36

25

19

17

15

1,5

1,2

0,09

0,06

0 50 100 150 200 250

HiFi/HiEnd Geräte

Gölles Balsamessig

PC

Brisky, LAVA Bräu

Vollholztür, TV Gerät

Vulcano Rohschinken

Eruption, VL Wein

Auto (Mittelklasse)

Kernöl

Stahl

Schweinefleisch

Maiskörner

SchnittholzEuro/kg

Rohprodukte

Produkte 1. Ordnung

Produkte höherer Ordnung

In 10 years the Vulkandland ..will be known for

• Top quality food & drink• Excellent restaurants• Transparent manufacturing • Innovative producers• Unusual and excellent products• Product philosophy & and lifestyle• Real “Lebensmittel” - food as a medium of living• Food that you can trust

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• Crafts = 64% of apprentices (future!)• Crafts = 42% of value creation• Crafts = 38% of businesses• Crafts = 37% of employment

.... all businesses are small enterprises.

Craft trades play the most important role in Vulkanland

In 10 years...in Vulkanland, you will find: ...

• innovative craftspeople and their values being respected• In progressive companies, excellent apprentices, often with

a full school education• People philosophizing abut the product, about how to

improve the customer’s quality of life, not arguing about the price

• Vulkanland quality internationally known• Companies active in R&D and cooperating on the

international market

40-45%36%31%24%23%

10-20%49% 49% 34% 30%

28% 27%35% 40-45%34%

1973 1981 1986 1990 2010

Qualitativ hochwertigeSpitzenprodukte

MittleresMarktsegment

Billigprodukte

gewerbliche, authentischeKleinbetriebe

industrielleGroßbetriebe

Quality Region VulkanlandQuality before Quantity

International Megatrend – loss of the mid-range

Decision 7

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In the high price segment,identity and lifestyle are at the

centre of consumer choice:A region without identity

will be trapped in low prices.

• Quality and gourmet campaign in the restaurant sector (eat&art, furnishing, ..)

• Volcanism & geomancy as underpinning themes• Identity, regional character and authenticity as

cornerstones of development of the range of products & services on offer, and spa tourism

• Culinary trails with theme gastronomy, health-related offers and “transparent” manufacturing

• Pushing theme events in the 4 seasons• Improvement of farm landscape festivals

Region of Vitality

In 10 years ..the Vulkanland will be known for ...

• The (geomantic, geological) traces of the volcanos• Autonomous lifestyle and the associated lifestyle

tourism• Authentic and hospitable people• An idyllic landscape• Living folk culture and regional festivals• Edible landscape• Peace and quiet for “recharging your batteries”

What, if someone says that

• you should cancel tourism branding and concentrate on leisure and holidays for inhabitants

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What, if someone says that

• there is a way in regional development, which is 20 times more effective than project oriented support

Strategy for regionaleconomic development:

Activation of the lead sectors through a long-term process that is oriented around the talents of the people and

their values that are good for the future.

Lead sectors:Crafts, Food & drink

External demand

Regional demand

othersectors

Vulkanland communities, regional development, Land Styria, Federal Govt.

MARKT

secondarydemand

AssociationsSponsoring

sozialinvolvementt

JobsIncome

SubsidiesMotivation

Taxes,Revenues

Society

Regaining room for manoeuvre for regional development

Vision

Global development: Regional development:

Actual: 70 %

Target: 40 %

Current: 30 %

Goal: 60 %

Socially more valuableEconomically more valuableEcologically more valuable

-30 %

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Comparison of Costs & Benefits of holistic development and big investment projects: a factor of 20 in the long run

0 5 10 15

Mio. € Nutzen

Mio. €Aufwand

Anschubprozess "Kulinarische Region"direkte und indirekte UmsatzsteuerESt. aus pos. ArbeitsmarkteffektEinsparung an ArbeitsmarktinterventionenSumme KommSt.

0 5 10 15 20 25 30 35

Mio. € NutzenGroßprojekt

Mio. € Aufwand

Investitionsförderung,Aufwanddirekte und indirekteUmsatzsteuerESt. aus pos.ArbeitsmarkteffektEinsparung anArbeitsmarktinterventionenSumme KommSt.

One regional job in big industry through an expansion project costs 30 times as much as in the Vulkanland process.

0 40.000 80.000 120.000 160.000

Werbeagentur

Technisches Büro

Schokolade

Magna Powertrain

A1 Mateschitz

€/AP

Durchschnitt Industrie

Durchschnitt Kleingewerbe

0 500 1.000 1.500 2.000 2.500

Produzierendes Gewerbe - kulinarische Manufakturenund Handwerk (inkl. Vertrieb)

Ärzte und -zentren zur Gesundheitsvorsorge (inkl.Masseure, Physiotherapeuten, Tai Chi, …)

Wirtschaftsdienstleister (Design, Marketing,Eventorganisation, Fotografen, ..)

Tourismus: Beherbergungsbetriebe & Gastronomie(Spuren, Gesundheitsregion)

erneuerbare, regionale Energieversorgung

andere

Arbeitsplatz-Potenzial

Kulinarik, Handwerk

Spuren d.V.

Energieregion

Prognose VL über zusätzliche, regionale Arbeitsplätze in 15 Jahren.

bis 2018

Gesundheitsreg.