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Forum: Critical mass?

We've got it, says Dwight Dietrich, but there's more to do

Sunday, March 11, 2001

Pittsburgh has reached a milestone in its drive to become a region of high-technology opportunity.

  Dwight Dietrich is a founder and co-CEO of PowerLoom Corp., which designs and develops exchange platforms for Internet-based trading markets. His e-mail is 

Over the last 10 years, we have built a critical mass of first generation high-tech companies that are adding jobs, dollars and cache to the region. You've probably heard of them: FreeMarkets, Marconi (formerly Fore Systems), Be Free, IBM Transarc and ServiceWare, just to name a few. Dozens of promising second-generation start-ups are now taking root here.

Because of this critical mass, we have something to build on, and that's the key. Building our high-tech base lies not only in persuading out-of-town companies to locate here, but in nurturing what we already have. If we do that, it will be much easier to attract new business.

This is how all the successful high-tech centers in the United States began: Silicon Valley, Route 128 in Boston, the Northern Virginia-Washington, D.C., corridor, Seattle, Austin and others. They all planted seeds that grew and multiplied until they became major centers. Pittsburgh needs to work harder at fertilizing its first-generation seedbed, or there won't be a second generation to carry the torch. They'll either wither on the vine and die, or move to greener pastures.

How do we accomplish this? At a recent meeting of Trading Pitt, an e-commerce group of some 30 local companies that meet here every quarter to develop ways of growing our Internet e-commerce base, we kicked it around and came up with a few important tenets.

1) We need to remove the word "never" from our vocabulary - as in, we'll "never" be a Silicon Valley or Route 128. Why not? We have most of the key pieces in place: a critical mass to build on, Carnegie Mellon (our Stanford) as an incubator of innovation and of technology and management talent, a great work ethic, superb air transportation, multilevel political support, and a quality of life that rivals any in the country. A no-nonsense local venture capitalist friend of mine who 10 years ago believed that we'd never get as far as we have, now thinks the sky's the limit. "Never," he said, "That's so Pittsburgh. We've got to change the attitude."

2) We need to be more flexible in our approach. In Pittsburgh's industrial heyday, the business landscape was stable and well understood. Progress was constant and predictable. The business scape today is very different. It has moved from the land to the sea, where nothing is stable or predictable and the height of the hurdles are forever changing. Navigating this hazardous seascape requires constant correction, even abandoning a new strategy for a newer one when the seas get really heavy.

It's all about flexibility, being able to change. Western Pennsylvania has certainly felt the pressure to change over the last few decades. It's up to Pittsburgh's technology community to step up and convince others in the region that it's in their interests to respond positively to these pressures. It is a message we need to repeat to the business community, government and the general public.

3) We need to keep our best technical talent in Pittsburgh. And we need to fortify them with a strong pool of proven leadership talent who know how to build technology companies. One of my colleagues from my days at Fore Systems still lives here - on weekends - but works in Silicon Valley. Other strong, experienced leaders have abandoned Pittsburgh for better opportunities elsewhere.

This raises an important point that our Trading Pitt panel was most adamant about. We're not going to persuade high-tech talent to come here based solely on quality of life or infrastructure alone. Career decisions in the technology sector hinge on opportunity: financial and professional. Everything else is a tiebreaker. Any new promotional campaigns selling the region should reflect this reality. True quality of life includes enjoying both your work and your time outside of work.

4) Finally, we should be more creative in selling the region. In addition to keeping our best talent here, why not launch a campaign to lure outside talent to Pittsburgh, not necessarily to work here immediately, but just to live here and commute? If my friend from Fore Systems can commute to Silicon Valley to work, it shouldn't be too difficult to woo some subset of Silicon Valley, Boston and Austin's finest technology leadership to build their personal lives in Pittsburgh while commuting to their current workplaces.

The savings in housing costs alone could easily be the clincher. The strategy, of course, is that as the commuting wears on them, they become interested in career opportunities closer to home. This fertilization is exactly the ingredient that led to the growth of the other major technology centers in the United States today; and it can unlock the success of Pittsburgh in a similar manner.

The software and hardware that our technology community is building today represent the virtual girders and beams on which tomorrow's great e-businesses will be built. Right now, it is a $43 billion a year business. By 2006, just five years from now, it is expected to grow to $7 trillion.

Pittsburgh can be a major part of that growing market by coupling the care, feeding and nurturing of our first generation of high-technology successes with the blood, sweat and tears that come naturally to Pittsburghers.

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