The Case for Localization

Identifying Key Factors Contributing to Localization

Framing a Way to Track Localization as It Unfolds

Responding to Localization Trends with Appropriate Integrated Solutions

Moore’s Law Postulates That the Capability and Capacity of Technology Double Every Two Years…

With each passing moment, technology gets: • Faster• Smaller• Stronger• More Embedded• More Intelligent

Advances in Technology Drive Deep and Pervasive

Integration

Integration through Technology Enables Us to…

• Shrink the Size of Our “Human Footprint”• Live Longer• Generate the Energy We Consume• Support a Community Economy while Participating in a

Global Economy• Engage in Community Political Action as a Means of

Personal Advocacy

Integration Prompts

LOCALIZATION

Localization is the process by which the distance between the point of production and the point of use or consumption is reduced to as close to zero as possible.

A comparative measure of localization is the shrinkage of this distance over time as observed within a localization framework applied to a target market area

The total value of an integrated solution equals the sum of the distance reduction by EACH and ALL elements comprising the solution

Localization Establishes a Context in which TOTAL Value Is Determined on a Wider Scale to Include:

$ Money Invested, Saved, Gained

E Energy Type, Consumption, and Conversion

Information Gathered, Framed, and Delivered

C Carbon Reduced, Sequestered, Remediated

Time Saved, Spent, Better Applied

Creativity Encouraged, Quality of Life Enhanced, Balance Restored

Money Becomes Only One of

Multiple Measures of Value!

Serving Customers in a Localized Context Means:

• Know the principles a customer chooses to honor in doing business:

Measures of Value

• Know what the customer’s business delivers that adds value:

Business Portfolio

• Know how the customer organizes operations to deliver added value:

Business Model

• Know how to improve the performance of the customer’s portfolio and business model through

Integrated Business Solutions

Know the Customer’s BusinessBetter than the Customer Does!

Knowing and Responding to the Customer’s Business Localizes Value Flow

Integration

Space

IntegratedSolutions

Products /Services /Platforms

$ E C Multiple Measures of Value

Pro

du

cers

an

d S

up

pli

er P

artn

ers

Po

rtfo

lio

s

Customer’s Business Portfolio

Customer’s Business Model

Howthe

CustomerDoes It

Whatthe

CustomerDoes

LocalizeMaterial Value-Add

VirtualizeProcess Flow

GlobalizeVirtual Value-Add

SolutionizeValue Flow

Cu

stom

er Seg

men

ts and

Cu

stom

er’s Bu

siness

A Framework Wherein Localization Is Anticipated

Fixed / Flexible

Value-Add Based

Equity / Debt

Low / No Risk

WarrantyConsumer

Outlet

Certified Service

Licensed Dealership

Plant Materials

Solar

HydrogenWind

Conversion to Electricity

Compliance to StandardsStorage

Debits / Credits

Community College

Virtual

On-The-Job Training

K-12 / Technical

Tracking / Influencing

Terms / Conditions

Timeframe Covered

Amount Available

Market Targeting

Collaborative Relationships

Business Planning

Attracting Investment

Social Network

Blog Site

PayPalWebsite

Community Supported Ag

Farmers’ Markets

Restaurants

Grocery Stores

Year-RoundExtended Season

HydroponicsField

RegulationsAsset

Utilization

Quality ControlQuantities

Inventory / Storage

Packaging / Handling

Farm-to-Market

Distance Traveled

Multiple Systems

Special Specs

InstallationStandardized

Kits

Optimized Distances

Integrated Design

Public Access

Zero Emissions

Integrated Waste Mgmt

Multiple Use

Holistic Design

Water Mgmt

General Contracting

Technology Adopter

Green Designs

Awards / Recognition

Logistics

Retailing

Production Financing

Subdivisions

TransportationRetrofit to Existing

Business Start-ups

Courses / Certification

Online Presence

Off-Grid / NetMetering

// H / Bio Tech

New Buildings

Processing Sales / Support

Multiple Measures of Value: $ E C

Gov’t Regs / Subsidies

LEED Construction / Landscaping Community / Connectivity

“100-Mile” Food / Feed / Floriculture Renewable / Distributed Energy

Localization Effectiveness Scoring System (LESS)How Localized Is YOUR Organization? More Points Is LESS!

Retrofit to Existing Production Technology Online PresenceStandardized Kits Field Wind Website

Installation Extended Season Solar Blog Site

Special Specif ications Year-Round Hydrogen Social Netw ork

Mulitple Systems Hydroponics Plant Materials PayPal

Total 0 Total 0 Total 0 Total 0 0

New Buildings Processing Off Grid / Net Metering Business Start-upsGreen Design / Architecture Quantities Conversion to Electricity Market Targeting

General Contracting Asset Uitlization Storage Business Planning

Aw ards / Recognition Regulations Debits / Credits Attracting Investment

Technology Adopter Quality Control Compliance to Standards Collaborative Relationships

Total 0 Total 0 Total 0 Total 0 0

Subdivision Design Logistics Financing Courses / CertificationWater Management Distance Traveled Low - No Risk K-12 Technical

Holistic Design Farm-to-Market Value-Add Based On-the-Job Training

Multiple Use Packaging / Handling Fixed / Flexible Community College

Integrated Waste Mgmt Inventory / Storage Equity / Debt Online

Total 0 Total 0 Total 0 Total 0 0

Transportation System Retailing Sales / Support Gov't Regs / Subsidies

Zero Emissions Grocery Stores Licensed Dealership Amount Available

Public Access Restaurants Consumer Outlet Timeframe Covered

Integrated Design Farmers' Markets Warranty Terms / Conditions

Optimized Distances Community Supported Ag Certif ied Service Tracking / Influencing

Total 0 Total 0 Total 0 Total 0 0

Total 0 Total 0 Total 0 Total 0 0

Co

mm

un

ity / Co

nn

ectivity

LE

ED

Co

nstru

ction

and

Lan

dscap

ing

100-Mile F

oo

d / F

eed / F

loricu

lture

Ren

ewab

le / Distrib

uted

En

ergy

Looking at 3 Ohio Metro Areas: Is Localization Worth It?

$ / Resident / Year Food Expenditures $ 4,000 $ 4,000 $ 4,000 $ 4,000 $ 4,000 $ 4,000 Total Food Expenditures / Year $ 8,400,000,000 $ 10,080,000,000 $ 8,400,000,000 $ 10,080,000,000 $ 6,900,000,000 $ 8,400,000,000 % Local Food 5% 25% 5% 25% 5% 25%

Total $ 420,000,000 $ 2,520,000,000 $ 420,000,000 $ 2,520,000,000 $ 345,000,000 $ 2,100,000,000

LEED Construction / Landscaping$ / Resident / Year Construction / Landscaping Expenditures

$ 3,000 $ 4,000 $ 3,000 $ 4,000 $ 3,000 $ 4,000

Total Construction / Landscaping Expenditures / Year

$ 6,300,000,000 $ 10,080,000,000 $ 6,300,000,000 $ 10,080,000,000 $ 5,175,000,000 $ 8,400,000,000

% LEED Construction / Landscaping 5% 25% 5% 25% 5% 25%

Total $ 315,000,000 $ 2,520,000,000 $ 315,000,000 $ 2,520,000,000 $ 258,750,000 $ 2,100,000,000

Total Spend:Energy, Food, Construction / Landscaping

$ 23,100,000,000 $ 30,240,000,000 $ 23,100,000,000 $ 30,240,000,000 $ 18,975,000,000 $ 25,200,000,000

Total Localization %:Renewable Energy, Food, Construction / Landscaping

5% 25% 5% 25% 5% 25%

Total Localization Spend:Renewable Energy, Food, Construction / Landscaping

$ 1,155,000,000 $ 7,560,000,000 $ 1,155,000,000 $ 7,560,000,000 $ 948,750,000 $ 6,300,000,000

Producer X Market Share 1% 2% 1% 2% 1% 2%

Producer X Revenue $ 11,550,000 $ 151,200,000 $ 11,550,000 $ 151,200,000 $ 9,487,500 $ 126,000,000

Producer X Aggregate Revenue $ 11,550,000 $ 151,200,000 23,100,000$ 302,400,000$ 32,587,500$ 428,400,000$

Much of Ohio lies within a 100-mile radius of Columbus: Ohio is LOCAL!

11,500,000 People (population of Ohio) x $11,000 ea ($4K Energy + $4K Agriculture + $3K LEED) = $126,000,000,000@1% Market Share = $1,260,000,000 Revenue Potential for Producer X—Right NOW!

Exploring and Exploiting the Localization Trend

• Apply localization framework by building on regional / global experiences with localization and targeting three localities in Ohio to research, learn, and test response possibilities

– Greater Cleveland Metro Area (2.1 million)– Greater Cincinnati Metro Area (2.1 million)– Greater Columbus Area (1.7 million)

• Engage social networks to match non-linear realities with non-linear measurement approaches

– Utilize a third party blogger as a “trusted intermediary” to facilitate the information exchange between local and global social networks

– Synthesize information gleaned from social networks and feed into the front-end of economic / business growth processes

– Sponsor active participation by select information analysts and communicators to strengthen the transfer of knowledge from the global external network to the participants in local networks

• Develop and deliver integrated solutions from basic “building blocks”– Populate portfolio with “mix ‘n match” systems / processes / tools– Package portfolio elements with complementary pieces to make a total integrated solution

tailored to the needs of customers and consumers– Play with the delivery and on-going support of integrated solutions

• Develop linkages with business startup and growth processes, integrated solutions projects, and capacity-building initiatives

– Provide modest seed money to prime the pump of project ideation and business planning– Establish collaborative relationships that encourage reciprocity and leverage of investments,

resources, and capabilities to drive ideas, concepts, and plans forward– Deliver training via download, video / voice, and two-way interaction that increases proficiency

in use of online tools, processes, systems for virtual communication, collaboration, and decision-making