Posted tagged ‘Nordic Consulting’

Old School Politics And The New Economy

March 19, 2015

The disconnection between Wisconsin’s growing tech sector and the state’s governing political dynamic has never been greater. This Isthmus story discusses how the Legislature’s decision to enact union-breaking “right to work” legislation left Madison area tech leaders puzzled and dismayed.

“As an employer, I can tell you this has zero bearing on my decision to stay in Wisconsin or to hire more people,” Dan Wilson, a founder of Moxe Health, told me. Other leaders had similar comments.

I write:.

It’s tempting to dismiss the comments of the techie execs as inconsequential because they represent startups and boutique businesses with small workforces. They are midgets compared to the titans of Wisconsin industry who have promoted right-to-work through their powerful lobbying arm, Wisconsin Manufacturers & Commerce.

But ignoring the new kids is a big mistake.

“In every single state, in every single metro area, young firms create the most jobs. That’s true everywhere,” says Dane Stangler, vice president of research and policy at the Ewing Marion Kauffman Foundation, which advocates for startup businesses.

The tech component has certainly paid off in Dane County.

It’s fueled, of course, by homegrown Epic and its rise as the dominant electronic health records vendor in the country. The workforce tops 8,000. Revenue in 2014 reportedly hit $1.8 billion. And because founder Judith Faulkner insists on running the entire operation through its fairyland campus in Verona, the region has boomed economically. Epic alone accounted for 27% of all the new jobs created here from 2001 to 2012, according to Kennelly.

The city staffer’s presentation on the Madison area’s economic dynamics makes a persuasive case that the Dane County metro area is impressively outperforming the rest of the state. With 10% of the state’s population, Dane County accounts for 12% of the state’s jobs, 15% of its economic output and 16% of the businesses created since 2000 and 73% of the net new jobs created in Wisconsin between 2004 and 2014.

The Milwaukee Journal Sentineldiced the numbers in a different fashion and came to the same conclusion: Dane County led the state in job creation between 2003 and 2013, with nearly 20,000 new jobs. That’s three times as many as second-place Waukesha County. Milwaukee County lost 19,000 jobs in the same period.

For anyone who still sees Madison as a cossetted government town — well, they need to think again. Kennelly’s report shows that the private sector is driving job and wealth creation in Dane County. “Our government workforce is effectively flat,” he says.

Even better, the growing industries here support good-paying jobs, namely in the biomedical/biotechnical and information technology business clusters.

“The Madison area is really an economic engine for Wisconsin,” Kennelly says. “State policymakers sometimes like to pick on Madison. A more constructive approach would be to say: ‘What are they doing right, and how can we replicate it in other parts of the state?'”

To read more, please go here.

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Epic’s Long Reach

December 5, 2014

Writing about software giant Epic Systems in its hometown is always interesting and always a challenge. The company is famously reclusive, and its former employees, who are at the heart of the Madison area’s emerging health IT industry, are afraid to say anything that might offend the powerful tech company.

In this story for Isthmus, I tease out the controversy over Epic’s noncompete policy for those expats.

The Huron Consulting Group’s announcement in April that it was buying Vonlay, a 130-person Epic-specialty consulting company, set off alarms locally when it became known than Epic had successfully intervened at the 11th hour to insist that Huron not hire Epic employees within two years of them leaving the company.

The one-year separation that Vonlay leaders observed in their hiring would be doubled for the acquiring firm. It also seemingly meant that former Epic employees who had signed an employment contract with a one-year noncompete clause when they had started at Epic would now be subject to a two-year stipulation they hadn’t agreed to.

Huron and Vonlay officials did not respond to queries, but Epic spokesman Brian Spranger confirmed that Huron had agreed to a two-year noncompete term. And then the shocker: “This is being reverted to a one-year term.” Spranger offered no explanation in his email for the reversal. “We’d rather not comment on the policy as a whole.”

There is no shortage of speculation. Most of it circles around Epic fearing it might be treading on federal antitrust laws and being accused of anti-competitive business practices.

To read more, please go here.

An Economy for the 21st Century

February 26, 2014

The past few years almost all of my writing has focused on documenting the rise of Dane County’s technology industry. This cover story for Isthmus begins:

This is the big question: How far can Dane County ride Epic’s success?

Done right, we’re talking about the foundation for Dane County’s 21st-century economy being built on the medical software industry: lots of good-paying information technology jobs that fuel an expanding housing market, a glittering downtown with hip restaurants and music clubs, a rising tax base to fund new community services and a lot more resources to deal with the serious problems of poverty.

Call it the “Epiconomy.” Madison advertising executive Andy Wallman, who coined the name, should trademark it. “Epiconomy” nails the fact that Epic now drives the Madison area’s prosperity.

Founded in 1979 by its mastermind Judith Faulkner, Epic Systems Corp.is the world leader in the burgeoning health-care software market. The privately owned Epic has 6,800 employees at its Disney-like headquarters in Verona and recorded $1.66 billion in sales in 2013. The company is renowned — notorious, say its critics — for hiring only the smartest young people and working them hard. Salaries for these twentysomethings range from an estimated $60,000 to $100,000 a year.

More are coming. Lots more.

“They could have as many as 10,000 employees by 2018,” says Madison planning chief Steven Cover, who was among top city officials briefed by Epic’s chief administrative officer Steve Dickmann in mid-January. (The media-shy company declined to be interviewed for this story.) Epic expects to add 800 positions a year for the next four or five years, Cover notes.

“They have an international operation that is growing very quickly. This will fuel their continued growth,” he says.

As heartening as that message is, the good news doesn’t stop there. Epic will continue to run its worldwide operation out of its nearly 1,000-acre Verona complex.

“There won’t be a European headquarters,” says Cover. “Their international operation will be staffed and operated from here.”

It’s big news that Epic will not decentralize its operation with regional headquarters. But for Dane County, the even larger payoff hinges on the answer to that opening question: Will Epic’s success give birth to an even larger health industry?

To read more, please go here.

I’ve written on Epic over the years.

For my 2002 story on how Epic wound up in Verona, please go here. You’ll see that back then the campus was valued at only $45  million.

Here’s another story from 2002 that describes how real estate speculators cashed in when they sold Epic the land for its new campus.

This cover  story from 2008 cited Epic as an example of “green sprawl”.

Here is a timeline up to 2008 that details Epic’s growth over the years.

This column from 2010 details how strikingly ignorant city leaders were when they lost Epic to Verona.

And here a mayoral candidate Paul Soglin talks about his Epic regret .


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