Inclusive Thinking Can Help Turn Negative L.A. Perceptions Around

DICK POLADIAN <i> is the managing partner of Arthur Andersen's Los Angeles office</i>

The current issue of Fortune ranked the best cities for business in the United States and internationally. Los Angeles was not among them. The San Francisco Bay Area was ranked first--the only California region to make the U.S. list.

My firm, Arthur Andersen, was responsible for collecting and summarizing the data that Fortune’s editors used in their decision making. However, much of that decision was based on opinions given by CEOs, economic development directors, governors and ambassadors worldwide in interviews with Fortune’s staff.

In other words, the perceptions of others around the world made the difference.

Los Angeles has long been a place of myths and dreams. In the past, those myths were extremely positive, but after the Northridge earthquake, civil unrest, fires, floods, widespread publicity surrounding the Simpson trial and you name what else, the myths and perceptions have turned decidedly negative. Both images of L.A.--as a paradise and as a city overwhelmed by economic, social and natural disasters--are equally distorted.


But perceptions are reality to those who hold them.

A couple of years ago when we had heavy rains, my family and I were traveling out of state. As we watched the news reports on television and read the newspapers, we wondered whether we had a home left standing.

Last fall, Arthur Andersen held its worldwide partners meeting in Los Angeles, with several thousand visitors booked into local hotels. In advance of that meeting, we received a stream of questions from those who would be traveling here. They wanted to know if the hotels were safe and whether the town had been rebuilt. People really believed the whole town had been destroyed by the earthquake.

I spoke with other Arthur Andersen partners who live and work in Southern California to ask them how they respond when confronted by “horror” stories or expressions of “sympathy” from their out-of-town business contacts.

My colleague John Nendick, head of the firm’s worldwide entertainment-industry practice, is himself a recent immigrant to Los Angeles. When he put in for a transfer to the United States from Britain a few years ago, he was told that a move to another U.S. location could be made right away, but that a transfer to Los Angeles would take at least a year. He chose to wait to come here.

As it happened, John was picked for a focus group of partners who met in Chicago that contributed to the Fortune research. He was astounded by the negative views he heard. John challenged the other participants on their perceptions. He pointed out that Los Angeles is still the world leader in our nation’s No. 1 export--entertainment programming.

And John is not alone in having positive perceptions. Another partner, Paul Sachs, recently moved here with his family from Kansas City. His colleagues in Missouri chided him about the higher cost of living here and said he, a financial adviser, should have known better. His response: The higher cost of living is more than compensated for by what you can do and the places you can visit within a day’s trip from Los Angeles. Not to mention the weather, which makes it possible to plan family outings year-round.

Professionally, too, Paul told his KC friends, Los Angeles is a place of change--which can be viewed as either positive or negative but which nevertheless creates a tremendous range of business opportunities.

There’s no question, however, that Los Angeles does have its share of problems. What major city doesn’t?

What often gets lost in all the talk, however, is that we have a safer city than Seattle when it comes to violence and property crime, according to 1993 crime statistics from the U.S. Census Bureau. In addition, we have more high-tech industry than all of Silicon Valley and two of the busiest ports anywhere on the planet.

And look at our diversity of population. If you want to test-market anything without the expense of shipping a product halfway around the globe, bring it to Los Angeles. We have the third-largest Latino population of any city in the world and tremendous Japanese, Korean, Vietnamese, Chinese and Cambodian communities.

It is truly ironic that many of the factors cited about San Francisco--its port, its diversity, outstanding universities and strong law firms--are matched by Los Angeles’ strengths and by its mix of companies, large enterprises and growing new ones. And not one business executive out of the 327 surveyed named L.A. in the top 10. So much for managing by facts.

In my view, the only way to right our reputation and change the perception to one that is more realistic is to take a personal approach. There is this idea about “inclusive thinking,” which refers to people who talk about “what is” working rather than dwelling on “what isn’t.” Los Angeles has plenty of ill-will ambassadors out there, not the least of whom are competitors--cities and states aggressively seeking to attract business and position themselves for the kind of growth our city enjoyed for so long.

Not long ago, I received a phone call from a representative of the South Dakota governor’s office, apparently part of that state’s economic development campaign. He wanted to interest me in moving our office to his state, and he was very well prepared.

When I explained that we’re a service business and have to be close to our clients, he hardly took a breath. He came back with a barrage of the attributes that would await us if we would locate a branch in his state: the number of flights daily, in and out; the new communications gear that would make it possible to stay in touch no matter where we relocated, and on and on.

When we hear the old myths about the city--and the new criticisms as well--most of us just shrug them off. I suggest that we see ourselves as the first line of defense, to talk about L.A.'s promise now and in the next century.

Just as the psychology of leadership shows that “inclusive thinkers” consistently rise to the top of their fields, this constructive approach can add a more balanced, realistic perspective to today’s perceptions of our city.