Silicon Valley recaptures its old magic: entrepreneurial minds engineer an economic rebirth through an innovative joint venture.

Silicon Valley is the home of perpetual evolution and creative individualism. Yesterday's discoveries are today's banalities and tomorrow's artifacts. Yet the economic environment is so competitive that people rarely join to celebrate their accomplishments. If roller coasters are not for the weak of flesh, then Silicon Valley is not for those who depend on certainty -- in this part of the world, jagged transformation is a way of life. It is with this value system in mind that the valley has set out to reinvent itself.

Stymied by competition abroad and regional rivalries at home, area visionaries joined with pragmatists to create an entity that would prepare Silicon Valley for tomorrow today. That organization was named Joint Venture: Silicon Valley. Consistent with its evolutionary format, Joint Venture: Silicon Valley is now in transition.

On June 23, this powerful alliance of community leaders transformed into the Joint Venture: Silicon Valley Network. This changeover will be completed on Sept. 1, when state Senator Rebecca Q. Morgan, who has left her post in Sacramento, takes her position as CEO of the already successful coalition.

Although the achievements of Joint Venture may seem logical to the casual observer, the evolution of this consortium of strong-willed and brilliant individuals has been anything but easy. Sometimes willingly, often skeptically, key business people and associations found themselves on unfamiliar terrain as they surrendered bits and pieces of individual turf to play as team members on a new field. Their cautious amalgamation has made our accomplishments all the more important to savor.

Catching up

The '60s and '70s were so heady for the valley that nobody stopped long enough to notice the downward drift of the '80s. For decades, start-ups bloomed while proven companies flourished. But then things changed. At first, observers pointed to the region's economic problems as "brief downturns." By decade's end, these blips had become long-term decay. "Recession-proof" Silicon Valley suffered a widespread decline evidence by escalating unemployment, rampant business failures, an eroding manufacturing base, and a work force preparing for mass exodus.

Faced with a crash course in reality therapy, key business leaders stopped patting themselves on the back and began looking beyond their profit/loss statements at the totality of the valley's deteriorating economy. After experiencing a period of denial, many agreed that collaboration was the only hope for economic renewal. This realization was a bitter pill to swallow in a region noted for rugged individualism. Yet these born-again activists understood that only a blend of entrepreneurialism and partnership could provide the proper medicine to restore the valley's economic luster. Once organized, Joint Venture: Silicon Valley moved rapidly.

In Phase I, the Board of Directors pursued a no-holds, comprehensive fact-finding effort that diagnosed the region's weaknesses through 14 warning signs. After six months of interviews, investigation and unprecedented area-wide survey research, Phase I ended on June 23, 1992 with a widely circulated report, "An Economy At Risk," that called for purposive action.

The call was answered with Phase II, when Joint Venture: Silicon Valley leaders organized 15 industry and infrastructure groups. These groups divided into subgroups and included more than 1,000 committed citizens. Meanwhile, the Joint Venture umbrella opened to leaders from the public sector, academia, organized labor, service industries, and public interest groups. Whether CEO or interested citizen, any individual could find a place in Joint Venture: Silicon Valley. On June 23, Phase II was completed with the announcement of 13 comprehensive initiatives as the key elements in the Joint Venture portfolio. In order to adequately nurture and implement the Phase II recommendations, Joint Venture participants incorporated as a new nonprofit organization with a new name.

Birth of the JVSV Network

The Joint Venture: Silicon Valley Network was designed as Phase III of the region's economic resurgence to sustain the work accomplished to date and pursue further linkages within the private sector and between the private and public sectors.

Many of the 13 initiatives from Phase II were bundled into four areas: (1) development of a specialized infrastructure; (2) new ways to reduce the cost of doing business; (3) retention and expansion of existing industry; and (4) support elements for new industry. These components became the cornerstones of Phase III, setting the stage for today's dreams to become tomorrow's accomplishments.

Consider the activities now in place or about to begin. Each has been approved by the JVSV Board after submitting a five-year business plan. In many cases, non-profit organizations have been established with their own separate boards of directors to bring about immediate credibility.

Developing an infrastructure

The hallmark of the valley's uniqueness has emerged with development of an advanced electronic information delivery system. Dubbed "Smart Valley," this consortium is forging new partnerships among technology providers, service providers, applications developers and users. Seizing upon the area's research, computing and communications capabilities, Smart Valley is helping to deliver an unparalleled information network. Other specialized infrastructure activities include work force training pilot projects.

The various enterprises intended to make the valley more competitive, the Silicon Valley Regulatory Streamlining Team and the Council on Tax and Fiscal Policy represent two important challenges to the status quo. The Regulatory Streamlining Team has been organized to promote permit streamlining and uniform regulations in the four-county, 18-city area. The Council on Tax and Fiscal Policy has brought together traditional adversaries from the public and private sectors to advocate mutually acceptable tax policy changes at the regional state and federal levels.

Retention and expansion

A remarkable outreach effort has emerged with the Silicon Valley Global Trading Center, an organization designed to establish a formidable presence of the valley's small- to medium-size firms in the global marketplace. To date, the Center has established a cooperative relationship with the U.S. Department of Commerce and begun distributing information about valley products to U.S. consulate offices and regional development bodies around the world.

On the domestic front, the Defense/Space Consortium has been formed to facilitate the transition of valley space and defense firms into equally vibrant peacetime-oriented enterprises. Its activities will include a service for training displaced workers. The consortium anticipates working closely with the federal government to take advantage of funding opportunities.

Supporting new industry

Perhaps the most entrepreneurial aspect of the Joint Venture: Silicon Valley Network lies with the initiatives to support new industry in the region. The Enterprise Network has been established to facilitate linkages between entrepreneurial ventures and funding sources. For an industry already key to the region, the Software Coalition has been created to act as an "industry voice" on industrial regulatory and intellectual property issues.

And finally, sponsors have joined to form new business enterprise clusters, "incubator" industries which are allowed to grow with minimal costs at companies with excess space and facilities. Supporters are aiming for 25 such clusters and as many as 600 start-ups by 1998, providing yet another source of vitality of the region.

Invention, not inertia

If necessity is the mother of invention, apathy is the soul mate of inertia. The need to accomplish guided the early days of Silicon Valley, but with each success the challenge lost some of its motivation. As good times became commonplace, intellectual hunger waned and complacency set in. For all? Of course not. But in an increasingly competitive world, the margin of error between success and failure can be incredibly thin. That is precisely the edge we lost in Silicon Valley.

The days of apathy are over in Silicon Valley. The valley that invented the future is not only now in the process of reinventing its elf but also spawning a new generation of inspired leaders and equally impressive products.

As the valley's economy regenerates, newexport industries will take their rightful place. Correspondent with the valley's revival, retrained people will be put back to work, local tax bases will rise and governments will be more equipped to provide the necessary services for their populations. It has not been easy to get to this point, but the early results already show that Joint Venture: Silicon Valley has become the catalyst for renewal.

Tom Hayes, founder of Joint Venture: Silicon Valley, is corporate relations manager overseeing global corporate relations for Applied Materials, based in Santa Clara.