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Rick Scott and Florida Inc.

Gov. Rick Scott
[Photo: Jon M. Fletcher]
The job of governor and that of chief executive officer of a corporation are very similar, says Bob Martinez, Florida's governor from 1987-91.

Both governors and CEOs, he says, have to understand how a large organization functions. Both have to understand finance. Both need to know how to lead. "I think the goal setting, the visioning, the objectives ... there's a lot of carryover from private to public," says Martinez, who now works as a senior policy adviser for the Holland & Knight law firm in Tampa.

Indeed, the single most striking thing about Gov. Rick Scott since he took office in January may be the degree to which he sees the governor's job in corporate terms. So far, Scott's tactics are textbook CEO:

» Eliminate what he views as non-productive assets, whether by selling state-owned planes or abolishing the four-person Florida Drug Control Office, a move that will save approximately $500,000. His budget eliminates all manner of activity he doesn't consider "core functions" of the state, including grading eggs and spending $26,000 to market alligator meat produced in Florida. "I just can't imagine why we'd be doing things like that."

» Control costs. Moves include requiring the state's more than 650,000 public employees to pay toward their pension accounts and shifting new hires, as the private sector has done, into a defined contribution plan instead of a traditional defined benefit plan. Scott's first budget, announced in early February, calls for billions in streamlining measures. Among other moves, he plans to combine the Department of Community Affairs into the Department of Environmental Protection and eliminate regulatory activity he believes is already carried out at the local level.

» Measure results and drive productivity, which Scott sees primarily in terms of job generation. Along with tax cuts and other organizational moves, Scott re-created a Department of Commerce whose secretary will have an office near Scott's and hold what amounts almost to an unelected Cabinet position, coordinating the activities of Enterprise Florida, the Agency for Workforce Innovation and the Office of Tourism, Trade and Economic Development and ensuring that departments like Community Affairs, Transportation and Environmental Protection don't get in the way of deals.

The words "laser-like focus" have become cliché in describing the new governor and his relentless schedule of meetings, phone calls and consultations with anyone anywhere he thinks could help Florida grow. "Even when you hear him talk about taxes, he makes a clear connection back to jobs," says Armando Olivera, president and CEO of Florida Power & Light. "I think that's very appropriate given where Florida is and where we are during this economic downturn."

Gov. Rick Scott
"My experience in life is that if I do things that are logical and I sit down with you and create win-wins, then I generally can have success. That's what I'm going to do."
[Photo: Colin Hackley]

Some observations on other elements of Scott's CEO style during his first months in office:

» With the exception of a meeting with a "wounded warrior" group and a few other occasions, including trips to Miami and St. Petersburg to attend memorial services for police officers killed in the line of duty, Scott has spent little time on ceremonial occasions — in marked contrast to previous Gov. Charlie Crist's love of the spotlight. Scott has even turned traditionally ceremonial appearances into opportunities to assert both his control and his vision. Case in point: Florida's governor is the titular head of the board of directors of Enterprise Florida, the state's public-private economic development arm, but both Jeb Bush and Crist maintained a ceremonial, rather than managerial presence. At his first board meeting in December, Scott took control of the meeting, ran it, used it to announce his reorganization of the state's economic development activities — and then quietly fired John Adams, Enterprise Florida's president and CEO, after the meeting ended.

» Scott is energetic and highly mobile, moving about the state almost daily in his own jet. During his first week in office, he flew to Miami on short notice to talk trade with the European Union Consuls-General. He also spent four days in Washington, lobbying, among others, Health and Human Services Secretary Kathleen Sebelius asking for an expedited approval of a Medicaid waiver as part of his cost-cutting strategy. Scott hasn't let his oft-expressed distaste for the federal government get in the way of trying to grab a bigger share of federal dollars for Florida for transportation, education and healthcare: He's indicated he plans to travel to Washington once a month to lobby.

» In appointing agency heads, Scott and his advisers have highlighted their choices of "outsiders" but behind the scenes appear to be mindful of not introducing chaos — picking an insider as chief of staff or in another high position. All his agency heads, says Scott, must share his chief passion: "The biggest mistake if you come interview with me is to say you don't like measurement. And that's happened by the way."

» Scott has made himself available for media interviews, including meeting with Florida Trend's editorial staff, but hasn't ingratiated himself with the Capitol press corps. A blue rope in the press briefing room, a gag order on agency heads and, in particular, efforts to cherry-pick pool reporters to cover meetings with legislators and others have raised hackles — and questions about how open and accessible his administration will be. Scott didn't win any friends with his blunt acknowledgement that he doesn't read the state's newspapers.

» Scott is, by all accounts, hands-on. After a meeting with several national site locators for companies possibly interested in relocating to Florida, he made a number of personal follow-up calls, soliciting advice about what Florida might do better. The day before the Enterprise Florida board meeting, Scott called James W. "Bill" Heavener, co-chair and CEO of Full Sail University, to get Heavener to join the group's volunteer board and contribute $50,000. Such efforts have won Scott big points with the business community, which had grown furious with Crist for what it saw as his refusal to engage in traditional nuts-and-bolts economic development. "Every time we tell (Scott) he can help us move a deal along or close a deal, he has picked up the phone personally and spoken with the prospect for moving jobs along with business investment in Florida, whether it be a corporate headquarters or a Florida branch of a company," says Enterprise Florida board member Howell "Hal" Melton, partner at Holland & Knight.

» Though personally conservative, Scott has given no signs he intends to make conservative social causes a major part of his agenda. "I have my own personal beliefs, you know, religious beliefs, but I was elected to get jobs going," he says.

» Unlike Jeb Bush, who came to information-gathering sessions from a rigid philosophical perspective and was usually well informed, Scott has been willing to acknowledge what he doesn't know, ask questions and listen. Several, including Martinez, say Scott "doesn't step over your answers. He gives you the full time. He doesn't waste a lot of words. His questions are to the point."

» Scott is clearly unafraid of big change, as evidenced by the financial details of his budget, sweeping departmental reorganizations, pension reform and the re-creation of a Department of Commerce.

So far, so good. But as the legislative session convenes this month, Scott will have to engage forces that will test his focus and aggressive managerial approach. While he enjoys fawning support from business groups, he's already experienced a taste of what separated powers mean when Attorney General Pam Bondi, Chief Financial Officer Jeff Atwater and Agricultural Commissioner Adam Putnam declined — politely —?Scott's request that the agencies under their control submit proposed rules for his review.

In addition, the Legislature, though GOP-dominated and presumably friendly to Scott, is rife with vested interests, lawmakers' personal agendas, lobbyist-driven machinations and citizen interest groups. Money for marketing alligators and sales tax exemptions for ostrich feed have remained part of the state's budget because it served some legislator to have them there.

Even Bush, who like Scott was hailed as a champion by the business community, got poor grades for his dealings with the Legislature early in his first term and complaints that he was a bully by the end of his second. Bush didn't get everything he wanted, and it's unlikely Scott will either. Before Scott released his proposed budget, state Senate President Mike Haridopolos had indicated that the budget shortfall means Scott won't be able to cut corporate taxes during the session.

"Clearly you have a Legislature, even if the majority are members of your party, they will have views. They will act on views, and sometimes it won't be in agreement," says Martinez. "Making policies on a corporate board for the CEO to carry out is quite different than the CEO of a government unit carrying it out because you have a legislative branch that's elected independently. It's quite different, the mechanics of it."

In addition to the cat-herding activity that goes into dealing with the Legislature, Scott, like Bush, likely will have to deal with court challenges to some of his bolder initiatives.

Scott expresses an almost wide-eyed belief in his ability to re-engineer the state. He says he has met most legislators and found them receptive to his goals. "My experience in life is that if I do things that are logical and I sit down with you and create win-wins, then I generally can have success. That's what I'm going to do."

Entering the legislative session, Scott has several considerable assets. One, says Martinez, is that he's built credibility by focusing on what he said he would do during his campaign.

More important, Martinez says, is that Scott is starting out with a clean slate. "Most people who end up holding the governor's office, like myself, were involved in government before you got there. He didn't go in with that. He can look at anything as objectively as he wants to because he had no part in having it done. There's no vested interest to defend. I think that's what makes him really different than others who may have gone before him. There's no program/spending in law that he was involved in getting it done, so therefore there is no empathy simply because you had a hand in it in the past."