Evanoff: Richard Smith signals changing of the guard in Memphis

FedEx executive Richard Smith got Memphis’ attention.

The city has stalled, he said.

The economy has failed to grow for nearly two decades.

Smith, the new chairman of the Greater Memphis Chamber, said it just that bluntly in this newspaper a week ago.

More: Does Memphis really want to grow? Get rid of complacency, Richard Smith says

It was the most dire assessment made by a civic leader in years.

And he challenged elected leaders in Memphis and Shelby County to take action.

Lots of people started talking about the future of the city’s economic development strategy.

What will happen next?

He’ll most likely get his way.

New guard

We are seeing another sign of the changing of the guard in Memphis.

“I was thrilled to see… your interest in being the leader that Memphis needs going forward,’’ said a reader who copied me in an email to Smith.

The FedEx exec is part of a cast of younger men and women whose world views never were rooted in 1960s’ memories. They're stepping up now.

More new than old guard are people like Memphis City Council members Berlin Boyd and Martavius Jones, and both candidates for Shelby County mayor, Lee Harris and David Lenoir.

No 40-year-old had emerged on the business side to clearly stand out among patriarchs like AutoZone philanthropist Pitt Hyde and FedEx founder Frederick Smith — until now.

Carol Coletta, a philanthropy executive who in 1979 helped organize the all-important Jobs Conference in Memphis with Hyde, Frederick Smith and other leaders, said, “I’m thrilled we have a new generation coming on.’’

Jack Sammons, a longtime Memphis political figure married to Richard Smith’s cousin, said, “I admire Richard for his bold leadership. The baton has been passed. I absolutely think there’s a new crowd.”

Haves and have nots

Smith said it clearly and directly: Memphis needs to grow.

If you have no history of Memphis, the words sound mild. Being polite is a deep Memphis trait. Some say it helps quiet the social tension between haves and have nots. “Part of the style of Memphis politics," Memphis lawyer John Ryder, former general counsel to the Republican National Committee, recently said, "is to not be particularly loud.”

By that measure, Smith was loud. He spoke of economics, rebuilding the tax base. He said it directly in a way civic leaders hadn't said it before. And people who regard themselves as have nots, or as activists who represent the have nots, said this: We've thought this for years.

In-your-face clarity was no surprise for those who have been around him.

“I’ve known Richard since he was just a little shaver,” Sammons said. “He was head and shoulders above other kids. I remember him when he was 11 years old. He was always engaged in conversations with adults.”

Smith is one of 10 children of Frederick Smith, 74, the founder of FedEx, the global parcel hauler that employs about 30,000 people in Memphis.

As a kid in that big family, Smith said, he recalled being decisive and direct to be heard.

He’s come of age not only as an outspoken civic leader but as the scion of a company regarded by many Memphians as peerless.

"Thank God it is Richard Smith stepping up," Memphis logistics manager Edward Palmer told me last week, explaining he thought FedEx and the logistics industry "kept this city from blowing away" and Smith, knowing all about logistics, can push Memphis to do more with its key industry.

Doing more

In some ways, FedEx is already doing more:

Phil Spinosa Jr. recently joined the Greater Memphis Chamber as senior vice president for the Chairman's Circle, an economic development initiative. Spinosa is leaving FedEx after 15 years in direct sales management and resigned from the Memphis City Council.

FedEx Express, which operates the cargo airline, in March committed $1 billion for the World Hub’s major upgrade. It will be the region’s largest project after the $1.3 billion expansion underway at St. Jude Children’s Research Hospital.

FedEx recently secured a key event on the PGA Tour’s World Golf Championship for Memphis. “It is absolutely shocking we’ve been able to pull this off,” said Sammons, now the general chairman of the Memphis event named the WGC-FedEx St. Jude Invitational. “If you heard a 40-year-old professor in some business school, they’d say take the World Championship to Dallas or New York. They’d say that’s where you get the most exposure. This never would have happened without the generosity of FedEx. They did this for Memphis. It’s going to fill every hotel for 200 miles. It’ll be like having the (college basketball) Final Four in town every year.”

Richard Smith recently took on the voluntary role of Greater Memphis Chamber chairman, an unpaid position in addition to his full-time job as chief executive of FedEx Trade Networks.

FedEx recently donated $10 million to EPICenter, an entrepreneur initiative launched in 2013 by the Greater Memphis Chamber.

Frederick Smith last month spoke at a private EPICenter fundraiser hosted by Richard Smith in his home. The event has raised $1.8 million in commitments so far.

Looking ahead

Not everyone praised Smith last week.

Some social media posts derided the city’s leaders. Said one post: “After reading the article it shows that the major impediment to Memphis’s economic growth is the systemic greed that both the political leaders and corporate leaders have entrenched themselves in for years and has benefited only them and not the citizens of Memphis.”

Whether you agree with the statement, it’s clear the writer has looked back.

Richard Smith is trying to look ahead.

“A lot of the leaders,” Sammons said, “have said we are just a poor city. We are who we are. Richard is part of this younger group. He’s saying we are not who we are. We are who we are going to be. He’s doing this because he’s passionate about his hometown. If we don’t grow the economy, those paying the bills will vote with their feet and walk away.’’

Next phase?

A few days ago I asked Smith what happens next.

Making change requires a process and he described the beginning of the process. He favors recasting the city-county EDGE board, an economic development agency that reports to both Shelby County Mayor Mark Luttrell and Memphis Mayor Jim Strickland.

A consultant hired to evaluate EDGE will report this summer, Smith wrote in an email: "I am continuing to make the case for Economic Development reform in terms of both our model and our programs to try and be more aggressive/competitive and grow our economy ..."

"We have this ED (Economic Development study) ... that will be complete in a couple of months, but I see no need to wait on the results to start pushing the things we already know it will tell us. I call these 'quick wins' and am trying to move the ball forward there," he says.

Quick wins refer to having EDGE more aggressively reach out to make deals with prospective companies considering investing in Memphis. EDGE might also get a larger budget to include the salary of another official.

EDGE, he said, needs a capable dealmaker in its ranks. And it needs to reach out sooner to chamber officials, including himself, to meet with representatives of companies considering Memphis.

"The main thing is that we need to restructure this whole thing when it comes to ED. It’s dysfunctional as designed. There are certain functions the Chamber needs to perform on the sales side due to the ability to keep projects confidential, which EDGE or any City/County entity could not do ..." Smith wrote. "But I think there needs to be more funding and more accountability on that front to the government, especially if the government starts actually kicking in on funding those efforts.''

Ted Evanoff, business columnist of The Commercial Appeal, can be reached at evanoff@commercialappeal.com and (901) 529-2292.