10 Reasons Why You Should Open a Washington Office
1. If your company is regulated substantially at the federal level. This reason applies to just about everyone. The federal government decides how commerce is conducted, who owns information, who merges or acquires other companies, what is exported and imported, and who pays what taxes. But some industries – such as energy, chemicals and health care – face exceptionally high levels of regulation at the federal level.
2. If the rulemaking process is a high-stakes game. Some companies live and die by the specific actions of Executive Branch agencies that implement the will of Congress. When you have a lot riding on the outcome of a proposed rulemaking, you may want to have representatives on the ground to make sure everyone understands all the facts in the case.
3. If your trade associations represent diverse interests. Delegating much of your federal lobbying to your trade associations can be an effective strategy when your entire industry faces major challenges. But associations can only be successful if they find common ground among their members. Sometimes this common ground doesn’t address the particular needs of your company or – even worse – it doesn’t produce a meaningful legislative position. Ideally, you should work with your associations to advance your general public policy issues and handle your company-specific issues yourself.
4. If you face long-term public policy challenges. Contract lobbyists can be extremely effective at getting decision-makers to at least consider your point-of-view. This is especially true for highly technical issues or work outside your core areas of expertise (e.g., postal rate proposals for utility companies or defense appropriations for non-defense contractors). But contract lobbyists can’t build long-term relationships for your company. In addition, they can’t capitalize on the positive reputation of your brand when they call on legislative offices.
5. If you are a diversified company with interests in several industries. Just monitoring the work of your trade associations, issue coalitions and contractors can be a full-time job. Having a staff in Washington allows a company to take leadership roles in these relationships. It means you have someone available to go to the White House for a last-minute meeting or head up a task force that advises a regulatory agency.
6. If most of your competitors have Washington offices. This is one case where taking a “me too” approach is not a sign of immaturity. Many legislative debates are not between Corporate America and government or between companies and consumers. Oftentimes a legislative proposal (such as the imposition of steel tariffs) pits one industry sector against another. If you don’t have a strong presence in Washington, it’s hard to be heard. To quote Woody Allen, “Eighty percent of success in life is just showing up.”
7. If you have a stake in the appropriations process. Because the federal budget has become so political, budget legislation can change daily over a period of many months. And the “noise level” in Washington has greatly increased in recent years as the number of interest groups has multiplied. If you are not in DC monitoring and staying engaged in this fast-changing process, your appropriations issue may be forgotten or ignored.
8. If you’re spending too much time in airplanes. It’s possible to manage federal affairs long-distance, but if you are finding that your trips to DC are becoming more and more frequent, it may be time to set up shop in the nation’s capital. When you’re always coming and going from Washington, it’s difficult to become a part of the community. And while the value of the relationships formed through volunteer service, attendance at charity events and fundraisers, and involvement in the local social scene is hard to quantify, these relationships do matter.
9. If you’re willing to consider a low-cost option. You don’t have to rent out 20,000 square feet on Capitol Hill to open a Washington office. There are many one- or two-person offices in DC. Technology allows the Washington rep to stay in touch with company management around the world, manage an outsourced PAC, oversee a grassroots campaign and still find time for face-to-face lobbying. (Obviously, as the business grows and as issues become more complex, you may need to hire additional people.) You may also want to consider sharing space and administrative staff with a federal government sales department or with a group of other small DC offices.
10. If you’re looking for a gateway to overseas expansion. Washington is not only the center of government; it is the home for many important international organizations and foreign embassies. These organizations can open doors to foreign markets and global partnership opportunities. In addition, your presence in Washington will ensure that you can stay up-to-date on trade and international regulatory matters.