Although it is widely recognized that Canada has great strengths and opportunity in advanced ICT, our nation must improve the economic performance of our domestic ICT sector if we are to strengthen our position as a global innovation player and the efficiency and economic competitiveness of other industry sectors – life sciences, energy, environment, defence/public safety, aerospace, automotive, etc.

These are interrelated challenges that require focused action. With the launch of a Digital Economy Strategy and a Federal R&D Review, Canada has a unique opportunity to fully integrate these efforts to achieve the greatest economic return on R&D investment.

Precarn is a proven policy instrument that addresses these interrelated challenges, and stands at the crossroads of three key innovation policy imperatives in Canada. The Precarn approach is unique as it is the only federally funded program that enables SMEs to undertake high risk, high reward R&D by bringing them together with a first customer/end-user and academic research talent. It employs this model to fund R&D projects that address a specific market opportunity and accelerate the development, commercialization and adoption of ICT-based products.

Building on a 23-year track record of results, the Precarn approach addresses three well recognized gaps in Canada’s innovation performance: the “first customer” gap; the ICT sector gap; and the productivity gap.

First customer gap

Precarn brings SMEs together with first customers/end-users on R&D projects with high commercial potential, providing essential support during a critical period of early-stage growth. This helps to balance the risk equation, reinforces the commercial potential of the innovation, and serves as an initial lead indicator of the potential to secure other paying customers downstream.

This interaction also enables SMEs to validate value propositions, refine product specifications and nurture innovative ideas that often lead to the creation of new product and service solutions – and more innovative and profitable firms. As outlined in Canada’s S&T strategy, growth of sustainable, technology-based SMEs serves as an effective engine for the commercialization of R&D. The Precarn model offers a proven approach to accelerate this growth and garner greater return on direct innovation investment.

ICT sector gap

Within its unique model, Precarn provides timely and direct funding to SMEs for market readiness activities (both R&D and business), helping to address the shortage of investment capital, increase the number of ICT-based firms that receive funding and grow this R&D-intensive sector.

This targeted investment increases the innovation capacity of these early-stage firms and makes them more investor-ready by increasing the commercial readiness of new technologies. This helps to reduce the risk for downstream investors, accelerate the growth of viable start-ups and SMEs, and stimulate the creation of new high-paying jobs.

Productivity gap

As the Precarn model requires a first customer/end-user in every project, it helps to build markets for ICT innovations and accelerate their adoption in priority sectors from life sciences to environment, energy, defence/public safety, aerospace, automotive and natural resources. This helps to address the unique opportunities and barriers for increased ICT-based innovation and adoption in each industry, while increasing the competitiveness of these sectors.

It also nurtures the development and application of digital skills across our economy. This helps to bridge the productivity gap and address a key focus of Canada’s emerging Digital Economy Strategy.

As Canada aims to strengthen its innovation and economic performance, our nation must adopt a sharp focus on those policies, programs and investments that deliver the greatest results and return. Most important, it must increase the integration of these elements to achieve overall program coherence, effectiveness and impact.

Precarn’s customer-focused, direct funding model addresses three key innovation gaps and policy objectives in a single program, and stimulates growth in a post recession economy. It is proven to increase business investment in the development, commercialization and adoption of novel ICT technologies, stimulate the continued growth of SMEs, and harness the power of a digital economy for the benefit of Canadians in the global market. The time to fully leverage the Precarn approach has come.

 

Henri Rothschild, PhD, is president and CEO of Precarn (www.precarn.ca).

 

SIDEBAR

From its inception in 1987, Precarn has:

  • Funded more than 260 R&D projects, engaging more than 300 ICT companies and 3,000 researchers, enabling the development of 325 new technologies or products, 45 start-ups and 86 patents.
  • Invested over $65 million in industry-led research, leveraging $255 million in total industrial research.
  • Generated at least four-fold economic return for every dollar invested in Precarn.

 

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