A Globe and Mail journalist made an interesting observation of trade when Prime Minister Stephen Harper visited China some years ago. A photo opportunity at a wharf showed cargo going to and from Canada. The journalist noticed the contents of the shipping containers.
What did China ship to Canada? Computers.
What did Canada ship to China? Ham.
Pork is a good export product. Yet, resource-rich countries like Canada earn billions of dollars by exporting what we dig, drill, and grow. Yet, what is the vision to prompt our businesses to grow, innovate, and contribute more to export sales?
Canada has over one million businesses.
Innovation Canada invested almost $1 billion to create five “clusters” involving 450 companies. Clusters bring together businesses, academics and government to focus on a specific industry or opportunity. Many countries support clusters.
Most countries invest in academic and scientific research, and then question its value. Visit any science, medical or technology research centre and you will find people under pressure to show results. They know successful research does not guarantee private sector interest. I recall a scientist at SCION, the New Zealand forestry research centre showing me research ready to exploit but industry was uninterested.
Adding to the Canadian dilemma is taxpayer-funded research that is then sold to foreign companies. A CBC report suggests half of Canada’s Artificial Intelligence (AI) patents are now owned by foreign companies to profit from. Jim Balsillie, former co-CEO of BlackBerry told CBC, “The problem is that taxpayer-funded research went to foreign multinationals who now charge Canada for the use of technology that our taxpayers paid for.” The risk is turning technology into a commodity that global firms purchase and exploit.
Need for better business management skills
Compounding this problem is the low level of management research in Canada. Is the quality of management in Canada a problem? What hinders Canadian companies from designing more profitable products and services? I have lived and worked overseas for many years. Policy in some countries suggests a limit on innovation can be the quality of business management. Do business owners and managers truly have the skills to compete globally? Ten years ago, this question was explored in, Why Mexicans don’t drink Molson: Rescuing Canadian Business From the Suds of Global Obscurity. It questioned why Canadian companies fail to lead their industries globally. This was particularly true for consumer products. Molson had 100 years to become a global brand yet failed. This is why Mexicans don’t drink Molson. Mexico’s Corona became a global brand in 20 years. This is why Canadians drink Corona.
The Council of Canadian Academies introduces another factor; the lack of innovation management education in Canada. While focusing on STEM skills is necessary, Canada lacks sufficient skills for innovation management. One solution is for more universities to create Centres for Innovation, Commericalization and Entrepreneurship. I taught in a Master’s of Innovation program with a Centre in Australia. (The CCA published a report on this need: Improving Innovation Through Better Management.)
What seems missing in Canada is the idea that policy can improve business management skills and nurture a richer management ecosystem. Other countries have such programs:
Singapore: Singapore’s equivalent to ISED launched an “Innovation Scorecard” program to help executives build a culture of innovation in all organizations. The self-audit helps executives make better decisions. Training and recognition programs prompted engagement. (Download sample).
New Zealand: New Zealand lacks high-value commodities. In 2002, its equivalent to ISED created a vision: “innovation, imagination and creativity should be the driving forces to grow per capita income”. The goal was to increase the value of business exports. It created a national design strategy: “NZ businesses looking to make their mark in export markets need to understand, not just in the way a product looks, but in the bottom-to-top discipline required to ensure their product is the best.” It launched a government consulting service in 2003 to work with company exectives called, Better By Design. It continues to be sucessful.
Building a Nation of Innovators
On February 12, the Honourable Navdeep Bains, Minister of Innovation, Science and Economic Development released, Canada is building a nation of innovators as a plan to “build a new culture of innovation, drive productivity and position Canada as an innovation leader in the world.” I see little discussion on the quality of management to nurture innovation to build this vision. The problem is never the top 1000 or 10,000 companies. The issue is prompting the other 1,000,000 companies to grow their capacity to innovate. All must be part of the national management and innovation ecosystems.
To provide a practical example, Canada is a world leader in exporting mustard seed (2017 sales of $120 million) yet not a world leader in exporting premium branded mustard. We import mustard made of Canadian seed. Perhaps this is a challenge for Innovation Canada’s Protein Industries Canada cluster. It wants to position Canada as a leading source of high-quality plant protein and plant-based co-products. Perhaps we need a mini mustard cluster.
Ed Bernacki started the Idea Factory to help people and organisations develop their capacity to innovate. He has extensive experience in the public and private sectors internationally. He has written a series of books (public sector innovation and conference design innovation).