17 October 2011

Jenkins Report Released

The Jenkins Report on R&D in Canada is linked here. I'll get to some detailed analysis in due course, but on a read of the Executive Summary there are many good points that will serve Canada's innovation needs well. This includes:
1. The creation of the Industrial Research and Innovation Council - effectively the council for commercialization.
 2. The increase to IRAP and the creation of a national commercialization voucher program
3. The creation of an innovation navigator service - a guide to all federal programs
4. Talent: the inclusion of college graduates in future business innovation talent creation programs, i.e. in NSERC programs for undergraduate internships and faculty scholarships.
5. Procurement: using procurement to help spur SME innovation

The full report is available here. I am looking forward to the discussion on this.

R&D Panel to release report today

The R&D Review Panel, chaired by Open Text's Tom Jenkins, will be releasing its report today. Jenkins is giving a talk tomorrow at the Economic Club to discuss the findings.

In advance of this, there is a very useful article in today's Globe where Barrie McKenna outlines the significance of the opportunity the R&D Review Panel has for meaningful change in Canada's approach to innovation.Clearly we need to fix our broken R&D system, and McKenna rightly posits that the Jenkins panel represents the best opportunity we have to do this. As I noted in my last post, Canada needs an innovaiton policy, and this will involve making some very hard choices indeed. McKenna refers to this as the difference between an R&D democracy and an R&D meritocracy. The latter is a preferred model that looks at making targeted investments to produce results - a focus on outcomes versus spreading everything around.

There is enough expertise across the country to fashion a complementary R&D ecosystem, to be sure, and Canada, while spending more per capita than most other OECD countries, frankly does not have the GDP to support unfettered research in any and all domains. Revamping our tax regime to provide more direct supports (like Germany et al) and providing more upstream support for business innovation will help modernize our approach to R&D. Our future productivity hangs in the balance.

03 October 2011

Canada needs an innovation policy

"Canadians are an inventive lot, but have trouble making it pay," reports Barrie McKenna in today's Globe and Mail, outlining the worn adage about Canada's failure to capitalize on R&D discoveries. McKenna talks about the need for Canada to start focusing on extracting value from our R&D, lest we become a nation of innovation renters. Are we innovation serfs? The example of Nortel shows that we are close to this, letting go of prized IP whose development was been heavily subsidized by Canadian taxpayers. It would be worth finding out how much of the Nortel R&D spend was financed by SR&ED tax subsidies, and if this was repaid when the IP assets were sold off. For the latter, likely not. We will be renting back that IP for generations to come.

Nobel Laureate John Polanyi's editorial in today says that science needs freedom in order to discover. Good point. However, his point that the focus on relevance shrinks scientific horizons may cloud the issue of ascertaining how our world-leading R&D system can provide the most benefit to Canadians. Canada spends more money than most other countries on per capita R&D. We need to think instrumentally about how to use this incredible capacity to address the pressing issues of today - climate change, energy use, food security. An interventionist, instrumentalist applied R&D policy can enable countries to sponsor basic R&D and realize both basic and applied science gains. Think: the Internet. With greater value extracted from scientific discoveries we will be able to increase per capita R&D (theoretically, at least). Without this value extraction, our per capita R&D spend will only decrease. This is not a zero sum game, and we should be careful not to posit that we must privilege one over the other.

Here is a useful overview of Canada's approach to invention, showing our anomalous focus on S&T and our collective assumption "that there is a continuum from knowledge creation to development of application, and finally commercialization and utilization." Canada needs an innovation policy that lets us fund basic science (invention policy) and to focus on where these inventions have application and value and follow through on taking these to market. The last federal budget announced a new program for college and university collaboration. This is a perfect example of an interventionist approach to funding basic research, linking it to the applied research capacity in Canada's colleges and polytechnics, and out to industry. We need more of this, not less. It does not diminish the quality of science. Quite the opposite: it shows Canadians that we have the capacity to invent and innovate in order to make our lives better.

Witness the Nobel Prize for Medicine, announced this morning, shared by two Americans and one Canadian, Ralph Steinman. It's worth quoting the Globe's lead sentence on this story: "Three scientists won the Nobel Prize in medicine on Monday for discoveries about the immune system that opened new avenues for the treatment and prevention of infectious illnesses and cancer" (emphasis mine). There you have it in one sentence: basic + applied research.

A focus on adding or extracting value from inventions is what Canada needs more of. We need an innovation policy with the capacity to fund basic science, even as it links applied research to business innovation for the good of social and economic productivity.