Innovation 2012: Tipping Point or Tilting at Windmills?

It's fitting to end the year with a rumination on innovation and a look to the year ahead. Yesterday I was on BNN's The Close talking with Michael Hainsworth on Innovation in Canada. In the discussion I said that 2012 will be a tipping point for innovation in Canada, largely because it has to be. With the Euro-zone crisis and our own debt to GDP ratio, now is the time for Canada to up its game with respect to adding value to raw resources (rather than simple extraction) and to create innovative products that command price premiums, rather than be a low cost manufacturer. This is about culture change, and fostering business innovation and an innovation mindset as a hedge on the future.

I've written often about productivity, and my comments on the Close yesterday benefited from discussions with Bert van den Berg, Director of NSERC's Knowledge and Technology Transfer and the CCI Program. Creating innovative products means being a "price setter" - being able to charge more for items instead of  simply trying to wring out more value from specific units of labour. Doing so will enable us to connect our world-leading basic R&D system to the needs of the market - be these defined or undefined. Market- or user-driven innovation is key to enabling businesses to compete in global markets. Central to this is the point made by the Council of Canadian Academies' 2009 report on business innovation, Innovation and Business Strategy: Why Canada Falls Short. In this report, the expert panel outlines the need for businesses to have innovation as a core business strategy. This points to two challenges for Canada: increased focus by our business sector on high-value market opportunities, and increased focus by public actors on supporting businesses focused on value-add opportunities.

Companies are handsomely rewarded for successful innovations, while not innovating can be a short road to extinction. Innovation implies a risk - companies are doing something others cannot or have not done. Better enabling our world-leading basic R&D system to support market innovation increases the potential for Canadian success. For Canada, being more innovation-focused is about changing business culture - fostering, supporting and recognizing the innovation mindset which we need for future success, and about increasing public R&D support for business innovation.

An example of a business that does employ innovation as their core strategy is GBC Research partner Infonaut.  Infonaut is addressing the need for innovation in healthcare (through the application of innovative technology) while addressing a "must solve" problem - hospital acquired infections - the fourth leading cause of death in North America. Their product, Hospital Watch Live, is currently being installed in the Transplant Ward of the UHN's Toronto General Hospital. This is an example of an innovation-focused company who has successfully commercialized technology as enabled through a partnership with college faculty and students.GBC Research has partnered with Infonaut over the past several years, enabled by NSERC CCIP funding, that explicitly supports business innovation and our capacity to put students to work with Canadian companies like Infonaut.

College applied research connects supply and demand in the innovation economy in two ways: we work with industry partners on applied research to help bridge capacity gaps and get products to market. We do this by mobilizing our talented faculty and students, the latter who learn key innovation literacy skills. This is our hedge on our future innovation capacity. Not only do we help Canadian companies become more innovative and get products to market, but we are future-proofing the work force by instilling innovation literacy in our graduates. Innovation is a social activity, and it requires communication - about the needs of the market, and the sources for solutions for these needs, including the application of science and technology (applied research).

The Jenkins Panel recently reported on business investment in R&D (BERD), and the CCA expert panel on the State of Science and Technology in Canada which I am part of is reporting in 2012 on public sector R&D (HERD and GOVERD). Many have pointed out that there have been numerous expert panels and reports on why Canada lags in innovation and what can be done about it. The time for action is now. A recent report indicates that at least one of the Jenkins Panel recommendations may be enacted as soon as this coming year. We can go further and implement innovation vouchers for companies wishing to partner with a college or university to do applied research - this idea was presented by Polytechnics Canada recently as one way to let the market decide how to access innovation support services from the public post-secondary education system. The recent extension of the ARC Initiative by FedDev is another way to get companies innovating in partnership with training the talent for the innovation economy.

It is incumbent on all of us involved in supporting, sponsoring and spending on business innovation to work together to catalyze our collective efforts. To not move forward is to continue tilting at the innovation windmill.

FEDDEV launches ARCI extension

Minister of State for Science and Technology Gary Goodyear yesterday announced an extension to the successful FedDev Applied Research and Commercialization Initiative. This is welcome news to businesses in southern Ontario who wish to partner with college, universities and polytechnics on business innovation. The announcement comes on the same day as Bank of Canada Governor Mark Carney urged businesses to increase investment in productivity. This follows the recent launch of the Federal R&D Review which has recommended stronger supports for business innovation, as well as the launch of the Digital Technology Adoption Pilot Program (DTAPP). DTAPP is an initiative being launched by the National Research Council aimed at aiding business investment in productivity-improving technology. As Carney says, it is time for Canadian businesses to step up. Accessing the many programs supporting business innovation and partnering with colleges and polytechnics on applied research and innovation will aid the economy.

George Brown College, like our counterparts, is open for business innovation.