From basic research to the entrepreneurial state

An interview in the Globe with the Honourable Kirsty Duncan, Minister of Science, offers a notably balanced view on the state of Science and Technology (S&T) and the differentiation between basic research and innovation. It nicely separates five often conflated issues: scientific muzzling in federal departments by the previous government (to be fair the Globe's Konrad Yakabuski says that the Chretien government did the same thing), the anti-environmentalism of the Harper government, the HERD spend, the BERD spend, and finally the need to increase commercialization and BERD.

It is important to point out that despite what the Globe reports in its interview with Minister Duncan, Canada ranks much higher than average on S&T. This was demonstrated by the Council of Canadian Academies' Expert Panel report on S&T, published in 2012 (and on which I served).

The consistent lumping together of low BERD (a proxy for poor industry innovation and productivity) with the lack of commercialization of basic research muddies understanding and does a continual disservice to public policy in Canada. 

First off, Canada has an excellent record when it comes to basic research (see the CCA's S&T report, linked above). Turning our research outputs into commercialization successes is where we fall down. Canada’s consistent lack of commercialization of basic research, well documented by many expert panels, is generally seen as a failure of business to invest in R&D or to be receptive to the outputs of academic research. This does not make sense as it confuses the basic research function with industry innovation capacity. These are related, but separate.   

There is an issue of receptivity for academic and industry partnerships, as outlined in my last post. These originate in the lab from discovery or basic research, or from industry, and are demand driven. A review of the mandate letters for Minister Duncan and Minister Bains shows that the government understands this distinction and is taking steps to correct a deficit of evidence-based policy. As well, they're taking steps to promote (and fund, presumably) the discovery to innovation continuum. This means basic research, through applied research right on to experimental development.

And into this mix the Science, Technology and Innovation Council (STIC) has filed its latest report. There are no surprises here: a focus on increasing both HERD and BERD, support more firm level innovation, take more risks, and importantly, "invest strategically, further focusing government funds to build globally competitive critical mass in targeted areas." This last point aligns well with the new government's incipient Innovation Agenda and its focus on being "the entrepreneurial state." Minister Duncan's goal to "Lead the establishment of new Canada Research Chairs in sustainable technologies, working with the Minister of Innovation, Science and Economic Development" aligns well with this mode of thinking. The state must be an active agent in the setting of national priorities for basic research. Climate change and sustainable technologies are among the most urgent priorities of the day.

The STIC recommendations, read alongside the incoming innovation agenda, show that the polytechnic and college applied research model is needed now more than ever. As I pointed out back in 2010:

The key for college applied research is instrumentality, or the intentional application of applied research and innovation services to industry needs and contexts. This means that we are focused on addressing the industry problems faced by firms who are seeking to innovate and create new value in their sectors. We are an explicit instrument for addressing these industry problems, meaning that we respond to what is needed, fitting into the R&D continuum for latter stage innovation support. 

Polytechnic and college applied research offers an instrumental component to increasing commercialization of basic research while helping to foster greater industry innovation capacity. We do this while providing our students with crucial innovation skills across a wide variety of industries, skills and experiences that are complementary to those that university graduates gain in their fields of study. 

We can benefit from more investment in basic research, as long as there is explicit planning and management of applied research and experimental development – the innovation side of the equation. Ultimately what we know right now of the new government's innovation agenda is good news for Canada and R&D generally. The challenge is to realize the downstream value of our HERD investments. Pushing harder on the innovate button won’t work. The role of the entrepreneurial state here is to specifically foster two things: greater academic productivity (read: commercialization) and industry innovation capacity (read: BERD).

There is really no mystery here: unpacking the “black box” of research commercialization and industry innovation requires the capacity for collaboration, and necessitates complementary approaches to increasing academic and industrial innovation capacity and productivity. Understanding these as two distinct yet intertwined phenomena is essential to ensuring we can leverage the right instrument against the right problem at the right time. Think of this as innovation therapy.

Unpacking the Black Box of Innovation or, the Planning and Management of Innovation

As noted earlier the Canadian Council of Chief Executives recently initiated work on the Business Higher Education Round Table (BHER). There are two areas of focus for the BHER: research collaborations and work integrated learning.

Industry-academic partnerships are an excellent vehicle for increasing both academic and industrial productivity when it comes to research and development and innovation. Strengthening these partnerships requires industrial receptivity to working with academic partners, as well academic receptivity to working with industry.

This can be further unpacked as ensuring that there is industrial capacity to receive the outputs of basic research performed in our world leading research labs (either directly or through “bundling” approaches to IP where individual IP is combined with others to create companies/marketable products). Tandem Launch is one company specializing in bundling of IP. Read an overview of it here.

Similarly, industry-academic cooperation models need to account for applied research and experimental development (the innovation side of the discovery to innovation continuum in OECD terms) where industry has a need and seeks academic help to address (this is the applied research model common in colleges and polytechnics. This also happens in universities.)

Models of cooperation thus need to account for the need to socialize both sides of the equation to working with each other according to context: who is the initiator of the research (industry or academic) and what goals or outcomes are desired (commercialization of basic research or addressing applied research needs of firms). And, who is the right person or what is the right facility at what point in time to address the stated outcome.

These models of cooperation could feasibly account for the type or nature of skills/competencies/facilities required for a given project. If we understand the discovery to innovation continuum as a horizontal process (though not necessarily linear), then the vertical axis at each stage of the process requires various people with complementary skills. This could be pairing a PhD with technician lab support at one end, through to engineers, technologists and technicians for prototype development on to marketing materials design and sales at the other. The point is that at each stage there are a host of complementary skill sets and facilities that various types of institutions can provide. This model would serve the need of increasing commercialization success of basic research through to addressing the applied research needs of firms.

In addition to the way in which colleges and polytechnics work to support demand-driven innovation in firms and universities (GBC for example supports many projects at the University of Toronto, helping scientists there create products for market based on research discovery), there are universities engaged in similar pursuits. The best example I know of is the UHN’s  Techna Institute, whose mandate is to link clinicians and scientists with the needs of industry and vice versa.

Network of Technology Access Centres launched to support business innovation

This past summer, the group of Technology Access Centres across the country put together a proposal to create a Technology Access Centres | Centres d'accès à la Technologie (TACCAT) Network. The TACCAT Network as it is presently called is funded jointly by NSERC and the TACs/CATs themselves.

GBC's Food Innovation Research Studio is a Technology Access Centre.

The TACCAT Network is comprised of college, polytechnic and institute applied research offices that serve the research and innovation needs of a specific regional economic cluster representing 9 technology sectors: advanced manufacturing, agriculture, construction technology, digital media and graphic communications, environmental technology/biotechnology, food technology, healthcare technology, nanotechnology and transportation (see our Members for more information). TACCATs serve vital industrial sectors across the country, responding to industry applied research needs through innovation support services delivered by college faculty, staff and students.

Here is a brief description of the goals of the Network:

In 2013, as part of its College and Community Innovation (CCI) Program, NSERC launched its first Technology Access Centre (TAC) applied research funding competition, with the intent of enhancing the ability of companies, particularly small- and medium-sized enterprises (SMEs), to become more productive and innovative by providing ready access to polytechnic, college and institute specialized expertise, technology and equipment. Funding supports core operations for five years and is renewable. The TAC concept is based on the successful Centre collégial de transfert de technologie (CCTT) model developed over the past few decades by the Government of Québec.

The proposed network approach will enable Canadian colleges, institutes and polytechnics to take a leadership role in supporting economic development in Canada across the spectrum of natural and social sciences, engineering, humanities and health disciplines. 

The 25 TACCATs, which have been meeting regularly since 2013 to share best practices regarding establishing and operating this type of applied research centre, have recognized common challenges in driving industry innovation that will be aided through harmonious and standardized approaches to college applied research. The creation of a formal, national TACCAT Network (TN) is seen as the most effective way to harmonize and promote college applied research through the TACCATs. This will help ensure that industry partners, college stakeholders, and government funders have a shared understanding of the value of TACCATs as representative of college applied research and their collective value to enhancing Canadian economic development. All 14 TACs and 10 of 11 CATs are participating in the creation of the TACCAT Network, providing cash and in kind support over two years as part of the collective commitment to supporting college and institute applied research in Canada.

Watch this space for more details.

Barn Raising the Innovation Economy

Of the many useful things I learned growing up in Saskatchewan, two in particular stand out as relevant to Canada's research and innovation ecosystem. The first is the importance of cooperation. The second is the weather.

Cooperation is the cornerstone of community building on the prairies, as anywhere really. I learned from a young age that when your neighbour is building a barn, everyone pitches in to help. "Collaborating to compete together" has real meaning: working together we create vibrant communities and resilient regional economies that amplify complementary strengths and common goals.

This form of "coopetition" defines how various actors in the research and innovation ecosystem work together. Where once we might have seen these actors try to upstage each other in a scramble for money and attention, we now see cooperation to achieve increased academic and industrial innovation and productivity.

There can be little debate about the need to increase business investment in research and development (R&D). We have too little firm spending on R&D (and new equipment and training for that matter). This translates into poor industrial productivity and innovation capacity.

For academic productivity, we are excellent in our ability to perform basic science. We need to start focusing more on leveraging and translating our basic research into practical applications for social and economic good. Successive expert panels have all identified a systematic failure in this country to capitalize on the basic research capacity of our world leading research institutions.

Countries like Canada, with economies dependent on resource extraction industries, need to start adding value to the raw resources we extract. Basic research with little or no focus on application or commercialization becomes just one more example of how Canada exports raw commodities (in this case ideas) without adding value (commercialization of these ideas).

Polytechnics and Colleges like George Brown work with many university scientists. We help them produce PhDs, patents, publications and products, just as easily as we work with industry to get new products and services to market. Here are some examples.

In 2012, the GBC Food Innovation Research Studio (FIRSt) collaborated with scientists at Mount Sinai Hospital / University of Toronto and Ryerson University to help test whether eating cheese fortified with Vitamin D could affect the levels of the vitamin in the body. Over the course of the study we recruited 120 students, staff, and faculty who volunteered to eat pizza—topped with Vitamin D fortified mozzarella—once a week for 8 weeks in a double-blind randomized trial. Our food scientists and chefs were able to design an optimal and delicious Italian style pizza and produce over 100 pizzas every week for 8 weeks. Leaving aside the difficulty we may or may not have had in recruiting volunteers, we were approached to participate in the study because we offered these scientists complementary expertise to help them test their hypothesis.

This project showcases a unique recipe that blended basic and applied research. The findings provide scientific support for commercialization of vitamin D fortified cheese, showing that Vitamin D3 is safe and metabollically available from fortified mozzarella cheese, even after being cooked.

Applied research at George Brown supports firms in a range of industries from construction and Building Information Modeling through to prototyping and food product development. Companies often access more than one academic partner in their engagement with industry-academic partnerships.  One such company is Clear Blue Technologies. Their "smart off-grid" street light uses solar panels and wind turbines to power street lights, networked through wireless technologies to provide cost effective and green power solutions for lights, traffic cameras and signs. The company received support from MaRS and Centennial College; at George Brown our Advanced Prototyping Lab helped take the product from prototype to production manufacturing. A graduate student from Ryerson University was also employed on the project. By working together and leveraging complementary strengths we have collectively helped propel the company from idea to invoice.

And so the weather.

Talking about the weather is a national past time, but it very nearly passes for religion on the prairies. Perhaps this is because so much of the growing season is determined by the whims of nature. Being able to talk about the weather is what is most important – predicting it, observing and commenting on it, lamenting it. The weather is something we all have in common. In this sense, weather talk is an important social lubricant, an expression of our commonality and shared experience in place.

And this is the point. Like the weather, innovation is a social activity. While innovation may involve a technical challenge, it requires us to recognize common goals and to socialize and realize we are stronger when we work together.

Place matters when it comes to innovation. By integrating the harmonizing strength of regional college, polytechnic, and university capacity, and linking this with industry, we can evolve the Canadian economy. Together we can ensure graduates from across the credential spectrum understand innovation, and can work together to stand up the innovation economy. 

This article is reprinted with permission from the Research Infosource Canada's Innovation Leaders 2015 / Feature Article and Editorials.

"Because it's 2015." More on science, innovation, policy (and the launch of GBC's new Food and Beverage Labs)

What more can be said about the new federal cabinet. This is fantastic news for the country on many levels, not the least of which is to have a federal cabinet that reflects the reality of Canada today.

Of particular note is the naming of the Honourable Navdeep Bains as the new Minister of
Innovation, Science and Economic Development, and the Honourable Kirsty Duncan as Minister of Science.

Renaming Industry Canada as Innovation, Science and Economic Development seems to indicate that the new government is implementing the recommendations of the Jenkins Panel. If nothing else, there is explicit recognition that we need to focus on the entire science to innovation continuum. Some claim this is an elevation of science to the old Industry Canada portfolio. I'm very interested to see what this means for the science to innovation cycle. 

Advice for the new minister is already coming in; of these the return of the long form census and the use of statistics for business is most sensible in the short term. And it is important to acknowledge that the previous government did a lot to support R&D in Canada - maintaining our #1 public sector R&D spend in the G7, growing and making permanent the college applied research funding, and promoting greater industry academic partnerships. Explicitly linking innovation, science and economic development flies in the face of what I have called the libertarian nature of our position on research to date. This is a good thing for the country. This is Generation Renew.

And as if that is not enough good news, yesterday saw the launch of GBC's new Food and Beverage Labs (FaBLabs) at 215 King. Funded in part by the Federal Economic Development Agency of Southern Ontario, FaBLabs is our latest build out of our flagship applied research, the Food Innovation and Research Studio. 215 King not only houses our leading restaurant, The Chefs' House, but now also has an event space for food and beverage product launches and sensory evaluation, a beverage lab, and, on the fourth floor, the new home of FIRSt (opening in March 2016). For obvious reasons no federal government ministers were on hand yesterday, but we look forward to welcoming our industry, government and other partners to the space.

Check out the video: 215 King: This is the place.

Innovation Policy Advice: Time to get rid of SR&ED

Writing in today's Globe regarding the incoming government's approach to innovation, Sean Silcoff provides some good advice on shaping a better innovation policy. Silcoff posits out that the Trudeau innovation platform was light on new ideas, and was merely an attempt to "Throw money at a problem without defining the problem." I don't agree. Implicit in the Liberal innovation platform is the need to foster greater business investment in R&D. This is important to unpack as it relates to our overall productivity and innovation challenges. Of course the issue is complex, but weak industry productivity and innovation coupled with poor academic receptivity to industrial efforts is a significant part of the problem.

The Liberal government's innovation platform includes targeted investments in clean technology and other important economic sectors (it's worth repeating: read the interview with Bill Gates in the Atlantic). And the incipient platform outlines

...direct support to business incubators and accelerators, research facilities, financing, and other support for successful small companies wanting to grow and export. The objective is to create successful networks like the American and German partnerships between businesses, government, and university and college research. Working with provinces, post-secondary institutions, and industry, this funding will also help modernize and strengthen the technology transfer and commercialization functions at universities and colleges.

The reference to international comparators (such as Fraunhoffer) and a Small Business Innovation and Research Program, modelled on the US program, looks to directly prompt industry to increase investment in R&D. Thus the problem is tacitly identified; rendering this explicit will be the job of the incoming government. Ensuring there is a strong, complementary academic support structure in our colleges, polytechnics and universities will help industry to innovate (and get more academic discoveries to market). This is an embrace of the entire research through to innovation continuum.

And it is here that Silcoff approaches some sensible advice, specifically on the Scientific Research and Experimental Development (SR&ED) tax credit scheme, as this is needlessly complex and seemingly a vehicle for to much overhead to be spent on applying to the program. He should go further: SR&ED should be eliminated and the money moved upstream to support direct industry R&D, or hiring as Silcoff writes about. I have previously outlined some of the problems with SR&ED; it really is time to get rid of this program. 

The Small Business Innovation and Research Program, and the IRAP industry voucher program as initiated by the last federal government, are key ways to incentivize industry to engage in R&D, and to partner with the most appropriate academic centre to get this done. 

Generation renew: innovation policy and education

I've been reading the revised edition of The Entrepreneurial State which supports the idea of state intervention and the development (and funding) of priorities in basic research. Those interested in this viewpoint would do well to read the interview with Bill Gates in the Atlantic, in which he says the same thing regarding the need for basic science investment in climate change. This is an important point that needs to be discussed as it relates to innovation policy and the public funding of basic and applied research, as well as experimental development (which is the innovation side of the equation - see post script below). There is also an interview in the recent Report on Business magazine with nobel laureate George Akerlof, in which he also supports the notion of state intervention. We are witnessing the rise of behavioural economics that shows how rational actors are induced to act irrationally.

A positive link here is the work that the Canadian Council of Chief Executives initiated recently: the Business Higher Education Round Table (BHER). There are two foci here: research collaborations and work integrated learning. Of particular import is the fact that leaders of business and higher education are working together to find productive solutions to inherent challenges in our economy - the lack of productivity and innovation, as well as persistent (and perceived) skills gaps. Universities Canada new CEO Elizabeth Cannon (co-chair, with GBC President Anne Sado, of the BHER) recently came out with a list of 5 priorities, which includes better industry academic partnerships.

All of this points to what I will call Generation Renew: we are generating renewal through a politics of detente that sees business, colleges, polytechnics and universities working together to address common needs. This includes industrial and academic productivity and partnerships, as well as a greater focus on skills the economy of the future needs.

Generation Renew is not just the generation of new models of cooperation and collaboration, it is also the generation of people that will come up within this milieu and start to address the long standing issues faced by the Canadian economy. Generation Renew supplants the alphabet soup of generational change and flux. Generation Renew are those people who work their way through the educational systems in Canada to acquire skills and competencies, are entrepreneurial and innovative, and who work together to make Canada a better place for all. The right mix of intervention and coopetition will enable Canada to make maximal use of our basic and applied research capacity, while ensuring we have the right skills for the innovation economy.



Post Script: Today's One Thought a Day blog post by Alex Usher offers some good advice on innovation policy. Usher offers views on differential spending between what he calls "pure research and applied research." There is an inherent problem with calling basic research pure research - it implies that applied research is somehow impure (and this in one statement sums up Canada's problem with commercialization as seemingly not pure). And, Usher, like most, ignores the third component of R&D - experimental development, in which innovation emerges. However, let's focus on Usher's repeat of the Jenkins Panel recommendation to support the establishment of an innovation granting council. This is important. While the previous government did a lot to promote HERD as well as to continue the previous Liberal government's initialization of the college research funding program, a lot of the good was lost in the rhetoric of entitlement to what I would call a libertarian view on "pure research": don't tell me what I can and cannot research, just fund me to do what I want to do. As I have pointed out in this space many times over the years, state intervention is required to support the establishment of clusters and national priorities. This is because, even though Canada spends more per capita on HERD than any other G7 country, we do not have the GDP to support research into anything and everything.