THECIS Board – Bio’s June – 2021

     Ronald Dyck  (Chair)

Ronald J. Dyck, PhD has over 37 years of executive and senior management experience in the public, academic and not-for-profit sectors, Ron has provided leadership to governments, academia, agencies, communities and companies in accelerating the identification, development, implementation and evaluation/reviews of needs-based, sustainable solutions through realizing and applying the benefits of science, technology and innovation.

Peter Josty photo low resolution     Peter Josty 

Peter Josty, PhD has been Executive Director of THECIS since 2001. THECIS is a not for profit research company that specializes in innovation research.

Before this he had a diversified career in the chemical industry in Canada, holding positions as research chemist, market development specialist, technical manager, new products application manager, business development manager and head of strategy and planning. In these roles he was a practitioner of innovation and led numerous new product introductions to North American markets.

Peter has a PhD in chemistry from the University of London and an MBA from IMI [now IMD] in Geneva Switzerland.

 

     Richard Hawkins

Richard is a political economist, at present  is a professor in the science, technology and society program at the University of Calgary. He is also senior fellow at THECIS and fellow of the Institute for Science Society and Policy (University of Ottawa).  He has authored over 100 scientific publications and reports on science, technology and industry policy.  He also has extensive international experience as a policy consultant and advisor. Major clients have included the European Commission, the OECD, the World Bank, Industry Canada, the European Committee for Standardization (CEN), The Standards Council of Canada, the UK Department of Trade and Industry, the UK Office of Science and Technology, the Dutch Ministry of Economic Affairs, the International Labor Organization, the Italian Telecommunication Regulatory Authority (AGCOM), the London Metropolitan Police Service, the Telecommunication Managers Association (UK) and the British Standards Institution.

He holds BA and MA degrees from Simon Fraser University (Canada), and a DPhil from the University of Sussex (UK).

 

     Mark Fedorak

Mark Fedorak P.Eng, PMP has over 20 years of technical, business, and project management expertise and his current primary position is as CEO of Xanantec Technologies Inc. an Edmonton based Electrical Engineering consulting firm.  Mark has worked on over 300 projects, and has been in the role of CEO, CTO, or Chief Engineer in a number of different medical and high tech startups.  Mark has served on a number of not for profit boards and provides THECIS with an SME perspective.

 

Bartlett, Walter, 2015     Blake Bartlett

Blake  is a CPA (Charted Professional Accountant) and MBA (Master of Business Administration).  He has 20 years of public sector experience including financial leadership roles in the areas of health, advanced education, innovation and technology.  He is currently the Director of Forecasting and Financial Analytics for Alberta Health Services.

 

     Daphne Cheel

Daphne worked in government and government agencies for 35 years.  She started her career at the Alberta Research Council conducting applied environmental research – in the areas of landscape dynamics, resource management decision support systems, and corporate environmental risk management.  After 18 years of “doing science”, she moved to the Alberta Science and Research Authority to work in the area of science and innovation policy.  Since then, her work in government has spanned many domains – from health to oil sands, and a number of different ministry portfolios – such as, science, resource management and economic development.  Throughout, her career has focused on systems, strategy, policy and performance.  She’s recognized as a collaborative, systems thinker, with a proven track record in government systems and management.  After retiring from government service, Daphne has incorporated a small consulting company: dbkc3 Solutions Inc., offering research, systems, performance and management consulting.

Daphne has a master’s degree in environmental science (University of Alberta) and a bachelor of science (honours) in chemistry (Trent University).

 

Anita Arduini Anita Arduini

Anita is currently Director with Portfire Associates, a consulting company to the Energy and Petrochemical industrial sectors.  Previously, she worked as Program Director with CMC Research Institutes (Carbon Management Canada) and as the Executive Director Research for the Schulich School of Engineering at the University of Calgary.

She has held numerous industry positions spanning a 25-year period including Technology Business Development Manager at NOVA Chemicals Corporation, Research Scientist at Canadian Fracmaster and Development Specialist at Union Carbide Canada.  As a result of her experiences in the corporate, academic and not-for-profit sectors, she is well-versed in research promotion and facilitation and all aspects of technology commercialization.

She received a B.Sc. (Honours Chemistry) from the University of British Columbia and a PhD (Inorganic Chemistry) from the University of Alberta.

 

Picture of Jim Saunderson Jim Saunderson

Jim Saunderson retired after 36 years of experience in the federal public service including senior leadership roles as Assistant Deputy Minister and Chief Financial Officer with Western Economic Diversification Canada.   He has wide ranging experience including economic development, program delivery, inter-departmental and inter-governmental collaboration as well as financial and human resource management. Jim holds a BA (Honours) in political science from Carleton University and completed the Canada School of Public Service Advanced Leadership Program.

 

Karen Sharp

Karen Sharp (PhD) has mostly retired after 4 decades in the energy industry, with some time in the education and non-profits sectors.  She has an B.A and M.A. in economics and mathematics and used that background as an energy economist with a small Calgary consulting firm.  Later she shifted to long term planning roles, and obtained her doctorate in Management (Finance) while consulting on strategy and regulation, including cost of capital.  Karen was in a senior technical role at the National Energy Board and in management at Nova Gas Transmission Limited and the City of Calgary.  Karen is a published author in Financial and Energy Journals.  Also Karen has consulted to non-profit organizations on governance, and served on the Boards of non-profit organizations.

 

Lori Sheremata

Lori is a researcher and a lawyer. Called to the British Columbia Bar in 2001, Lori then pursed her Masters of Law focusing on the regulation of emerging technologies. She has held positions in academia at the University of Alberta, the National Research Council (at the then National Institute for Nanotechnology) and the government of Alberta through Alberta Ingenuity Fund, now Alberta Innovates.

In addition to administrative roles at the interface of science, business and government, Lori has a substantive research background focusing on law, policy and ethics relating to nanotechnology, the life sciences, clinical trials and the societal implications of artificial intelligence. Lori has served on Health Canada’s Science Advisory Board and various expert panels. The Council of Canadian Academies expert panel on nanotechnology published “Small is Different: A Science Perspective on the Regulatory Challenges of the Nanoscale” in July 2008. The panel was tasked with evaluating the current state of knowledge of nanomaterials, their health and environmental impacts that could underpin regulatory perspectives on the need for research, risk assessment and surveillance. Much of Lori’s academic work has focused on the commercialization of research, the translation of research findings to society and the role of intellectual property in this process. Lori remains active in areas of clinical ethics, the regulation of professionals, and the law, policy and regulatory challenges surrounding privacy and access that are raised by our increasingly connected and analyzed world.

 

 

 

 

 

Chad Saunders

Dr. Saunders is an Associate Professor in the Entrepreneurship and Innovation area at the Haskayne School of Business and holds adjunct appointments with the Department of Community Health Sciences and the Department of Medicine at the Cumming School of Medicine.   Chad received a BSc in Applied Mathematics, and an MBA from Memorial University of Newfoundland and a PhD from the Haskayne School of Business.  Chad has published in leading journals including Entrepreneurship Theory & Practice, Journal of Business Venturing, Research Policy, IEEE Transactions on Software Engineering, and the Ivey Business Journal.  Chad completed the Institute of Corporate Directors ICD.D designation as part of his  commitment to effective governance and recently finished his term as Chair of the Board at the Business Link.

 

M_Cote_Ball_bio     Martha Cote’ Ball

Martha has been the Executive Secretary of THECIS since its beginning in 2001.  During this time, she also worked for TWM, and was the Administrator for Strategic Leadership Forum – Calgary Chapter for 10 years.  She has held many positions in different organizations and companies over the years.  A graduate of Mount Royal University, she has a diverse background in leadership, leisure leadership and coaching, event co-ordination and planning, healthcare, and pastoral care.


THECIS logo Integrity, Indepencence, Quality

Backgrounder on THECIS

THECIS (The Centre for Innovation Studies) is a province-wide not for profit organization devoted to study and promotion of innovation.  Based in Calgary, Alberta, and Incorporated in 2001, its primary geographic scope is western Canada.
THECIS has three core functions – research, networking and education.
  • Research. Creating new knowledge and building insights into how the innovation systems functions and policies that can improve it.
  • Networking.  Providing opportunities for exchange of ideas through breakfast meetings, workshops and conferences.
  • Education.  Dissemination of information through Blogs/Newsletters, events and other informal education activities, particularly for graduate students.

Funding.  THECIS is funded on a project basis by a variety of organizations.  since 2001, nearly 50 organizations have provided financial support to THECIS.

THECIS is governed by a Board of Directors from across Alberta, with extensive experience and knowledge relating to innovation.

Executive leadership is provided by an Executive Director, and projects are carried out for clients by a network of experienced individuals called THECIS Fellows.  The THECIS Fellows represent a major asset and a major source of competitive advantage for THECIS.

The Core Values of THECIS are integrity, independence and quality.

 


THECIS logo Integrity, Indepencence, Quality

THECIS Governance Structure

Incorporated: June 15th 2001 under section 9 of the Alberta Companies Act [Not for profit section] as a company limited by guarantee.

Members

The Members play a role analogous to shareholders in a for profit company. They represent the broadest constituency for THECIS activities.  The Articles of Association limit the number of members to 50. An Annual general meeting must be held at least every 16 months; a quorum is 50% of the members.  Members are appointed by a simple majority vote of the members.  The major responsibility of the members is: to elect Directors; to appoint auditors; to fix remuneration of auditors.

 

Board of Directors

The Directors provide governance to the organization, represent THECIS to the community and accept the ultimate legal authority and fiduciary responsibility for THEICS. Directors serve a one year term that may be renewed.  The Articles state there should be 3 – 20 Directors.  The composition of the Board is determined by the Articles of Association so as to ensure participation from business, government and university.  The Chair must be from industry.

 

Executive Director

the position has primary leadership responsibility for establishing THECIS  as a significant player in Alberta and western Canada as it evolves from a volunteer to a professional organization.

THECIS Associates

THECIS Associates carry out the work of THECIS.  They include: THECIS Fellows; Executive Secretary, comptroller; Conference Planner; Accountant, Newsletter/Blog Editor; etc.

 

 

 

 

 

 

 


THECIS Funding

THECIS is funded on a project basis by a variety of organizations.  Since 2001 the following have provided financial support through contracts or grants:

 

Federal Government Departments and Agencies

  • Western Economic Diversification Canada;
  • ACOA  (Atlantic Canada Opportunities Agency);
  • Industry Canada – Ottawa;
  • Industry Canada – Saskatoon office;
  • Office of the National Science Advisor [ONSA];
  • ISED (Innovation Science and Economic Development Canada;
  • Canadian Biotechnology Secretariat;
  • Agriculture and Agri-Food Canada;
  • Standards Council of Canada;
  • National Institute of Nanotechnology [NINT];
  • National Research Council –Industrial Research Assistance Program [NRC-IRAP];
  • Federal Partners in Technology Transfer [FPTT];
  • Business Development Bank of Canada; National Science and Engineering Research Council – Prairies Region;
  • International Development Research Centre [IDRC]
  • Prairies Economic Development Canada (PrairiesCan)

 

Provincial Government Departments and Agencies

  • Alberta Economic Development;
  • Alberta Innovates – Technology Futures;
  • Alberta Finance and Enterprise;
  • nanoAlberta;
  • Alberta Status of Women
  • Alberta Innovation and Science;
  • Advanced Education and Technology;
  • Alberta Sustainable Resource Development;
  • Informatics Circle of Research Excellence [iCORE];
  • Alberta Agricultural Research Institute; Alberta Innovates – Health Solutions;
  • Alberta Energy Research Institute;
  • Alberta Research Council;
  • Alberta Ministry of Agriculture Food and Rural Development [AAFRD];
  • British Columbia Ministry of Advanced Education;
  • Saskatchewan Industry and Resources;
  • Enterprise Saskatchewan;
  • Manitoba Science, Technology, Energy and Mines;
  • Government of Newfoundland and Labrador;
  • Government of Ontario;
  • Ontario Centres of Excellence
  • Innovation Saskatchewan
  • Government of the Northwest Territories

 

Foundations

  • International Health Business Opportunities Conference Foundation
  • Alberta Ingenuity Fund;
  • Alberta Heritage Foundation for Medical Research [AHFMR]
  • Canadian Youth Business Foundation [CYBF];
  • Futurpreneur Canada

 

Other Funders

  • Calgary Technologies Inc.;
  • University of Calgary;
  • Ryerson University
  • TEC Edmonton;
  • The Evidence Network;
  • University of Alberta, Faculty of Extension
  • AVAC Ltd.   Alberta Chamber of Resources;
  • Genome Prairie; Genome Alberta;
  • CMC Microsystems;
  • Pfizer Inc., Nexen Inc.;
  • Merck Frosst Canada Ltd.;
  • Ernst and Young LLP;
  • Alberta Treasury Branches;
  • Institute of Chartered Accountants of Alberta
  • Certified Management Accountants of Alberta;
  • Calgary Regional Technology Commercialization Advisory Committee [CRTCAC]
  • APEGGA Association of Professional Engineers, Geologists and Geophysicists of Alberta;
  • Institute of Chartered Accountants of Alberta
  • University of Manitoba, Stu Clark Centre for Entrepreneurship

 


THECIS Cumulative Projects

Project List as of April 2021

COVID Impact and Recovery (2021)

This project, for the Government of  Alberta, aims to better understand the impact of COVID-19 on entrepreneurship in Alberta and identify pathways for recovery from the pandemic.

Impact of COVID-19 on Women and Youth Entrepreneurship in Western Canada (2021)

This project, for Western Economic Diversification Canada, aims to examine the state of entrepreneurship for women and your in the four western provinces and what impact COVID-19 has had since the previous major study in 2019.

Women’s Economic Knowledge Hub (2019-2022)

This long-term project – funded by ISED and located at Ryerson University – uses Global Entrepreneurship methodology to examine the state of women’s entrepreneurship across Canada.

The state of Women and youth entrepreneurship in western Canada (2019)

This project, for Western Economic Diversification Canada. A look at the state of entrepreneurship across western Canada with a special focus on women and youth. It surveyed 6,144 individuals across western Canada, a very large sample that allowed us to present results in a very granular fashion.

The Impact of Medium sized companies on the Alberta economy.

This project, funded by the Alberta government and Western Economic Diversification, aims to better understand the mid-sized companies in Alberta and characterize their impact on the Alberta economy.

 

Export of gas from the Mackenzie delta.

This project , funded by the government of the Northwest Territories, is to develop a preliminary technical analysis of the prospects of exporting gas from the Mackenzie delta and associated developmental benefits to the region.

Global Entrepreneurship Monitor [GEM] project. 2013- present

THECIS took the lead to create a cross Canada team and secure funding for GEM studies in Canada as well as in BC, Alberta, Saskatchewan, Manitoba, Ontario, Quebec and Newfoundland. This project will produce 20 GEM reports when completed:

  • Canada – five reports
  • Alberta – four reports
  • Ontario – four reports
  • Quebec – five reports
  • British Columbia – one report
  • Saskatchewan – two report
  • Manitoba – one report
  • Newfoundland – one report
  • Nova Scotia – two report
  • Atlantic Canada (four provinces) – two report
  • Women’s entrepreneurship – three report
  • Entrepreneurship at the university of Calgary – one report
  • Western Canada Youth – one report
  • Yukon – one report

 

Nanotechnology Road Map implementation project, starting summer 2012

A best practice for developing road maps is to spend the time necessary once the road map is completed taking it to all the main stakeholders and interest groups to secure their understanding and buy in for the Road Map.

 

Nanotechnology Roadmapping project, 2011-2012

Following on from the previous project, nanoAlberta has asked us to develop road maps for the most promising applications for nanotechnology in Alberta. This involves a collaborative effort among all the stakeholders, in industry, government, university and NGOs.

 

Impact of nanotechnology in Alberta, 2010/2011

NanoAlberta asked us to identify the major applications for nanotechnology likely to have commercial impact by 2020 and to develop a road map and action plan for realizing the benefits to Alberta.

 

InnoWest 2004, 2005, 2006, 2007, 2009 and 2010

InnoWest is the western Canadian Innovation Conference. THECIS has organised this event since 2004, and it has become an annual event, with steadily increasing attendance from across western Canada and beyond.

 

Science to Society Workshop 2004, 2005, 2006, 2007, 2008, 2009 and 2010

This event is organised to provide business information to 50- 70 graduate students in science, engineering ICT, health and agriculture. It takes place at a weekend on October in Banff.  Support has come from iCORE, Alberta Ingenuity, AHFMR, the Alberta Agricultural Research Institute, NSERC Prairies and the governments of Alberta, Saskatchewan and Manitoba.

Ingenuity 601 [Graduate Innovation Course], 2007, 2008, 2009 and 2010

This project, carried out for Alberta Ingenuity, is to develop and deliver a learning experience to graduate students in Alberta to acquaint them with the basics of business concepts and give them experience working on  a business related project in a multidisciplinary environment.  The delivery of the Course in the Fall of 2007 is supported by the CRTCAC  [Calgary Regional Technology Commercialization Advisory Committee] and in 2010 by Alberta Innovates – Technology Futures.

 

Health Research Translation Project, 2009

This course is modelled on Ingenuity 601 but targeted at graduate students in medical, health and biosciences and related fields such as medicine, nursing, rehabilitation, life sciences and biomedical engineering. The course is supported by CRTCAC  [Calgary Regional Technology Commercialization Advisory Committee and AHFMR

 

Second Banff Innovation Summit, 2008

The theme of the second Banff Innovation Summit was “The resource industries as engines of economic diversification”. The Summit took place in September, with about 30 senior individuals from industry, government and university from the four western provinces. The Summit was supported by Western Economic Diversification, the Alberta government, iCORE and NSERC Prairies.

 

Pathways Project, 2008

Industry Canada asked us to review the various pathways that knowledge travels from university to business in Canada, and provide examples of each type of pathway identified.

 

International Comparison Review, 2008

This project developed an analysis of the policies being pursued in different countries to encourage industry-university collaboration; assessed the various strengths and weaknesses of various national approached; provided a critical assessment of the organizational structures of universities that underpin university-industry collaboration; and identified best practices and principles. This was for Industry Canada.

 

ICT Sector Performance in Alberta, 2007/2008

This project, supported by Alberta Advanced Education and Technology, is a follow on from the Alberta Innovation Scorecard project. It aims to answer two questions: How is the ICT sector performing in Alberta?  How is the government doing supporting the sector?

 

Foresight Scoping Workshop, 2007

This was a foresight exercise to identify applications that may emerge from the convergence of nano-technology, biotechnology and ICT. It is initiated by the Office of the National Science Advisor and supported by Agriculture and Agri-Food Canada, the Canadian Biotechnology Secretariat and CMC Microsystems.

University Business Collaboration, 2007

This project is a critical review of the literature on how university researchers collaborate with industrial firms, and how those relationships can result in commercial products. Supported by Industry Canada.

 

Interprovincial Trade in the Oil and Gas Industry, 2007

The Standards Council of Canada asked us to carry out a project to determine if there were any barriers to interprovincial trade in the oil and gs industry that were caused by standardisation factors.

 

What can we learn from clusters? 2007

This project, for the Alberta ICT Council, aims to identify learnings from the ISRN [Innovation Systems Research Network] research on ICT clusters across Canada which are relevant to the Alberta ICT sector.

 

Saskatchewan Innovation Scorecard 2006

The Saskatchewan Innovation Scorecard project was funded by the Saskatchewan government, Western Economic Diversification and NRC-IRAP. It aims to portray the state of innovation in Saskatchewan and compare it with benchmark jurisdictions.

 

First Banff Innovation Summit  2006

The goal of turning Western Canada into a dynamic, diversified and internationally competitive knowledge-based economy must be supported with policies and strategies that take account of both leading-edge ideas and local knowledge about how to assess and improve innovation performance.

The Banff Innovation Summit brought together 30-40 carefully selected industry, policy and academic stakeholders in economic diversification and innovation will interact with an elite international group of experts who are producing leading-edge ideas and knowledge concerning innovation policy and strategy. A speaker from the OECD in Paris provides the keynote address. The Summit was funded by a number of organisations, including the Governments of Canada, Saskatchewan, Alberta, and BC, and the University of Calgary.

 

Feasibility Study for a Seraphim Fund and Virtual Angel Support System  for Western Canada  2006

One of the problems holding back innovation in western Canada is the shortage of early stage funding. This project addressed that problem by carrying out a feasibility study for a new form of virtual angel network. The project was funded by NRC-IRAP.

 

Alberta Technology Report 2006

THECIS partnered with Ernst and Young and Ipsos Reid to prepare the 2006 edition of the Alberta Technology Report. The project was funded by Alberta Innovation and Science, Western Economic Diversification xxx. It involved a survey of CEOs of high tech firms to identify the state of the sector.

 

University Research Park Vision and Conceptual Masterplan, 2005

THECIS worked with a consortium of firms of architects to develop a Vision and Conceptual master plan for the rejuvenation of the University Research Park. This was done for Calgary Technologies, the University of Calgary and Alberta Infrastructure.

 

Alberta Innovation Scorecard 2005

The Alberta Innovation Scorecard was a direct follow up to the earlier project on developing new economic measures for Alberta. The Alberta Innovation Scorecard was developed using a consultation process with a team from the project sponsors [Western Economic Diversification, Alberta Innovation and Science, and NRC-IRAP]. The Scorecard was released publicly and is available on the THECIS web site.

 

Health Innovation 2005/2007

This project was funded by a private Calgary based Foundation. It was a year long study of the health industry in Alberta, to identify the main characteristics of the industry and celebrate its successes. The results of this work were disseminated across Alberta by a series of workshops in major centres organised by THECIS.

 

Innovation System data Initiative 2005/2006

Policy makers often need better and more timely information than is currently available from Statistics Canada. This project – supported by Alberta Innovation and Science, Western Economic Diversification and NRC-IRAP – addressed this need by sending a graduate student to Ottawa and supervising him to obtain information of value to the project sponsors.

 

Calgary Innovation Clinic 2004

Industry Canada and Western Economic Diversification asked THECIS to organise an Innovation Clinic in Calgary. This involved having two high tech CEOs being interviewed before a live audience to describe the factors leading to their success. The interviews were recorded and have been made available across Canada in DVD format by Industry Canada.

 

Return to Community – the Impact of the University of Calgary on its Community. 2004

The University of Calgary asked THECIS to prepare a report showing the impact the University has on the community. This report was subsequently used in discussions at the university Senate and by other bodies.

 

Feasibility Study for a wet lab facility at the Edmonton Research Park

THECIS was asked to join a consortium of architect firms to prepare a feasibility study for this facility. The main THECIS role related to developing the business case for the facility. Subsequently the facility was approved and is under construction.

 

Annotated Bibliography: Innovation in the Prairie Provinces 2003

Industry Canada in Saskatoon asked THECIS to prepare an annotated bibliography of papers written about innovation in the prairie provinces.

 

External Technology Audit of AACI Program, 2003

The Alberta Energy Research Institute asked THECIS to carry out an external audit of one of their major technology programs to determine how effective they were.

 

New Economic Measures for Alberta 2003

This major project for Alberta Economic Development was to develop a set of metrics to measure the effectiveness of the Provinces new economic development plan. It involved participation of members from several different Alberta ministries.

 

Briefing Paper for a conference on Receptor Capacity 2003

Calgary Technologies asked THECIS to prepare a briefing paper relating to a  Canadian conference on receptor capacity held in Toronto.

 

Paper on Industrial Research, 2002

This project, for Alberta Innovation and Science, was to prepare a paper for discussion at the Ministers of Science and Technology from across Canada.


Innovation Policy in Canada – Blog #29

24, May 2022

Innovation Policy in Canada.

Canada is ranked poorly for innovation in most international comparisons. For example, it is ranked #16 globally in the WIPO Global Innovation Index, 6th of the seven G7 countries.

A recent book1 casts interesting light on this. It is a rare example of a non-partisan look at innovation policy in Canada at the provincial level. It has a chapter for each province and the territories and is written by 20 mostly academics from across Canada (including me). The value of a book like this is that it doesn’t provide “the answer” to Canada’s innovation problem but it documents approaches taken recently, assesses what worked and what didn’t and stimulates further discussion.

Here are some of the topics that caught my attention from the Chapter on “Conclusions and Lessons Learned”:

  • Canada’s innovation performance. The authors describe the conundrum that while Canada has numerous advantages, including a stable political situation, well-educated population, broad socio-economic advantages such as multiculturalism, a merit-based immigration system, broad social safety nets and good social mobility, etc., and yet it performs poorly on innovation. Companies underperform on R&D spending, companies are not scaling, entrepreneurs tend to move to other jurisdictions, and so on.
  • Evaluation of policies. One of the biggest weaknesses in the Canadian policy system is the almost complete absence of structured evaluation of any policy ideas. The authors note that there are established methods that exist around the world (for example, the Maryland Scientific Methods Scale) to support policymakers in delivering evidence-based policies. The provincial chapters show no evidence of any substantive assessments of programs to support innovation.
  • Natural experiments among provinces. The authors note that provinces have powers over many of the drivers of innovation, so comparing the performance of different Provinces – reflecting the different political differences and dynamics across the county – is a natural experiment to determine what works best. It is one of the aims of the book to document this. This can be seen as one of the advantages of a federal structure in Canada.
  • Drawbacks of the federal structure. The authors note that as powers influencing innovation are very diffuse across Canada not much happens unless two or three levels of government are aligned. Generally, the federal government sets the agenda, and the provinces and territories selectively respond.  This makes it hard to get support for Canada wide efforts.
  • Diffuse focus. A review showed more than ninety program streams to support business innovation, across twenty different federal organizations. Each province also has numerous support programs, so overall there are a vast number of support programs across the country, which spreads the support very thinly.
  • Broad-based support. The authors note that there is reluctance among provincial governments to pick winners, and as a result most support programs fall back on offering general support to whichever firms can access their programming. This leads to efforts that are more incremental than transformative.
  • Big bets can pay off. One example of a sustained long-term effort to support innovation citied in the book is AOSTRA (The Alberta Oil Sands Technology and Research Authority) that led to the development of the Alberta oil sands and made a material contribution to the Canadian economy. This was led by the provincial government. Other examples include ocean industries in the Atlantic region, digital industries in New Brunswick and PEI, aerospace and transportation in Quebec, and agri-food in Manitoba and Saskatchewan.
  • SME focus. The authors note that Canada’s private sector is dominated by SMEs (small and medium sized enterprises) and that many large companies are foreign owned. This explains why many innovation programs are aimed at SMEs and startups, and why success stories are usually about small businesses doing well, while reports of innovation among Ontario’s branch plant auto industry are seldom heard.
  • Bias towards technological innovation. The book notes that Canadian innovation support programs have a strong bias towards technological innovation at both the federal and provincial levels. “The evidence that a science and technology focused research funding strategy will generate innovation in a predictable fashion is slim to none.” This bias has a couple of consequences. 1. It mainly focuses on cities, and ignores rural areas and the territories, leaving out 98% of Canada’s geography and 40% of its people and 2.  it neglects the voluntary, cultural and creative sectors that generated $169.2 billion in 2017, 8.5% of the GDP.
  • Impact of resource industries. Despite the strong orientation of policy towards SMEs, the authors note that adoption of innovation by large resource based forms generated most of the improvements. This is not surprising, as a 1% increase in productivity in a $5 billion company has more impact than a 100% increase in a 30 person startup.
  • Challenge of implementation. While provinces and territories recognize the need to create the conditions that lead to innovation driven economic growth, their ability to implement policies and programs has been more challenging. Part of the reason for this, as the authors note, is the relatively low staffing levels of innovation specialists with sufficient experience and expertise in provincial governments.
  • Role of Universities. The authors note that universities, often seen as a significant source of ideas that lead to commercialization, are not evaluated provincially or federally in a way that would account for their net economic contribution. Contributions of universities are often overestimated. Research at universities costs about $13 billion a year but generate less than $75 million annually in commercial technology transfer activity.
  • Institutional gaps. The authors identify a number of institutional gaps in Canada with their recommendations:

 

  • Raise Canada’s research and development effort. This would require support at both federal and provincial levels.
  • Develop more targeted and sustained innovation efforts. These have been demonstrated to generate successful results, e.g. AOSTRA, mentioned above.
  • Improve threat identification and hazard mitigation that can produce dual use technologies for civilian security and defence applications.
  • Focus more on digitalization. This has been described by former Bank of Canada Governor David Dodge as an “absolute imperative”. It is an area where Canada has lagged behind other countries.
  • Avoid misalignment between federal and provincial innovation policies, particularly for energy and climate.

If any of this strikes a chord with you get a copy of the book to learn more.

Peter Josty

 

  1. “Ideas, Institutions and Interests” – The Drivers of Canadian Provincial Science, Technology and Innovation Policy – Edited by Peter Phillips and David Castle, University of Toronto Press, 2022, 398 pages.

Is Canada a hewer of wood and drawer of water? – Blog #28

3, May 2022

Is Canada a hewer of wood and drawer of water?

Canada is often described as a resource based economy, or, less kindly, as a hewer of wood and drawer of water. But is this really true?  As a resource based economy Canada is often compared to countries like Australia, Norway and Russia. But look at the graphic below.

This shows a measure for each country called the Economic Complexity Index.1 The Economic Complexity Index is a ranking of countries based on the diversity and complexity of their export basket. High complexity countries are home to a range of sophisticated, specialized capabilities and are therefore able to produce a highly diversified set of complex products. Low complexity countries export more undifferentiated commodities and simpler products. The reason this index looks at exports, rather than total production, is that exports are seen to be a measure of international competitiveness, and allow better international comparisons.

So, Canada is far from being a hewer of wood and drawer of water. We have a much more complex export mix than Australia, Norway and Russia.

Broadly speaking, richer countries usually have more complex exports.  The highest ranked countries according to this index are Japan, Switzerland, Germany, South Korea and Singapore. The US ranks #11 out of 133 countries.  The lowest ranked countries are Venezuela, Cameroon, Papua New Guinea, Liberia, Guinea and Nigeria.

The comparison with Australia is particularly interesting as Australia is often seen as a twin for Canada. Canada ranks #36 out of 133 countries in this ranking (and is growing more complex), and Australia ranks #88 (and is growing less complex.) That is a huge difference, and is explained by the fact that a much larger proportion of Australia’s exports are “simple” compared to Canada. Well over half of Australia’s exports are commodities such as iron ore, coal, petroleum and gold. The corresponding number for Canada is roughly half that, with exports of petroleum, gas, gold, lumber and wheat. Canada has significant exports of complex products such as cars, car parts, ICT, machinery, medications and plastics.

The researchers place the diversity of tacit knowledge—or knowhow—that a society has at the heart of its economic growth story. Research from the Growth Lab finds that countries whose exports are more complex than expected for their income level, grow faster. So, according to this approach Canada would be expected to grow faster than Australia.  This is true, with Canada’s growth to 2029 estimated to be 3.06% per year, compared with 2.17% for Australia. (These estimates were made before COVID-19, so take them with a grain of salt.)

The Harvard Growth Lab has an interesting view on economic development. They see that countries grow by diversifying into new products of increasing complexity. So the more complex your export mix the more opportunities you have to grow into adjacent areas. Some examples from Canada could be:

  • Oil and gas firms getting into other energy sources such as geothermal energy, that exploits their drilling and energy expertise;
  • Automobile firms getting into electric vehicles, that exploits their manufacturing expertise.
  • Forestry firms using drones for reforestation exploiting their expertise in forestry.
  • Energy firms getting into hydrogen production to exploit their expertise in natural gas and related technologies such a carbon capture and storage.
  • A historical example is Shell getting into GPS technology to know where they were drilling, and subsequently spinning off the business, that seeded the formation of the Calgary GPS cluster.

Conclusion.
Canada has a much more complex economy than we realize. The idea of using the diversity of tacit knowledge to diversify into adjacent areas is an interesting one that should receive more attention. It’s probably a much more robust approach that trying to attract unrelated businesses to set up here.

Peter Josty

  1. Harvard Atlas of Economic Complexity https://atlas.cid.harvard.edu/

Why are mid-sized companies so important in Alberta? – Blog #25

15, March 2022

Why are mid-sized companies so important in Alberta?

Mid-sized companies play a key role in the Alberta economy due to their stability, innovation, their exporting, and contribution to the community.
In December 2021 the size distribution of firms in Alberta is shown in the table below1:

Mid-sized companies employ about 20% of the workforce in Alberta. Mid-sized firms are active in most areas of the Alberta economy. The Table below shows the percentage active in the most frequent areas1:

But the main reason they are important is because of their characteristics. Several years ago we interviewed the CEOs of mid-sized firms in Alberta. A large majority of the firms interviewed displayed the following key characteristics:

  • They are very stable. We found most medium sized companies have been in existence for 10 years and many were 50 and 60 years old and more. They are almost always privately owned so are not subject to the influence of stock markets and the pressure to produce quarter to quarter improvements, and therefore can think much longer term
  • They have deep expertise. Frequently the founders had gained industry experience in a big company before branching out by themselves. This is a common but not universal experience. Almost all CEOs interviewed had a university education and many had graduate degrees.
    They respond positively to the challenges of finding skilled people. A frequently expressed barrier to growth was lack of qualified people. Alberta MSEs have responded in various ways. One found an Alberta Innovates program very valuable. It helped to subsidize new hires (engineers) for a year or two while they learned the business and could become productive.
    There is huge attention to employee wellbeing. Likely related to the challenges of finding qualified workers, most MSEs interviewed go to great lengths to keep employees happy. This results in employee loyalty and very low attrition rates. One company had a retention rate of 99%. Another was proud to be the recipient of many “Best Place to work in Alberta” awards. Most go to great lengths not to lay off employees in a downturn.
  • They focus. Most medium sized companies have a quite a narrow and sharp business focus. They know their niche very well and don’t want to stray outside it. They tend to be deep rather than broad.
  • They innovate. Although some of the MSEs interviewed were reluctant to describe themselves as ‘innovators’, most were observed to have made significant innovations in terms of new products, new processes or new business models.
  • Access to capital is not a huge issue. MSEs are stable, profitable businesses with good prospects, so many are prime candidates for accessing normal banking instruments – loans and lines of credit. None mentioned venture capital funding.
  • Growth is not in itself a high priority. Many MSEs see themselves as being an appropriate size to serve their niche; growing beyond that would be problematic. Some saw a tradeoff between high growth and survival. Many regarded aiming for high growth as a risky strategy.
  • Use of contractors is widespread. Many of the MSEs interviewed used contractors to supplement their workforce. One design firm employed hundreds of extra people for large projects. Others contracted with software developers abroad, where costs were lower than in Alberta. However, it was often stressed that this did not reduce employment in Canada as all the core personnel remained in Alberta.
  • Many export. One firm had no customers at all in Canada for the first eight years it existed. But some served local markets and did not export at all. A majority of the firms we interviewed exported more than 30% of their sales revenue.
  • They contribute to the community. Many companies are deeply involved in community affairs, supporting local cultural institutions, charities and industrial organizations. Such involvement was often described as a defining element of the company culture.
  • MSEs operate largely outside the milieu of targeted industry supports. Use of government support programs varied considerably, but no firm interviewed was dependent on such programs. Most expressed the view that MSEs were generally not on the radar of most of these programs.
  • Flight risks are mounting. Most MSEs seem happily embedded in Alberta, and have no plans to consider moving to another jurisdiction. However several expressed concern about increasing regulation and taxes compared with the US and were starting to look at relocating their business.
  • The overall business environment is critical. SMEs have structural relationships with many sectors throughout the Alberta economy, especially but not exclusively with the resource sector. They tend to thrive best when overall conditions are favorable for the economy as a whole and can be severely affected when legislation and regulation is not synchronous with up or downturns.

Conclusion

We need more medium sized businesses in Alberta,

Peter Josty

  1. Statistics Canada. Table 33-10-0493-01  Canadian Business Counts, with employees, December 2021
  2. Businesses are counted according to the number of “statistical locations” they have. For example, a retail business with 10 stores and a head office is counted 11 times in the Canadian business counts.

The latest R&D statistics are just out. Here’s what they mean, and what to do about them. – Blog #24

1, March 2022

The latest R&D statistics are just out. Here’s what they mean, and what to do about them.

The latest headline numbers from Statistics Canada for R&D spending in Canada are:
2021 (intentions) $40.1 billion, down 1.4%;
2020 (preliminary) $40.6 billion, up 0.7%;
2019 (final) 40.3 billion, up 3.9%.

Before getting into the detail it may be worthwhile reviewing the significance of R&D (technically – gross domestic expenditure on research and development, or GERD). These statistics are often used as an indicator or proxy for innovation. However they are very imperfect indicators of innovation, for a number of reasons. First, they are input measures, not output measures. Second, they cover a multitude of different activities with very different risk/reward levels. For example, one company may be developing a new improved type of yogurt, and another may be working on nuclear fusion, and these have totally different risks, rewards and timelines. Third, several industries innovate in ways that don’t show up in R&D statistics – for example natural resource industries such as the oil sands where tweaking in the field can offer major improvements. Nevertheless, these statistics are widely followed.

International comparison

So how does Canada compare internationally?  The graph below, from the OECD, shows GERD as a percentage of GDP, for Canada, the USA and the OECD average.

Source: OECD, https://data.oecd.org/rd/gross-domestic-spending-on-r-d.htm

This doesn’t look very reassuring for Canada. However it is not that different from the UK and Australia.

Who does R&D in Canada?

Who does the R&D in Canada? The main performers of R&D in 2021 are forecast to be business (52%), higher education (40%) and the Federal government (6%).

The main funders of R&D are: business (43%), higher education (20%), the Federal government (18%) and foreign sources (9%).

How did Alberta do?

In 2019 (latest available provincial data) Alberta did $3.79 Billion of R&D. The main performers of R&D were: business (47%), higher education (45%), the provincial government (4%) and the federal government (3%).

The main funders of R&D were: business (45%), higher education (20%), federal government (15%), the provincial government (10%), and foreign sources (5%).

In terms of R&D as a percentage of GDP, Alberta’s ratio is about 1.3% of the provincial GDP, about two thirds of the corresponding rate for Canada as a whole.

Why is Canada so low?
There are a number of reasons:

  • Canada is a resource based economy and resource companies typically don’t spend much on R&D.
  • Canada has a small number of companies in industries that typically spend the most on R&D, such as pharmaceuticals and high tech companies.
  • Canada has fewer large firms than competitors and these usually spend more on R&D.
  • Canada has relatively few head offices, and there is often a ‘head office effect’ where R&D is performed near the head office. This is related to the fact than many Canadian companies are foreign owned.
  • Offsetting this, Canada’s public sector spends more on R&D than the OECD average.

It is remarkable that the five US companies in the graphic below each spend more money in 2021 than all Canada business combined. (Canada business R&D was about $17.7 USD in 2021)

Source: The Economist January 22, 2022.

Does it matter?

This topic is hotly debated. The main argument usually goes that as the world embarks on the fourth industrial revolution, with a stress on connectivity, artificial intelligence, robotics, Internet of things, and autonomous vehicles, etc., the economy is becoming more knowledge intensive and so intellectual property and R&D is becoming more and more important. That argument clearly has merit.

However, by conventional economic metrics Canada is doing well.  The table below shows a comparison between selected countries for 2020.

Country GERD as % of GDP (OECD) GDP per capita $US (World Bank)
Israel 4.93 $44,169
South Korea 4.64 $31,632
Sweden 3.39 $52,274
UK 1.76 $41,124
Canada 1.59 $43,258

So there clearly isn’t a linear relationship between R&D spending and GDP per capita.

By quality of life rankings, Canada fares very well. The table below shows the latest quality of life ranking from US New and World report:

Ranking Country
1 Canada
2 Denmark
3. Sweden
4. Norway
5. Switzerland
6. Australia
7. Netherlands
8. Finland
9. Germany
10. New Zealand

Source: https://www.usnews.com/news/best-countries/quality-of-life-rankings

What to do?

Trying to figure out what to do should be based on three ideas:

  • Canada’s low spending on R&D is primarily a business problem. Government spending on R&D is above the OECD average.
  • Low spending by businesses on R&D is part of a pattern of behavious that also includes: low spending on machinery and equipment, low spending on IT, low spending on employee training, and low productivity, all low by comparison with other countries.
  • No CEO spends money on R&D because they want to. They spend money on R&D because the have to in order to remain competive. Amazon spends $60 billion a year on R&D because their business is hyper-competitive and fast moving and if they don’t they will become uncompetitive.

So we can re-phrase the question as follows: How to incentivize companies to spend on R&D?  Clearly incentives like the SRED tax credit are not enough – Canada has among the most generous incentives in the world.

I think the best clue lies in the nature of the Canadian economy. Significant parts of it are oligopolies, with few players and low competitive pressures. Some examples:

  • Three companies dominate telecommunications;
  • Two companies dominate airlines;
  • Five companies dominate banking;
  • Three companies dominate grocery stores;
  • Two companies dominate print media;
  • There are many more examples.

So the best way to increase R&D spending – that will also improve  a host of other factor such as low spending on IT, low employee training, etc.- is to make the economy more competitive. That means more anti-trust enforcement, and updating the  Competition Act (the Canadian government has already announced some small steps in this direction). Even the the Commissioner at the Competition Bureau has noted the decline in competitiveness of the Canadian economy and called for updating the Competition Act to create a more competitive economy.

Do you agree with this approach?

Peter Josty

This blog appeared first at www.thecis.ca