Innovation discussion in Canada lacks imagination

Today, Feb. 18, 2011, is the last day you have to make a submission to the federal government of Canada’s Review of Federal Support to Research and Development.

By the way, the  expert panel appointed and tasked with carrying out this consultation consists of:

Mr. Thomas Jenkins – Chair
Dr. Bev Dahlby
Dr. Arvind Gupta
Ms. Monique F. Leroux
Dr. David Naylor
Mrs. Nobina Robinson

They represent a mix of industry and academic representatives; you can read more about them here. You will have to click for each biography. Unfortunately, neither the website nor the consultation paper offer a list of members of the panel withbiographies that are grouped together for easy scanning.

One sidenote, big kudos to whomever decided this was a good idea (from the Review web page),

Important note: Submissions received by the panel will be made publicly available on this site as early as March 4, 2011.[emphases mine] * The name and organizational affiliation of the individual making the submission will be posted on the site; however, contact information (i.e., email addresses, phone numbers and postal addresses) will not be posted, unless that information is embedded in the submission itself.

This initiative can be viewed in two ways: (a) necessary housecleaning of funding programmes for research and development (R&D) that are not effective and (b) an attempt to kickstart more innovation, i.e. better ties between government R&D efforts and industry to achieve more productivity, in Canada. From the consultation paper‘s introduction,

WHY A REVIEW?

Innovation by business is a vital part of maintaining a high standard of living in Canada and building Canadian sources of global advantage. The Government of Canada plays an important role in fostering an economic climate that encourages business innovation, including by providing substantial funding through tax incentives and direct program support to enhance business research and development (R&D). Despite the high level of federal support, Canada continues to lag behind other countries in business R&D expenditures (see Figure 1), and this is believed to be a significant factor in contributing to the country’s weak productivity growth. Recognizing this, Budget 2010 announced a comprehensive review of federal support to R&D in order to maximize its contribution to innovation and to economic opportunities for business. (p. 1 print;  p. 3 PDF)

I’d like to offer a submission but I can’t for two reasons. (a)  I really don’t know much about the ‘housecleaning’ aspects. (b) The panel’s terms of reference vis à vis innovation are so constrained that any comments I could offer fall far outside it’s purview.

Here’s what I mean by ‘constrained terms of reference’ (from the consultation paper),

The Panel has been asked to provide advice related to the following questions:

§ What federal initiatives are most effective in increasing business R&D and facilitating commercially relevant R&D partnerships?

§ Is the current mix and design of tax incentives and direct support for business R&D and businessfocused R&D appropriate?

§ What, if any, gaps are evident in the current suite of programming, and what might be done to fill these gaps?

In addition, the Panel’s mandate specifies that its recommendations not result in an increase or decrease to the overall level of funding required for federal R&D initiatives. (p. 3 print; p. 5 PDF)

The ‘housecleaning’ effort is long overdue. Even good government programmes can outlive their usefulness while ineffective and/or bad programmes don’t get jettisoned soon enough or often enough. If you want a sense of just how complicated our current R & D funding system is, just check this out from Nassif Ghoussoub’s (Piece of Mind blog) Jan. 14, 2011 posting,

Now the number of programs that the government supports, and which are under review is simply mind boggling.

First, you have the largest piece of the puzzle, the $4-billion “Scientific Research and Experimental Develoment tax credit program” (SR&ED), which seems to be the big elephant in the room. I hardly know anything about this program, besides the fact that it is a federal tax incentive program, administered by the Canada Revenue Agency, that encourages Canadian businesses of all sizes, and in all sectors to conduct research and development in Canada. Former VP of the NRC and former President of Alberta Ingenuity, Peter Hackett, has lots to say about this. Also on youtube.

But you don’t need to be an expert to imagine the line-up of CEOs waiting to testify as to how important these tax incentives are to the country? “Paris vaut bien une messe” and a billion or four are surely worth testifying for.

Next, just take a look (below) at this illustrative list of more directly funded federal programs. Why “illustrative”?, because there is at least one hundred more!

Do you really think that anyone of the heads/directors/presidents (the shopkeepers!) of these programs (the shops!) are going to testify that their programs are deficient and need less funding? What about those individuals that are getting serious funding from these programs (the clients!)?

Nassif’s list is 50 (!) programmes long and he suggests there are another 100 of them? Yes, housecleaning is long overdue but as Nassif points out. the people most likely to submit comment about these programmes  are likely to be beneficiaries uninclined to see their demise.

There is another problem with this ‘housecleaning’ process in that they seem to be interested in ‘tweaking’ rather than renovating or rethinking the system. Rob Annan at the Researcher Forum (Don’t leave Canada behind) blog, titled his Feb. 4, 2011 post, Innovation vs. Invention, as he questions what we mean by innovation (excerpt from his posting),

I wonder if we’ve got the whole thing wrong.

The fact is: universities don’t produce innovation. For that matter, neither does industrial R&D.

What university and industrial research produces is invention.

The Blackberry is not an innovation, it’s an invention. A new cancer-fighting drug is not an innovation, it’s an invention. A more durable prosthetic knee is not an innovation, it’s an invention.

Universities can – and do – produce inventions.

In fact, they produce inventions at an astonishing rate. University tech transfer offices (now usually branded as “centres for innovation and commercialization”) register more intellectual property than could ever be effectively commercialized.

But innovation is distinct from invention. Innovation is about process.

Innovation is about finding more efficient ways to do things. Innovation is about increasing productivity. Innovation is about creating new markets – sometimes through the commercialization of inventions.

Innovation is about the how not about the what.

Thought-provoking, yes? I think a much broader scope needs to be taken if we’re going really discuss innovation in Canada. I’m talking about culture and making a cultural shift. One of the things I’ve noticed is that everyone keeps saying Canadians aren’t innovative. Fair enough. So, how does adding another government programme change that? As far as I can tell, most of the incentives that were created have simply encouraged people to game the system, which is what you might expect from people who aren’t innovative.

I think one of the questions that should have been asked is, how do you encourage the behaviour, in this case a cultural shift towards innovation, you want when your programmes haven’t elicited that behaviour?

Something else I’d suggest, let’s not confine the question(s) to the usual players as they’ll be inclined to offer more of the same. (There’s an old saying, if you’re a hammer, everything looks like a nail.)

Another aspect of making a cultural shift is modeling at least some of the behaviours. Here’s something what Dexter Johnson at the Nanoclast blog (IEEE Spectrum) noticed about US President Barack Obama’s January 2011 State of the Union address in his January 28, 2011 posting,

Earlier this week in the President’s State of the Union Address, a 16-year-old girl by the name Amy Chyao accompanied the First Lady at her seat.

No doubt Ms. Chyao’s presence was a bit of stage craft to underscore the future of America’s ingenuity and innovation because Ms. Chyao, who is still a high school junior, managed to synthesize a nanoparticle that when exposed to infrared light even when it is inside the body can be triggered like a bomb to kill cancer cells. [emphasis mine] Ms. Chyao performed her research and synthesis in the lab of Kenneth J. Balkus, Jr., a chemistry professor at the University of Texas at Dallas.

This is a remarkable achievement and even more so from someone still so young, so we would have to agree with Prof. Balkus’ assessment that “At some point in her future, she’ll be a star.”

However, Chyao was given to us as a shining example of the US potential for innovation, and, as a result, its competitiveness. So beyond stage craft, what is the assessment of innovation for the US in a time of emerging technologies such as nanotechnology? [emphasis mine]

As President Obama attempts to rally the nation with “This is our Sputnik moment”, Andrew Maynard over on his 20/20 blog tries to work out what innovation means in our current context as compared to what it meant 50 years ago at the dawn of the space race.

Notice the emphasis on innovation. Our US neighbours are as concerned as we are about this and what I find interesting is that there glimmers of a very different approach. Yes, Chyao’s presence was stagecraft but this kind of ‘symbolic communication’ can be incredibly important. I say ‘can’ because if it’s purely stagecraft then it will condemned as a cheap stunt but if they are able to mobilize ‘enough’ stories, programmes, education, etc. that support the notion of US ingenuity and innovation then you can see a cultural shift occur. [Perfection won’t be achieved; there will be failures. What you need are enough stories and successes.] Meanwhile, Canadians keep being told they’re not innovative and ‘we must do something’.

This US consultation may be more stagecraft but it shows that not all consultations have to be as thoroughly constrained as the Canadian one finishing today.  From Mike Masnick’s Feb. 9, 2011 posting (The White House Wants Advice On What’s Blocking American Innovation) on Techdirt,

The White House website kicked off a new feature this week, called Advise the Advisor, in which a senior staff member at the White House will post a YouTube video [there’s one in this posting on the Techdirt website] on a particular subject, asking the public to weigh in on that topic via a form. The very first such topic is one near and dear to our hearts: American Innovation. [emphasis mine] …

And here is the answer I provided:

Research on economic growth has shown time and time again the importance of basic innovation towards improving the standard of living of people around the world. Economist Paul Romer’s landmark research into innovation highlighted the key factor in economic growth is increasing the spread of ideas.

Traditionally, many people have considered the patent system to be a key driver for innovation, but, over the last few decades, research has repeatedly suggested that this is not the case. In fact, patents more frequently act as a hindrance to innovation rather than as a help to it. Recent research by James Bessen & Michael Meurer (reviewing dozens of patent studies) found that the costs of patents far outweigh the benefits.

This is a problem I see daily as the founder of a startup in Silicon Valley — often considered one of the most innovative places on earth. Patents are not seen as an incentive to innovation at all. Here, patents are simply feared. The fear is that anyone doing something innovative will be sued out of nowhere by someone with a broad patent. A single patent lawsuit can cost millions of dollars and can waste tons of resources that could have gone towards actual innovation. Firms in Silicon Valley tend to get patents solely for defensive purposes.

Getting back to Dexter, there is one other aspect of his comments that should be considered, the emphasis on ’emerging technologies’. The circumstances in which we currently find ourselves are hugely different than they were during the Industrial revolution, the arrival of plastics and pesticides, etc. We understand our science and technology and their impacts quite differently than we did even a generation ago and that requires a different approach to innovation than the ones we’ve used in the past. From Andrew Maynard’s Jan. 25, 2011 posting (2020 Science blog),

… if technology innovation is as important as Obama (and many others besides) believes it is, how do we develop the twenty first century understanding, tools and institutions to take full advantage of it?

One thing that is clear is that in connecting innovation to action, we will need new insights and “intelligence” on how to make this connection work in today’s world. These will need to address not only the process of technology innovation, but also how we develop and use it within an increasingly connected society, where more people have greater influence over what works – and what doesn’t – than ever before. This was the crux of a proposal coming out of the World Economic Forum Global Redesign Agenda earlier this year, which outlined the need for a new Global Center for Emerging Technologies Intelligence.

But beyond the need for new institutions, there is also the need for far more integrated approaches to building a sustainable future through technology innovation – getting away from the concept of technology innovation as something that is somebody else’s business, and making it everybody’s business. This was a central theme in the World Economic Forum report that Tim Harper of CIENTIFICA Ltd. and I published last week.

There’s a lot more to be said about the topic. Masnick did get a response of sorts to his submission about US innovation (from his Feb. 17, 2011 posting on Techdirt),

Tony was the first of a bunch of you to send over the news that President Obama’s top advisor, David Plouffe, has put up a blog post providing a preliminary overview of what he “heard” via the Ask the Advisor question, which we wrote about last week, concerning “obstacles to innovation.” The only indication that responses like mine were read was a brief mention about how some people complained about how the government, and particularly patent policy, got in the way of innovation:

Many respondents felt that too much government regulation stifled businesses and innovators and that the patent process and intellectual property laws are broken.

Unfortunately, rather than listening to why today’s patent system is a real and significant problem, it appears that Plouffe is using this to score political points for his boss …

Masnick hasn’t lost hope as he goes on to note in his posting.

For yet another perspective, I found Europeans weighed in on the innovation topic at the American Association for the Advancement of Science (AAAS) 2011 annual meeting this morning (Feb. 18, 2011). From a Government of Canada science blog (http://blogs.science.gc.ca/) posting, Mobilizing resources for research and innovation: the EU model, by Helen Murphy,

EU Commission Director-General of the Joint Research Centre Robert-Jan Smits spoke about what all countries agree on: that research and innovation are essential to prosperity — not just now, but even more so in the future.

He said European leaders are voicing the same message as President Obama, who in his recent State of the Union address linked innovation to “winning the future” — something he called the “Sputnik movement of our generation.”

Smits talked about the challenge of getting agreement among the EU’s 27 member countries on a growth strategy. But they have agreed; they’ve agreed to pursue growth that is smart (putting research and innovation at centre stage), sustainable (using resources efficiently and responsibly) and inclusive (leaving no one behind and creating new jobs).

The goal is ambitious: the EU aims to create nearly four million new jobs in Europe and increase the EU’s GDP by 700 billion Euros by 2025.

What I’m trying to say is that innovation is a big conversation and I hope that the expert panel for Canada’s current consultation on this matter will go beyond its terms reference to suggest that ‘housecleaning and tweaking’ should be part of a larger initiative that includes using a little imagination.

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