ARCHIVE: PRESIDENT'S MESSAGE
| Why a New Centre for Business Innovation? Anne Golden, President and CEO
The Conference Board of Canada | Over the past decade, Canada’s policy community has become smitten with innovation as the key to our future prosperity. It is through innovation that Canadian firms can make the productivity gains they need to be competitive and, ultimately, profitable in global markets. For public sector organizations, innovation is viewed as imperative to improving services while cutting costs—an increasingly pressing need in today’s turbulent and uncertain world. While most leaders have a sense of what innovation is, they don’t have a common definition of it or a deep understanding of how it works in practice within their own organizations. Nor have they figured out how to spur and embed innovation in their businesses. Federal and provincial governments have long sought to incent innovation through policy initiatives. Canada is recognized internationally for its strong record of public investment in research and innovation—through R&D funding, tax incentives, business tax cuts, and funding for targeted sectoral programs. However, the results have been mixed and governments are uncertain about what more they can do to achieve measurable improvements. While most leaders have a sense of what innovation is, they don’t have a common definition of it or a deep understanding of how it works in practice within their own organizations. There is now widespread consensus that business needs to step up to the plate. On the whole, businesses are not investing adequately in productivity-enhancing technology. Nor are they making the most of information technology’s capacity to bolster innovation. Firms are doing too little R&D, and they are slow to commercialize their research as products and services for the marketplace. Inventors who launch new companies find venture capital and entrepreneurial expertise in short supply. The firms that do succeed in creating new products and services too often sell out quickly to foreign-owned enterprises, with the result that their intellectual property moves offshore. For more than a decade, the Conference Board has been researching innovation and its impact on the economy. Since we began benchmarking the national innovation performance of the world’s leading countries, Canada has ranked near the bottom when compared with its global peers. In our 2010 How Canada Performs analysis, Canada placed 14th out of 17 developed countries and received an overall “D” grade. With “D” grades on 9 out of 12 indicators—measuring aspects such as invention (patents and trademarks), knowledge diffusion (technology exchange), and knowledge transformation and use (export shares of high-tech industries)—Canada has weaknesses that span the innovation continuum. The benchmarking results and the lack of improvement despite changes in tax and regulatory regimes have made us realize that real progress on innovation requires a better understanding of firm-level behaviour. That is why we have launched the Centre for Business Innovation (CBI), a major, five-year initiative to help bolster Canadian firms’ success as innovators. The first step to improving business innovation performance is to develop performance indicators and establish metrics that reveal innovation activity inside firms. We are beginning our work by taking up the measurement challenge issued by the Coalition for Action on Innovation, which called for an “agency to collect and analyze benchmarking and other data that would measure innovation and track results.” The first step to improving business innovation performance is to develop performance indicators and establish metrics that reveal innovation activity inside firms. The Centre’s research will delve into four other areas: business strategies for firms; capital markets; people; and public policy. Historically, Canada has a proud record of innovation. It was Canadians who developed the telephone, insulin, the snowmobile, Pablum, and the BlackBerry. Today, we need to renew our innovation impulse in order to meet the competitive demands of an increasingly complex global marketplace. Finding the answers to businesses’ innovation conundrum will allow us to regain our position as an “innovation nation” and ensure our future prosperity.
 | Anne Golden
President and CEO
The Conference Board of Canada |
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