Beyond Canada’s relative performance on a selection of high-level indicators, there is much room for improving our understanding of innovation in Canada. In response to this gap, we have developed the Capability-Centred Innovation Framework, which focuses on six categories of organizational capabilities and environmental factors related to firm-level innovation performance. These include:1
- General resources of the firm
- Management capabilities
- Workforce skills and human resource management
- Technological capabilities
- Markets and the environment for business innovation
- The public policy environment for business innovation
The Conference Board of Canada acknowledges the thought leadership, advice, and other important contributions from Alberta Innovates, the National Research Council of Canada Industrial Research Assistance Program, and Canada Economic Development for Quebec Regions to establish this proof-of-concept framework. In addition, these organizations were the first to apply and pilot this framework to their portfolios of clients. These efforts pave the way for a more nuanced understanding of how to strengthen Canada’s innovation performance.
Using data from a survey of Canadian organizations across Canada, we proxy firm-level innovation performance according to revenue and employee growth and have identified several capabilities important to innovation. For example, ensuring diversity within the management team, formally assessing management capabilities and expertise, and participating in daily R&D activities are all important factors that should be strengthened in organizations across Canada.
Another important consideration is the enabling role that not-for-profit organizations play. For example, they often administer grants and advisory services to help businesses iterate and validate their ideas. If Canadian governments want to spur businesses into action, they need to understand how to motivate and equip them for innovation success. Spending money on public R&D and fostering a healthy business environment is only beneficial to the extent that firms can use their capacity and resources effectively and efficiently.