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Susan Ward

Why Canadian Businesses Suck at Innovation

By September 14, 2013

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Canadian business's general failure to be productive and innovative is a long-standing problem - a problem that has produced countless studies over several decades now.

But Micheál Kelly, the Dean of the School of Business and Economics at Wilfrid Laurier University, says that the bulk of these studies bemoaning our lack of innovation, with their recommendations for doing things such as increasing private-sector investments in R&D, providing support for venture capital and investing in science and technology talent, are missing the point;

image of lightbulb and pencil to represent innovation.

if we want more innovation, what we need to do is focus on management skills and knowledge (If only geniuses knew how to run a business, Financial Post).

Seventy-one percent of firms that fail fail because of poor management, he points out, and a number of studies have highlighted that technology startups in Canada suffer from deficient business and management skills particularly compared to U.S. companies.

Further, as "a key objective of a successful innovation policy is the growth of Canada's technology-based firms into global competitors... our relative failure to do this is seen as a key factor in our poor R&D and productivity performance."

So what do we have to do? Emphasize the development of business and entrepreneurial skills in our education system, says Micheál Kelly.

Granted, Mr. Kelly may have a vested interest here, but his argument is compelling. All the technical expertise in the world won't automatically make you a good business person.

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September 14, 2012 at 2:26 am
(1) Canucklehead says:

This is not a new issue for Canucks and now seems to be ingrained, as well as substantiated in a recent international report that Canada lags in innovation and R&D. It seems some of the best (?) recent innovative suggestions are to resurrect the old Avro jet that never made it, or to resurrect our winning the War of 1812 in commemorative coins that will surely irk the eagle to the south of our exposed derrières…sshhheeessshh! Call it complacency, or ‘nice’ Canucks have resolved to finish last (not in hockey…yet), or we accept our Governments over regulating us (bright minds bent on stopping others), or over taxing profits (vs. incentives) for innovations, etc. There are lots of reasons/excuses that could be posted. I agree there is need to re-energize an entrepreneurial spirit across Canuckland and to ensure that our bright-minded persons are equipped with proper educational and management skills to see and seize opportunities. We also need the means to support and promote innovation to fruition, versus watching it get swooped-up by eagles to the south of us. We also need to ditch the attitude of being bearers of natural resources to foreign companies and become strategic (like China, US) about retaining ownership and selling only the fruits of our labour (dont sell tree that bears fruit). Just as this has grown over decades from general complacency and allowing ineffective governments to implement short-sighted laws and regulations, the solution needs time and effort to create a stimulating environment for the bright minds of Canucks to once again gain control over their bright ideas, resources and futures. Unfortunately, I don’t see any clear minds or team players in key places across our great horizon to lead this charge for our future. In the meantime, go Avro and yeah 1812 eh…sshhheeessshh! Simple musings of a Canucklehead.

September 14, 2012 at 12:30 pm
(2) I was lucky says:

I find myself lucky since I spent years working for technology companies that had bad management. I saw management (engineers) that would do things like price products based on some stupid equation they made up instead of pricing based on what the market would bear. Building a product, then for no reason building a new cheaper (less profitable) product effectively making their previous product obsolete. One company shipped their products in used grocery produce boxes to save a few bucks. Another company an engineer owner tried to do company accounting and taxes which was a disaster. After 12 years of seeing business decisions done ‘wrong’ resulting in those companies failing, I started my own company and within 7 years I was making profits most companies would die for. So yes I 100% agree it is management that makes a company successful. Universities and colleges would be doing everyone a big favor if they ditched some of the less relevant courses and focused on business operation, marketing, basic accounting. Even if the graduates did not start their own business having a background on what their future employer is trying to achieve would make them better employees.

September 14, 2012 at 1:10 pm
(3) Susan Ward says:

Ah, ‘Canucklehead’ – you say it so well!

September 14, 2012 at 1:16 pm
(4) Susan Ward says:

Thanks for sharing these great examples of poor management, ‘I was lucky’. And “graduates having a background on what their future employer is trying to achieve would make them better employees” is another strong reason for incorporating more business basics into the curriculum.

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