Recently, “innovation” has become one of the most popular buzzwords in Canadian business, politics, and the economy. While there are many definitions of innovation, it can simply be stated that innovation entails revolutions to make the subject matter faster, more efficiently, or simply better than previous version, sometimes creating a completely new product/technology category altogether. Innovation is the ability to transform our world into an entirely new reality that brings with it new technologies, extends people’s lives, increases happiness, and enables a thriving economy.
We can all agree on why innovation is important. Innovative products and processes are what will define the rapidly advancing world that we live in. Those who are innovative and invest in innovations will dominate this new world, while those who remain in their ‘traditional’ ways of thinking will be left behind and face enormous barriers to success.
Canadian businesses have critical decisions to make now and in the coming years. Will they begin to develop an innovative mindset that guides direction and future growth? Will they make strategic investments necessary to empower their company’s innovation? Ultimately, each business must decide what type of company they wish to be in 10 years – the one that’s grown and remains ahead of the latest trends, or one that is struggling to keep up with ‘new world’ innovative leaders.
Government of Canada Urges Businesses to Develop an Innovative Mindset
In a recent Toronto Star article, Navdeep Bains, federal Minister of Innovation, Science, and Economic Development urged more businesses to develop an innovative mindset to stimulate our economy.
“The key to securing Canada’s place in the new industrial age is innovation. It needs to be among our defining values as a nation.”
– Navdeep Bains, federal Minister of Innovation, Science, and Economic Development
His rationale, based on a vision for Canada becoming a worldwide technology and industrial leader, focused primarily on the fact that businesses must begin to make strategic investments that enable innovation to occur. Should Canadian companies wish to remain competitive in the global economy 20 to 30 years from now, they must be prepared to drive innovation now.
Here are some of the key arguments that were made throughout the article:
The Canadian Economy is Positioned to Excel in an Innovative World
When you look at the Canadian population and business environment, it’s clear to see that Canada is uniquely positioned to lead the global innovation shift.
Canadians are some of the most highly educated people around the world, our scientific research institutions are highly regarded, and despite hosting only 0.5% of the world’s population, we produce nearly 4% of scientific research papers.
The business climate in Canada is equally supportive. The country’s tech startup scene is one of the most advanced across the world and tremendous support services exist for startups who wish to grow. Relatively low taxes and a strong regulatory environment support the creation of nearly 11,000 new businesses per year, of which an increased number are surviving their first few years and growing to become extremely successful.
Technology will Continue to Influence Production and Consumption
Think about how your business is currently using technology to enhance productivity, communication, and generate revenue. What would happen if all of that technology wasn’t available? Would your business be able to deliver great products or services to your clients?
Now think about how your business may use technology 10 – 20 years from now. Will your business sell new products or services? Are your margins increased from new productivity-boosting production, packaging, or shipping processes? Is your business able to service the Canadian market in addition to new export markets?
Technology will continue to shape the world around us in ways we might not fully understand yet. However, investing in innovation, whether it’s the development of new products or simply becoming more efficient, will ensure that your business remains successful in the new economic landscape.
Low Business Investment in Research and Development will Hinder Future Growth Potential
In 2012, Canada ranked 22nd in business research and development expenditures among OECD countries. Furthermore, Canada ranks second last in the G7 for this category of business spending. Despite all of the funding and support services available to help businesses make innovative investments, businesses invest into other areas that provide short-term benefits.
Businesses in Canada have already begun to feel the effects of this lack of investment. A relatively stagnant economy could be jump-started by investing in research and development of products and processes. Productivity could climb through investments in innovative equipment or production techniques.
Many companies are simply worried about the economy and afraid to make these investments since there is always some risk that the investments won’t provide a strong return. However it’s through investing in their business that companies can begin to feel the government’s support. There are a variety of Canadian government funding programs to support these investments, businesses simply need to know how to obtain them.