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The Way Ahead

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Tom Brzustowski

Chapter 6. Innovation in Canadian Industry

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“Wealth is generated most abundantly by producing tradable articles in which knowledge is embodied.”—John A. Schey

  • 1 On page A11, in continuation of a front-page story.

1The box shown below appeared in The Wall Street Journal on July 11, 2007.1

Philips Rx
• The situation:
As their core products become commodities, technology pioneers like Philips have looked to new areas, such as health care, for growth.
• The background: Philips’s medical systems unit has long made big equipment for hospitals. A new consumer-health division aims to directly target consumers-especially the elderly.
• What’s at stake: Mainly a seller of products, Philips must now learn to market services in order to win on the health-care front.

2The company in question is Royal Philips Electronics NV, a Dutch MNE (multinational enterprise) that had been one of Europe’s greatest successes, first in the electrical and then in the electronic industries. Philips has a great record of producing innovations, including the ubiquitous audio cassette introduced in 1963.

  • 2 We have a difference in usage here. In this book, products are taken to include both goods and serv (...)

3The box has some important things to say about industrial innovation. First, it points out that even a great technology company has to face the fact that its innovations eventually become commodities, as has already been discussed in Chapter 5. Second, it describes Philips adopting a new business model for future success, redirecting the company to a new market based on one of their established product lines. Third, it shows that to serve that market, they will move into offering services,2 blurring the traditional distinction between manufacturing and services. And finally, it shows the growing market influence of demographics and the aging of the population.

4The box reproduced above offers a good introduction to a discussion of innovation in industry.

  • 3 The classic “Innovation, The Attacker’s Advantage” by Richard Foster, McKinsey (1986) describes how (...)

5There are some excellent books providing managers with insight and guidance on industrial innovation,3 and it is not our intention here to venture into that space. Rather, we will consider some aspects of innovation and R&D, the role of design in D, the R&D spending by Canadian industry, and finally the road ahead.

The impacts of different sectors

6To begin, let us consider the impact of the various sectors of industry on the Canadian economy.

  • 4 Report on Canada’s Industrial Performance, Second Half of 2006, Micro-Economic Policy Analysis Bran (...)

TABLE 6.1 Relative economic impact of the main sectors of industry4

TABLE 6.1 Relative economic impact of the main sectors of industry4
  • 5 Statistics Canada, CANSIM tables 376-0001 and 376-0002, accessed from the Statistics Canada website (...)

7Table 6.1 shows that manufacturing is the leading exporting sector by far, with oil and gas, and mining placing a distant second. It is very interesting, however, to note that ICPST and other services to business together export as much value as the oil and gas, and mining industries. However, things look different in our balance of international payments.5 In 2006, for example, Canada’s balance of payments in goods and services was $36.1 billion, made up of a positive balance of $51.3 billion in goods and a negative balance of-$15.1 billion in services, mainly in travel and transportation.

8One more statistic will be useful. Industry Canada (see note 4) also reports the change in the contributions of various industries in the manufacturing sector to real GDP since the end of 2001. These are shown in Table 6.2. Nine industries decreased their contributions. What they have in common is that they all make commodity products.

9Eleven other industries increased their contributions to GDP over the same period. Many of these industries, particularly the ones with the highest increases, produce innovations and differentiated products. We shall come back to these observations later in discussing a long-term strategy.

Griller’s Framework

  • 6 “National Systems of Innovation: A Research Paper on Innovation and Innovation Systems in Canada,” (...)

10Thirteen years ago, David Griller6 proposed a framework for industrial innovation in Canada that is useful for guiding our thinking. It classifies industrial innovators into four categories, and applies equally to product and process innovations. The categories are: science-based, high-tech craft firm, systems integrator, and flexible technology purchaser.

  • 7 Those produced only for the domestic market.

11There are three further classifications of innovations that are very useful: (1) the distinction between manufacturing and services, (2) between traded and untraded7 products, and (3) among innovations that are world-first, Canada-first, or company-first.

12

TABLE 6.2 Changes in the contribution to real GDP since 2001 for various industries in the manufacturing sector

TABLE 6.2 Changes in the contribution to real GDP since 2001 for various industries in the manufacturing sector
  • 8 2(product or process) x 3(manuf., service to business, service to home) x 3(world-first, Canada-fir (...)

13Services, in turn, can be divided into services to households and services to business. Combining these distinctions with Griller’s four categories gives us a framework of different kinds of innovation that, in theory, can number 72.8 Fortunately, far fewer need be considered, since not all combinations make sense. For example, the makers of products only for the domestic market are not likely to invest in developing world-first innovations. And producers of services to households seem much more likely to innovate by purchasing technology than in any of the other three ways.

14While the four categories in Griller’s framework are listed as separate, they are not mutually exclusive, in the sense that more than one of them might be found in any innovative enterprise. Since innovation is invention with commercialization, the four kinds of innovation might be expected to differ both in the source of invention and in the process of commercialization.

  1. Science-based: The inventions of research-based innovators arise from their own research results, or from those of others obtained by reading the open scientific literature. Some established companies in high technology and many in pharmaceuticals/biotechnology, as well as start-ups in both areas, depend on research-based innovation for their competitive advantage; but commercialization is much easier for the established firms with established market reach. The innovations are likely to be in traded goods and services with export potential, since the cost of developing entirely new products starting from research results can be very high, and the Canadian market is too small for recovering them. Patents, licenses, and IP (intellectual property) management are important for research-based innovators. In the case of established companies with substantial R&D capabilities, the original invention can trigger a cascade of related enabling inventions that are patented and become the basis of a whole range of new products. This is very difficult to achieve in the case of a start-up based on a single invention.

  2. High-tech craft firms: In a craft firm the source of competitive advantage lies in the skills and knowledge of its workers. Inventions can arise in the course of making things, and trade secrets are generally more important in protecting the IP than are patents. Expensive projects with markets for only a limited number of units, (e.g., satellites in the aerospace sector,) provide one example. Such innovations are generally traded goods. They may be final products, or components for someone else’s system, or even process innovations in the form of new tools. At the other end of the spectrum of technological complexity is innovation by design or redesign. There the high-tech aspect of the craft probably resides more in the tools than in the products. The design department of a manufacturing company may be its main source of competitive advantage. Other examples of craft shops that depend on design to produce innovations in goods or services include advertising agencies, designer clothing studios, custom boat builders, etc. Depending on the ingenuity of the workers and on the particular markets served, world-first, Canada-first, and company-first innovations by craft firms are all possible, but some are much more likely than others.

  3. Systems integrators: Their inventions are made possible by the availability of products—artifacts, software, tools, etc.—available from suppliers. The system integrator contributes skills in analysis, design, adaptation, assembly, etc., as well as proprietary tools and methods that might come out of their own R&D. Innovation can take the form of developing a custom solution that uses available software and hardware components to meet one client’s particular needs and is sold as a one-off system (e.g., a custom IT system for a company). In that case, the innovation might be seen as a service provided by the vendor. At the opposite end of the volume spectrum, the innovation of a system integrator might be the design of a final product and its manufacture by integrating components from many suppliers, including some in-house (e.g., auto final assembly). In that case, the system integration would be counted as manufacturing. Lead time over the competition is the way such innovations are protected. World-first, Canada-first, and company-first innovations by system integrators are all possible.

    • 9 Small and medium enterprises; see note 13.

    Flexible technology purchasers: In this case, inventions arise from new uses of technology already available in the market. The biggest companies offering new service products created in this way are in telecommunications. In the case of SMEs,9 process innovations developed using the purchased technology seem more likely than product innovations. In either case, world-first innovations of either kind are unlikely, but not impossible. It all depends on the depth and ingenuity of the technology purchaser’s technical people, and their capacity to increase the added value in their products by the use of technology that is available to others as well. Canada-first innovations are more likely, particularly when the purchasers are among the first in the country to acquire the new capability, and marketing can often be the main means of maintaining advantage. Examples might be a new food-packaging technology that is a process innovation in the grocery business, or a new sawmill technology for the lumber industry. Technology purchasers can innovate in manufacturing or in services, in traded or domestic sectors; process innovations in commodity businesses to reduce costs are common. However, if they have substantial R&D capacity of their own, they can use purchased technology to create significant product innovations in any sector. And if they work closely with the producers of the technologies they purchase, world-first innovations may not be out of reach, (e.g., companies buying production equipment for “fabs” in which they manufacture microelectronic computer chips).

The R and the D of R&D

15Contrary to the impression that might be given by frequent joint labelling in economic statistics, “R&D” is not one thing. Research and development are two closely related but very different activities carried out by different people working in different places, within different cultures, for different purposes, at very different costs, and with very different risks. The expenditures reported under “R&D” spending are made up of two components that are not interchangeable, and are balanced very differently in the public and private sectors.

  • 10 The Canadian Oxford Dictionary, Oxford University Press Canada, 1998. The same thing is put slightl (...)

16At the highest level, research may be defined as the process of learning that which is unknown to anyone, anywhere. As used in R&D, development is defined10 as “the process of working up (an idea, product, etc.) for marketing etc.” It is an essential step in the commercialization of new products. The contrast between research and development is evident from the definitions, but it is more useful to show the differences in a list of the main features of the two processes. This is shown in Table 6.1. Evidently, it makes little sense to talk about R&D at universities. There is only research at universities, and no products are developed there. Contrived expressions such as “Big R and little d” or “little r and big D,” take only a small step toward greater precision.

17In reality, the cultures of research and development are so different that connecting them is difficult even within one corporation driven by a single set of goals. It is even more difficult when the task is to transfer the results of research from a university, whose goal is to create and transmit knowledge, to a corporation whose goal is to create wealth. Nevertheless, in Canada we have been learning how to do this, and we’re starting to get good at it.

18Recent changes in industry have produced some paradoxical changes in the relationship between R and D. At one time, many major corporations had their own basic research labs. These were the sources of new knowledge and ideas for the companies’ long-term growth. Among the best known were the Bell Labs in Murray Hill, N.J. and the General Electric Research Laboratory in Schenectady, N.Y., in both of which Nobel Prize winners could be seen in the corridors.

19However, most companies can no longer afford to support basic research. Because of the faster and faster commoditization of their products in the market, and the need to produce innovations more and more quickly in response, most companies have had to bring the capabilities of their researchers to bear on product development. Their R has come much closer to their D, and the earlier concern with ideas for tomorrow has been sacrificed to meeting the market pressures of today. This has produced organizational and cultural changes in which research capacity has been changed and inserted into product development, and embedding new knowledge in new products has been accelerated. In the terminology used here, project research has replaced basic research.

20Paradoxically, the changes that have brought research and development closer together in industry have created a greater separation between industry R&D and university research. The universities, and some government laboratories, have now assumed the responsibility for basic research—at public cost, of course. This poses a particular challenge to Canadian universities. They must combine this new level of responsibility for basic research with the need to undertake project research in areas where Canadian industry needs help, as will be shown in the next chapter.

TABLE 6.3 Research and development are very different

Research

  • long-term programs of exploration and discovery

  • in Canada done mostly in the public sector, with some exceptions

  • mainly the work of scientists, and some engineers

  • involves theory, experiment, and verification

  • consumes wealth

  • risk is scientific, and kept to a minimum through scientific peer review

  • open publication of results, international flows of information, some patents

  • successful research always leads to more research; it may also produce important and revolutionary innovations, but they are rare and unpredictable

Development

  • short-term projects with specific goals, often driven by market feedback

  • private sector activity essential to commercialization and innovation

  • mainly the work of engineers and some scientists

  • involves design and building of prototypes, testing and improvement, design for production

  • consumes wealth, generally much more expensive than research

  • risk is financial, and kept to a minimum through due diligence and good business practice

  • information closely held and protected: trade secrets, many patents

  • successful development projects lead to innovations and new wealth creation through sales of new goods or services

The role of design

21The discussion of the four categories of innovation suggests an additional way of looking at them. Craft shops, system integrators, and technology purchasers all engage in market-driven innovation. They respond to signals from the market. Research-based innovators are driven by new knowledge.

22Figure 6.1 shows the differences. Research results play a big role in research-based innovation and only a small role, if any, in market driven-innovation. And in the latter case, this might likely be market research rather than scientific research. On the other hand, market feedback is a big factor in market-driven innovation. Market forecast is important in both research-based innovation and market-driven innovation, but the feedback is available only in the latter case.

FIGURE 6.1 Comparing research-based and market-driven innovation

23Design is a key element of both kinds of innovation. It may be the design of an entirely new product, or the redesign of an existing one. Design is the intellectual creative activity of engineers, but not only of engineers. In this context, it should be thought of as the solution of a particular problem under a set of constraints, and embodying that solution in an appropriate artifact, system, or service. The designer’s first task is to study the needs of those whom the design is to serve, the environment in which it is to function, and the constraints under which that must be done. Cost is always a constraint, but only one of very many different ones. The needs to be served suggest the functionality of the design. The environment has many dimensions: physical, ergonomic, legal, cultural, etc.

24The designer’s challenge is different in the two cases. In research-driven innovation, the designer must develop an entirely new concept that will embed the new knowledge and transform it into the desired functionality to serve the customer. In the market-driven case, the designer must start with the existing product and improve the design in a way that will respond to the market feedback. The economic factors are different in the two cases. The challenge with research-based innovation is the large and risky up-front investment required to launch a new product to an unknown reception. The economic factors are less challenging when the market for the product is well known and the product is responding to demand, even if it is new. A redesigned, improved product carries even less risk. It has already been on the market, the marketing channels are established, and its sales record is known.

25Figure 6.2 shows the factors influencing design in market-driven innovation. The word (re)design is used to show that these ideas apply both to the design of new products or the redesign of existing products to improve them.

FIGURE 6.2 Design in market-driven innovation

  • 11 The word technology is often very loosely used, provoking not entirely frivolous quips such as “The (...)

26At this point it may be useful to review the Glossary (p. 171), which gives the precise meaning of some important words used in this chapter. Imprecise use of common words such as technology11 and innovation can sometimes lead to confusion and misunderstandings.

The cost of R&D

  • 12 “Science and Technology Data—2005,” Industry Canada, Policy Branch, March 2007.

27Compared with the other advanced industrialized economies, Canadian industry spends relatively little on R&D. This is indicated by BERD/GDP, i.e., the business expenditure on R&D measured as a fraction of the country’s GDR For Canada in 2004, BERD/GDP was about 1.15%.12 This compared with a high of almost 3% for Sweden, 2.4% for Finland, and 1.85% for the US. Of the countries included in the comparisons in Chapter 1, only the UK and the Netherlands were lower than Canada, but still above 1%. China came in at 0.85%, but with its BERD growing at over 20% per year, it will quickly move up in the ranking.

28The dollar amount of Canadian business spending on R&D in 2004 was $14.4 billion. This sum supported the work of 126,700 employees, providing wages and salaries, current operating costs, and capital expenditures. This works out to an average annual expenditure of $114,000 per employee.

29The R&D spending by Canadian industry is highly concentrated. The top one hundred R&D spenders are responsible for about 75% of the total. Even so, only the top company in that group, Nortel Networks, has ever made it into the world’s top 100. And within the Canadian Top 100, the Top 10 companies account for two-thirds of industrial R&D spending, or half of the national total. The cut-off for the Top 100 has been at an annual R&D spending between $14 and 15 million for several years. That means an R&D establishment of 100 to 150 people.

  • 13 “Canadian Industry Statistics,” Industry Canada, Strategis website, accessed July 19, 2007. Large e (...)

30These numbers, of course, say something about the rest of the economy. There are 600 large establishments in the goods-producing sectors of the Canadian economy and 109 in professional, scientific, and technical services,13 609 of them obviously outside the Top 100 R&D spenders. If all the remaining business R&D in Canada were concentrated in these 609 establishments, it would involve at most 31,600 R&D employees engaged in an effort worth about $3.5 billion. On the average, then these large establishments might operate with 52 R&D employees engaged in a $5.7 million enterprise. Since some medium enterprises and even some small ones are also engaged in R&D, these averages are actually smaller. This all adds up to a strong impression that in the large majority of Canadian companies the R&D capacity is spread very thin, much thinner than the weak national BERD/GDP would suggest.

31As pointed out in Chapter 4, a useful indicator of business R&D spending is the percentage of revenues spent on R&D, the so-called R&D Intensity (RDI). It introduces the connection between R&D spending and the frequency of innovation. In general, average RDI varies greatly from sector to sector. For example in 2003, it ranged from a high of 14% in the pharmaceuticals, biotechnology, medical devices and instruments sectors, to a low of 0.67% in natural resources and commodities. According to the Forgacs formula described in Chapter 5, this would mean a range of innovation frequencies from about one a year at the top to about one every two or three decades at the bottom.

  • 14 T.A. Brzustowski, “Innovation in Canada: Learning from the Top 100 R&D Spenders,” Optimum Online, V (...)

32Comparing this performance with the top R&D spending companies in the US and in the world reveals that Canadian companies as a group innovate the least frequently, and their sales revenues depend the least on new products.14

Now what?

33Various explanations have been offered for this state of affairs. “It’s all in the structure of our industry,” some will say. “We are strong in areas that don’t require much R&D.” Others point to the large number of branch plants in Canada, in industries whose R&D is done in the US and elsewhere. Interprovincial trade barriers, and federal-provincial relations that are not always as constructive as they need to be, have been identified as part of the problem. Social commentators decry Canadians’ lack of entrepreneurship and aversion to risk. Management education for too few, and maybe of the wrong sort, and a weak culture of commerce have also been identified as contributing factors. And there is always something that government has done, or failed to do, that can be assigned blame for the latest shortcoming. There’s some truth in all of that, but explaining the situation in so many ways too easily turns into justifying it.

34The fact remains that we are in the state that we’re in, and we need to change.

35The strategy of Philips cited at the beginning of this chapter has lessons for Canadian industry as well. The manufacturers of commodity products have not been doing well, as shown in Table 6.2. Philips reacted to the commoditization of their products by seizing a business opportunity provided by the conjunction of two factors: their experience in high-tech hospital equipment, and the aging of the population. Their solution was to create a new line of business based on a new product aimed at the needs of the elderly living at home—a smart personal monitor and alarm—and providing the communication services that connect it with the health care system.

36This business model is not new. For example, RIM does the same thing in selling the BlackBerry® handset through telcos and then working with them to deliver the BlackBerry® service to consumers. The BlackBerry® is a manufactured product with “a long service tail,” and the Philips monitor has the potential to become one as well.

37The Canadian manufacturers of commodity products should follow the lead of Philips, and begin reducing their dependence on commodities by innovating and introducing value-added products. This will not be easy. Their new business opportunities are not likely to be as clear-cut as in the case of Philips, and their R&D capabilities will most likely be far inferior, so they may need help. A few of them might be able to take advantage of the growing need for services in an aging population, but most may be limited to moving up the value chain of their present businesses. If they succeed, they will do themselves a lot of good, and contribute to raising Canada’s productivity in the process. The alternative is to stay in the commodity business and keep trying to cut costs.

Value-added manufacturing in the big picture

38How good is that last advice? Is it telling people to board a sinking ship? With the growth of services in the Canadian economy, the outsourcing of production to Asia, and the rise of the Canadian dollar relative to the US dollar, is Canadian manufacturing of any kind—commodity or value-added—not in imminent danger of becoming uncompetitive and unimportant, and disappearing from view?

39The answer to all these questions is that value-added manufacturing is so important to the economy, both directly and indirectly, that we must make every effort to help it continue in a healthy and vigorous form. That does not mean that it should continue without change, but it does mean that its huge contribution to the economy must be understood, maintained, and even increased.

  • 15 John A. Schey, Introduction to Manufacturing Processes, 3rd ed. McGraw-Hill, Boston, 2000.

40These are strong statements, and in their support I cite the very authoritative book15 by John Schey, one of the world’s great manufacturing engineers. Written at the University of Waterloo in Canada, this book has been translated into the languages of many of the industrialized nations of the world and has become one of the world’s most influential engineering textbooks. In its three editions, it has been used by hundreds of thousands of mechanical engineering students on their way to becoming production engineers. The following paragraph taken from Schey’s introductory chapter tells the story with striking clarity:

If one analyzes the components of the GNP, it is evident that the material wealth comes from only two substantial, basic sources: material resources and the knowledge and energy that people apply in using these resources. Agriculture and mining are of prime importance, yet they represent only 3-8% of the GNP of industrially developed nations. Manufacturing claimed the largest single share until the 1950s. Since then, much of the growth has taken place in the service sector, and recent data...would suggest that-at least in highly developed economies-material wealth is independent of the contribution of manufacturing to the GNP. This, however, is an illusion. What the numbers fail to show is that increasing wealth is based on an increasingly sophisticated manufacturing sector; this in turn creates the need for many similarly sophisticated supporting activities such as research, design, and financial services, distribution, maintenance, and field service of products, and even the hospitality and travel industry connected with manufacturing. For statistical purposes, all these supporting activities are classified as services. Yet, unless a nation is exceptionally well endowed with natural resources, a strong service sector can exist only if there is a similarly strong manufacturing sector. Only the interactions of the two can secure competitive advantages in a global economy where the simpler tasks migrate to low-wage environments. It is often said that, in the information age, knowledge is the most valuable commodity. This is quite true, but it is also true that knowledge itself can be bought relatively cheaply. Wealth is generated most abundantly by producing tradable articles in which knowledge is embodied, [emphasis in the original]

41That last sentence expresses the main idea on which this book is based.

A distinctive feature on Canada’s R&D landscape

42To complete this look at industrial R&D in Canada, we need to note two relatively recent institutional innovations that are already proving to be very valuable. They both rely on the ability of Canadians to create effective national networks of university researchers and their partners in industry and government. One such innovation is the program of Networks of Centres of Excellence (NCE), and the other is the “4th Pillar” organization, the first three pillars being industry, government, and academe.

43The 4th Pillar organizations are independent, not-for-profit corporations that leverage private and public funding to assemble networks of strong university-industry R&D collaborations and partnerships on a national scale. They focus on developing complementary industrial and university capacity in specific sectors, in order to achieve both world-class excellence in research and competitiveness in high-tech industry. They do this by sponsoring project research that exerts a market pull and involve students in working at the state-of-the-art, and by providing the most modern tools for them to use in their research and their studies. There are three 4th pillar organizations, and it is a measure of their success that each one has been instrumental in helping Canadian industry to achieve prominence in an important area of high technology: CANARIE Inc. in broad-band communications networks, CMC Microsystems in microelectronics and the broader area of microsystems, and Precarn Inc. in artificial intelligence and robotics.

44The NCE program is larger in scale and broader in scope. For example, in 2004-2005, there were 21 individual networks. The typical one involved between 50 and 100 professors from several dozen universities in Canada and abroad, as principal investigators supervising the research of 200 to 300 graduate students, postdoctoral fellows, research associates, and technicians. The small administrative centre of each network is tucked away on one host campus. Each network deals with one problem area, generally approaching it in a broad and multidisciplinary way, with partners from industry and government. The problem areas include environment, health, and technology. For example, the first five in the alphabetical list are networks on Advanced Foods and Materials; on Allergy, Genes, and Environment; on Aquaculture; on the Arctic; and on the Automobile in the 21st Century. The Canadian Stroke Network deals with topics ranging from the basic science of the causes of stroke to protocols for urgent emergency treatment of victims. The Mathematics in Information Technology and Complex Systems (MITACS) network works with companies in all sectors to help them adopt mathematical tools in their business. The Auto 21 NCE deals with passenger safety, with new materials and manufacturing methods, with energy efficiency and clean combustion of alternative fuels, with the regulatory domain, and much more.

45The NCEs have become a proven source of solutions in very complicated problem areas and of highly-qualified people (HQP) able to follow up. They also have the mandate and capacity to commercialize any IP emerging from their work that might have innovation potential. Perhaps the most sincere praise for the NCE program is the recent appearance of some very similar programs in the EU and elsewhere around the world.

46The NCEs and 4th Pillars are institutional innovations that Canadians developed to meet the need for critical masses of competence in important areas in a huge and thinly populated country. In a physical sense they are virtual institutions whose members and facilities are distributed across the land. But in the intellectual sense they are very real and strongly connected. Both of them must be counted among Canada’s strategic assets, as we work toward a more prosperous future.

Notes

1 On page A11, in continuation of a front-page story.

2 We have a difference in usage here. In this book, products are taken to include both goods and services, but in the third bullet in the Wall Street Journal box “product” clearly means a good or an artifact.

3 The classic “Innovation, The Attacker’s Advantage” by Richard Foster, McKinsey (1986) describes how to decide when to stop investing in improving a product and move on to developing a new one, and foreshadows some of the ideas later developed by Christensen. “Innovator’s Dilemma” by Clayton M. Christensen, Harvard (1997) discusses disruptive vs. sustaining innovations through case studies from various sectors. “Dealing with Darwin” by Geoffrey A. Moore, Portfolio (2005) describes how great companies innovate at every phase of their evolution.

4 Report on Canada’s Industrial Performance, Second Half of 2006, Micro-Economic Policy Analysis Branch, Industry Canada—downloaded from the Strategis website, July 2007.

5 Statistics Canada, CANSIM tables 376-0001 and 376-0002, accessed from the Statistics Canada website July 13, 2007.

6 “National Systems of Innovation: A Research Paper on Innovation and Innovation Systems in Canada,” National Research Council of Canada, Corporate Planning and Evaluation, April 1994, 78 pages. David Griller and le Groupe SECOR Inc. did the research, summarized on p. 28.

7 Those produced only for the domestic market.

8 2(product or process) x 3(manuf., service to business, service to home) x 3(world-first, Canada-first, company-first) x 4(science based, craft shop, systems integrator, technology purchaser) = 72.

9 Small and medium enterprises; see note 13.

10 The Canadian Oxford Dictionary, Oxford University Press Canada, 1998. The same thing is put slightly differently in the table of definitions later in the chapter.

11 The word technology is often very loosely used, provoking not entirely frivolous quips such as “The First Law of Technology Transfer is that first there must be technology.”

12 “Science and Technology Data—2005,” Industry Canada, Policy Branch, March 2007.

13 “Canadian Industry Statistics,” Industry Canada, Strategis website, accessed July 19, 2007. Large establishments have more than 500 employees; medium establishments have 100 to 499, small ones from 5 to 99.

14 T.A. Brzustowski, “Innovation in Canada: Learning from the Top 100 R&D Spenders,” Optimum Online, Vol. 36, Issue 4, December 2006.

15 John A. Schey, Introduction to Manufacturing Processes, 3rd ed. McGraw-Hill, Boston, 2000.

Table des illustrations

Titre TABLE 6.1 Relative economic impact of the main sectors of industry4
URL http://books.openedition.org/uop/docannexe/image/1744/img-1.jpg
Fichier image/jpeg, 216k
Titre TABLE 6.2 Changes in the contribution to real GDP since 2001 for various industries in the manufacturing sector
URL http://books.openedition.org/uop/docannexe/image/1744/img-2.jpg
Fichier image/jpeg, 188k
Légende FIGURE 6.1 Comparing research-based and market-driven innovation
URL http://books.openedition.org/uop/docannexe/image/1744/img-3.jpg
Fichier image/jpeg, 60k
Légende FIGURE 6.2 Design in market-driven innovation
URL http://books.openedition.org/uop/docannexe/image/1744/img-4.jpg
Fichier image/jpeg, 63k

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