July 25, 2016—Toronto, ON
World-Leading Clusters and Partnerships
Hosted by Ilse Treurnicht
Area of Focus
Super clusters for business innovation and global reach, from idea generation to value creation:
- What is the right Canadian model for world-leading clusters
- How can we best select clusters
- How can we best support Canada's world-leading clusters
Highlights
Superclusters and connected regional clusters, need for anchor companies, talent centres, scale and critical mass, infrastructure, digital and connectivity, competitiveness on a global scale, promoting Canada's brand.
Summary of Discussion
Canada has many unique assets which it can build on (e.g. natural resources, cost-competitive research and development, strong education system, stability/predictability, quality of life, cultural diversity, etc.). However, Canada lacks population density, and needs to look at unique ways to create strong networks, and encourage Canadian talent/companies to remain/grow in Canada (capital and talent challenges).
There is a need for both superclusters and connected regional clusters, which reflect concentration of assets (research institutions, academia, startups, industry, government assets, incubators/accelerators, etc.) Clusters can be virtual (sector or expertise driven) or geographically concentrated (often multi-sector). Anchor organizations are necessary, and Canada should strengthen the clusters that have potential to be truly outstanding on a global competitiveness scale, because Canada is a small market.
Key Implementation Considerations/Challenges
Clusters: Modern clusters are globally connected and contain:connectivity, technology, advanced infrastructure, capital, and talent. Cities create this type of dense, cross-disciplinary environments, and are increasingly a magnet for young talent. Participants highlighted the need for a significant industrial core, one that will attract and/or grow threshold companies, and will amplify the capacity of the region, particularly in its area of concentration. Participants also discussed possible models of clusters (physical vs virtual). Need for design to be used in all sectors and for effective knowledge networks across Canada. Need for both clusters and superclusters, given large geography, urbanization and regional economic strengths.
Scale and critical mass: Participants noted conditions for scaling up included: concentration of talent, capital, leadership, receptivity to test/adopt/grow products, connectivity to global markets. Need to build competitive cooperation in ecosystems and the conditions to facilitate that, and create local champions. Need to focus on high impact, high potential firms and amplify 'hot spots'.
Access to capital: While early research funding in firms is accessible, there needs to be more investment in later stage R&D and growth capital. Need to look to firms capable of growth and strengthen them with collaborative R&D to accelerate their growth.
Market barriers: Participants noted that Canada's firms must have global market share in areas of strength. Canada lacks a sufficient number of large Canadian companies, and it was noted that there is instability if clusters are comprised of too much foreign investment. We need to focus on growing local anchor firms. There is also a need for a new approach to attracting foreign investment, gaining access to both local and global supply chains, and a customer base at home and abroad (especially in emerging markets).
Infrastructure: Participants highlighted the importance of having the right infrastructure in place, including information infrastructure. A portion of infrastructure funding should be earmarked for innovation and digital connectivity. Need for platform technologies as connectivity pieces, and for people networks that are digitally enabled.
Talent: Participants noted that successful clusters are talent hubs. They develop and attract talent. The social side is equally important, and there is a need for an academic feeder in a successful cluster. Universities will play a larger role in these ecosystems, they will be expected to do more to create the right environment and catalyze new collaborations.
Connectivity: Participants noted that this was more important than ever. Small clusters in regions could be connected to super clusters to create a network of clusters. Networking within and between the clusters and forums are important to get the community together to be exposed to, share and discuss novel ideas. We need effective virtual connectivity platforms (conferencing systems) to foster collaboration and access to critical expertise.
Indicators: We lack data on innovation economy activity. Actions and programs should have measurable outcomes. However, a big success is not always anticipated (caution about data-driven versus data-inspired). Success would be more scaling companies and anchor firms in multiple sectors. Consistent investments and long term vision are key indicators of the success of a cluster.
Top Ideas/Outcomes
Canadian Branding: We continue to lose people to the US and internationally.
Global Market Development: Government can facilitate increased foreign direct investment by developing a focused business strategy to raise awareness of Canada's talent and strengths internationally. Government policies should focus incentives in strategic areas, and target global market development where growth is (sectors, regions). Ensure clusters are highlighted as magnets in our approach.
Stability: All level of governments (federal, provincial, municipal) should align their policies and programs for maximum impact. Policies and programs should be a long-term plan (e.g. 10 years), but also agile to respond to rapidly changing circumstances. The federal government should invest in clusters that represent future opportunities, not simply in traditional industries.
Access to capital: Need incentives to retool clusters (transition strategy) as economy changes, building new connections with Canadian firms. Focus on scaling up firms, creating incentives to invest, and encouragement to stay and grow in an ecosystem.
Procurement: There is an opportunity to better use procurement by incorporating research and development/innovation considerations or having collaborative procurement (e.g. modelling on the SBIR in the US).
Criteria: Participants noted that Canada's clusters are sub-scale when compared to global peers. As a result, we need to be strategic. There is a need to focus on clusters that are strong against many criteria and that demonstrate exceptional potential. Governments must consider global market dynamics and accelerating technologies when considering investments in sectors.
Connectivity: Need for widespread, high speed broadband.
Talent: In order for Canada to be a destination spot for talent, a number of gaps must be addressed: innovation visas, access to mentorship, and closer collaboration with industry and community organizations to provide students with experiential learning opportunities (co-op, etc).
Intellectual Property: The development of leading intellectual property policies that support changes in the innovation economy should be supported. The intellectual property rights for researchers, companies, investors, and institutions supporting the research should be clear, fair to everyone and encourage collaboration and investment. Need increased awareness and knowledge of IP issues in the innovation community.