Collaboration for innovation: Canada has a substantial number of innovative universities and private companies working to make an impact on the global stage. In the fight for limited funding and a shrinking pool of talent, these organizations are working together more often to improve the strength of their business community in general. Such associations are only going to become more important in the future.

In the December 2004 issue of Fast Company, writer Alan Deutschman noted an important trend in the high tech industry. According to his report, Silicon Valley insiders are eyeing China and India in a new way. No longer are these countries simply viewed as destinations for outsourced customer service centres and cheap manufacturing.

"India and China are launching high-tech companies that will innovate brilliantly--and will bring their creations first to consumers in their own lands, often bypassing our shores entirely," says Deutschman.

This type of direct competition will demand more from Canada's universities and the private sector. Now, and well into the foreseeable future, collaboration will be one of the most important words in business relationships. Tech and trade organizations will have an evermore important role in creating links within the community and leveraging the talent available to drive innovation.

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Tech transfer

The C4 project in southwestern Ontario is a good example of collaboration at work. The University of Western Ontario, the University of Guelph, the University of Waterloo and McMaster University recently signed a Memorandum of Understanding (MOU) to collaboratively protect and commercialize technologies deriving from research at each institution.

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The initiative is based on a joint vision for coordination, cooperation, collaboration and commercialization (hence the working name, C4). By sharing resources and expertise, the universities hope to establish broader partnerships, apply jointly for funding opportunities and more effectively market and commercialize technologies. The group also has plans to extend an invitation to other universities in southwestern Ontario, further expanding the commercialization network.

"Working together allows us to tap into a wider talent pool by maximizing each other's areas of expertise, which makes this a significant venture for each institution," says Nils Petersen, Western's vice-president of research.

The MOU will provide a framework for enhancing the universities' ability to work collaboratively to obtain federal and provincial support for individual and joint projects--basically, as a group, they are more attractive for funding organizations.

As Douglas Keddy, communications and public affairs manager for University of Western Ontario, notes, "we are being challenged by funding agencies to find either other forms of funding or justification for the funding we're requesting. For instance, a new nano-fabrication laboratory that we have attempted to find funding for a couple of times is now being created because we have this consortium. As a group, we are more appealing."

But the critical point is that innovative ideas may reach the commercialization stage sooner when these organizations work together. "The research and innovation capacity collectively represented by our four universities is being strategically positioned to better capture opportunities for knowledge transfer and commercialization," explains Alan Wildeman, vice-president of research at the University of Guelph.

Evolution of an idea

Paul Guild, vice-president of university research at the University of Waterloo noted at the announcement of the C4 project that his university had "long been advocating that institutions can improve their knowledge transfer by working with partners and by building on innovation strengths within geographic regions." This is a critical lesson that many Canadian communities can and are benefiting from.

For instance, our feature profile this month, Stephen Palmer, CMA, FCMA, of Whitehill Technologies, is involved with the Greater Moncton Knowledge Industry Network (GMKIN), an advisory group representing 80 tech companies and more than 2,000 employees in the Moncton area. The GMKIN's marquee program is its mentoring program, known as Rising Stars. But the organization is also encouraging the development of innovation networks among the government, private sector and universities.

The GMKIN is following the lead of other successful organizations across Canada that are gathering together the innovators in their communities to create learning and growth opportunities. Two prime examples of this are Communitech in the Waterloo region of southwestern Ontario, and the Ottawa Centre for Research and Innovation (OCRI) in Ottawa. Although these organizations are primarily in place to encourage the development of the high tech industry within their communities, their influence and importance go well beyond that seemingly simple responsibility.

OCRI is the older of the two organizations. It was created 20 years ago to bridge the gap between federal and private research agencies. Gradually, it became inclusive of the university community in the region, which wanted to partner with the tech sector to encourage innovation. Currently, about one third of OCRI's programs are in the education sector.

Part of OCRI's work is also to promote Ottawa as a tech destination in the U.S. and overseas. The biggest step the organization has taken in the last few years to support this effort was in 2000, when it merged with Ottawa's economic development organization. As OCRI's president, Jeffrey Dale, notes, "Both organizations were out promoting Ottawa as a knowledge centre. The two boards realized that they could merge their organizations. Through this, the education sector was also able to expand its international opportunities. For instance, through OCRI's promotional efforts, Carleton University has been able to develop a number of joint projects with the Univeristy of Arizona in Tucson."

Dale notes that this sort of collaboration across borders is indicative of the new economic development model that's driving the tech business.

"Economic development used to be about discussing a community as an investment attraction--in other words, encouraging companies to move their plants into a neighbourhood," says Dale. "Now, it's a different model and has more to do with access to people. For instance, Ottawa and the Raleigh / Durham area have a good relationship. Back and forth discussions between communities and companies within those communities has become self-generating. There are currently 12 companies operating in Ottawa and the Raleigh / Durham area that arose from such discussions."

OCRI is currently working on opportunities of this kind in Europe and South America as well, while also exploring a China strategy. "We are asking the companies in our community where they feel they have synergies in China--whether it be Shanghai, Beijing or Hong Kong, that's where we'll aim our efforts."

To support the growth of companies within the community, OCRI runs, among other services, a venture capital fair, which involves a number of U.S. venture capital firms. Mentoring and advising services for entrepreneurs and tech employees in the region are available as well.

OCRI also lends support to education and volunteer programs, including school breakfast programs and education programs that bring retired and working professionals into schools to encourage literacy. Thus, through a variety of programs, OCRI supports its constituents by improving the well-being of its tech workers and using its business networks to create a better quality of life in the wider community. Perhaps the most impressive manifestation of this work is SmartCapital.ca, a virtual collaboration tool for the Ottawa community. This provides online access to university libraries, museums, OCRI's services for small and medium-sized businesses, free e-mail services, and online tools for cultural, recreational and special interest groups.

"It's important for any organization like ours to keep focused," insists Dale. "Although we are involved in volunteer programs and improving the technology infrastructure of our community, the focus is primarily on the export community--how we grow the economy. The local chamber of commerce takes care of local business--the retail sector, restaurants, etc."

But Dale is perhaps being a bit modest in this regard. Although everything his organization does is there to promote the city's tech savvy, at the same time it boosts the city's appeal by making it, for lack of a better word, user friendly.

Waterloo's adaptation

Communitech has done a lot to emulate OCRI's development model. With a strong base of Universities like Waterloo and Laurier, and the business savvy of tech professionals from firms like Research in Motion and Open Text, among a host of others, the organization has the benefit of serving a powerhouse of high tech companies and research institutes in diverse fields. Still, with competition as fierce as it is among tech clusters in North America, the organization does have a number of important roles to play.

"We are serving the community in three distinct ways," says Iain Klugman, president of Communitech. "Number one, we provide leadership on bigger issues. For instance, we're about 1,000 tech people short in the community right now. We are out looking for engineers and designers we can draw to the community. At the same time, we're making sure that we have enough venture capitalists talking about the area so that there's support for new and second and third round venture financing. We also take an interest in broader community issues, such as transportation concerns, and services available to the community--for instance, having enough physicians to support the community."

The second and equally important focus of Communitech is to be a hub for the community--an organization through which people can meet each other, and get advice about how to take their ideas or business to the next level. Communitech organizes an entrepreneur boot camp, leadership conferences, peer-to-peer networking, venture support services, and a variety of special events.

"I think of it as building a farm team of entrepreneurs and giving them the nuts and bolts to get started," says Klugman.

The third role the organization plays is as a promoter of the community as a world class centre, in Canada and overseas. The organization is currently launching a recruitment campaign that will take it through Ontario and into the U.S. "India may also offer recruiting opportunities," says Klugman.

Tim Jackson, founder of venture capital firm Tech Capital, based in Waterloo, believes that there are a lot of places where Communitech's sales pitch for the area will really resonate.

"The University of Waterloo and Wilfrid Laurier University have coop programs that often make recruitment somewhat easier," he says. "Students from those programs might end up working anywhere in North America. When the region gets publicity, somebody working in Silicon Valley might understand better the many excellent advances being made here. That might just make them think about coming back. That's a big part of what Communitech can do--repatriate a lot of ex-patriate Canadians. There is an example of one company that, on the power of relationships with grads from here, hired a whole development team out of Texas. It's clearly a possibility."

Klugman agrees that there is a draw for former students, and Communitech can gain from that. "People might come back when they have kids," he says. "We have to offer them the right lifestyle, and we certainly do that. Even though this is a small city, it's not a bedroom community--there's lots to do. We also stress in our campaign the many opportunities there are outside of the tech sector--among insurance companies like Manulife and Sunlife, the Toyota operations close by, and more."

Jackson deals exclusively with companies in the Waterloo region. "It's a very good environment in which to do business," he says. "The University of Waterloo is by far one of the most entrepreneurial of universities. They have a very liberal intellectual property policy, so that we can negotiate directly with faculty and students. The industry is very diverse here as well, with wireless technology, photonics, the Institute for Quantum Computing--there are a lot of opportunities for entrepreneurs and a lot space for venture capital."

Jackson's company, as a very hands-on VC organization, aims to make two deals a year, which he believes is a pretty realistic goal. "Some people have this notion that if they've got an idea, they'll be able to get VC financing," he says. "Realistically, venture capital isn't appropriate for most people. But for those who are at the right stage, there is plenty of money to go around in the community.

"Communitech helps with mentoring and guiding entrepreneurs so that they understand what stage their ideas have reached," he continues.

OCRI and Communitech are an interesting amalgam of economic development organizations (though Communitech isn't strictly that), civic support groups and business associations. "I'm still trying to figure out a good elevator pitch," says Dale. "When you call yourself a collaborative organization, people's eyes just glaze over. We've called ourselves a rallying point, a business civic leadership program, a fifth pillar organization. We still need a description that people will understand over time."

Organizations like theirs, and arrangements like southwestern Ontario's C4, are creating important synergies that need to be exploited and built upon in Canada's business community.

Robert Colman is editor-in-chief of CMA Management.