2019, Volume 4, Issue 1 - Summer 2019

Prairie Innovation: A Keystone of Manufacturing Success

The Prairies are a hotbed of innovation, but is our walk nearly as strong as our talk?

By Jayson Myers

Maybe it’s the water… or the fresh air. I think the wide-open spaces make a big difference. So, too, do the long distances between communities and the diversity of people who call Western Canada home. For me, the Prairies have always been a hotbed of innovation.

The grandeur of the environment makes a natural impression on the Prairie spirit, as does the need to overcome the challenges of climate and geography. The prominence of Prairie agriculture and Western Canada’s resource-rich economy have helped engender the type of practical problem-solving that is at the heart of innovation. Of course, they have created ready markets for innovative manufacturers as well. From a business point of view, there’s simply the need to create value for customers in a fiercely competitive global market – no one in Western Canada can grow their business without reaching beyond local customers.

From the oil sands, agricultural equipment, and aerospace to artificial intelligence, nanotechnology, clean tech, additive manufacturing, and advanced forming and welding technologies, the Prairies are home to some world-leading innovations. We need to do more to recognize and celebrate those achievements and draw attention to them around the world.

Two recent surveys underscore just how innovative the Prairie provinces – and Prairie manufacturers in particular – actually are.

The first was published in March of this year by Statistics Canada. It is a survey of how companies in all business sectors across Canada use advanced technologies related to materials handling, production and processing, design and information control, environmental management, security, and business intelligence. It also looks at the use of emerging technologies like sensors, advanced materials, the industrial internet, artificial intelligence, nano- and biotechnologies, blockchain, geomatics, and 3-D printing.

The survey found that more than 58 per cent of Prairie manufacturers have invested in advanced and emerging technologies over the past three years. That’s relatively higher than the 55 per cent of manufacturers that invested in new technologies across Canada as a whole, and it’s a significantly higher adoption rate than the 46 per cent of companies from all business sectors in both Western Canada and across the country that report using innovative technologies.

In fact, Prairie manufacturers have the highest level of technology adoption in the country. Quebec checks in second at 55 per cent; Ontario comes next at 54 per cent; and the Atlantic provinces at 43 per cent.

What sectors of Prairie manufacturing are leading in technology adoption? The answer may be a little surprising – or maybe not if you know many of the leading companies in the sector. Wood products, paper, furniture, electronics, and medical devices all have above average rates of technology investment.

The second survey was published in early May by the Rideau Hall Foundation, the organization established by former Governor General David Johnston to inspire and mobilize ideas, people, and resources across Canada to help realize our shared aspirations, particularly when it comes to innovation.

It’s a study of attitudes and engagement around innovation – in finding new and better ways of doing things. First off, it shows that Canadians are very optimistic when it comes to the benefits of innovation. Close to 80 per cent of us believe that diversity and collaboration are unique strengths that influence our innovation culture. Nearly one in three Canadians would position the country among the top innovating nations in the world, and the business sector is viewed as the most important innovating sector, especially in Western Canada.

So far, so good. However, the survey also identifies some important challenges when it comes to acting on even the best of intentions. While 82 per cent of western Canadians say that it is important to take risks in order to come up with new ways of doing things, fewer than half would actually be willing to take those risks themselves. Over 70 per cent say that they are open to using new technologies, but only 48 per cent are willing to pay more for them.

While a large majority of people across the country see collaboration as a crucial factor enabling innovation, fewer than a third say that they are comfortable partnering with others. This is very much in line with another Statistics Canada survey published a couple of years ago that investigated the innovation practices of Canadian business. It found that only 23 per cent of Prairie manufacturers regularly build collaborative relationships to lower the risks involved in innovation. That’s far higher than other business sectors, but slightly lower than the Canadian average. Manufacturers in Western Canada are more likely to collaborate with universities, colleges, or with government agencies than with each other or with other business partners.

It’s clear that there is a disconnect when it comes to translating good intentions into real outcomes. Statistics Canada points out that even when manufacturers do invest in advanced technologies, 40 per cent or more do not achieve their business objectives. There are real challenges when it comes to business strategy, management, and execution.

David Johnston emphasizes the importance of ownership when it comes to innovation and decision making. He’s right. The mark of successful innovation is not just the fact that companies are investing in advanced technologies, but that they are deploying them successfully in their business to add customer value, compete, and grow.

Jayson Myers is the CEO of Next Generation Manufacturing Canada — the country’s advanced manufacturing supercluster. An award-winning business economist and leading authority on technological change, Myers has counselled Canadian prime ministers and premiers, as well as senior corporate executives and policymakers around the world.