Uh Oh, Canada: Innovation Alert!

Yikes. According to a report just released last week by The Conference Board of Canada, Canada is in big trouble. How Canada Performs: A Report Card on Canada compares Canada’s performance in several areas to other OECD countries and tries to come up with relative ratings and a national strategy.

The good news is that they gave Canada an “A” grade for education and skills training, claiming that Canada’s education system “works well for mainstream participants” but that it doesn’t serve the needs of the highly educated or innovative. From my experience, I agree. That’s better in some ways than systems that can’t even fulfill basic needs. But America has a thriving private school system and a system of scholarships that accompany it to reward excellence and encourage cutting edge thinking.

America’s education system produced 58% of the world’s Nobel prizes in science between 1950 and 2006: 206 awards. Despite criticism of America’s public system at the lower levels, it is firing on all cylinders at this higher level. Canada’s system produced a measly 6 Nobel prizes in science in the same 56 year period, a rate of only one prize every 9 years or so. Canada’s system produced as many winners as Australia, a country with only 60% of Canada’s population. Canada was beaten by Sweden, a country of only 9 million people (versus Canada’s 33 million). I’m being a tad provocative here, but so what if we’ve got good basic education? It just means we are graduating a bunch of highly educated bank tellers, franchise workers, and wait staff.

Canada’s education system is stuck in the middle tiers of mediocrity. It teaches mediocrity and it rewards mediocrity. It isn’t completely bad, it’s just not innovative. It doesn’t take many risks and it encourages students not to take risks. I’m puzzled about how that system can get an “A” grade. The big reason seems to be that a lot of people move through the system and get their secondary and post-secondary degrees, yet I think we need higher standards than that. This isn’t a world where having your high school diploma guarantees you anything anymore. Maybe a job working at Subway.

So that’s the good news.

Let’s move on to the not-so-good ratings. They give a “B ” rating to the Health system. I like what the Report had to write about Health, but think they are too generous to an outmoded system. But hey, they need to be politically astute. I don’t.

They cite a number of statistics to show that Canada provides a good basic level of universal health care, which it does. They also seem to factor in that Canadians think they have a great health care system. This conveniently ignores the truth: they’re misguided. Canadians also think that Americans suffer with a terrible health care system. But the Canadian system is on the verge of a breakdown, with wait times in emergency wards around me approaching 6 hours, insane delays for appointments with specialists and criminally long waitlists for important surgeries like heart bypass surgery. The care I got with the most basic HMO in Chicago completely kicked the lauded Canadian health care system’s butt. Basic care for diseases like cancer is okay according to the report, but not amazing. Now think about that. When you can afford the care (and that’s a big “if”, but bear with me) and it is you or someone you love that has cancer, I can only think that you want amazing care, not just sufficient care. In Canada, you can’t even buy better care if you want it. That’s illegal, and that’s nutso. The report finds that innovation is sorely lacking in health care, and is a key to its revival and success. Innovation is their common theme.

Now, to the really bad news. Among other things, Canada is not managing child poverty well at all; that issue is getting out of hand. Dashing the safe and happy Canada image portrayed in movies like Bowling for Columbine by Michael Moore, Canada has high burglary and assault rates. Organized crime is out of control in major cities. The country has a crime problem that no one wants to discuss.

And worst of all for future generations, Canada gets a D in terms of how it is managing its Environment. While there are some decent achievements in environmental protection, overall Canada deserves an F, not a D. Only two countries contribute more greenhouse gases per capita than the supposedly green Canadians: America and Australia. The Conference Board again makes a stand for innovation, saying that with the right initiatives, Canada could be building a green economy that would lead to all sorts of benefits. I think they’re right.

The bottom line is Canada’s D in innovation. Canada ranks far behind smaller counties like Switzerland, Sweden, and Finland, and behind powerhouse economies like America and Germany. Canada has been depending on its natural resources for far too long and is squandering its greatest resource: a highly educated and well-trained workforce. Many countries have done much more with less. It’s a cultural problem. A problem of motivation. As the report says “This culture holds Canada back in entrepreneurial and technological innovation.” Across the board, the system punishes risk takers and encourages mediocrity.

Canada’s performance across all measures of innovation is “consistently poor.” As the report says, that poor performance is beginning to seep into every other aspect of Canadians’ lives. It has a direct impact on the economy. It leads to an aging and outmoded health care system and weaker social services. It shows up in a mediocre, risk averse education system. And old methods and a reliance on outdated technology mean a dirtier and unsafe environment.

The report says that Canada desperately needs a “national vision” that will encourage innovative behavior. I couldn’t agree more. And a good place to start would be Canadian business schools. As I learned in my last two years teaching MBAs in Toronto, Canada has outstanding students with excellent basic skills and lots of good ideas. As I raised the bar on them, they could handle most of what I threw at them. In the span of a semester, they achieved great things like creating new products (in a few cases suggesting new industries), estimating demand for entirely new products, using innovative methods like netnography and visual metaphor elicitation to get a read on current trends and insight into consumers’ tacit needs, and editing consumer videographies. They received b-school education at the highest levels.

Unfortunately, most of them weren’t rewarded with the great jobs they deserved. I taught them cutting edge marketing and management techniques that most of them simply were not able to apply in their Canadian jobs, because the scope of those jobs was so limited. It wasn’t simply a function of their management level, either. My MBAs from University of Wisconsin and Northwestern simply had more choices of jobs with much wider and more innovative marketing scope.

One of the reasons I chose to come back to Canada and work at the Schulich School was the high rankings and attention that Schulich was getting for its emphasis on integrating environmental and social issues into a business school curriculum. For some details, see the recent Beyond Grey Pinstripes report. But it’s crucially important that the students get good jobs so that they can apply that worldview and use those techniques.

I’m currently working on three initiatives to try to make progress for our students by working with industry and with the school to come up with new programs to teach and help implement innovation. These programs need to work with industry to ensure a relevant education and that we have good placements for students when they are done. We want the education to have real impact, impact that can be realized.

1. I just finished teaching one of Canada’s first Word of Mouth Marketing courses. The course ran in collaboration with Sean Moffitt of Agent Wildfire, one of Canada’s leading thinkers and innovators in the area, and the founder of one of Canada’s top WOM Marketing firms. Along with Sean’s help, I had students placed working with Starbucks, Nike, HarperCollins publishers, a CBC/Discovery Channel Documentary called Gamer Revolution, and the interesting nonprofit Rethink! breast cancer. Together, the 5 student teams came up with some dynamite marketing plans that ran on shoestring budgets with high-level thinking and ingenious ideas. I’m a true believer in WOM as a source of major marketing innovation. The results of the inaugural year of WOM Marketing were a major success, and I plan to follow the course up with another version next year.
2. The next initiative is a brand new MBA level course in Innovation and New Product Strategy at the Schulich School of Business that will launch in Winter 2007.
3. The third one is the biggest initiative of all. Along with a number of faculty and other people I’m spearheading a plan to start a new degreed program exclusively in the area of Consumer-centered Innovation. I hope this program will be among world leaders in implementing ideas that cross functional lines and disciplinary areas and lead to applications of breakthrough thinking.

Canada isn’t the only country in trouble. I think that what the report is saying in general applies well to almost every nation, maybe to our entire species. We need new thinking and new governance systems. Across the board. We need innovations that will help us rapidly change our culture and our systems to a more sustainable social system. We need a nimble and innovative global economy, and a cultural system that helps us use resources wisely and live within our means.

In a previous post, I had an idea that would help consumers to see environmental impacts of the products and service they buy. Imagine the kinds of innovation such a system would begin to spur. Imagine the other innovations we could come up with and implement if we put our minds to it.

Education has a huge part to play in all of this. So does business. Academics, particularly those in business schools, are well placed to have an impact on these matters. I welcome collaborators in all of these areas from next door and from across the world. And as always I welcome your comments.

This entry was posted on June 19, 2007 at 10:01 am and is filed under Innovation & Creativity. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response or trackback from your own site.