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Wealth through Technological Entrepreneurship

Background

In December 1997, the transistor marked its fiftieth birthday. No single technological development has had such profound and widespread impact on human society since the steam engine launched the Industrial Revolution. This simple static switch has made possible the programmable automation of billions of repetitive tasks affecting every aspect of economic activity. As one example, communications have been revolutionized, making the world in many respects a "global village". Many other technologies have also been transformed. In almost every field of human activity, the transistor has been the underlying catalyst for an exceptional growth in new businesses around the world

Computers, the most significant derivative of the transistor, have had a radical impact on the practice of engineering. In many areas, notably design, one engineer can now do the work of many in less time and ensure higher reliability in the result. In essence, computers have "liberated" engineers from mundane tasks, allowing them to focus on innovation and wealth creation.

These developments illustrate a climate where technological entrepreneurship is a vital contributor to national wealth. This is particularly true of Canada, with its dwindling resource sector and its heavy dependence on international trade.

By their education and experience, engineers provide an essential bridge between the continuous developments of science and the practical needs of society. With ready access to today's computing resources, engineers are well-equipped to translate scientific discoveries into useful products and services. They have the tools and the know-how to improve substantially the quality of our lives by innovating in goods and services and generating durable, knowledge-based employment.

A suitable environment that encourages engineers in Canada to work harder at innovating does require articulate leadership, informed understanding (especially among non-engineers) and a substantial change in public and political attitudes towards technology and its appropriate use in advancing Canada's economic condition and well-being. No G-7 country does less to encourage public interest and support for technology-based enterprise. Nevertheless, such endeavours are the basis of the New (knowledge-based) Economy and the opportunities it provides to those with appropriate skills.

The Canadian Academy of Engineering believes that these opportunities are best exploited in a competitive market place through technological entrepreneurship. The economic value of any new idea is the price users pay to obtain the benefits it provides. This is the essence of every innovation: it must prove its worth in a free market, with all the risks that this activity implies. Entrepreneurship engages engineers directly in the process of innovation, not merely as technology based inventors but as risk-takers seeking receptive markets for success.

Technological entrepreneurship is an efficient way of finding practical results for the discoveries of research. It rewards risk and innovation, provided the product or service has a market value higher than its costs. The technological entrepreneur must combine technical knowledge with other qualities and skills necessary for success. With better preparation and stimulus, more engineers can become highly effective entrepreneurs.

Canada's traditional economic strengths in natural resources have been seriously eroded in the past twenty years by rising costs in Canada; the expansion of lower-cost producers in other countries; the growth of global free-trade and a continuous improvement in the quality of life for most Canadians. Wealth creation in Canada has not kept pace with our rising expectations. In two decades, our national debt has ballooned to the highest per capita level in the world among the industrialized countries.

Part of this rising indebtedness is due to our large public investment in education. Canada ranks with the world's leaders in per capita spending on education and Canadians have the highest average years of formal education after the United States. While these learning achievements surely contribute to Canada's recognition by the United Nations as the best place to live, there is no doubt that we must do better economically if we are to sustain our fortunate status and hopefully continue to enhance it.

To be prosperous, Canadians must overcome real obstacles and build on strengths. This is not a new situation for us but, because of today's economic environment, the challenges are quite different and must be met in new ways. Whereas in the past much of our wealth has depended on large-scale activities, exports of raw or minimally processed materials and high capital investment, economic success today is increasingly knowledge-based and requires rapid adaptation to change. Capital, while not as intensive, is no less important but the processes to access it are not the same.

The most important source of the new knowledge that feeds innovation is engineering and scientific research. While Canada is near the bottom of G-7 countries in gross expenditures on R&D relative to GDP, Canadian universities perform a significant share of this effort. Beginning in the 1970's, several universities began to expand their research ties with industry, seeking both licensees and sponsors. Fifteen years later, as government funding for universities began to decline, most Canadian universities intensified the marketing of their research activities in a concerted effort to increase outside income. Despite some successes, the financial results of these efforts until now have been generally disappointing.

A pioneer in the development of university-industry collaboration in R&D, and member of the Academy, Dr. Roger A. Blais, professor emeritus at École Polytechnique de Montréal, has long been an outspoken champion of engineers as agents of technology transfer and innovation. He urged the Academy to promote the vital importance of technological entrepreneurship to the national economy. In the autumn of 1995, the Academy invited Dr. Blais to set up a task force to prepare a background report on issues and opportunities. Financial assistance for the project was provided equally by Industry Canada, NRC and NSERC.

The final report of Dr. Blais' task force, Technological Entrepreneurship and Engineering in Canada, was published in September 1997. It provides a remarkable insight and overview of this activity in Canada. Appendix A is the Executive Summary of this report. Its findings were discussed at workshops held in Toronto, Montreal, Vancouver, Calgary and Halifax.

Based on the work of Dr. Blais' task force and the workshops, this document presents the recommendations of the Canadian Academy of Engineering for the advancement of technological entrepreneurship in Canada.

Wealth through Technological Entrepreneurship