Jim Balsillie’s band of innovators and technologists is tiring of Justin Trudeau’s approach to the digital economy, mostly because they’ve become unsure if the prime minister actually has one.
“I was one of those people, when Trudeau was getting elected, who was invited to meet with him,” said Carol Leaman, chief executive of Axonify Inc., a Waterloo, Ont.-based maker of employee-training software. “I had great hope that we would see more of a focus on innovation and support locally. It really has fallen away.”
Leaman is one of 132 leaders of fast-growing companies who signed an open letter to Trudeau on Oct. 27 that accuses his government of drift after promising a half-decade ago to re-establish Canada’s place among the world’s most innovative economies.
The letter was penned by the Council of Canadian Innovators (CCI), which Balsillie, the former co-CEO of the company that created the BlackBerry smartphone, helped create five years ago because he felt companies such as the one he used to run were being shut out in Ottawa.
CCI has had success changing the nature of the policy conversation, but results remain elusive. The letter cites the 2020 Bloomberg Innovation Index , which ranked Canada No. 22 in its ranking of innovative countries. That’s a long way from the top tier.
“When your government took office in 2015, we received encouraging signals that you understood the importance of Canada’s overdue transition to a knowledge economy,” said the executives, including Dax Dasilva of Montreal-based Lightspeed POS Inc. and Kevin Edwards of Winnipeg’s SkipTheDishes Restaurant Services Inc.
“But in the years since 2015, innovation is barely mentioned,” they continued. “We see less of a bold, cohesive plan for innovation in Canada and more of a patchwork — pilot programs and furtive policies rolled out in hope they will amount to something greater than the sum of the parts.”
Trudeau’s election originally looked like an opportunity for Canada’s technology industry, which insists the rules of the game it plays are different than those that apply to activities such as resource extraction and traditional manufacturing.
The previous government, led by Calgary-based Conservative Stephen Harper, had a soft spot for traditional industries such as oil and gas and had an ideological aversion to using government policy to pick winners.
Trudeau, by contrast, said he wanted Canada to be known for its “resourcefulness,” not just its resources. His government set up myriad programs meant to accelerate young technology companies, including the Innovation Superclusters Initiative, which put up nearly $1 billion to create five new-economy hotbeds across the country.
The approach mirrored the one that Balsillie had long argued was necessary to keep pace in a global economy that values intangibles such as intellectual property far more than commodities and automobile parts.
The countries at the top of Bloomberg’s innovation list have no problem using policy and the public purse to tilt the playing fields of emerging industries in their favour. Balsillie believed that Canada had a choice: join them, or get left behind as corporate behemoths such as Alphabet Inc. and Alibaba Group Holding Ltd. take over from Exxon Mobil Corp. and General Electric Co.
This isn’t about growing the technology industry. This is about growing industries’ technological capability
Greg Malpass, CEO, Traction on Demand
“Let’s build a real strategy,” said signatory Greg Malpass, chief executive of Traction on Demand, a Burnaby, B.C.-based developer of workforce management software. “This isn’t about growing the technology industry. This is about growing industries’ technological capability.”
Trudeau’s failure to impress the country’s most prominent tech lobby is emblematic of his troubled relationship with business generally.
Established groups such as the Canadian Chamber of Commerce and the Canadian Federation of Independent Business tend to prioritize tax cuts and balanced budgets, which haven’t figured that much in the current government’s economic agenda. Tension was expected.
CCI, on the other hand, often pushes a more interventionist agenda that sometimes clashes with the free-market orthodoxy favoured by most business associations, but figures prominently in the Trudeau government’s approach to economic policy.
For example, CCI argues that procurement should favour homegrown firms, even though Canada for years has complained about “Buy America” policies in the United States. CCI’s argument is that the boy-scout approach to trade is making the country less competitive by denying innovative entrepreneurs a chance to secure an anchor client that could provide a steady source of revenue.
We need something to change. We need to reinvigorate the focus here
Carol Leaman, Axonify
“The intention is to build the anchors, to inspire this next generation of companies,” said Malpass, who employs about 800 people and is planning to double the size of his company over the next 18 months so that he’s ready for a post-pandemic rebound in demand. “I’m building excess capacity. We want to build up the talent ahead of time.”
The tech CEOs didn’t offer specific policy proposals, with the letter stating the government should consider strategic investments in “market-proven” businesses, back the commercialization of Canadian discoveries, and staff the government with officials who better understand the demands of the digital economy.
Those are standing requests from CCI, some of which Trudeau indicated he would be happy to fulfil. The country’s next corporate champions are still waiting.
“We need something to change,” Leaman said. “We need to reinvigorate the focus here.”
Copyright Postmedia Network Inc., 2020