A recent Rand report , “The Global Technology Revolution 2020″, looks at 16 upcoming key technologies and the ability of 29 countries to acquire and to implement. The following chart identified the key technology applications -
Only three of the 29 countries examined by Rand were identified as being able to acquire and implement all 16 key technology applications – the United States and Canada in North America and Germany in Western Europe.
The Ontario Commercialization Network Steering Committee Report was delivered to the Minister late February. PWC produced a report on OCN prior to the Steering Committee Report but it was not made public.
The report makes some blunt assessments of serious problems with Ontario’s current approach to economic development and commercialization. Some key findings include:
Lack of co-ordination and sharing across many fragmented organizations
Lack of overall governance
Lack of clear entry-point for clients/entrepreneurs
Lack of metrics and performance targets
Need for better co-ordination between Provincial and Federal governments
Economic conditions demand quick action
Key recommendations include specifics related to:
Fixing the governance model
Fixing the delivery model
Reducing overlaps of products and services within the Province and between the Province and Federal programs
The report was one of the best i’ve seen so far – it cuts directly to the issues and provides some very rational recommendations.
In 2002, Carleton University ran a survey to look at stress among tech workers – “Coping with Job Uncertainty : A Survey of Employed and Unemployed High Technology Workers”. The report identified numerous interesting results, however the one that I found particularly noteworthy was the fact they found that people who have an optimistic predisposition have a natural buffer against stress. In fact, the more optimistic one’s nature, the less stress they reported.
… 31,000 jobs added to the health care and social services sectors in February alone.
Recession-proof jobs are identified as including: education, health care, the public service. Civil engineering and construction jobs are also considered safe due to government stimulus spending on physical infrastructure such as roads and bridges.
From the US Patent Office -Nortel was ranked 68th overall relative to US patent filings in 2007, details are shown in the table below.
McKinsey recently published an article summarizing their analysis of US patent filings as a proxy to predict/identify centers/clusters of innovation. Volume of patents is reflected by the size of the bubble, growth in patents and diversity of patent filing companies are the two axis.
Nortel currently accounts for 32% of the R&D spend in the top 10 spenders in Canada, and Magna (automotive parts) currently accounts for 13%. Over 45% of the R&D spend of the top 10 spenders in Canada is in decline and at risk of evaporating to nothing.
Unfortunately – RIM which is always held up as the shining tech light for Canada – isn’t even in the same league as Nortel and never will be. It could be argued that RIM is likely to rapidly diminish in size/scope over the coming years as technologies such as the iPhone and Android continue to see rapid adoption.
Fully 80% say that jobs are difficult to find in their local communities – up seven points since December and 16 points since early October. Overall views of the national economy, already quite negative at the end of last year, have declined further; 30% say the country is in a depression, up from 20% as recently as December.
There are an increasing number of articles cronicling the human toll that the job losses are having the United States.
The New York Times and Mercury News have both published articles recently that reflects the significant impacts the the downturn continues to have on families and individuals.
The Silicon Beat has a regular feature Pink Slip 2.o which chronicles layoffs in Silicon Valley.
I have the first and second edition of this book on my bookshelf. It is concise, practical advice for starting and running a technology/knowledge-based company… and it is written by a local tech leader – Denzil Doyle! For those trying to figure out where to start and what to do I recommend this book as a good place to start reading.
Making Technology Happen describes in detail the techniques used to identify and exploit technology and how to build and manage a technology-intensive company around that technology. It covers such activities as ‘go-to market’ strategy development, general management, investment analysis, organizational development, and competitive market analysis – all from the perspective of a technology-intensive enterprise. It is used by governments and technology transfer professionals across North America, as well as by entrepreneurs and business executives
A friend in California sent me an article today that was very disconcerting. The article was reflecting on a recent report published in Europe relative to the impacts and consequences of the economic situation:
According to the European think tank, LEAP/Europe 2020, two factors make the US a likely candidate for civil violence: the absence of a strong social safety net and the presence of hundreds of millions of firearms.
Former National Security Adviser Zbigniew Brzezinski has publicly expressed his fears about impending civil unrest with MSNBC’s Joe Scarborough:
JOE SCARBOROUGH: You also talked about the possibility of class conflict.
ZBIGNIEW BRZEZINSKI: I was worrying about it because we’re going to have millions and millions of unemployed, people really facing dire straits. And we’re going to be having that for some period of time before things hopefully improve. And at the same time there is public awareness of this extraordinary wealth that was transferred to a few individuals at levels without historical precedent in America….
And you sort of say to yourself: what’s going to happen in this society when these people are without jobs, when their families hurt, when they lose their homes, and so forth?
We have the government trying to repair: repair the banking system, to bail the housing out. But what about the rich guys?… Where is the monied class today? Why aren’t they doing something: the people who made billions, millions…. there’s going to be growing conflict between the classes and if people are unemployed and really hurting, hell, there could be even riots!
And the unrest is not expected to be restricted to the US. On Feb 23rd, London Police expressed public concern over the possibility of a “summer of rage” in the UK -
Police said on Monday they feared a “summer of rage” with mass protests over the economic crisis…
A reduction in the number of service companies related to knowledge-based companies (and Nortel), e.g. legal, accounting, recruiting, manufacturing, technical contracting, retail
Ottawa economic growth prospects will decline as the city becomes increasingly less attractive for knowledge-based multi-nationals to locate/expand in Ottawa due to declining size and skills of the local workforce brought about by:
Continued emigration of knowledge-workers out of Ottawa (Stats Canada reports have highlighted the lost high tech capabilities and workforce emigration away from Ottawa - 2 in 5 laid off tech workers left Ottawa)
Continued reduction in base of knowledge-workers with current experience (Stats Canada reports have highlighted that 4 of 5 laid off tech workers did not find work in tech)
Ottawa may soon be the “Flint Michigan of Canada” when it comes to high tech.
One in five persons living in Canada is foreign born
In Toronto, almost half of the population is foreign born
Census statistics from 2001 provides a broader overview of immigrant origin in Canada:
I personally believe this is a great advantage for Canada. The more ties we have with other countries, the more likely that business relationships will be developed.
With all the talk of government stimulus and spending it is disappointing to see the government not using programs that have already been approved and rolled-out.
“We’re stepping up because Ontario is not going to let others steal our future out from under us - we will produce the next wave of clean technologies that create jobs and clean up the environment,” said Premier McGuinty.
“We’re sending the message to companies around the world that if you’ve got a project that will grow your business and create jobs, we’ll make it happen in Ontario,” said Minister of Economic Development and Trade Sandra Pupatello.
“This fund is about building on our strengths to ensure Ontario can compete and win in the global economy - and create a better standard of living for Ontario families,” said Minister of Research and Innovation John Wilkinson.
There was also much noise made about how:
Companies are guaranteed a decision within 45 days of submitting a complete proposal.
So, since being announced a year ago…. nothing has happened.
Furthermore, last summer – Nortel, IBM and Carleton University submitted a proposal to establish and collaborate on a project called “Coral CEA”. The group’s proposal was to setup an organization to focus on development of communications enabled applications with the objective of spinning-off companies and jobs. In-spite of being under bankruptcy protection Nortel remained committed to the proposal because of it’s strategic value.
This was a proposal from two of Canada’s top innovators and Ottawa’s leading University… and nothing has happened.
In fact, worse then nothing has happened – good ideas have been submitted and no action has been taken.
It appears that the only jobs that the NGoJF is creating are jobs for government organ grinders whose purpose is to turn our “Creative Class” into dancing monkeys for the bureaucracy -
If McGuinty is serious about his commitment to innovation and the NGoJF – he needs to roll up his sleeves and take direct personal action in his government. Right now McGuinty and his government fall into the category of “Big Hat, No Cattle”.
Applications to Oxford and Cambridge rose 9.9%. The University of Exeter said it had an 18% increase in applications from British students and 88% rise in those outside the EU. New universities and smaller specialist institutions also reported record rises. Bedfordshire University had a 24% rise in home applications.
Enrollment/application numbers for Universities in the US and Canada for late 2008/early 2009 are hard to find, however here is what has been published so far:
In US, Universities share similar concerns as in Canada. In the US there is particular concern regarding decreasing endowment funds which are due mainly to the stock market decline:
… the average college endowment lost 2.7 percent in the fiscal year that ended June 30, 2008, according to Commonfund, an organization that manages many colleges’ endowments. A follow-up survey found endowments lost another 22.5 percent in the five months that ended Dec. 1, 2008.
In the US and Canada, Universities are likely to be beneficiaries of the various stimulus packages, which should off-set some of the concerns that are currently being expressed.
Sun has developed Sun Small Programable Object Technology (SPOT). It’s an experimental platform to inspire developers to build the next great toy, sensor, communication device — who knows — using Sun technology. The Sun SPOT devices make include a flexible hardware platform as well as the software and tools to make it easy to innovate, experiment, and prototype whatever a developer can imagine.
The Sun SPOT Device is a small, wireless, battery powered experimental platform. It is programmed almost entirely in Java to allow regular programmers to create projects that used to require specialized embedded system development skills. The hardware platform includes a range of built-in sensors as well as the ability to easily interface to external devices.
This little platform is full of potential for “Creative Class” people to base a microbusiness on.
There is more data and complexity everyday. There are a number of very interesting sites on the web that present visualization of data on a wide variety to topics, including:
I particularly like the site “Visual Literacy” which provides online training on methods to represent information visually. They have an interactive diagram which summarizes, with examples, all the various various visualization techniques. Not to be missed!
There are a vast, and increasing, number of technical certifications available. A big question many people have is what is the value – if any – of an individual spending the time and money to obtain a certification. Will the certification increase prospects for employment? Will the certification increase the salary of the holder?
A study published by TechRepublic “2008 IT skills and salary report“, gives some insight into the salaries of various certification holders:
TechRepublic also published another report identifying the following IT-specific certifications as being the “Top 10″ relative to increasing employment opportunities:
Microsoft Certified Technical Specialist (MCTS) or Microsoft Certified IT Professional (MCITP) (formerly MCSE)
Microsoft Certified Architect (MCA)
Certified Information Systems Security Professional (CISSP)
Systems Security Certified Practitioner (SSCP)
GIAC Security Expert (GSE)
Cisco Certified Internetwork Expert (CCIE)
Cisco Certified Security Professional (CCSP)
Red Hat Certified Engineer (RHCE) and Red Hat Certified Architect (RHCA)
Information Technology Infrastructure Library (ITIL)
Certifications for Special Situations (including VoIP)
For local tech job seekers – be sure to pickup your copy of the Ottawa Business Journal’s Ottawa Technology Magazine which hit the newstands this week. The magazine features more than 1,300 technology company listings in clean tech, life sciences, high technology and other sectors.
A report from Insala provides some interesting insights into a business sector that is growing and expected to continue to grow in 2009:
Providing outplacement support to exiting employees has become standard business practice for many companies. The demand for such services is increasing in this heavy job-cutting market. This is evidenced by the following research:
81% of employers engage help from external outplacement providers (The Value of Outplacement, Reed Consulting).
50% of employers use only external outplacement providers (The Value of Outplacement, Reed Consulting).
34.1% of surveyed organizations offer outplacement services to certain classifications of employees, while 13.6% offer it to all of their employees (HRfocus Termination Survey 2008).
30% of 600 surveyed companies outsource outplacement services (H.R. Department Benchmarks and Analysis 2008, Bureau of National Affairs).
With this increasing usage, the outplacement industry has grown to a 3 billion dollar industry, and some sources state it is as high as 10 billion.
Financial performance data on individual outplacement firms is extremely limited due to the fact that the majority of firms are private. One public firm however recently reported a 25% increase in net revenue this year compared to last year. In September, Penna Consulting, a U.K. based public limited company reported their net revenue to be approximately 25% ahead of the same period last year and pre-tax profits earned in the first six months of this year will be higher than those of the full 2007/8 year. Consequently, they are projecting that market expectations for the full year ending in March 2009 will be materially exceeded.
Business incubation has been identified as a means of meeting a variety of economic and socioeconomic policy needs, which may include:
Creating jobs and wealth
Fostering a community’s entrepreneurial climate
Technology commercialization
Diversifying local economies
Building or accelerating growth of local industry clusters
Business creation and retention
Encouraging women or minority entrepreneurship
Identifying potential spin-in or spin-out business opportunities
Community revitalization
Business incubators typically provide a range of services to clients that may include:
Help with business basics
Networking activities
Marketing assistance
High-speed Internet access
Help with accounting/financial management
Access to bank loans, loan funds and guarantee programs
Help with presentation skills
Links to higher education resources
Links to strategic partners
Access to angel investors or venture capital
Comprehensive business training programs
Advisory boards and mentors
Management team identification
Help with business etiquette
Technology commercialization assistance
Help with regulatory compliance
Intellectual property management
Facilities (e.g. office space, specialized lab space) and associated business services (e.g. security, receptionist, meeting rooms, phone service, photocopiers, printers, internet service)
Stats Canada released a report in late 2008 “The Business of Nurturing Businesses” which takes a look at business incubators in Canada based on survey data taken in 2005. Some key findings from the report include:
Almost all business incubators are sponsored by economic development organizations, governments, academic institutions, i.e. tax money
1 in 6 incubators offer facilities and on-site support services
Almost half of all incubators were focused on professional, scientific and technical services businesses
The top three most used services of incubators were: legal consultation, management guidance and assistence in obtaining financing
There are various lists of incubators in Canada, unfortunately none up-to-date, including:
Unfortunately, with the exception of Carleton University’s Tony Bailetti, there is little/no information available on the public incubators relative to return on investment of the tax money in the operation of the incubators – which would lead me to believe that compelling results do not exist.
From the perspective of efficiency, it appears that our tax money is being spent a bit recklessly relative to overlapping mandates and services. The Ontario government and Ottawa Municipal government have both being doing a review of how they are funding and delivering their economic development programs. I hope that as part of this review, they look towards stronger collaboration and reduced overlap of services between Provincial and Municipal programs.
A future blog entry will examine how business incubators role will evolve/change in the context of Business Ecosystems.
For a start-up, one of the biggest challenge is gaining access to customers and being able to transact business with them as easily and quickly as possible. In the last 5 years, new business models have been emerging that help reduce that challenge, referred to as Ecosystem business models.
These new business models are providing knowledge workers (aka the “Creative Class“) access to ready-made delivery platforms and selling channels to a well-defined market.
These emerging channels to market typically provide a means to connect suppliers with consumers, usually handling the transaction between the two as a trusted mediator (taking a percentage in return for the channel services, e.g. selling platform, marketing, customer management, fulfillment, transaction handling):
Apple Apps Store – sells applications to Apple iPhone phone users, handles delivery and payment, payment is via iTunes account
Google Android Market - sells applications to Android mobile phone users, handles delivery and payment using Paypal
Amazon Webstore - sell your wares online, access Amazon shoppers and Amazon store tools, handles payment using Amazon account
99Designs - companies/individuals post requests for graphics designs and designated “prize money”, companies/individuals post responses, the winning design selected gets the “prize money”
oDesk - teams or individuals post skills/availability, companies/individuals post jobs with desired fee for completion (fixed rate or hourly)
Shutterstock – royalty-free photographs, individuals/companies provide photos and get paid based on sales
Innovation Exchange – companies/individuals post challenges and cash, suppliers post responses
Mechanical Turk – people post questions/tasks, suppliers post answers/accept task
Cafepress – individuals/companies generate graphic content, Cafepress puts it on mugs, shirts, etc and handles all fulfillment for the supplier
Amazon Kindle – sell eBooks via Amazon and their new eBook reader
Spot Us - allows journalists to post story ideas and solicit funding from public
One channel which can be very significant for Microbusinesses is Paypal -
Paypal – “one-click” purchasing between suppliers and consumers. Many niche sellers, e.g. 3rd party add-on suppliers for Joomla! use Paypal as their transaction vehicle. Most eCommerce solutions provide a gateway to Paypal as the payment means. Paypal itself also can accept credit cards on behalf of a seller. Paypal by itself provides access to a group of consumers who are comfortable transacting business online. Paypal provides a trusted supplier relationship between the buyer and the supplier. I have to confess I never thought Paypal would amount to anything when I first heard about the business many years ago…
Stats Canada released an interesting report in 2007 that seems to have gone almost un-noticed. The report itself highlights the impact that the high tech downturn in 2000 had. The report contained a few very interesting facts that were, and still are, relevant to Ottawa, including:
Among laid-off high-tech workers, about four out of five did not locate employment in high-tech, and about one out of three moved to another city. In Ottawa–Gatineau, about two in five laid-off high-tech workers left the city.
With the ongoing layoffs this trend will continue – resulting in the ongoing erosion of Ottawa’s tech workforce and capability – unless action is taken.
There are two interesting new ideas that I find very promising, and if the City of Ottawa is able to capitalize on them, it may create a major new source of growth for our local economy.
Richard Florida is a professor at the Rotman School of Management in Toronto. His primary area of research is that of the “Creative Class”. Dr Florida argues that the economy is shifting away from routine-oriented jobs to creativity-based occupations. He also argues that the ability of an economy to adapt and weather disruptions are greater for a creativity-based economy compared to routine-jobs based economy. Dr Florida recently delivered a report to the Ontario government on this topic - it is interesting reading.
In Ottawa, we have Tony Bailetti, a professor at Carleton University. His primary area of research is that of “Ecosystems”. He argues that the business models of the world are changing. During the Industrial Age – companies were vertically integrated. During the Technology Age – companies were horizontally integrated with outsourced partners. In the emerging Ecosystem Age – Dr Bailetti argues that it is all about creative knowledge workers and collaboration. An ecosystem is not a single company, but rather is a collaborative community formed around a central keystone organization that facilitates collaborative relationships and access to wide established markets. And this is more then just a theory – Ecosystems exist today and their numbers are growing. A leader in this emerging Ecosystem business model is headquartered in our city! The Eclipse Foundation is a very successful keystone organization — they are at the heart of the worlds most successful Integrated Development Environment platform.
Ecosystems are a means of organizing and enabling knowledge workers, leveling the playing field against established Technology Age and Industrial Age competition, and flattening the world relative to allowing world-wide virtual teams to come together to create innovation, wealth and economic growth. Ecosystems effectively give a practical framework around how we can capitalize on the power of the “Creative Class”.
Dr Florida and Dr Bailetti’s work have evolved independently but are very complimentary and timely.
I would love to see Tony and Richard get together as their ground-breaking ideas represent a strong opportunity for Ottawa, Ontario and Canada to re-invent itself.