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Alec BruceA handy term that invokes sweet dreams of big scores for small businesses everywhere is ‘innovation.’

Government officials, burdened with the otherwise boring work of economic development, are obsessed with it. Its mere mention, they think, virtually guarantees a contact high.

Hey folks, their websites screech, roll up and read all about our “Superclusters Initiative,” which could “create more than 50,000 jobs over 10 years.”

Now learn all about the “Clean Growth Hub,” which sets aside $2.3 billion to support green technologies and, in the process, “Canadian firms and exports.” Remember, friends, “the innovation race is on! A bright future for Canadian businesses, creators, entrepreneurs and innovators starts with access to programs, services and tools that push ideas forward, create jobs and grow the Canadian economy.”

All of which is fine, as far as it goes. Public sector cheerleading (and the program funding that inevitably follows) is a necessary part of what it means to be Canadian.

But have any of these diligent public servants ever sat down with the owner of a Canadian business employing fewer than 100 workers (altogether about 1.14 million enterprises, accounting for 98 per cent of the entire private sector) and actually asked him or her what they think about innovation?

Words like ‘bright future’ and ‘create jobs’ almost never come up in conversation. Words like ‘tough,’ ‘elusive,’ ‘complicated,’ ‘killer,’ ‘breakdown’ and ‘collapse’ almost always do.

That’s because entrepreneurs know, from experience, that innovation isn’t a product you plug, play and customize endlessly to fill your heart’s desire. Innovation doesn’t necessarily tell you that once you’ve successfully expanded your business all will be well. In fact, sometimes it says you’re in the wrong line of work after all.

A few sobering statistics serve the point.

According to the small business branch of Innovation, Science and Economic Development Canada (ISED), between 2002 and 2014, 37 per cent of startup firms in Canada failed after five years in business. After 10 years, the rate was closer to 60 per cent.

What’s more, the research says, “firms have higher survival rates when they are born larger. During the first three years 23 per cent of entrants with one to four employees failed while only about 14 per cent failed among those with 20 to 99 employees.”

That’s the national data.

Take a closer look at New Brunswick, Prince Edward Island, Nova Scotia, and Newfoundland and Labrador, which collectively host a larger per capita number of smaller companies than does the country overall (about 41.3 per 1,000 population aged 15 or older, compared with the Canadian average of 39.2), and the picture down East appears even more troubling.

So the marketing misses the point. You don’t get a prize for being smart or nimble or creative. You get to survive, often against a cosmos of odds stacked against you. Sometimes, if you’re lucky, you get to make a few bucks. That’s why most companies these days innovate like crazy­ – whether they want to or not.

The real questions are:

  • How are they innovating?
  • Where are they investing their time and brainpower?
  • Are they adapting to constant disruptions?
  • Have they properly adduced the value of what they produce given the changing demands their marketplaces supply?

Like everything else in business, successful innovation is about nuts and bolts. It’s hard, quotidian and sometimes tedious work. In fact, it’s a lot like life.

It’s certainly not a “race” that is “on” between “Canadian creators” to “grow” anybody’s economy, except their own. In this game, there is no finish line to cross.

Fortunately, though, there is help – even among government officials, sitting on bundles of capital, who might one day stow their honey-tongued hyperbole about “innovation” in favour of some real-time information that’s actually useful in the trenches of invention.

Troy Media columnist Alec Bruce is a Halifax journalist who writes about business, politics and social issues.

© Troy Media


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