Consumer-driven innovation: On the fringe of globalization

Namir Anani, President and CEO, Information and Communications Technology Council

Globalization is far from a new concept and an economic imperative, with its origins dating back many centuries. Increased free trade agreements among nations have enabled access to advanced technology, exposure to new consumer goods and services, exchange of cultural and media content, sharing of research and educational practices, advances in health, among many others. Opening markets also bring along increased competition that is central to the operation of markets and an important driver for innovation, productivity, and growth.

While the driving force for ground-breaking products and services has always been and continues to be attributed to large multinational companies with significant financial resources and strong R&D infrastructure, the innovative tide is now being complemented by a new breed of innovators. Sometimes referred to as lead users, these creative consumers develop products and services that do not exist yet to respond to social or economic needs.

The democratization power of the internet and social media, affordable cloud services, 3D printing, inexpensive computers and smart communications services (like the Raspberry Pi), open source, and many others have unleashed a new era of innovations that appeal to the masses. The “sharing economy” and the “maker movement” are both different manifestations of this new vastly creative ecosystem. These trends have also deep-seated roots in Information and Communications Technologies (ICTs) and the ability to reduce the complexity and cost of products and services while appealing to a larger consumer base of middle and lower income groups. Innovation spaces such as MakeSpaces and FabLabs have enabled every day entrepreneurs to experiment and design simple solutions to problems they encounter on daily basis. The birth of this tinkering and engineering based approach to making, customizing, and bringing technology solutions to the masses is an important trend to be reckoned with.

Such innovations are not only helping developed countries but are also benefiting developing nations that are outside the confines of a formal economy in terms of stable energy supply, reliable communications infrastructures, banking, sound health system, others. The success of mobile banking in many developing countries is an example of a low-cost business solution to respond to the needs of the community. These developing markets with their younger consumer demographics have also the potential to shape the global economy in the next number of years.

Stimulating a vibrant innovation ecosystem in Canada requires a careful policy balance between attracting and maintaining a healthy share of multinational FDI and R&D while investing in citizen and community innovations that respond to larger societal needs in Canada and abroad. The benefits of such inventions can be far-reaching, the “Square” device for instance, that plugs into a smart phone and allows payment at the point of sale (POS) has democratized the retail business and allowed small firms a share of a bigger market, hence increased their potential for economic and employment growth.

Building on public R&D and academic based research can be a good way to carve investment and support for stimulating such consumer-driven innovation. Policies to encourage private sector investment in grassroots entrepreneurial capacity are also ideal for nurturing this approach. In this global and hyperconnected landscape disruption is an inevitable fact of business. Innovations that can reshape how businesses can extract better value proposition either at the lower-end of the cost spectrum or even at the higher-end by creating products and services that never existed before can be invaluable for growth and competiveness.

Skills and education also play a crucial role in this equation, and starting early in schooling is vital. With the advent of affordable computing, every classroom can become a makerspace where students and teachers can learn and tinker together. Maker-centered education can provide strong industrial foundation for youth entering STEM careers. Recognizing the inventor in every child in Canada is a powerful approach for unleashing the creative capital of our nation.

Nurturing this grassroots creative capacity to disrupt and create new businesses should be a key pillar of our national innovation agenda. Never before have so many been able to do so much with so little leveraging ICTs, inclusive innovation is an important construct to nurture going forward.

Gauging Canada’s progress in its digital innovation journey on yearly basis will be key for identifying any future policy interventions. In collaboration with other partners, ICTC will be developing Canada’s Digital Innovation Measure (CDIM), guided by four key factors: Innovative Climate Index, Innovative Capacity Index; Innovation Outcomes/impact Index; Innovation Confidence Index, which mutually reflect Canada’s goals of enabling an inclusive and globally competitive economy.

– Namir Anani


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