We know how important innovation is to economic growth, living standards, and the realization of human potential. Perhaps the formation and development of persons like Tsiolkovsky and Goddard may provide some clues on how a society can encourage more innovation – so let’s review some of the details.

Sickly as children, both spent a fair amount of time apart from other children and outside the public school system, apparently being home schooled and/or self taught. Both found some solace in books. As teenagers, they were inspired to develop space rockets by the then-new genre of science fiction — especially Jules Verne’s book on traveling to the moon, From the Earth to the Moon, and H.G. Wells’ book on Martians invading earth, The War of the Worlds.

I have noticed before how many distinguished persons in the sciences and higher callings come from home-schooling environments or at least environments where the parents are actively involved in the education of their children (e.g. Thomas Edison and John Stuart Mill). It didn’t surprise me that Canadian scientist Willard S. Boyle, a recent co-winner of the Nobel Prize in Physics, was home schooled and attributes much of his success to his mother.

But Mary Kay Carson’s book increased my awareness of another aspect: the shaping of the imagination. Both Tsiolkovsky and Goddard found vision and purpose in their lives from the imaginations of Verne and Wells. “It has often proved true that the dream of yesterday is the hope of today, and the reality of tomorrow.” Goddard said in the class oration at his high school graduation in 1904.

Sadly, though, the lack of imagination elsewhere gets in the way. When Goddard published “A Method of Reaching Extreme Altitudes” in 1919, the New York Times ran an editorial that ridiculed him for lacking “the knowledge ladled out daily in high schools.” Propulsion is not possible in the vacuum of outer space, it claimed.

Three days before man’s first walk on the moon in 1969, the New York Times printed a retraction to the 1920 editorial. It stated: “it is now definitely established that a rocket can function in a vacuum as well as in an atmosphere. The Times regrets the error.”

Less than two weeks remain to enter the Clean 15 competition, put on by Drayton Weissenfels and Canadian Business magazine. The contest is designed to help aspiring clean tech firms connect with potential customers and become leaders in the field. That kind of success is more than possible for Canadian clean tech companies. Just a few days ago, Ottawa-based Lixar, a low-key energy management company that has nonetheless attracted interest from its peers, had its energy business scooped up by GridPoint in Virginia for an undisclosed amount.

All aspiring firms should enter the competition by July 13. The winning company will win services valued at $60,000—including face time with execs from Fortune 500 companies looking for clean tech opportunities. Full contest details, rules, and more info on the sponsors (which also include Yet2.com, OCETA, and Ricardo McRae) are available here.

One major challenge for clean tech firms is connecting with customers. Sure, you may have spent years perfecting your product in the lab, but how do you sell it? Dwayne Matthews, president of Drayton Weissenfels, points out many such companies are understandably focused on the technology and may lack the business savvy necessary to take the company to the next level.

That’s where the Clean 15 competition can help. Companies with market-ready products can enter to win services valued $60,000—including face time with execs from companies looking for clean tech opportunities. Judges will narrow down the entrants to 15 companies before picking one winner.

Full contest details, rules, and more info on the sponsors (which also include Yet2.com, OCETA, and Ricardo McRae) are available here. You can also find out more in the new issue of Canadian Business, on newsstands today. The deadline for entry is July 13, 2009—so get moving.

Most hockey fans are aware that it was Jacques Plante, then tending goal for the Montreal Canadiens, who first used a practical mask in 1959 after being struck in the face by a shot by the New York Rangers’ Andy Bathgate. Bill Burchmore, a 35-year-old sales-promotions manager at Fiberglass Canada Ltd, designed the mask, which eventually evolved into the product that all goalies were using by the early 1970s.

Fewer people know that Clint Benedict briefly wore a leather-and-wire mask in 1929, and even fewer realize Elizabeth Graham was the first to wear a mask in a game, way back in 1927 while playing for Queen’s University. Good on ya, Liz.

But before we get too excited about how much we know about this country’s innovative history, it turns out that both the electric oven and lightbulb were invented in Canada, but only 8% and 20%, respectively, of those surveyed know that.

And while Leger’s survey, done on behalf of innovation consulting firm Nytric Ltd., reports that 76% of respondents believe Canadians are an innovative bunch and that nearly 60% have had product ideas of their own, only one in seven have ever considered marketing them.

Why bring this up? Because Canadian Business and Nytric have kicked off the third annual Great Canadian Innovation Competition – giving one lucky inventor the opportunity to receive up to $90,000 in engineering and business services to bring the winning concept to life, plus a profile-boosting feature in an upcoming issue of the magazine. The deadline for entries is midnight, May 1.

So if you believe you might just have invented the next lightbulb or goalie mask, go to http://www.canadianbusiness.com/greatinnovation

There’s one week left to enter. Don’t get left behind.

Although executives must be sorely tempted to focus on the severe and ever-changing challenges of the here-and-now, it seems that they are for the most part taking to heart the idea that research and development budgets should be protected from cost-cutting initiatives, so that when the recession ends, the cupboard isn’t bare.

The Wall Street Journal reported on Monday that big U.S. companies spent nearly as much on R&D in the last three months of 2008 as they did a year earlier, even as revenue fell 7.7%.  (The WSJ looked at the 28 largest R&D spenders, excluding auto makers and the drug industry, where government requirements dictate R&D spending.)

This could be a lagging indicator, as the story notes:

“Research budgets often are planned in advance and take time to cut. Companies that today pledge to protect R&D may cut it tomorrow, particularly if the recession worsens. Mergers of major players could lead to cost-cutting that crimps overall R&D spending.”

But the question of how much is being spent on R&D is perhaps not so pressing as the question of how R&D budgets are spent (and even where, since some North American firms may outsource more R&D overseas). According to this story, companies are retooling to focus on improving existing products, and not as aggressively targeting new markets. (Also, the U.S. government’s stimulus spending plans are also shaping R&D priorities—no surprise there.)

In response to the story, Massachusetts-based innovation consultant and author Scott D. Anthony wrote a blog post of his own, warning that this might be the wrong approach. By pouring money into improving existing products, companies could “overshoot” what customers are willing to actually buy—and miss emerging opportunities. Anthony’s suggestion: prune R&D prudently, and balance the short-term opportunities with exploring new markets.

So how do you do that? If you ask Sophie Vandebroek, Xerox Corp.’s chief technology officer, she would likely tell you to talk to your customers about both the here-and-now, and the future—and empirically study how they use your products or services.

Vandebroek spoke about this when I interviewed her for a recent column of mine about her company’s revamped approach to R&D. Xerox, which is not one of the 28 that the WSJ analyzed for its story, is an interesting example of a company with a long-standing commitment to R&D, but also one with a history of squandering it. Ever since Xerox almost went bankrupt earlier this decade, a priority for Vandebroek has been making R&D more effective.

It is no panacea. Xerox still faces its share of business challenges.

But it’s worth noting that while Xerox has big research facilities with lots of smart engineers and scientists toiling away in labs, what matters is how successful those same people are working alongside business managers to foster real innovation with their customers.

What’s your company’s approach to making innovation work in an uncertain economy?

Most hockey fans are aware that it was Jacques Plante, then tending goal for the Montreal Canadiens, who first used a practical mask in 1959 after being struck in the face by a shot by the New York Rangers’ Andy Bathgate. Bill Burchmore, a 35-year-old sales-promotions manager at Fiberglass Canada Ltd, designed the mask, which eventually evolved into the product that all goalies were using by the early 1970s.

Fewer people know that Clint Benedict briefly wore a leather-and-wire mask in 1929, and even fewer realize Elizabeth Graham was the first to wear a mask in a game, way back in 1927 while playing for Queen’s University. Good on ya, Liz.

But before we get too excited about how much we know about this country’s innovative history, it turns out that both the electric oven and lightbulb were invented in Canada, but only 8% and 20%, respectively, of those surveyed know that.

And while Leger’s survey, done on behalf of innovation consulting firm Nytric Ltd., reports that 76% of respondents believe Canadians are an innovative bunch and that nearly 60% have had product ideas of their own, only one in seven have ever considered marketing them.

Why bring this up? Because Canadian Business and Nytric have kicked off the third annual Great Canadian Innovation Competition – giving one lucky inventor the opportunity to receive up to $90,000 in engineering and business services to bring the winning concept to life, plus a profile-boosting feature in an upcoming issue of the magazine. The deadline for entries is midnight, May 1.

So if you believe you might just have invented the next lightbulb or goalie mask, go to http://www.canadianbusiness.com/greatinnovation

Triticale is a wheat-rye hybrid crop, and one that happens to be mentioned briefly in an episode of the original Star Trek, “the Trouble with Tribbles.” (Technically, the crop mentioned in Star Trek is “quadro-triticale,” but I’m not going to quibble.) In that episode, Captain Kirk finds himself neck-deep in a sea of rapidly procreating furry creatures called tribbles that threaten to eat through the Enterprise’s food supplies.

In the real world, triticale has failed to multiply as fruitfully as tribbles. Farmers in Canada have never taken to growing it on a large scale, preferring the cash crops of canola and wheat. But now there is serious government money behind promoting triticale based on its environmental and economic benefits.

The federal government invested $15.5 million in CTBI this month, a 10-year research and development program created by the Alberta government in 2005 with an initial investment of $4 million. The crop could have a variety of applications, including plastics, transportation fuel, and renewable heat and power generation. CTBI says triticale has advantages over other crops, such as higher yields, lower input costs and higher biomass content—key for energy production.

Using food crops for energy is, of course, a tricky business. Corn ethanol has been pilloried for its impact on carbon emissions and food prices, and is seen as an example of lobbyists and rural economic development zeal trumping environmental concerns. Second-generation ethanol, which uses the non-edible portions of the crop, has so far proven uneconomical on a commercial scale. (Read more here.)

CTBI says triticale can be competitive with corn for ethanol production, but “without complications related to competing food uses.” The reason, according to the Alberta Department of Agriculture and Rural Development, is that triticale is not typically used in food or energy production, and it grows on marginal land, so its acreage can be expanded without taking much land away from food and fuel crops.

But triticale is used as a food crop elsewhere in the world. The department’s website states elsewhere that the crop is considered “a very suitable grain for human diets” and that “internationally, triticale has found great success in a very large number of ethnic cereal-based foods.” If triticale is a cheap, high-yielding crop, why not promote its use as food as opposed to vehicle fuel? That could free up funds to invest in other technologies that can mitigate climate change. According to a C.D. Howe Institute report released last month, wind and biomass power (such as switchgrass, a non-food crop) are the most efficient technologies to reduce emissions available for widespread roll-out in Canada today.

Triticale is farther off. CTBI is still working out the environmental and economic benefits of triticale for use in both transportation fuels and heat and power generation, and the crop may yet prove to be beneficial. But whatever CTBI finds, government and industry need to ensure the environment doesn’t lose out in the name of economic development.

Further reading: my recent cover story on the state of early-stage financing.

Also, a first skeptical take from Wellington Financial’s Mark McQueen, who has been prolific on the sector’s woes.

UPDATE

As noted in the trackbacks, McQueen issued another biting missive today (why he mocks MRI for contacting reporters, I don’t know).

Also, check out Toronto-based high-tech lawyer Suzie Dingwall Williams’ take on things.

“You know what I’m doing? I’m investing in companies outside of Canada, and I don’t feel good about that either. I’m investing in the U.K. and the U.S., because their environments are better. Out of the four technology companies I start every year, three of them are outside of Canada. Now, isn’t that sad? I talk to many people of like mind, within government and business, and they agree with my observations.”

Coming from Canada’s eminent technology entrepreneur, with some 40 startups to his name (and some very big exits), that’s a damning indictment.

And he’s not alone. I heard a fair number of similar observations last night at Deloitte’s Technology Fast 50 gala in Toronto. There was much talk about the economy and the ramifications of Wall Street’s financial crisis, but mostly, these leaders from high-growth tech firms were just trying to keep their chin up. Deloitte’s press release tells a grim tale, and it was reflected in the conversations I had. Several award winners acknowledged that the cumulative 5-year revenue growth numbers (by which they are ranked) are likely to be smaller next year. Venture capitalists told me that money is tight already (see my colleague Joe Castaldo’s story on the subject), and that the growing financial crisis in the U.S. will only further shrink the pool. Some entrepreneurs said that it’s hard to attract U.S. VC money with onerous Canadian tax rules. Other people said that software companies, which once boasted about the low Canadian dollar being a boon to developing in this country, are scrambling to outsource development.

And one founder of two successful companies made it clear that within two years, his company will move to the U.S. Why? Canada offers no reward for wealthy entrepreneurs, and the U.S. does. And it will be easier to get the attention of big tech firms in the Valley to buy them up. He also said that most of the engineers he’s interviewing and hiring in Canada were born in India, China or Eastern European countries.

What stuns me is that we’re in the middle of a federal election campaign. Are any candidates talking about this? Cultural funding is somehow the topic of the week. But these are the companies that are forming the foundation for the future of the economy. And it’s not all just whiz-band Web 2.0 stuff with flimsy business models.

I know my local candidate claims to support “A strong economy with investment in innovation”. But when I e-mailed to find out what she meant by that, I got no response.

The fact that initiatives to build an strong, innovative economy have completely fallen off the radar does not bode well.

Sadly, he was the only scientist in the group of 75 honoured on July 1. The rest were a pastiche of politicians, musicians, union leaders, actors, dentists, activists, and so on. Maybe when Canada begins valuing its scientists more, we'll have more of the kind of innovation that leads to greater national wealth.

Source: Statistics Canada Service Bulletin Science Statistics Catalogue 88-001-XIE/ISSN1209-1278