He’s been the Clerk of the Privy Council — the top job in the federal public service — and now serves as vice-chair for one of Canada’s largest banks, which means Kevin Lynch probably knows a lot about why large organizations find it difficult to innovate with IT.
BMO Financial Group’s Kevin Lynch joined the stage last week with Cisco Canada president Nitin Kawale for a Canadian Club of Toronto luncheon that explored the ongoing challenges in fostering innovation across all industry sectors. Besides having a particularly storied and successful career, it’s also been long enough (he’s near retirement, he says) that Lynch has a unique perspective on how little progress has been made in this area.
“We’re not doing any better today relative than where we were before,” he said, pointing out that discussions about a so-called innovation gap have been happening in Canada for many years. “It’s not a question of whether we’re doing the right things. We’re not.”
For Lynch, it starts with defining innovation the right way. He said innovation means “any time you change a product or a service and get value back.”
A second issue is around perception. Lynch cited a survey by GE that suggested there was a 23-point percentage gap between how innovative Canadian firms think they are and how innovative they are considered by their global peers. This was the biggest percentage gap in the research, he noted — no other country was more than about five. Another study from Deloitte showed 33 percent of Canadian business people believe they are above average in spending on innovation, he added.
“The biggest problem in Canada is complacency,” Lynch said, suggesting the relatively strong Canadian dollar over the last 10 years may have made firms hesitant to take risks and apply technologies to increase competitive advantage. “Why innovative and upset anything? We are now reaping the cost of a decade of under-investing in information and communications technologies.”
Besides opening their wallets, Lynch had a few other ideas to better foster innovation. The first was better benchmarking against similar firms. “In every sector there is at least one innovator. We somehow maintain more of a gap between the best and the average,” he said.
The second action item is fostering a ‘Silicon Valley’ mindset by commercializing more of our university research and making it more attractive for entrepreneurs to take root here. Lynch cited Technion, a public research university in Israel, where 43 percent of graduates said they prefer their first job to be at a startup. “There’s not a university in Ontario where even five percent of their graduating class would work at a startup,” he said.
Finally, firms of all sizes need to find more ways to get feedback from the people with whom they conduct business. “The best identifier of what the problems are come from customers,” said Lynch. “We’re not doing as good as we could be in connecting those things. They know of what they don’t like.”
For more from Lynch, and lots of additional insights from Cisco’s Kawale, view the video recording of the innovation event in its entirety.