The conclusion that retail is the one sector which is an "illuminating bright spot and the most significant contributor to narrowing the productivity gap" is another surprising conclusion. With the entrance of companies like Target, Walmart, Home Deport into the Canadian market which seem to have had great success taking market share away from Canadian competitors, it seems a stretch to imagine that Canadian retailers are more productive. The global bright spot in retail is, of course, the online businesses such as Apple and Amazon that are American and which are highly innovative and productive. Rather than suggest that our retailers are doing well, it might be more interesting to try to understand why these online businesses have been so successful and what Canadian firms could learn about innovation in this sector.
An interesting conclusion is that Canada has its fair share of fast growing new entrepreneurial firms but that over time, a number of factors such as risk aversion, low export activity, and weak R&D activity stifle growth.
The results for risk aversion are interesting and are based on a survey of executives and perhaps help to explain lower levels of investment. The report also references a 2006 CIBC survey of small business owners that suggests that the issue may also be related to a higher priority placed on balancing wealth creation with other lifestyle choices. US entrepreneurs were more likely to say that wealth creation alone was their primary motive. The report concludes that both factors are at play; attitudinal differences may affect the growth in demand for financing but there is also less risk capital readily available. Early stage businesses in Canada can only access 35% of the funding available to US start-ups.
The report suggests that Canadian business is less innovative. They discuss the business life-cycle and suggest that managers in Canada are not quick enough to address decline let alone to engage in "creative destruction” and to re-invent and re-invigorate their businesses.
The issue of creative destruction and the suggestion that Canadian businesses are less innovative are areas that warrant further investigation.
An interesting conclusion is that Canada has its fair share of fast growing new entrepreneurial firms but that over time, a number of factors such as risk aversion, low export activity, and weak R&D activity stifle growth.
The results for risk aversion are interesting and are based on a survey of executives and perhaps help to explain lower levels of investment. The report also references a 2006 CIBC survey of small business owners that suggests that the issue may also be related to a higher priority placed on balancing wealth creation with other lifestyle choices. US entrepreneurs were more likely to say that wealth creation alone was their primary motive. The report concludes that both factors are at play; attitudinal differences may affect the growth in demand for financing but there is also less risk capital readily available. Early stage businesses in Canada can only access 35% of the funding available to US start-ups.
The report suggests that Canadian business is less innovative. They discuss the business life-cycle and suggest that managers in Canada are not quick enough to address decline let alone to engage in "creative destruction” and to re-invent and re-invigorate their businesses.
The issue of creative destruction and the suggestion that Canadian businesses are less innovative are areas that warrant further investigation.
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