Why Mexicans Don't Drink Molson. Andrea Mandel-Campbell

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СКАЧАТЬ are definitely not soft and cuddly, say those who have dealt with them. The Australians, descended from convicts exiled to a distant island, are ballsy adventurers who travel the world over. And while Bern may rival Ottawa as the world’s most boring capital city, the Swiss are “calculating, regimented and disciplined. They know what they want and are fantastic negotiators,” says Jeff Swystun, the Toronto-based global director for the branding company Interbrand.

      “It’s a problem of our marketing aggressiveness. When has Canada ever conquered another country? We are a country that’s never had a revolution, never had a civil war,” says Swystun. “Unfortunately marketing is all about scrapping it out — for market share, for share of mind and share of wallet. That means being aggressive day in and day out. And that just doesn’t appear to be in our character. It would mean taking a stand, and that’s something we are loath to do.”

      So instead of being scrappers, we are skimmers. Whether it’s the big banks that sit at home counting their billions, logging companies content to hew two-by-fours instead of manufacture tissue paper, or manufacturers churning out generic products rather than innovating, Canadian companies scoop the cream off the top rather than milk their products and services for all they are worth. Why go through the painful and risky process of building brands, expanding internationally and adding value when there is relatively easy money to be made carving up homegrown monopolies, cutting down trees and turning out component parts?

      “The Americans phone us and say ‘We need wood’ and we sell it to them, and they sell it back to us as a cabinet,” says Drury Mason, Alberta’s assistant deputy minister of economic development. “And we’re happy to do it because we made money on the wood.”

      That kind of inward-looking comfortable complacency has taken a toll on the country’s entrepreneurial drive. The lag is reflected in a reluctance to invest in new technology, a reliance on cheap labour and a yawning productivity gap between us and the United States. Canada’s investment per worker in machinery and equipment is about 60 per cent of U.S. levels, its companies spend less than half as much on research and development as the Americans do, and we are twenty years behind our neighbour in our stock of information technology.³⁹

      It’s why, when I was in the Arctic, I was surprised to learn that all of Canada’s fleet of Coast Guard icebreakers are powered by Finnish-made engines, and why Quebec, traditionally the largest source of aluminum for Alcan, doesn’t have a single aluminum auto parts maker. It’s also why, despite manufacturing cars for forty years as part of the Auto Pact, an automotive free-trade agreement between the United States and Canada, Canadians are essentially still assembly-line workers.

      Not surprisingly, Canada continues to slip in the World Economic Forum’s annual rankings of the world’s most competitive countries. Its overall business competitiveness sank from sixth place in 1998 to fifteenth in 2006, largely due to a weak track record on innovation. According to the survey, Canada ranks thirty-second out of 125 countries in its propensity to compete based on unique products and processes. When it comes to the degree to which exporting companies go beyond the simple resource extraction and are involved in product design, marketing sales and logistics, it ranked a dismal forty-sixth. In contrast, Finland, Sweden and Denmark have topped the charts year after year, thanks to a private sector that according to the forum “shows a high proclivity for adopting new technology and nurturing a culture of innovation.”

      That’s not to say that Canadians never come up with innovative technologies or ground-breaking inventions. They do. In fact, they do it quite often. The problem is that they seem to have a hard time making the leap from the laboratory to the marketplace. When a Canadian product does make it to the store shelves, it’s usually because an American company made it happen. “What Americans are good at is taking a commercial venture and getting people excited about it,” says Nizar Somji, owner of the Edmonton-based technology firm Matrikon. “We are not only unable to commercialize, but we are unable to get people excited.” Adds Interbrand’s Jeff Swystun: “We don’t have a marketing mindset in this country at all. We’re bad at making the finished product shine, and there’s a real void in marketing talent, in aggression, in boldness of claim. It’s truly a void in the business world.”

      The story of IMAX Corp., the iconic big-screen movie company, is the Canadian conundrum writ large. In the late 1960s, a group of Canadians developed a revolutionary technology for large-format film. The technique became a staple at science centres and museums, but eventually it stumbled on drab content and limited growth. Two Americans picked up the floundering company in 1994 and gave it a new lease on life. No longer merely a vehicle for documentary and educational films, imax now features Hollywood blockbusters using a technology it developed to convert conventional films to its format. The new owners, a pair of New York investment bankers, have signed licensing agreements with theatre operators around the world. There are now 366 big screens running in thirty-six countries, from Russia to Kuwait, while China is the company’s biggest market outside the United States, with twenty-five theatres set to open by 2008.

      John Mendlein, an American biophysicist and lawyer who spent four and a half years working in the Toronto biopharmaceutical sector, traces Canada’s limp salesmanship back to another duo: Fredrick Banting and Charles Best. In 1921, the two Canadian doctors discovered insulin, the lifesaving secretion used to treat diabetes. The Nobel Prize–winning find is one of the greatest medical discoveries of the twentieth century, yet the two doctors never attempted to cash in on their work, considering it “culturally unacceptable,” says Mendlein, to commercialize science.

      A group of Danish scientists, however, were not bothered by similar concerns. On hearing of the Canadian breakthrough they immediately got to work producing insulin, and in 1923 — just two years after the initial discovery— they launched a company and began treating patients. That company, Novo Nordisk, is today a world leader in diabetes treatment, employing twenty thousand people in seventy-eight countries.

      Canada, in comparison, while having made world-leading advances in diabetes and stem cell research, is nowhere on the pharmaceutical industry map, according to Mendlein. It has been outmanoeuvred by everyone from Sweden and Denmark to India. “If you look at where you are on the level of research and biological science, you are probably in the G3,” he says. “But Canada doesn’t even make the G8 of pharmaceutical countries. It’s tragic.” While small towns like Indianapolis, Indiana, and Thousand Oaks, California, have spawned world leaders like Eli Lilly and Amgen, Toronto, which is home to Canada’s largest cluster of biotech firms, has failed to produce a single stand-alone biotech company or blockbuster drug.

      Canada doesn’t even boast an insulin manufacturer; the original University of Toronto laboratory where diabetes was discovered was spun off into Connaught Laboratories, which busied itself with maintaining a domestic monopoly while handing out international licences to the likes of Eli Lilly and Novo Nordisk. It eventually lost its ability to even supply the Canadian market, and was taken over by the federal government in 1972 before being sold to a French pharmaceutical firm. Absorbed into the massive ranks of the world’s number three drug company, Sonafi Aventis, the “Connaught campus” in north Toronto is the only remaining vestige of Canada’s contribution to diabetes treatment.

      “Canada has some software and electronics companies, a little aircraft, but no consumer goods, or cars, and it’s not really happening for computers or pharmaceuticals,” says Mendlein. “You could be the Norway in North America and rely on commodities, but you are not going to be Sweden, which is home to the top-selling drug in the world and probably the car you drive. The question is, where does Canada, which is a much bigger and much more powerful country, fit in?”

      It’s a good question. To answer it, I asked four related questions about the largest supposedly “Canadian” companies to the gauge the country’s entrepreneurial drive and managerial capacity — the basic requirements for creating globally competitive companies:

      1. How СКАЧАТЬ