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@CloudExpo: Blog Post

Canadian G-Cloud Key to Addressing Innovation Gap

Creating innovation clusters around Government requirements is key to closing Canada's innovation gap.

Recently I launched a new initiative to help accelerate Cloud Computing innovation in Canada, the OpenRFP Network.

A number of key concepts inspired this project, most notably Cisco's vision for how Michael Porter's cluster strategy for economic development can be upgraded through new technology, their 'Next Generation Cluster' model, and the 'Forward Commitment Procurement' ideas pioneered in the UK.

Government-driven Innovation
Both share a common theme, that Government spending can be leveraged as a mechanism for stimulating innovation.

The critical point being this isn't their existing R&D investment budgets, but rather their regular procurement, like their IT budget for example.

This approach is key to the challenges Canada faces. The innovation strategies & government bodies developing them are overly academic, there is too much emphasis on the universities and there is too much of an isolated government institution including academia that gets too much of the money.

The universities are funded to the tune of $5 billion or so, while their high-tech innovation fund, the IRAP program, has only a paltry $100m or so to work with, so it’s hardly surprising Canada isn’t feeding a pipeline of new tech ventures.

This results in a literal 'Innovation Gap' - There is a distinct shortage of "seed" phase of startups, new ideas being funded with $20-200k, due to a lack of funding and government support.

G-Cloud Innovation Pipeline
So, the solution needed is to direct more of the large-scale funding programs towards actual, real-world commercial innovation, and the idea of OpenRFP.net is to help fill this gap.

What the new Cisco and UK Government best practices highlight is that this can be simply through a new perspective, where traditional procurement budgets are viewed in a new light of being sources of investment capital too, simply through connecting them to the right programs.

By this I mean helping new startup entrepreneurs tap into existing procurements. Whereas IRAP only offers $100m the IT budget for the Canadian Government itself is around $6billion a year, and by setting up the right environment where new ventures can more easily sell to them, then it can be directly linked to the startup venture process and thus be tapped for a source of seed funding.

Our first example of this is VMaware. This is a concept for a new Cloud Computing technology, the value of which can be quantified by linking it the RFP published by Elections Canada. By incorporating consulting fees for the development of this software into the bid, et voila, we have established this link and a virtuous cycle where Government spending can be directly stimulating local venture innovation.

G-Cloud Innovation
Accessing startup financing isn't the only benefit to this approach. By using Government RFPs like Elections Canada as 'blueprints' for the new technologies being developed then new startups are very cleverly meeting market needs, the RFPs act as "innovation specifications" for new services that the market as a whole will be buying over the next few years.

Furthermore it sets them up for global expansion too. Meeting the needs of Government locally here in Canada means solutions are being designed for the needs of Governments globally.

Our solutions are being designed as part of our overall 'G-Cloud' program - Government Cloud Computing. This is a trend being driven heavily by the UK and USA governments, and setting up export links to these markets is a key part of our sales acceleration program that OpenRFP enables.

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