Canada’s tech innovation spending is too low: PwC
Canadian businesses allocate just 7.8% of their revenue to innovation, compared to 9.64% globally, innovation survey suggests.
TORONTO – Canadian technology companies are struggling with innovation—enthusiasm is low, and businesses are not making it a priority when it comes to allocating funding or resources.
According to PwC’s Global Innovation Survey, 88% Canadian companies in the technology sector are aiming for at least moderate growth over the next five years, but only 27% have an eager appetite for innovation. While the figure sits slightly above the global average (21%), competitors worldwide are still spending more: Canadian businesses are allocating just 7.8% of their revenue ($21 million) to innovation, compared to 10.38% ($111 million) in the UK and 9.64% ($200 million) globally.
The survey suggests that Canadian businesses are far more likely to rely on the government to fund the innovation programs they do initiate, with half of the respondents in these categories relying on federal and provincial incentives.
Respondents also lack the structures necessary to effectively manage innovation. And, even though Canadian companies are more likely than their global counterparts to think that having innovation structures is important, they are in fact less likely to actually have them in place.
In terms of where companies are looking at innovating, products rank at the top of Canadian businesses’ lists, with 35% indicating this as a high priority—well ahead of customer experience (8%) and business models (4%). It’s a competitive space to play in, as both the US and the UK also list products among their top areas to innovate.