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Innovation Coaching Series Part 3 – Innovation in the Public Sector

Innovation in the Public Sector
Public sector is the largest contributor into the economy of any city, state or country. Embedding innovation will kick start the innovation eco-system and will have a spillover effect on the private sector, as it will gear itself to keep up the pace thus public sector innovation can become the key driver to an innovative economy, Key components of innovation in this segment are as follows:

  • Creating a Climate for Innovation: If the public sector has an agenda to upgrade and innovate its infrastructure, then it needs to exhibit it by internal innovation and make a 3, 5 and 10 year plans and set clear goals. By doing this it will trigger an innovation snowball effect, that will push the private sector to innovate too, and in turn benefiting all. As an example, key cities in Canada did not ban Uber, although the Taxi Cartel went berserk, instead it legitimized it. This gave a message to companies testing Driverless Technology that environment is conducive and opted to setup their testing base in Greater Toronto Area. Another example is Green P Parking. A brilliant way to pay for your parking, and also extend time seamlessly. This triggered users to abandon the parking meters and use this app instead. As app usage went up amongst citizens, other app usage also propelled.
  • Incentives & rebates: Sometimes startups need funds to kick start their initiative, government grants, rebates and subsidized employment can all help. Subsidized employment not only help train the workforce in future technologies, but it also provides competitive employees for startups. These incentives help the startup to come of age if they have the promise and mettle. Usually getting access to these grants is not easy and this needs to be looked into it. Red tape needs to reduce and public sector needs to think like incubators.
  • Government Incentives: This does not only mean money, but the rules and regulation in place. Just by tweaking the immigration policy, Canada was able to attract more high tech jobs Silicon Valley www.utoronto.ca/news/toronto-added-more-tech-jobs-last-year-silicon-valley-or-anywhere-else-report . Race is on to attract tech talent globally, certain countries are doing much better than others, www.cbc.ca/news/business/immigration-high-tech-canada-global-skills-strategy-1.4391409 . Hats off to Canadian Prime Minister Justin Trudeau and his entire team, as they policy is working.
  • Tax Vehicle: Tax holidays and incentives are given to investors set up their shops, if its an innovative manufacturing setup, then this is a good feat as this can last for a decade or more, but for software and tech shops, this may be a sunk incentive, as these can avail incentives and pack up and leave. So this is not always a benefitial step and must be used very carefully. Canadian cities did not offer Amazon any tax incentives when it was evaluating cities for HO2. Instead they pitch was around workforce, medical care, immigration, legals etc. We lost out on HO2, but the entire world got to know us better and several innovative companies are now opting to set up their offices in Canada.
  • Legal Environment: Extremely important for innovative driven companies. Protection of Intellectual Property is an absolute essential aspect of a business. The legal system should be able to secure the intellectual property rights of the owners and judicial laws should abide by international laws.
  • Fiscal Environment: GDP growth, interest rates, banking system, law and order, domestic GDP, good quality of life and many such factors contribute in triggering innovation. Working 24/7, office space, reliable hydro supply and competitive cost of doing business will not only trigger innovation, but will also keep us globally competitive.

Its interesting to see each city and country’s innovation roadmap, all stakeholders should be on one page, continuity has to be maintained. This is just like bidding for Innovation Olympics, the city, province and country are part of the planning process.

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