National Research Council gearing up to make its mark as a solutions-oriented RTO

President says major challenges overcome

The National Research Council is expanding its executive suite to implement its new outcomes-oriented strategy for assisting companies in priority areas of the economy. Within weeks, the restructured agency — which is gearing up to celebrate its 100th anniversary this June — will unveil a slate of five VPs (up from three) with titles that reflects a focus on solutions while also seeking additional funding for R&D.

And while it's falling short of achieving the aggressive industry funding targets set in 2011, president John McDougall notes that the NRC implemented its comprehensive overhaul of Canada's largest industry R&D support organization amidst an economic downturn and a serious cyber attack. Instead of tripling industry revenues from $50 million to $150 million, the current industry contributions amount to approximately $120 million.

"Our industrial revenues have been growing steadily which is nice in spite of the downturn and struggles … They have not grown as much as we would have hoped but this (executive expansion) is also designed to try and address that," says McDougall. "The best way to ensure that programs are outcome-oriented is to …get away from focusing on the activities side … The strategy is the outcome and you want to be able to engage people in how the outcome is achieved and really dig the creativity out of our guys."

The NRC currently has three VPs, two of whom are staying on (R$, January 26/16). Once another three candidates are selected, the NRC executive will match them with the new VP positions. McDougall says the key qualities being sought are executive skill sets.

"When you're at the VP level, there are three fundamental things you've got to be able to do — strategy, the know-how to run a business and the discipline to operate it," says McDougall. "They're not married to a particular area although they need a little knowledge of the field in which they're working ... We know what they (VP engineering Dr Ian Potter and VP life sciences Dr Roman Szumski) can do. We're going to hire three more people and put them all in the best possible positions."

(RE$EARCH MONEY's interview with McDougall took place prior to his announcement that he was taking personal leave starting today, delegating all authority until further notice to Maria Aubrey — VP business and professional services).

While the NRC was implementing its transformation, funding provided by the federal government was directed primarily towards capital requirements required to engage more fully with industry. Several flagship platforms and many R&D initiatives were launched during this period, including the high-profile Factory of the Future program which is rolling out in Ottawa, Winnipeg and London. During that period, McDougall says the NRC was not looking for increases in its R&D budget.

"While we were changing we didn't want increases as that just complicates things. I know that's not normally the way people think around here but you've got to have the capacity to absorb the changes," he says. "We had things that needed to be dealt with, things that needed to be fixed, so the last thing we wanted was to dump a whole bunch more stuff on top of that ... You've got to get things in place before you can use the operating (funds)."

With the change in government, the NRC is better situated financially than many other government R&D operations. McDougall says the organization is up by about $150 million since 2011 "in sustainable terms" due primarily to significant increases to the Industrial Research Assistance Program, "and we're anticipating more if you accept the (Liberal election) platform. Actually I'm really happy".

The 2014 hacking incident posed a serious challenge to the NRC's transformation plans and revenue targets. The security breach prompted the organization to shut down all its information technology systems and embark on a year-long overhaul that cost in excess of $30 million. The NRC now runs two parallel systems including a so-called "green computer network" where sensitive correspondence and collaboration is conducted.

"We're bringing on new infrastructure, bringing us back pretty much to full productivity. What was amazing is we still grew our industrial revenue (during that period)," says McDougall. "That was a huge credit to people but it will take a while before we can say the whole thing is done."

McDougall says he anticipates industry funding will continue to grow.

With the structural transformation nearly complete, the organization is seeking new funding to ramp up its R&D. McDougall acknowledges there is a request before government for this week's Budget but would not provide details.

As part of the transformation process, the NRC launched an extensive foresight exercise called the Game Changing Technologies Initiative (see chart above). Led by Dr Dan Wayner, NRC's VP emerging technologies, the initiative identified seven "challenge areas (and) emerging cross-cutting technology themes" deemed critical to Canada's future (R$, June 24/15).

Extending the frontiers of these emerging technologies will require new funding and may include the creation of a civilian version of the US Defense Advanced Research Projects Agency (DARPA). According to a recent Globe and Mail article, the idea involves the conversion of the National Institute of Nanotechnology into an incubator for emerging technologies. NINT is jointly owned by NRC, the Government of Alberta and the Univ of Alberta. The NRC and the U of A declined to provide further details on the initiative saying it was "premature".

But the concept underscores the new thinking that is positioning the NRC as an RTO and a "solutions" organization. McDougall calls this the NRC's "visual identity" in which R&D is a mandatory component.

"The solutions element is really tied to outcomes, that's what it's about ... Research is the means to an end but if it's not used and taken up by whatever, you do something else," says McDougall. "What I want to do is put our resources into the things that matter, which are helping industry be successful today, tomorrow and decades from now. Our job is to give (industry) the solutions that allow them to do that."

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