Power Breakfast: Presentations by Alizabeth Calder of Brainhunter and Dan Fortin of IBM Canada

This morning, I attended a Technology Innovators Breakfast session at the Toronto Board of Trade as a guest of Alicia Bulwyk, Project Manager of ICT Toronto. It's a suit-y affair, held at the Toronto Board of Trade's dining room, deep in the heart of suitland: First Canadian Place at the corner of Bay and King Streets, the centre of the Canadian financial universe.

This breakfast gathering is one of a new series in which interested parties can "hear Toronto's industry leaders expound on their own personal success stories - why Toronto is their company's chosen location to expand their business, and what their forecast is for the next wave of technology." Today's speakers were:

  • Alizabeth Calder, Executive Vice President, National Accounts for Brainhunter, doing a short preliminary presentation
  • Dan Fortin, President and CEO of IBM Canada doing the main presentation.

By my count, the event was attended by about 100 people, with a good number of IBMers in attendance, and the major banks well-represented. I sat at the ICT Toronto table, joined by a number of the ICT Toronto regulars, including my TorCamp brain trust compatriot Jay Goldman.

I found the event useful -- it's good to break out of the nerd world every now and again and see what the suits -- particularly the big players like IBM, Accenture and the major financial institutions -- are up to. After all, tech centres thrive when nerds meet rich people. I'd be more than happy to attend another one of these breakfast sessions and learn more.

Host (Could somebody tell me his name?)

  • We have a problem: a lack of commercialization of our technical know-how
  • Of the $3 billion spent by angel investors in Ontario last year, only $10 million went to information and communication technologies firms.
  • The number of Ontario universities teaching a marketing course specifically for technology: 0
  • His suggestions:
    • Create programs to encourage entrepreneurship
    • Provide tax incentives for tech companies
    • Support small startups: they're the "secret sauce of the ICT community"

Alizabeth Calder, Brainhunter

  • There are three trends in the Toronto area:
    1. It's an employee's market. Even Brainhunter's "B- and C-caliber candidates" are getting multiple offers.
    2. Good people want more. For them, merely getting a paycheque isn't enough; they want interesting, challenging work. On the hiring side, there's a high level of specificity in what companies want: specific skills, experience and expertise.
    3. The vagaries of doing contract work are no longer an obstacle. Finding clients used to be a chore for contractors 10 years ago; now it's a matter of calling up your favourite recruiters. Companies like BrainHunter also help contractors with the matter of getting paid -- their HireSafe program managed $30 million in salaries this past month. Contract working is now a safe, viable option.

Dan Fortin, IBM

  • A brief history of IBM Canada:
    • IBM opened its first Toronto office in 1917.
    • The IBM Toronto office was the first branch to use the name "International Business Machines" and the "IBM" acronym.
    • There are 20,000 IBM employees in Canada; 11,000 of them are in the Toronto area.
    • Toronto is home to IBM's Toronto Software Lab, Canada's largest software development facility, with 2,500 people and $350 million in R&D spending.
    • IBM Toronto is IBM's largest outbound sales centre.
    • IBM has an innovation centre located downtown.
  • There's been a transformation in the industry -- some signs:
    • Formerly thought of as a hardware company, IBM has had to transition to become a services company.
    • Where once people wanted proprietary software built on proprietary standards, they now want open solutions built on open standards.
    • "Computing is no longer coming just from computers." Think of RFID tags, home appliances, shipping containers, roadways...
  • It's an online world! There are:
    • 1 billion people online
    • 1 trillion devices online
  • The networked world allows distance working.
  • Other factors transforming the industry:
    • The advent of free trade agreements
    • Emerging economies (such as the BRIC -- that's Brazil/Russia/India/China -- countries)
  • Competition from emerging economies:
    • Companies outsource to reduce costs.
    • Reduced cost is not the only factor -- if it were, we'd see everything in tech being commoditized and work flowing in one direction only.
    • Work flows in this direction because of innovation.
  • We need to foster skills
  • We need to make use of open systems and open approaches:
    • They stimulate competition, collaboration and innovation.
    • It means more competition, even between companies in totally different channels, even totally different industries!
    • But it also means new opportunities.
  • We need to innovate
    • Note that the number of articles around the term "innovation" doubled in the last year.
    • Innovation isn't merely invention alone, but invention coupled with business insight.
  • How do we innovate to make Toronto stand out?
    • The best way is to focus on the expertise that's available right here:
      • Toronto has an incredible base of skills
      • Canada has some of the most highly-educated people in the world, and a large portion of them are here
      • Toronto's multicultural nature is an asset: we have many immigrants with post-secondary degrees.
    • We need to track and retain expertise, and to do this, we need to:
      • Build relationships with universities
      • Start internship programs to help students get started
      • Encourage mentoring programs to ensure that knowledge and experience don't get lost when people retire
      • Embrace diversity. When you gather people with different ideas and points of view, creativity flourishes.
      • Be flexible. For example, look at roles in your organization: do they all always have to be physically located within your office?
    • We need to realize that collaboration is key:
      • In a global economy, we all wear many hats -- it's possible to simultaneously be partners, competitors, clients and suppliers.
      • In a recent global survey of 750 CEOs, a large number of them said that the majority of ideas for innovation came from outside their companies.
      • Financial performance is tied to collaboration.
  • Toronto is "very well-positioned" to become a world-leading city, and a strong ICT community is key:
    • We have the skills, expertise, diversity and experience.
    • What we need is to make deliberate choices, be willing to do some risk-taking and risk-sharing, and collaborate.

Q & A Session

Q [RBC Innovation person] How can the little guys -- the 100-man, 200-man shops -- "plug and play", or participate in the ICT sector?

A [Dan Fortin]:

  • It might be the large coporations that will face more difficulties; they're the ones who'll have more trouble adjusting to a more collaborative environment, especially if their corporate culture doesn't favour collaboration.
  • The ability to collaborate will extend a small company's reach
  • IBM has an entire program devoted to seeking out smaller firms to collaborate with.

Q [Power Logic person]: Regarding the earlier statement on how little angel money is being spent on tech -- what can leaders do to change this situation and increase angel investment? We need that, because it's those "skunk works" projects that are the sources of change.

A [Dan Fortin]:

  • Some good ideas appear in the current issue of Macleans -- the How to Fix Canada cover story
  • The TRRA has been working on the problems of how to attract research and development and how to help government understand the funding requirements for ICT

A [Alizabeth Calder]:

  • I've talked to a lot of VCs, and a common link among all of them is the "fear factor": they feel held to ransom by the techies they invest in.
  • Investors need to understand technical decision as business decisions.
  • We need technical people who can explain technical decisions and factors in a way that business people can understand.

(Commenter: We also need tax incentives to reduce the "fear factor" of angel investors.)

Q [Person from Ottawa]: How do we get investors past what seems to be their fixation -- that of the "early exit", where they want to invest in a technology just to make some quick money and then bail? There seems to be a low level of interest in actual commercialization, and as a result, the attention is moving away from technology out of frustration.

A [Dan Fortin]:

  • One reason people haven't been interested in taking an idea through to commercialization is that there are so many stories about terrific opportunities that eventually don't pan out.
  • "It's like a bad 'Deal or No Deal' game -- you could've taken the $250,000 briefcase, but you held out and walked away with a $45 one."

A [Alizabeth Calder]:

  • It's situations like that that led us to invest in RIM -- they had principals that we could look in the eye.

Q [Dave Craig, Price Waterhouse Coopers]: What's ingredients is Toronto missing for ICT success?

A [Dan Fortin]:

  • "I thought these were supposed to be easy questions!"
  • We could leave it to governments to figure it out for us, but I strongly recommend against that. Take the example of the problem with the Detroit/Windsor corridor, through which 35% of the goods between the US and Canada flow. They did a 4-year study of the problems, and the end result is a task force with a 5-year window to make recommendations! This story was being told by a Canadian Pacific Railway exec who reminded the audience that once upon a time, "it took us only 4 years to build a friggin' railway across the country!"
  • This is a task that the Toronto ICT community needs to take on themselves.

A [Alizabeth Calder]:

  • We need to focus on collaboration.
  • We need more openness, to be able to have conversations with each other without worrying whether or not they're proprietary.
  • We need more gatherings for members of the Toronto ICT community to meet each other.

Q [Host]: What do you think of the idea to close the Gardiner?

A [Dan Fortin]:

  • "Thanks goodness I don't have to drive it every day!"
  • "I think it's a terrible idea."
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