Kirk Mandy on wealth creation

(The following is an extract from Kirk Mandy's keynote address at the recent RE$EARCH MONEY Conference).

"Canada has a basic policy model that suggests that research leads to development, leads to commercialization and ultimately wealth creation. As a result, we are the envy of a great deal of nations in terms of research and development incentives and capabilities that are available in Canada.

We do research in government labs, we support research in our universities, we subsidize research in our companies and as a result, we have a lot of researchers and a lot of technology.

But have we created wealth for anybody other than the researchers and the institutions that support them? Where are the growing companies, the growing industrial sectors of our economy which we can point to and say, ‘Thank God we spent all that money on research or we wouldn't have all these wonderful companies and industries providing quality jobs for all these Canadians.'

I can honestly say that I have never had a customer say to me, ‘Jeez, I got to have that research, where can I buy it?' And I contend that this basic philosophical model under which we develop policy, under the assumption that it will lead to wealth creation, is not only wrong but backwards.

To create wealth, you must start with an idea of where the wealth is going to come from ... Building businesses is about creating value for customers. You must start with a very clear idea of where the money that you want to put in your company's bank account is going to come from and why your customer would allow you to have it. This is a process of market insight generation, i.e.: where is the money and what do I have to do to cause a financial transaction to occur between my customer and my company.

Once a clearly thought out description of the above is available, then an algorithm describing an execution plan must be defined ... If the above two items are clearly thought through, then successful execution of the overall plan will result in wealth creation."

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