Magna receives $50 million from province to establish unique commercialization centre

Ontario Budget

The Ontario government is investing $50 million over four years in a novel centre to accelerate the commercialization of automotive products and processes with a lighter environmental footprint while training innovation-ready workers for the sector. The Stronach Centre for Innovation (SCFI) will focus on training post-graduate students for three key functions by taking mid- to late-stage R&D and moving it into the marketplace.

Funding for the centre was provided in the March 22 Ontario Budget under climate changes initiatives, although the name of the centre was not mentioned. While Ontario has provided funding assistance to big auto makers in the past through the $500-million Ontario Automotive Investment Strategy, it marks the first time it has agreed to support a supplier of specialized parts and processes.

The concept for the centre was hatched two years ago by Frank Stronach, chairman of auto parts colossus Magna International and Canada's third highest corporate R&D performer. The idea is to accelerate the commercialization of products and train graduates from provincial universities and colleges (see chart). The SCFI will be located within Magna's headquarters in Aurora ON.

"We needed a plan to take ideas and developments that come off the shop floor and commercialize them … This is a small ‘R', big ‘D' play for mid- to late-stage R&D that needs an extra push," says Dan Donovan, Magna's VP public and government affairs. "The projects will be focused on vehicle weight reduction because if you reduce weight you reduce emissions. They were identified by Magna, its supplier companies and our university associates … based on their wealth creation potential and ability to sell products. These are real projects with real timelines initiated by industry."

The Centre's initial slate of projects was provided by Magna but once the program ramps up it will be opened up to other sources and possibly areas of R&D other than automotive. Magna has worked in conjunction with Univ of Toronto professor Steve Martin to develop a three-tiered training program that will see up to 60 people enrolled for 18-month terms when it hits full stride.

"This centre and the training program are unique in the manufacturing world," says Donovan. "There's been explosive growth in India and China and specialized products are the key. But you also need to develop a specialized work base. The winners are going to be those with the best trained people and think outside the box."

Magna has a strong innovation tradition within the automotive supply sector and is a major R&D performer. It currently ranks third on Canada's Top 100 Corporate R&D Spenders list with outlays of $823.9 million in FY05 on revenues of $12.7 billion for an R&D intensity of 3%. The company is best known for pioneering hydroforming in the 1990s, a transformative manufacturing process that shapes tubing or sheet metal using the force of water or hydraulic fluids.

SKILLS DEVELOPMENT

Magna's reputation as an innovative manufacturer was a major attraction for Martin who led the development of the SCFI's curriculum. He says the company tends to spin out new plants around individuals who are innovation specialists and the challenge is to reduce the amount of time it takes to produce people with comparable skill sets.

"Not enough people are being produced by schools in Canada with this skill set. We want to compress 15 years of experience into two years. This is an uber apprenticeship," says Martin, director of the Professional Development Centre within U of T's faculty of applied science and engineering. "Students will go from genesis to the marketing and sale of products in 18 months."

increases ‘D' funding

The apprenticeship program will have two streams for university- and college-trained students and three levels of apprenticeship – practitioner, manager and executive. When students successfully complete the program, they will receive either a Masters of Innovation and Engineering or an Innovation Certificate. Those training to become innovation managers will have to take both streams.

Students will be placed in teams with a team leader — typically a senior individual with a track record of innovation. The program is fulltime, with students either taking courses or working on assigned projects. They will also be paid a nominal salary.

"We see innovation as commercialization but in R&D, there's no funding for ‘D'," says Martin. "We want to produce people that do lots of ‘D'. Magna provided that avenue and the projects, and we add the students and put them into a centre devoted to commercializing products."

One of the training program's unique elements is a tracking and measurement system to gauge its effectiveness in meeting its goals. Specialized software will allow program managers to track the innovation process including outputs to determine what works and what doesn't. The intention is to build up a body of knowledge that can be replicated in other areas of innovative activity. "The idea is to improve the overall innovation environment in a real way in Ontario and in a measurable way," says Martin. "The kids are going to be scary when they come out … There's no other centre like this globally."

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