He’s been present at every major business conference for a decade or more. He’s been a regular commentator for BNN and TVO, and a trusted source of advice for governments of all stripes.
Since he joined the Institute for Competitiveness and Prosperity in 2002, James Milway has been one of Canada’s most respected business advisers and commentators.
Mr. Milway stepped down as ICP’s executive director this summer (his successor is Jamison Steeve, the former principal secretary to Ontario Premier Dalton McGuinty) to begin as chancellor of temporal affairs with the Catholic Archdiocese of Toronto. After a decade studying Canada’s economy – including ICP’s research on Canada’s Global Leaders – he’s drawn some conclusions about what Canada can do to develop more homegrown, world-beating companies.
“What’s needed is a combination of both support and pressure,” he said. Mr. Milway added that Canada does well on the support side of the equation. Its competitive tax system, stable inflation and interest rates, and strong postsecondary education system all help to create conditions for businesses to thrive.
The next step, he said, is to apply more pressure. “Canada is a small country with a history of sheltering its industries,” Mr. Milway said. “Our firms are not exposed to a lot of competition. So we have to export competition from elsewhere.”
He believes the federal government is moving in the right direction by seeking new trade agreements with both the European Union and Pacific Rim nations.
For Canadian firms with ambitions of conquering the global marketplace, Mr. Milway’s decade of research with the ICP can be distilled into three maxims.
Get good, smart management
While the media loves the young-dropout-strikes-it-rich stories of tech entrepreneurs such as Steve Jobs, Bill Gates and Mark Zuckerberg, research shows the founders of most Canadian global-leading companies are well educated. They also had substantial experience in their industry before they founded their firms.
Education is just as important for the managers who come on board as the firm grows, Mr. Milway added. “The Americans are ahead of us when it comes to producing educated, professional managers,” Mr. Milway said.
Export early, export often
According to Global Leaders research, half of Canada’s Global Leaders were exporting outside Canada within the first five years of their existence. In a small country with relatively little business competition, global leaders are those who actively seek more of it – especially in the firm’s early years.
“No one wants their job to be made more difficult by exposure to more competition,” Mr. Milway said. “But that exposure makes firms better.” Firms that don’t get into the export habit early are also less likely to develop the habit later on.
Never stop innovating
Canadian firms become world beaters, and stay world beaters, through innovation. The ICP’s research found that all 42 of Canada’s Global Leaders with more than $1-billion in revenue had successfully innovated in some area of their operations, whether it was new products or services, acquisition strategy, training, technology applications, or supply chain management.
Global leaders Top 10
The Toronto-based think tank Institute for Competitiveness and Prosperity assesses the global competitiveness of hundreds of Canadian companies and determines which of these firms are global leaders in their industries. Here are the Top 10 from their 2011 list, along with the percentage of sales outside Canada (and 2010 revenue in thousands of dollars).
1. Manulife Financial – 74 per cent ($37,633,000)
2. Royal Bank of Canada – 39 per cent ($36,026,000)
3. Magna International – 77 per cent ($24,825,060)
4. Husky Injection Molding (Onex) – per cent NA ($24,366,000)
5. Scotia Mocatta – 44 per cent ($23,775,000)
6. Research In Motion – 93 per cent ($20,325,048)
7. Bombardier – 94 per cent ($18,172,512)
8. Alimentation Couche-Tard – 78 per cent ($17,689,010)
9. Brookfield Asset Management – 81 per cent (14,031,690)
10. Thomson Reuters – per cent NA ($13,462,100)
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Editor's note: This is a corrected version stating 2010 revenue in thousands of dollars in the Global leaders Top 10 list.