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Given the size differential of the two cities, you'd think Toronto could blow Waterloo off the smart-city map with a well-aimed sneeze.

If so, it had better be loud enough for the likes of Bill Gates and Barack Obama to hear.

"Waterloo has two claims to fame, and they're just hard to argue with," said Roger Martin, dean of the University of Toronto's Rotman School of Management. "One is that Microsoft hires more engineers from the University of Waterloo than any other university, and then RIM," he said, referring to Research In Motion, whose BlackBerry the popular American President cannot live without.

These two "over-the-top successes," magnified by having emanated from a small, tech-focused city of 120,000, will be tough for Toronto to top.

"What has got to happen for Toronto to get the same kind of attention is, we've got to get successfully commercializing all that great stuff that comes out of the medical complex," Mr. Martin said.

The closest thing to a would-be Waterloo in Toronto is the medical "discovery district" around College Street and University Avenue, near the University of Toronto and several teaching hospitals. In the midst of it is MaRS, a non-profit, collaborative entity of the university, provincial and federal governments and industry, which aims to turn these discoveries into commercial projects.

"What Toronto has going for it is Sick Kids and Princess Margaret hospitals, that are in the top little handful in the world in what they do," Mr. Martin said. "But it's a little bit different to have something like the Microsoft thing or the RIM thing," which are so much more out of proportion to Waterloo's size than are Toronto's feats in fields such as oncology and stem-cell research.

Thomas Homer-Dixon, a political scientist and popular author who left U of T for Waterloo last year, has found stark differences between the University of Waterloo and U of T, which are "mirrored in the larger communities of which they're part."

U of T, not unlike Toronto itself, suffers from diffuse administration, a long history (182 years to UW's 52), gigantism, a lack of visionary leadership and arrogance, he said.

UW, a smaller institution on a smaller campus in a smaller city, has only a handful of faculties with "less entrenched and immutable cultures," whose leaders can collaborate more naturally. Those leaders "believe in a common vision for the institution as a pragmatic, problem-focused innovation generator," said Dr. Homer-Dixon.

What U of T needs is "strong leadership to articulate a compelling vision that draws people together."