The document describes the activities and services provided by the Canadian Innovation Centre related to new product and business development. It discusses three main activities: education, tools, and development. Under education, it shares knowledge about commercialization best practices. Its tools involve pre-commercialization research and evaluation. For development, it works on new strategies and methods to help innovators commercialize technologies. It outlines various studies it conducts at different stages from evaluation to launch to address issues innovators may face.

1. Canadian Innovation Centre catalogue of activities related to New Product & New Business Development 1 (519) 885 5870 (EST/EDT GMT-5) www.innovationcentre.ca [email_address] December 1 2004 Subject to change and improvement :-)

2. Statistics and experience clearly demonstrate that companies doing proof of concept work (and those sponsors supporting them), commercializing a technology within a market-driven process fare significantly better than those who don’t. Typical benefits include: faster time to market reduced development costs greater user acceptance investor confidence and buy-in, and ultimately greater sales potential. Canadian Innovation Centre Guiding Innovation to be Market and Buyer Driven

3. CIC work is designed to provide information and insight necessary for both the sponsor (government or private lender or investor) and client (the new or small to medium enterprise - SME) perspectives. By validating client assumptions and directions plus adding information, education, and experience, our greatest achievement is to provide metrics and investment insight tools for sponsors in their role and to introduce a client to the value of a process and series of market-driven attitude and product shifts to achieve commercial success . Not all studies are supported by all sponsors. Sponsors by their nature, objectives, and geography, participate in business and technology development activities at different stages and use certain studies. This catalogue describes the work we are doing today and the nature of ongoing future development efforts. Custom work is available. Canadian Innovation Centre Two Audiences with Two Points of View to Consider

4. New products and innovations proceed through a number of stages on their path to commercial success. Each stage comes with it’s challenges and sense of urgency. Canadian Innovation Centre New Product Development Path Proof of Principle >>>>> Proof of Concept >>>>> Proof of Commerce

5. Canadian Innovation Centre A Note about Our History The CIC is far from a new or recent player in commercialization support work. Initially associated with the University of Waterloo, for a period, we were an integral part of Industry Canada and operated the highly successful Inventor’s Assistance program in Canada for a number of years. We’ve been operating for over 30 years. We’ve seen many strategies, models, and theories….. We won the coveted Manning Award in 1994. The Manning Award recognized our outstanding work in assisting Canadian innovators, inventors, and entrepreneurs. The CIC Model has been studied within Canada and Internationally.

6. Canadian Innovation Centre Prior Art - Influential Models, Authors, and Organizations – a partial list Robert G. Cooper, author of Winning at New Products , developer of the Stage-Gate ™ process – past Director at CIC Clayton M. Christensen et al’s work, including his book The Innovator’s Solution Gerald G. Udell et al, author of How to Assess Before You Invest Bell-Mason Model and Diagnostic Oklahoma Technology Commercialization Center Model Vertex Intellectual Property Strategy Inc, Vertex Technology Commercialization Roadmap D. J. Doyle and Doyletech Corporation, author of Making Technology Happen – past advisor to CIC Australian Institute for Commercialization

7. Canadian Innovation Centre A Snippet of a Recent Study of the CIC Thomas Asterbro (Rotman School of Management, U of Toronto) and Derek J. Koehler (Department of Psychology U of Waterloo) are the most recent scholars to use the CIC’s library of past studies to conduct research on the predictability of commercialization. (A number of such studies have been done over the years.) In their paper, titled Calibration Accuracy of a Judgmental Process that Predicts the Commercial Success of New Product Ideas, their Concluding Remarks begin with: “ Experts at the Canadian [Innovation Centre] are reasonably accurate forecasters of the future commercialization of new product ideas. Over a period of five years [1998 to 2003] the experts were able to correctly classify 79% of the ventures. Such performance is impressive….”

8. Canadian Innovation Centre Our Three Activities - Education We can divide our work and efforts into three groups: Education * Tools * Development Education includes both gathering information about commercialization and disseminating it. The CIC is the Canadian repository of legacy, current, best, and emerging practices with respect to new product development, invention, and innovation.

9. Canadian Innovation Centre Our Three Activities - Education We can divide our work and efforts into three groups: Education * Tools * Development We monitor, collect, and apply practices for inventors, love, angle, and venture investors, government sponsors, SMEs, large corporations, and university and college technology transfer offices. Across Canada. The CIC is active across Canada at the University level working with educators to bring the most recent and relevant content regarding commercialization to students. In some cases, this has included participation in case study projects. In 2004, the CIC began work to establish an internship program for individuals to come to CIC for a 3-month tour of duty to learn the ins and outs of pre-commercialization research and development first hand.

10. Canadian Innovation Centre Our Three Activities - Tools We can divide our work and efforts into three groups: Education * Tools * Development Our work around Tools involves a well established and trusted, ongoing pre-commercialization research practice, (dealing with innovators, sponsors, and investors during proof-of-principle and proof-of-concept). With a continuous improvement mind set, we are adapting established tools (for use at a particular government sponsor or investor, or private corporation) and driving evolution of the tools to support the current investment community and government focus.

11. Canadian Innovation Centre Our Three Activities - Tools We can divide our work and efforts into three groups: Education * Tools * Development Our objective is be involved in 20% to 40% of the innovation evaluation and commercialization support work in Canada in order to: Facilitate and extend the development of a common understanding and vocabulary of commercialization across entrepreneurs, SMEs, support groups and investors. Serve as a benchmark for activities and involvement of local/regional commercial (for-profit) market research and business development with the stakeholders

12. Canadian Innovation Centre Our Three Activities - Development We can divide our work and efforts into three groups: Education * Tools * Development Over the last 30 years, the CIC has been at the forefront of developing, testing, and reporting on new strategies and methods to assist innovators with their commercialization efforts and dreams. The CIC has operated incubators, managed venture capital funds, prototype testing, provided market and business research, and done countless evaluations, workshops, and studies. As methods are established and deemed repeatable, they often are taken up by regional or local organizations. And the next round of development begins. Development teams are ideally made up of representatives from the investor, large corporate, federal, and provincial government areas.

13. Canadian Innovation Centre Our Three Activities - Development We can divide our work and efforts into three groups: Education * Tools * Development 2005 development is focusing on identifying “where” a particular innovation (or company) is in the pre-commercialization process and then the ability to monitor progress – or lack of it. The Commercialization Positioning Scorecard (CPS) will be inexpensive to undertake and will not require extensive study to arrive at a conclusion. Reassessing at regular intervals – 6 to 12 months – will allow an investor or sponsor to judge the progression of the innovation and the risk of their ongoing involvement. Overall costs to support innovators will be reduced through measurement methods not available today. This method would also provide a framework for all sponsors and investors across Canada to have a common scale and terminology to use when dealing with innovators.

14. Canadian Innovation Centre Current Practice - Studies The following slides describe the organization and focus of the current CIC commercialization research studies. On the next slide, the pre-commercialization process is divided up into a number of stages and focal points. The boxes numbered from 1 to 12 represent the core of the process. Additional studies have be added to surround the core to reflect concerns and needs of SMEs – as voiced by them . Relating back to the 2005 development project, the goal is to be able to identify, along each of the horizontal streams, where a innovation/SME is and to plot their progress over time.

15. Canadian Innovation Centre Current Practice - Process Focus Points Each focal point must be addressed for efficient success! There are many ways to address the critical focal points (1 through 12)-it need not be laborious nor expensive. Numbering on focal points is used for reference on later sheets. What was missed or changed Growth Lost Order Analysis Concept to the business issues and opportunities Evaluate Critical Factors Multiple Applications Launch Maximize Align Validate Stage/Time First Customer Demands 10 Testing & Refinement 7 Buyer-Driven Functionality 4 Market Impact 1 Technology Development Activities How to make the most of it to how to support it What is needed to how to make the most of it What is practical to what is needed What is possible to what is practical Attitude Shift Growth Demands 11 Licensing & Segmentation 8 Business Resources 5 Business Proposition 2 Business Development Activities Market Entry Demands 12 Channel & Distribution 9 Competitive Positioning 6 Market Dynamics 3 Sales Development Activities

16. CFA MTA OM EMF LOA Validate Innovation’s concept stabilizes Assess technology development investment risk Confirm opportunity; confirm technology Alignment Development underway Map product and competitors features Assess business strength and weakness Maximize Confirm sales channel needs Ensure licensing options OEM preparation May be divided into multiple studies Launch Prepare message Growth financing plan First customer testing and support Identify additional opportunity Usually divided into multiple studies Canadian Innovation Centre Current Practice - Roadmap Points of Interest MEV Evaluate New concept (CFA) or alternate applications (MMA) Identify strength and weakness Stall What is holding sales back? Investigation of past 2 year sales opportunities Proof of Principle >>>>>>>>>>>> Proof of Concept >>>>>>>>>>>> Proof of Commerce MMA

17. Canadian Innovation Centre Current Practice - Roadmap Study Pricing Study Fees The study fees are somewhat variable for each study, the following pages show the lower limit (CFA is a fixed price) Early stage (Evaluation, Validation and some basic Alignment) studies tend to be the full amount listed; later stage (some advanced Alignment, Maximization, and Launch) studies tend to be broken into smaller phases In some cases, sponsor financial support is greater for the earlier stage studies and reduces as the stage/studies progress Client portion of a fee is payable before the project begins, the sponsor fee after the study report is delivered CIC is an independent not-for-profit corporation, we are not a government organization CFA MTA OM EMF LOA MEV MMA

18. Canadian Innovation Centre Current Practice - Roadmap Study Methods Study Methods and Information In our view, the quantity of primary interviews is not as important as the cross-section of those contacted, the quality of the discussion, and the experience the contact represents. By default, CIC does not provide the names of individuals contacted. People contacted have the opportunity to agree to have their specific information passed on. Results are intended to validate presumptions, provide insights, recommendations, and suggested next steps. In each case, the client will have additional decisions to make and tasks to undertake. Each study begins with a proposal describing the general nature and purpose of the investigation and the specific fee. During the research it may become apparent that certain questions cannot be answered, certain questions are immaterial, or that other questions are more important. When this happens, the client and sponsor will be involved as is practical to adjust the study. Ultimately the goal is to provide 3 rd party insight that will make a difference during the commercialization of the project, whether that be to proceed, stop, ask more questions, or head in a different direction. CFA MTA OM EMF LOA MEV MMA

19. Critical Factor Assessment (CFA) 40 factors considered Each factor rated from low to high risk Considers technology, business, history, competitive issues Secondary research and in-house review Report of ratings and challenges Very useful for initial product investment decision After a positive CFA study, next stop is likely a MMA or MEV study Study fee: $895 (fixed fee) plus GST, 100% funded by client Turnaround about 3 weeks Canadian Innovation Centre Current Practice – Roadmap: Evaluate Stage Studies CFA MTA OM EMF LOA MEV MMA Multiple Market Assessment (MMA) 3+ market opportunities compared Considers technology, business, history, competitive issues Primary and Secondary research and in-house review Report of ratings and challenges Very useful for additional market entry decisions Study fee: from $5,000, dependant on work plan Turnaround about 5 weeks

20. Validation Assessment (MEV) 6 issues considered: apparent opportunity, growth and trends, business proposition, alternate markets, likely competitors and service model, market concerns additional issues may be considered as proposed by client and sponsor (primary Focal Points #1 and generally either #2 or #3) Preliminary review of patent and licensing issues (early stage only) Primary (at the association, governing body, regulator level) and Secondary research and in-house review Report of answers, insight, and client To Do list (Word/PDF format), data to assist with clarity of value proposition and adoption rate Intended for a new or existing business with business experience, should already have a business plan Tailored to the particular client technology situation and the client’s the business experience After a positive MEV study, next stop is a MTA, usually within a month or so Study fee: from $4,000, dependant on work plan Turnaround 4 to 6 weeks Canadian Innovation Centre Current Practice – Roadmap: Validate Stage Studies CFA MTA OM EMF LOA MEV MMA

21. Alignment Assessment (MTA) 4 areas considered: what are the high-level unmet (or poorly met) needs of the customer, competitive strengths and weaknesses, business challenges to take this innovation to market, interoperability needs (primary Focal Points #4, #5, and #6) Primary (at the senior buyer – C level) and Secondary research and in-house review Report of answers, insight, and a client To Do list (Word/PDF format) providing direction towards Alpha customer activities Intended for a existing business starting or already into development work Focus is on aligning the development and business activities as defined by the buyer needs Normally a MEV or CFA would be done first After a MTA study, next stop is an OM, usually within a year Study fee: from $6,000, dependant on work plan Turnaround 6 to 8 weeks Canadian Innovation Centre Current Practice – Roadmap: Alignment Stage Studies CFA MTA OM EMF LOA MEV MMA

22. Maximization Assessment (OM) 4 areas considered: licensing position and opportunities, distribution and channel strategies, OEM opportunities and needs, user information expectations (and training) – study customized to client’s specific needs Primary (at the distributor, licensor, and OEM level) and Secondary research and in-house review Report of answers, insight, and a client To Do list (Word/PDF format) providing direction towards Beta customer activities Intended for a existing business nearing development completion Focus is on maximizing sales opportunities and peripheral customer and distributor satisfaction issues Normally a MTA would be done first After a OM study, next stop is a EMF, usually within a year Study fee: from $6,000, dependant on work plan Turnaround 6 to 8 weeks Canadian Innovation Centre Current Practice – Roadmap: Maximization Stage Studies CFA MTA OM EMF LOA MEV MMA

23. Launch Assessment (EMF) 4 areas considered: early adopters vs. mainstream market, information for raising capital, first customer support and insight, next version planning – study customized to client’s specific needs Primary and Secondary research and in-house review Report of answers, insight, and a client To Do list (Word/PDF format) providing direction towards Early Adopters and Mainstream customer activities Intended for a business launching or recently launching an innovation Focus is on successful launch and sustainable business Normally a OM would be done first Study fee: from $6,000, dependant on work plan Turnaround 8 to 10 weeks Canadian Innovation Centre Current Practice – Roadmap: Launch Stage Studies CFA MTA OM EMF LOA MEV MMA

24. Lost Order Assessment 2 areas considered: with respect to orders won and lost during the launch, why did the customer select a competitor and why did the customer select the client? Also, what are the post purchase insights? Primary and Secondary research and in-house review Report of answers, insight, and recommendations (Word/PDF format) Intended for a business that is struggling with the customer and market adoption of an innovation Focus is on why people are not buying or why sales cycle is so long Often, client has had no studies done before After LOA studies, client may request Alignment or Maximization studies Study fee: from $8,000, dependant on work plan Turnaround 8 to 10 weeks Canadian Innovation Centre Current Practice – Roadmap: Stall Stage Studies CFA MTA OM EMF LOA MEV MMA

25. Remember….. Statistics and experience clearly demonstrate that companies doing proof of concept work (and those sponsors supporting them), commercializing a technology within a market-driven process fare significantly better than those who don’t. Typical benefits include: faster time to market reduced development costs greater user acceptance investor confidence and buy-in, and ultimately greater sales potential. Canadian Innovation Centre Guiding Innovation to be Market and Buyer Driven