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Talent Attraction and Innovation Vancouver, Melbourne, and Santiago. Sixth Illuminate Consulting Group Thought Leader Session at 2011 NAFSA

Talent Attraction and Innovation Vancouver, Melbourne, and Santiago Sixth Illuminate Consulting Group Thought Leader Session at 2011 NAFSA 1 June 2011 IMPRESSUM ICG Contact Information Post Office Box
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Talent Attraction and Innovation Vancouver, Melbourne, and Santiago Sixth Illuminate Consulting Group Thought Leader Session at 2011 NAFSA 1 June 2011 IMPRESSUM ICG Contact Information Post Office Box 262 San Carlos, CA USA Phone +1 (619) Fax +1 (650) Web Publication Notes Release Date: 1 June Version: Final PDF. ICG Report Team: Grace Gair, Dr. Daniel J. Guhr. Cover Design: Illuminate Consulting Group. Language: US English. Distribution and Usage Policy This report is available free of charge. For information about permission to reproduce selections from this report, please contact the Illuminate Consulting Group by at or write to our San Carlos, California office. Legal Disclaimer and Copyright The views expressed in this report are those of the authors alone. They do not necessarily reflect the views of a given institution, or of ICG. While ICG endeavors to provide reliable analysis and believes the information presented is accurate, ICG is not liable for errors and omissions, and will not be liable for any party acting on such information. Illuminate Consulting Group, All rights reserved. 1 TABLE OF CONTENTS Table of Contents 2 Foreword 3 Session Program 4 Presenters 5 Chair and Moderator 6 A Perspective on Vancouver 7 A Perspective on Melbourne 11 A Perspective on Santiago 16 Registered Session Participants 17 Past ICG Thought Leader Sessions 20 2 FOREWORD Dear colleagues, I am delighted to welcome you to the sixth ICG Thought Leader Session at the 2011 NAFSA Annual Conference in Vancouver. ICG conceived the Thought Leader Session format in 2007 to provide a forum for intellectually rigorous debate equally driven by expert presenters and actively engaged attendees. In many ways, the format of these sessions is intended to follow the structure of a graduate school seminar. This year s session focuses on Talent Attraction and Innovation in Vancouver, Melbourne, and Santiago. The three cities were chosen based on their shared role as destinations for international talent on the one hand, and their different and innovative approaches to policy design and implementation on the other hand. For more details please refer to the presenter s PowerPoint presentations. The presentations, as well as this document, are posted as PDF files on the ICG website at under the Thought Leader Sessions section. ICG remains committed to the continued discussion of salient strategy issues in international science, research, and education and will continue to convene Thought Leader Sessions at major international education conferences. I look forward to meeting you at the session. Yours sincerely, Dr. Daniel J. Guhr, Managing Director 3 SESSION PROGRAM Session Program 08:30 Continental Breakfast 09:00 Welcome and Housekeeping Dr. Randall Martin (British Columbia Council for International Education) 09:05 Innovation and Talent Attraction: An Introduction Dr. Daniel J. Guhr (Illuminate Consulting Group) 09:15 A Perspective on Vancouver Prof. Michael A. Goldberg (University of British Columbia) 09:45 A Perspective on Melbourne Prof. Chris Robinson (Victoria University) 10:15 Tea Break 10:25 A Perspective on Santiago Mr. Nicholas Shea (Ministry of Economics & Start Up Chile) 10:55 Moderated Discussion 11:55 Session Summary 12:00 Session Close 4 PRESENTERS Prof. Michael A. Goldberg (Presenter) Prof. Goldberg is the Dean Emeritus at the Sauder School of Business, University of British Columbia (UBC). His past positions include Associate Vice President International at UBC and Chair of the Canadian Federation of Deans of Management and Administrative Studies. Prof. Goldberg has also served on advisory boards of local, provincial, and national agencies in Canada. Prof. Goldberg joined UBC after completing his Ph.D. in Economics at the University of California at Berkeley. He has wholly or partly authored nine books and more than 200 academic and professional articles. Prof. Chris Robinson (Presenter) Prof. Robinson is the past Head of the Victoria University Graduate School of Business, and now serves in the position of Associate Dean International. Previously, he served as Head of the School of Business at the University of Ballarat. He has also held senior positions at the University of Melbourne and the Australian Institute of Management, and has worked as a senior executive in international consulting companies. Prof. Robinson was the inaugural Managing Director of the international university consortium Universitas 21. Prof. Robinson holds degrees from Flinders and La Trobe Universities. Mr. Nicholas Shea (Presenter) Mr. Shea serves as the Innovation and Entrepreneurship Advisor at the Chilean Ministry of Economy. He is also the secretary-general of the Inter-Ministerial Committee for Innovation, and is the founder and CEO of Start-Up Chile. Mr. Shea also serves on the board of Fundación Chile, and is the founder and Chair of eclass. He holds degrees from Stanford University s Graduate School of Business, Columbia University s Teachers College, and Pontificia Universidad Católica de Chile. 5 CHAIR AND MODERATOR Dr. Randall Martin (Chair) Dr. Randall Martin serves as the Executive Director of the British Columbia Council for International Education (BCCIE). His experience spans more than twenty years in post-secondary, development, and international education, including more than 15 years supporting the internationalization efforts of Simon Fraser University (SFU) in Vancouver. Dr. Martin holds a doctoral degree in international education. Dr. Daniel J. Guhr (Moderator) Dr. Guhr serves as ICG s Managing Director. Prior to founding ICG, he served as a strategy consultant with the Boston Consulting Group, and as a Director of Business Development with SAP in Silicon Valley. Dr. Guhr has authored more than 25 research papers, reports, and studies. Since 2007, he has contributed to more than 60 conference sessions and workshops. Dr. Guhr holds a D.Phil. in and a M.Sc. from Oxford, as well as a M.A. from Brandeis. He was also trained at Bonn and Harvard, served as a research specialist at Berkeley, and conducted research at a Max-Planck-Institute. 6 INNOVATION, TALENT ATTRACTION, AND RETENTION: VANCOUVER SUCCESSES AND CHALLENGES Introduction Vancouver is a historically commodity-based economy which has suffered from low productivity and a lack of diversity. Strategies which aim to foster innovation and talent attraction in Vancouver have developed on local, regional, and national levels. While these approaches have been met with successes evidenced in innovation growth, immigration and international student inflows much remains to be addressed. Historical Context and the Need for New Strategies Historic Context Similar to Melbourne and Santiago, Vancouver is relatively isolated on a global scale; it resides within a resource-based economy; and, is seeking to diversify/ stabilize its economy. Historically, Vancouver grew on gifts of nature and became a rent-seeking, not rent-creating culture. Subsequently it has been a price-taker on world markets and has lacked the ability to set margins. Additionally, low productivity has been a huge problem not only for BC, but also Canada as a whole. Being largely a commodity-based economy, Vancouver has tended to focus largely on costs and not on customers. However, in its global setting, the engineering and production driven orientation instead of customer, innovation and entrepreneurially driven orientation has been identified as no longer being an effective outlook New Strategies In order to succeed, BC and Canada need new metaphors. Knowledge and human resources must replace reliance on natural resources and gifts of nature. Government at various levels, tertiary institutions, labor and business must all work together. And, as the traditional commodity, low-cost production, strategy has come under stress, added value to customers via innovation is key. As a result, market diversification strategies have become largely centered on new products and new customers as well as new trading partners and geographic foci. Strategies include branding and product differentiation approaches (e.g.; BC Hothouse Brand for high quality vegetables and VQA wine branding) and creating new or joint high-end niche products/services (e.g.; joint use of forests for fiber and ecotourism and joint use of oceans for sports fishing and whale watching). 7 BC Policy Efforts to be More Innovative and Diversify Its Economy Overview In the 1980s and 1990s efforts began with projects like EXPO, API and the devolution of YVR, Vancouver s International Airport. In 2001 the BC Progress Board was founded to track changes in the economic performance and social wellbeing of British Columbia as a whole through comparative benchmarking. In 2002 the Federal Innovation Initiative began with a goal to make Canada one of the world s most innovative countries and a magnet for talent. Canada s innovation strategy was presented in two reports Achieving Excellence & Knowledge Matters and proposed specific actions to reach goals with targets to measure progress. Five horizontal themes emerged from the process to include: Improving research, development and commercialization. Building an inclusive and skilled workforce. Enhancing the innovation environment. Strengthening our learning culture. Strengthening communities. A core focus of Canada s Innovation Initiative and a key goal of API is making Universities key drivers of talent. An example of this can be seen in the longstanding recruitment of undergraduates, MBAs, PhD students and faculty from outside Canada as well as the promotion of student exchanges as the lifeblood of UBC Commerce/Sauder School. Evidences of Policy Impacts Innovation in BC Two major trends have been the commercialization of IP and the technology industry. With a base of approximately 78,500 employees in 2008, the BC technology industry was at a new peak for labor demand in BC, over 10,000 jobs or 14.8% higher than the peak of the technology bubble in While the sector was impacted by the 2009 downturn, growth projections show sector headcounts surpassing the 2008 level during Immigration to BC In 2010, 44,176 persons emigrated to BC from the following areas (of last permanent residence): Asia: 32,739 Europe: 5,622 North and Central America: 2,652 Africa: 1,228 South America: 778 Australasia: 614 Oceania & Other Islands: 320 Caribbean: 215 A further break down can be seen in the Top 10 source countries of immigrants to BC in All other countries equal 11,422 (25.9%): China: 9,317 (21.1%) Philippines: 6,661 (15.1%) India: 5,850 (13.2%) UK: 2,475 (5.6%) South Korea: 2,164 (4.9%) Taiwan: 1,842 (4.2%) US: 1,697 (3.8%) Iran: 1,359 (3.1%) Mexico: 758 (1.7%) Singapore: 631 (1.4%) Student Flows to BC In 2010, the value of BC international student expenditures was CAD 1,787 million. International Students in BC by Level of Study and Expenditure, 2010 Level Number of Students Expenditure Total Post-Secondary 82,000 1,495 Total K-12 12, Notes: Amounts in millions of CAD. Source: Roslyn Kunin & Associates, Economic Impact of International Education in British Columbia, Final Report. 9 An example of universities contributing to innovation growth is UBC s University- Industry Liaison Office. Founded in 1984, UBC s UILO was the first in Canada and is now ranked among the top 10 university technical transfer units in North America. To date, 140 start-up companies have been founded with cumulative royalties earned approaching CAD 200 million. In 2009, annual patent filings ran at 245 with CAD 550 million managed in external research funds. Conclusion: Lots of Successes Yet Much More Needs to Be Done Remaining Challenges As evidenced through immigration, student inflows and innovation data, there have been a number of successes. Yet much more needs to be done. Canada and BC still focus on natural resources and innovation is still not a core value or driving principle. Thus productivity and patenting, from a global standpoint, lag badly behind. Additionally, there exist a number of livability and planning shortfalls which will need to be addressed. Looking Ahead The good news and reason for optimism are multi-fold: International immigration and student successes. The region takes pride in its diversity. Present and future generations take being global well as the need to innovate and compete as given. Tectonic shifts from earlier generations and our future hope. Much smaller countries and regions have succeeded in being innovative and globally competitive. Thus there is no reason why BC and Canada as a whole cannot replicate their successes and learn from them. As Maskell, et. al. note: A learning perspective on regional policy will be aiming at change, restructuring, dynamics and -- first and foremost -- at augmenting the ability of firms, industries and regions to create, accumulate and utilize knowledge. In order to do so, public policy must enhance the creation of a multitude of competencies in both private and public institutions, and promote an integration of knowledge from different bodies into commercial activities. About the Presenter Professor Michael A. Goldberg is the Dean Emeritus at the Sauder School of Business, University of British Columbia (UBC). 10 MELBOURNE, A KNOWLEDGE CITY An Introduction to Melbourne Melbourne is the capital city of the state of Victoria and the second largest city in Australia, with a population of about four million people. Almost a quarter of Victoria's population was born overseas, and the city is home to residents from 233 countries, who speak over 180 languages and dialects. For the ninth consecutive year, Melbourne had the biggest growth of any city in Australia. Since 2001, Melbourne has gained 605,000 new residents, an increase of 17 percent that has rapidly expanded the urban boundary in every growth corridor of the city. In the year to June 2010, Melbourne is estimated to have grown by 79,000 people, or more than 1500 a week. The west of Melbourne, where my university is based, is the fastest growing region in Australia, and is predicted to remain so for at least the next decade. No Australian city has ever before recorded growth of this magnitude. The rate of population growth has strained the city's infrastructure and services, adding to congestion on the roads, delays, overcrowding on public transport and waiting times in hospital emergency wards. Melbourne as a Knowledge City In the 2010 Global Innovative Cities Index operated by the research agency 2thinknow, Melbourne was ranked 19th out of 289 cities worldwide. A number of achievements have shaped Melbourne s reputation for its knowledge-based capabilities, including: Melbourne is home to 50 per cent of the top 20 biotech companies listed on the Australian Stock Exchange Melbourne is one of only three cities in the world with two of its universities in the top twenty biomedical university rankings Major scientific breakthroughs were developed in Melbourne; including medical innovations such as the cochlear implant, Relenza anti-flu vaccine, and Gardasil cervical cancer vaccine A significant part of Melbourne s knowledge city status is based on the concentration of universities, and university students, in it. Education is Victoria s largest export industry, contributing annually more than $5 billion to the Victorian economy. All eight public universities are located in Melbourne, and two are ranked among the top 100 universities of the world (THE-QS World University Rankings). The 2008 Global University City Index ranked Melbourne fourth behind London, Boston and Tokyo. More students study engineering, science, mathematics and information technology in 11 Victoria than in any other Australian state, and Victoria has a higher ratio of scientists and engineers per capita than Germany, Canada or the UK. Recently, Melbourne was awarded the 2010 Most Admired Knowledge City Award, beating Singapore and Barcelona. Melbourne has focused on a cluster approach to innovation development, with examples including the Australian Synchrotron, the Bio 21 Institute for health research, and the IBM Computing Centre located in Melbourne, This approach has had its successes, but not without some difficulties along the way. The history of the Australian Synchrotron project illustrates the point. In 2001, the Australian Government conducted a tender process for building a synchrotron, but the state government of Victoria pre-empted the process by declaring that it would act alone to establish the facility. The Australian Synchrotron was opened in 2007 after an investment of AUD 270 million, 42 percent of which came from the federal government, and currently is operating only nine of a possible 30 beams. The recently elected state government has so far provided no indication it will continue to fund its operation, and the federal government has not budgeted to provide any of the AUD 156 million it will need over the next five years to keep it operating. For Melbourne, then, innovation and talent attraction are critically important. Innovation, the development of new combinations of knowledge, production and markets, relies on a capacity to develop and retain talent. In Melbourne, much of its talent base is developed or attracted by its universities. So, a comparison of Melbourne s story with those of other cities involves a concentration on its higher education sector. Higher Education in Australia Government funding of higher education in Australia represents about 0.7 per cent of GDP, compared with the OECD average of 1.0 percent, and provides about 40 percent of Australian universities total revenue. The universities peak body, Universities Australia, has estimated that raising public expenditure on higher education to 1 percent of GDP would boost Australia s GDP by an extra 6.4 percent, or AUD 163 billion by Over the last two years, the Federal Government has continued to regulate university fees, while requiring universities to increase participation in higher education. As a consequence, funds for infrastructure and research have declined significantly, and Australian universities are starting to seriously contemplate debt financing as a means of maintaining and developing infrastructure. For many years, a centralized federal system has allocated funding for post-secondary student places, but from 2012, provision of domestic student places will be deregulated, and the Commonwealth will fund as many qualified students as each university can attract. 12 A major funding source over the past decade for Australian universities has been the revenue generated from international students studying in Australia or in Australian university programs offered in offshore locations. About 16 percent of all Australian universities revenue comes from international student fees reaching AUD 18.5 billion in 2009, and making education Australia s third largest export industry. Starting in 2009, this industry faced what has been called a perfect storm. The Australian dollar soared against the US dollar, rising from a low of in early June 2010 to a high of at the end of April this year, radically increasing the cost of Australian education for international students. Market research in 2010 indicated that, at the same time as these rises were occurring, families in offshore markets were becoming more price sensitive as a result of the Global Financial Crisis. During this period, with a federal election due in the second half of 2010, immigration and population growth became major political issues, driven by debates around population growth, and concerns about the increasing numbers of asylum seekers arriving on Australia s northern coast with the assistance of people smugglers. Applicants for student visas have become collateral damage in the immigration debate. Recent changes in Australia s skilled migration program have reduced opportunities for international students to r
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