Last May, the National Research Council (NRC) announced that it was “open for business” and would “work with Canadian industries to bridge technology gaps, helping build a more innovative Canadian economy.” The goal is to counter Canada’s historically poor performance in industrial research and development. But changing the culture of a 97-year-old institution has its challenges, not the least of which is public debate over the balance between curiosity and commercial application in government research. ACCN sat down with NRC President John McDougall to discuss the lessons learned.

The mandate of the NRC is to “undertake, assist or promote scientific and industrial research.” How do you interpret that?

The role of the NRC, fundamentally, is as an agent of economic development.  We have a couple of other mandated roles: we run Canada’s ground-based astronomy, we look after Canada’s national science library and things of that nature. But what we’re really trying to do is line up with the mandate in the National Research Council Act. That focus is on economic development through technology for industry.

You’ve been a university chair, a business executive and president of the Alberta Research Council. What lessons influenced your thinking when you came to the NRC?

In my role as Poole Chair in Management for Engineers at the University of Alberta, one of the things I learned very quickly is that students won’t accept ‘just because’ as an answer. They need to understand the rationale, the models and the frameworks around which decisions occur. Scientists and engineers are very smart and creative and they like to understand ‘why’ just like students do. But they also love to show off the fruits of their work and talk about how they are contributing to society. You can take advantage of that.

How was the NRC structured when you arrived and why did it need to change?

When I arrived, the NRC was more like a federation than a single organization. We had institutes, clusters, sector teams and centres, all essentially operating independently. There was no overall coherent direction and there wasn’t really an outcome mentality. To deliver on our mandate, we needed to ask ourselves: what are the things that are going to contribute to economic development? What are the challenges faced by Canadian industry and what can we do to make a difference? If we were simply to sprinkle resources around among the researchers and engineers, we might raise the level of the ocean a millimetre or two. If we did fewer things with more impact, we could really make waves.

The highly polished steel sphere in front of the building known as M-58 was commissioned in 1966 for the 50th anniversary of the National Research Council of Canada. The statue symbolizes the NRC and the global impact of its innovations, which include the pacemaker, canola, the electronic synthesizer and a host of other inventions. Photo credit: National Research Council of Canada

What about metrics? How can you tell if you’re doing the right kind of research?

Once you identify the issue or challenge that you’re going to deal with, you test that against the people and companies who will be the beneficiaries. If they buy into it, initially through good words rather than money, then that gives you the encouragement to build a research program. If these beneficiaries then participate in that program with real money, that’s another indication that you’re on the right track. And if they take the things developed through the program and put them to work within their own operations, that’s another clue that you’re doing things that matter. Ultimately the investments, made by third parties and not by us, start to turn into jobs, sales and exports. And if that happens, those parties will be back when we’re sorting out what the next challenge should be. 

Can you give an example?

Carbon dioxide (CO2) is viewed by many as a problem — we took a look and concluded it was an opportunity. Instead of producing enormous amounts of CO2 and throwing it away, we could use it as a feedstock. We came up with a concept and ultimately found a series of partners who said, “Yes, there are lots of reasons why we would play in this space.” As ACCN reported earlier this year, we’re in the process of building demonstration bioreactors to transform exhaust gases from an oil sands project into algae. That algae becomes value-added products like biofuel. The idea is to be able to do something at high volume and controlled cost that will produce good value out of CO2.

What about research in emerging fields where the industrial applications and partnering companies may not exist yet?

When one is thinking about the business of science and technology and innovation, there is always a continuum, from established industries where the innovations are incremental to areas where the research is at an early stage and is very high risk. What we want is to end up with a balanced portfolio. You see this across our operating divisions. In sectors like automotive, construction and aerospace, the companies are in place and the problems apparent. On the other hand, in the life sciences, new discoveries tend to lead to new industrial constructs. As well, biological processes tend to take longer to mature and there are also different regulatory elements. So there we use what we’ll call a co-development­, or shared-risk model. You take from the company’s eventual success, because they usually can’t pay as much up front.
We also keep an eye on emerging technologies, areas that could one day become quite pervasive, but right now we’re not entirely sure how they’ll be used. But until we see a platform emerging, we leave that in the hands of the universities. We let them do the high-end, early-science stuff. When we see that it just might go somewhere, we’ll try and build the capability to build critical mass and transfer that not only into our other divisions but into Canadian industry as well.

So basic research is the domain of universities, not the NRC?

I think you’ve got to be careful about this. It isn’t really about basic or applied science, it’s about curiosity versus mission-oriented, which is not the same. The NRC has done various things at various times, but it began very much as an applied research organization aimed at helping Canada grow up industrially; this was reinforced during the Second World War. But as the universities became more and more involved in curiosity-driven research during the post-war decades, the question was: Did the NRC really need to continue doing it?
NRC had, and continues to have, some areas that are very-early stage, but they weren’t nearly as large as some people seem to think they were. They probably represented 10 per cent of what we did; in the future they might represent five per cent of what we do.  So the change is really pretty small.

Universities also collaborate with industry. Will they be competing with the refocused NRC for private sector partnerships and funding?

I frankly don’t believe we are competitors. At universities, the research, which is important, is driven predominantly by the researcher. The work that we’re trying to do is driven primarily by the needs and interests of Canada’s industrial base. We also tend to operate at a larger scale, so we’re able to do things that universities typically can’t. So there’s a different marketplace. My expectation — and certainly my experience with the Alberta Research Council bore this out — is that the whole package will grow, as opposed to somebody winning and somebody losing.

NRC technical officer Nicholas Charest is assembling the high temperature fuel spray facility in M-46 of NRC, which is a unique research facility allowing in-depth study of the superheated flashing jet phenomena for its aerospace engine application. Photo credit: National Research Council of Canada​ 

Can you talk about the changes in organizational culture you had to implement at the NRC? 

In order to make a real difference to industry, you have to be accountable. In a structure in which the resources you need are passed to you at the beginning of the year, with minimal accountability for outcomes, you’ll behave in one way. If, on the other hand, you have to create a value proposition and demonstrate that there’s going to be a return on investment to Canada, and if you’re going to be accountable for meeting budgets, quality, specifications, timelines etc., you’ll behave in another way. What we had to do was move from a culture that was academic, which is to say more individualistic, to one that was more performance-based, which is about defining and meeting expectations.

Did you experience resistance?

Of course — you would naturally expect to. It was difficult taking people into a space that they didn’t really know, or asking them to think about things that they haven’t necessarily thought about. We’re adding in market dynamics, human relations, project management, supervisory skills and a whole bunch of stuff that is quite new. We’ve brought in a lot of new employees and training, everything from human resources and supervision to finance and economics and market evaluation.

Scientists are best at doing science; do you worry that you’re impeding their creativity when you bring in this business-oriented thinking?

There are people who are more comfortable in an unconstrained scientific space and we have people who are like that. We have to make sure we’re not putting people into positions where they can’t perform. One of the things I’ve learned over the years is that the most creative people are often those who their supervisors consider to be the most difficult. You might be tempted to get rid of those people, but if you do, you’ll cut the heart out of your creativity. You need them, but there are things you shouldn’t have them do. But at the same time, if people like that were all your organization had, you wouldn’t be able to get much done.

What do you make of the public reaction to the changes at NRC?

The public didn’t react to the announcement very strongly, but as they see the projects and programs that we’re bringing out, they’re responding very positively. And of course industry is generally extremely pleased with what we’re doing.
The noise in the media was driven mostly by Twitter. Some of the scientific community was quite vocal about the idea of “losing basic research.” The irony is that it reinforced the fact that we really were changing. People who don’t understand innovation probably took some more negatives out of it than they should have, but as we go around the country and roll out new projects, we’re finding that people understand pretty quickly and we’re able to focus on building and supporting the Canadian economy.

The NRC has a venerable history of important discoveries, from canola to pacemakers. How do you honour this legacy while preparing it for the future?

You have to celebrate the history, because it is really great. There have been amazing things over the years that have come from NRC and we want to ensure that we continue to generate more of those amazing things in the decades ahead. What we’re really trying to create is an organization that is truly connected to the needs of Canada, is cost-effective and is making the most out of the investment that the Canadian public entrusts us to manage.