only internal source of dissolving pulps. Whereas Cocel's R&Dfocused on pulping, <strong>the</strong> central laboratory of Celanese in New Yorkfocused on <strong>the</strong> pulp-converting stages.As Cocel began to lose money in <strong>the</strong> late 1960s <strong>the</strong> R&D staffbecame embroiled in operational problems at <strong>the</strong> expense of longtermresearch regarding dissolving pulps. When it became clear Cocelwould close its R&D division, two employees in 1972 purchased <strong>the</strong>laboratory <strong>and</strong> created Econotech. Then <strong>the</strong> company had nineemployees; by 1978 it had 20. Econotech still specializes in pulpingR&D <strong>and</strong> concentrates on developmental work <strong>and</strong> technology transfer.Although Econotech does provide "consulting services" on operationalmatters, it emphasizes independent evaluations of pulpingprocesses utilizing its own equipment, which includes complete pilotplant facilities for pulping <strong>and</strong> bleaching.Econotech's customers include equal numbers of large companies,for which it conducts "overload" R&D, <strong>and</strong> small firms, which maylack <strong>the</strong> expertise to do <strong>the</strong>ir own R&D. Virtually all work is doneunder contract to forest-product firms, capital goods manufacturers,<strong>and</strong> consulting engineers. About 50-70 per cent of revenue is generatedwithin British Columbia.There are three explanations for Econotech's growth <strong>and</strong> its abilityto compete internationally. One, it has a high level of expertise indissolving pulps, a field where <strong>the</strong>re are few competitors to beginwith. Two, Econotech claims to be able to maintain confidentiality. Allemployees sign secrecy agreements <strong>and</strong> sometimes technologists are<strong>the</strong>mselves not fully informed about <strong>the</strong> problem <strong>the</strong>y are investigating.Three, Econotech has accumulated considerable experience in avariety of mill environments throughout North America.Ano<strong>the</strong>r British Columbia-based spin-off company is CoastMountain Consulting of Nanaimo, which designs software packagesfor use in forestry. All Coast Mountain's original personnel came fromMacMillan Bloedel's Woodl<strong>and</strong> Services in 1982, when MacMillanBloedel was cutting back. MacMillan Bloedel had created <strong>the</strong> groupcalled Computer Assisted <strong>Forest</strong> Engineering or CAFE in 1975 toprovide <strong>the</strong> company with a series of programs on various forestryrelatedtasks. Coast Mountain continues to serve MacMillan Bloedel,but also sells to o<strong>the</strong>r corporations in <strong>the</strong> United States <strong>and</strong> Canada."Software packages range in price from $300 to $20000.Government <strong>and</strong> University R&D<strong>Canadian</strong> governments, especially <strong>the</strong> federal government, <strong>and</strong>universities have traditionally done R&D for <strong>the</strong> forestry sector." In44
contrast to in-house R&D by forest-product firms <strong>and</strong> equipmentmanufacturers, <strong>the</strong>se activities are mostly forestry related <strong>and</strong> onlyperipherally concerned with manufacturing.Let us look first at forestry-related R& 0, which is <strong>the</strong> only sort <strong>the</strong>federal government does. Since <strong>the</strong> privatization of <strong>the</strong> EFPL <strong>and</strong> WFPL,<strong>the</strong> main laboratories controlled <strong>and</strong> operated by <strong>the</strong> federal governmenthave been those of <strong>the</strong> <strong>Canadian</strong> <strong>Forest</strong>ry Service (CFS). Atpresent, <strong>the</strong> CFS operates an extensive R&D network that includes <strong>the</strong>Petawawa National <strong>Forest</strong> Research Institute, <strong>the</strong> <strong>Forest</strong> Pest ManagementInstitute, <strong>and</strong> six regional laboratories in St. John's (Nfld.),Fredericton (N.B.), Ste-Foy (P.Q.), Sault Ste. Marie (Ont.), Edmonton(Alta.), <strong>and</strong> Victoria (B.C.). Although some of <strong>the</strong> laboratories havelonger histories, this system was substantially created, <strong>and</strong> itsm<strong>and</strong>ate clarified, amidst considerable controversy, during <strong>the</strong> 1960s.Proponents argued that university research was limited, lumberindustry research virtually non-existent, <strong>and</strong> provincial governmentresearch concentrated on <strong>the</strong> problems of forest administration.» Asexpected, <strong>the</strong> research programs of <strong>the</strong> regional laboratories reflectmainly local priorities whereas <strong>the</strong> institutes focus on matters ofnational concern.In 1977-78 <strong>the</strong> federal government spent $31.0 million on forestryresearch, mostly in <strong>the</strong> laboratories of <strong>the</strong> CFS.32 At that time, <strong>the</strong>selaboratories employed approximately 370 professionals.» During <strong>the</strong>review by government <strong>and</strong> industry that led to Forintek, CFS researchcame under scrutiny <strong>and</strong> in 1979-80 federal research expenditures onforest management were reduced, even in current dollar terms, to$30.1 million.> The system was not modified substantively, however,<strong>and</strong> federal funding increased to $58.9 million in 1983-84. Provincialfunding, although lower <strong>and</strong> concentrated in Quebec, Ontario, <strong>and</strong>British Columbia, also increased. As a result, total governmentexpenditures on forest management R&D rose from $40.0 million in1979-80 to $77.2 million in 1983-84.Finally, universities do forestry-related research not only at <strong>the</strong>faculties of forestry at <strong>the</strong> universities of Laval, New Brunswick,Toronto, <strong>and</strong> British Columbia, <strong>and</strong> at <strong>the</strong> newer schools at LakeheadUniversity <strong>and</strong> <strong>the</strong> University of Alberta, but also in departments ofapplied sciences <strong>and</strong> biology."R&D by governments <strong>and</strong> universities into forest-product manufacturingprocesses is more limited. The federal government does notdo any. The provinces of British Columbia, Ontario, <strong>and</strong> Quebec haveset up industrial research organizations that do R& 0 related to forestproducts(<strong>and</strong> forestry). However, <strong>the</strong> <strong>Forest</strong> <strong>Product</strong>s Section of <strong>the</strong>Ontario Research Foundation (ORF) has declined to <strong>the</strong> point where in1984 it employed only four professionals <strong>and</strong> had a budget of $450000,45
- Page 3 and 4: Science Council of Canada100 Metcal
- Page 5 and 6: ContentsForewordAcknowledgments1113
- Page 7 and 8: In-House R&D by Equipment Suppliers
- Page 9 and 10: Table 2.5: R&D Employment in 10 Can
- Page 11 and 12: ForewordTechnological innovation an
- Page 14 and 15: adapted sufficiently rapidly to the
- Page 16 and 17: Finally, the author interviewed sen
- Page 18 and 19: Table 1.3: Degree of Foreign Contro
- Page 20 and 21: Figure 1.1: Innovation Patterns and
- Page 22 and 23: Since 1945 the pace of technologica
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- Page 26 and 27: science occurred between 1900 and 1
- Page 28 and 29: Forestry Sector R&D SystemIn Canada
- Page 30 and 31: up its forestry research group at N
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- Page 40 and 41: product. One, by no means atypical,
- Page 44 and 45: of which only 18 per cent came from
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- Page 48 and 49: Chapter 3The R&D System andHow It W
- Page 50 and 51: Table 3.2: Summary Characteristics
- Page 52 and 53: Sixteen firms provided details on s
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- Page 56 and 57: however, within the last two decade
- Page 58 and 59: in 1959, and a full-scale experimen
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- Page 70 and 71: forest-product equipment patents, w
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the foundations were poured, until
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inherent capabilities were never fu
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especially in the east, has receive
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"export staples mentality." The bel
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size of the conglomerates would cer
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the concept of flexibility explicit
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This author therefore recommends th
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with respect to technology transfer
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of the R&D system and influence the
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operations, attitudes toward innova
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limited R&D base, but they do empha
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The small size and non-innovative n
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Promoting In-House R&D in the Fores
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Notes1. The Technological Challenge
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7. For example, nj. Daly, "Weak Lin
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7. P.G. Mellgren and E. Heidersdorf
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this R&D facility has become even s
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3. K. Noble, "Forest Industry Urged
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Publications of the ScienceCouncil
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Reports on Matters Referred by the
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No. 40. Government Regulation of th
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1981An Engineer's View of Science E