Change and Innovation—Keeping Canada a Forestry Leader

For decades, Canada has been a leader in the forest sector. What is our main competitive advantage?

Canada is fortunate to have one of the world’s most extensive forest covers and an industry that contributes $80 billion a year to the economy. But having a huge resource endowment does not necessarily translate into competitive advantage. What really makes the difference is our people—a resource we often overlook when we speak of the forest sector.

Our firms are well-managed and generally meet very high environmental and community standards. Our forestry workers are highly trained and skilled, and they have the advanced technology they need to do their jobs. Our governments have set up a governance framework for the forest industry that demands high levels of environmental, social and economic performance.

Forestry is not just about forests; it is also about people and technology because it is people who transform the resource into value. This is where we must look for Canada’s main competitive advantage as aggressive competitors vie for our markets.

Canada’s forest industry has experienced many challenges in recent years, such as low return on investment, mill closures, the softwood lumber dispute and increased competition. What must Canada do to remain a forestry leader?

As a country and as an industry, we need to work smarter. Specific areas where I see a need for change include technology and innovation, governance, and the skills that will be required of our labour force.

I think we are on the right track in terms of technology and innovation, and in restructuring our institutions to get the best value from scarce innovation dollars. We need to determine if we are spending the right amount of money in the right ways, and we need to align our research and development priorities with the needs of our clients. When I say we are on the right track in this regard, I am thinking, for example, of the new national Fibre Centre, which was recently created to group existing research jobs and facilities into one “virtual” centre (for more detail, see the article on “Innovation and Competitiveness in Canada’s Forests”).

But we still have work to do in this area. For example, our research institutes are more fragmented than they need to be, so their member companies and governments recently agreed to amalgamate them into a single institute to create the world’s largest integrated forest research institute. Among the expected advantages are increased efficiencies through the sharing of technology and best practices, and less duplication of effort.

The way governments operate and make decisions in forestry, and the relationship between governments and industry, also need to change.

Governments cannot stay the same while others are changing. They need to be innovative in their decision making and in the way they manage their affairs. I believe the single most important thing people can do in this regard is to be vigilant about the capacity of governments to carry out their roles, and insist on efficiency in government.

The traditional relationship between government and industry has been largely
ad hoc—workable relationships that vary considerably from place to place and time to time. Intense competition has put an end to being able to operate this way. We need a more efficient, systematic relationship between government and industry to keep our place as a leading forest nation.

What labour-related challenges do you see affecting the future of the forest sector?

On the positive side, we have highly skilled, creative and talented people—the people who have built the huge industry we benefit from today. On the negative side, the industry is facing uneven labour demands, with downsizing and layoffs in some places and employee shortages due to an aging workforce in others.

The parts of the industry that are expanding are going to require a new generation of highly trained people, perhaps with much different skills, to keep the sector energetic and dynamic. Our challenge in the coming years will be to build capacity in this regard and to attract highly skilled workers by showing them that there are exciting and meaningful jobs in the forest sector.

What do you predict for the future of Canada’s forest industry?

I am optimistic about the future, but I expect that we will have to go through some painful transitions in the coming decade. As governments, as industry and as people, we will need to make farsighted decisions. Some of these decisions will be unpopular and we may make mistakes. But that does not lessen the need for governments to play an ongoing dynamic role in making forest-sector decisions. We must be dedicated to recognizing the changes that are needed and to making the decisions that will promote as easy and as sustainable a transition as possible.

I believe the forest industry will look quite different in 10 or 20 years. As former French president Charles de Gaulle once noted, the only way to get things to stay the same is to change. I think we as a country and an industry have the courage to change and the talent to succeed—that is my prediction for the future.