A Digital Transformation Roadmap for Quebec’s SMEs

What is the current state of Quebec’s digital economy and how can we best position Quebec for success in the global digital future?

Quebec is an important ecosystem of small and medium enterprises (SMEs) that have strong expertise in digital tech products, e-commerce platforms and, of course, artificial intelligence (AI). Our federal government invested nearly $6.3 million in AI. AI is a niche investment, but it’s one of our strengths here in Quebec and we are in a great position to nurture it and excel.

“The first step is to get SMEs to understand the real value behind investing in digitalization – around products, around customers, around opportunities – because to make this happen, we need complete alignment.”

However, we are still far from an inclusive digital ecosystem, with many SMEs lacking the digital understanding, tools and systems to stay competitive and increase their exports outside of Canada. This delay in digitalization results in a productivity gap and a decline in exports for SMEs. We want to eliminate this productivity gap. That gap will be filled by both digitalization and a move to manufacturing 4.0 and Internet of Things (IoT), which are directly related to it.  The government’s role is to cultivate a digital culture and accommodate SMEs in finding a faster, more collaborative way to digitally transform their business. Sectors that we must focus on include retail, aerospace and manufacturing.

What policies or systems can the government and your ministry implement to ensure that the world-leading technology Quebec invests in benefits SMEs and improves their competitiveness?

One of the areas our government focuses on is implementing the right programs that will support and provide guidance to SMEs in their digitalization journey. To succeed, the first step is to get SMEs to understand the real value behind investing in digitalization – around products, around customers, around opportunities – because to make this happen, we need complete alignment. Most SMEs are responding to some degree, and see areas of their business improve through digital platforms and tools, but they don’t see the real value in investing significant resources for a complete transformation. So, once that awareness is established, the real work can start.

“IP ownership is an important part of where our money should go. I would not invest more money into attracting companies to Quebec […] if we do not get the IP that is developed here through our investments.”

The programs we are developing will vary and there will not be a one-size-fits-all model. Our SME ecosystem is rich with different markets, needs and requests. One example of a program we launched is the Innovation Program to provide Quebec-based companies, and companies having a place of business in Quebec, with up to $500,000 of financial assistance in support of the development of new products and other key business assets, including digital ones. The program offers significant benefits for SMEs and provides access to financial assistance expressly for the purposes of innovation. The Innovation Program will be available until March 31, 2021.

What would you like to see other key players – tech companies, businesses, financiers, academia and others – do to support that mission?

We are seeking engaged, digital-savvy and bilingual experts to lead SMEs in their digital transformations. This is key. We are looking for digital consultants that will be able to provide guidance and act as mentors that could, for instance, conduct digital tech audits and help shape transformation roadmaps. They would identify what areas of their businesses could be positively impacted by AI or manufacturing 4.0 technology, and how that should be implemented. We need to make entrepreneurs and SMEs aware of the benefits such a digital transformation would bring them. Also, we must ensure that the linkages are made between our local SMEs and our world-leading tech firms, in order to improve our economic output and competitiveness.

The government’s role will be to facilitate the digital transformation investments SMEs need and to incentivize our tech leaders and companies to lend their expertise. Importantly, we would want to establish long-term partnerships with enterprises that specialize and invest in AI or digital products. There are already many, many grants to help scale such products. So, we are thinking of creating a symbiotic link between the grants and soon-to-be mentorship programs, to create a more comprehensive digital economy.

How can we maximize the opportunities that large foreign tech investors represent for Quebec tech ecosystem?

In Quebec, we already have powerful foreign investors like Warner Brothers, Google, Microsoft, Facebook and Amazon. But the reality is that it is not a mutually beneficial dynamic and our talent base and digital IP assets are not protected. That is in part why the Government of Canada is investing $85.3 million over five years to help Canadian businesses, creators, entrepreneurs and innovators understand, protect and access intellectual property (IP) through a comprehensive IP Strategy. IP ownership is an important part of where our money should go. I would not invest more money into attracting companies to Quebec or helping them come to Montreal if we do not get the IP that is developed here through our investments.

“We want corporations to come to Quebec, establish themselves with a divisional head office, help us fuel our digital economy, and ultimately stay in Quebec.”

The foreign investments poured into Quebec need to be mapped properly and be linked to clear, ambitious projects. We want corporations to come to Quebec, establish themselves with a divisional head office, help us fuel our digital economy, and ultimately stay in Quebec. Of course we need to work with large companies. My foreign investment focus is on getting large corporations to come to Quebec, invest in R&D, and to develop talent and expertise. Then we can focus on having our local supply chain benefit from their presence.

What must be done to ensure Quebec produces, attracts and retains the top international tech talent our digital economy sector needs to flourish?

We have two priorities. The first is placing digital tools and platforms in the hands of high school students. It is essential that digitalization be integrated at the core of our schools’ agendas and curriculums to develop the talent and skills for the workforce of the future. We want to make sure our youth is prepared with the capabilities needed to enter the rapidly changing digital markets.

“In two years, we will see a 15 to 30% increase in immigrants that will be able to directly contribute to our digital economy.”

At the same time, we are focused on recruiting qualified immigrants. If an SME is currently struggling to hire new tech-savvy employees for their business operations we need to fill that shortage. We have identified 118,000 job vacancies in Quebec. The vacancies have been narrowed down by regions, expertise-level and salaries. We are currently mapping this information to benchmark the needs of our digital economy.  It’s a very dynamic map as you can imagine. I believe that in two years, we will see a 15 to 30% increase in immigrants that will be able to directly contribute to our digital economy.