Strategic Plan 2007-2012 (page 5 of 12)
Strategic Plan 2007-2012 (PDF – 7.3 MB – 23 pages)
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3. The context: Strategic determinants
3.1 Supporting Canada's economic performance
To meet the challenges of the 21st century, Canada must be able to generate and apply knowledge, and develop new products and processes based on the knowledge acquired. In today's knowledge-based economy, innovation is a key driving force in creating wealth and economic growth for Canadians. The IP system plays a key role in facilitating the effective exploitation of innovative knowledge, thus enhancing Canada's climate of innovation to the benefit of the Canadian economy and society.
In recent years, IP has taken on a much more significant role in the economy, where the effective use of knowledge is a decisive determinant of business success. Innovators are making IP protection decisions in the context of an increasingly global marketplace. Indeed, IP rights are increasingly becoming the "currency" that businesses use to secure competitive advantage in the global marketplace.
Critical to achieving a competitive advantage is the exclusive right to exclude others from applying that innovative knowledge in the marketplace for a period of time. Given the enhanced value of IP rights to innovators operating in a knowledge-based global economy, IPOs around the world have experienced a significant increase in demand for IP protection in recent years.
Recent patent activity statistics from the World Intellectual Property Organization (WIPO) show CIPO receiving the 7th highest volume of patent applications in the world. Given that we are the 8th largest economy, and our population is 35th in size, it is clear that Canada is seen as an attractive country in which to obtain patent rights. Canada also ranks 8th in the world in total number of patents currently in force worldwide and 9th in terms of patent filings by nationals outside of the country. However, there is an opportunity for Canada to further promote participation in the IP system so that Canadian innovators are better positioned to seize business opportunities domestically and abroad.
This is particularly the case with small and medium-sized enterprises (SMEs) that tend to use IP rights to enhance business performance less frequently than larger firms. In early 2007, CIPO conducted an IP awareness survey with a representative sample of Canada's over 900 000 SMEs. The survey found that SMEs have a relatively low level of familiarity with IP and a very low level of usage of databases that provide access to IP-related information.
SMEs are critical to Canada's economic development. As their operating environment becomes increasingly competitive, CIPO is committed to enhancing efforts to allow SMEs to better respond to opportunities and challenges through the IP system.
3.2 CIPO's role as a government agency
CIPO is an SOA of Industry Canada under the direction of the Deputy Minister and Minister of Industry. CIPO's mandate and mission support the Department's overall strategic outcomes and priorities. In particular, the mandate and mission, along with the strategic directions outlined in this strategic plan, are closely tied and contribute to key strategic outcomes identified by Industry Canada and the Government, including "a fair, efficient and competitive marketplace"; and "an innovative and knowledge-based economy."
In addition to CIPO's delivery of quality and timely IP products and services to clients, the organization supports education and skills development for Canadian target audiences and provides access to the latest in technological, scientific and intellectual advances through our databases. These combine to nurture the capacity of Canadians to innovate, build new ideas and gain competitive advantage.
As well, CIPO participates in other departmental and government-wide initiatives, including the development and implementation of policies, practices and standards. For instance, part of the Government of Canada's economic strategy is to provide streamlined access to government services to make it easier for both businesses and consumers to do business in Canada. This includes a transparent and predictable regulatory system that accomplishes policy objectives while mitigating unintended impacts, as well as providing an up-to-date legislative framework for business. An example of how Industry Canada is modernizing marketplace frameworks is through the government-wide Paperwork Burden Reduction Initiative, which promotes the competitiveness and prosperity of small businesses by reducing the paperwork burden imposed on them.
3.3 Expectations of clients and stakeholders
The Government of Canada recognizes the importance of delivering quality, citizen-centred services. This requires that services to clients be designed around their needs. This is a constant challenge, as CIPO's clients' needs, like those of clients of other IPOs and indeed of other governmental and non-governmental service providers, are evolving rapidly. One key reason is technology. Today's clients expect service round-the-clock regardless of geographical location.
The IP environment itself is also evolving rapidly, generating demand for new products, new services and new ways to access information easily, seamlessly and securely. At the same time, CIPO's clients have become much more aware of service options available to them in other jurisdictions and demand that CIPO provide similar — if not better — services here in Canada.
IP rightseekers and their agents place significant value on TATs and quality, and compare performance on these two service attributes with the imperatives (e.g. average product life cycle, degree of competitiveness) of their particular business sector as well as their experience with other leading IPOs. In 2001, CIPO made reducing TATs the number one priority. More recently, in part due to progress achieved in addressing TATs, other issues have come to the fore. For example, consistency, accuracy and comprehensiveness in searches and examination have emerged as key quality priorities to be addressed.
But while TATs and quality are important, they are only part of the story. As CIPO's 2005 client survey showed, information and access are two primary drivers of clients' overall satisfaction with CIPO. Action in these areas is also imperative. Clients want to be kept informed as to the status of their IP application or changes in CIPO policies or services. They also want the information they receive to be clear, consistent, concise, accurate and comprehensive.
With respect to access, they want to be able to use CIPO's services themselves, on their own terms, when they choose. They expect online systems to be up and running and to incorporate the latest technology and functionality. They also want to find the information or service they need easily and to reach a knowledgeable CIPO employee when they encounter a problem.
Modernizing Canada's IP framework is also important to clients and stakeholders. Targeting, developing and leveraging relationships and networks both inside and outside of the federal government will help CIPO in modernizing the IP administrative framework (legislation, regulations, office practices) and influencing IP policy more generally. Reviewing and updating legislation and regulations will enable CIPO to improve service to existing clients while attracting new clients.
More broadly, CIPO's clients want CIPO to be innovative and outward-looking and to acquire and maintain the organizational capacity and infrastructure it needs to function as a "leading" IPO — one that provides efficient, business-friendly service delivery to innovators and creators, and delivers quality IP rights in a timely fashion.
While the needs of existing clients are growing rapidly, so are those of potential new clients. For example, many Canadian innovations go unpatented simply because creators and inventors in Canada are unaware of the value of IP. Unlike countries such as Japan and South Korea, IP protection is often overlooked by Canadians as a critical instrument that provides the foundation for investment and growth opportunities. CIPO needs to play its part in better promoting the linkages between IP and economic growth. Businesses, especially smaller ones, often fail to recognize or value IP as a strategic asset and most individuals never receive a basic grounding in IP as part of their education.
3.4 CIPO in the larger international IP picture
CIPO operates within a larger international IP community. Many IPOs, like CIPO, face challenges such as increasing volumes, duplication of work, and the need to deliver quality IP rights. These challenges drive CIPO and other IPOs to cooperate on the international stage. CIPO works to contribute and influence, in order to improve the IP system internationally. We also seek to form alliances and share best practices.
Within the patent field, there are three dominant players — the United States Patent and Trademark Office (USPTO), the European Patent Office (EPO) and the Japanese Patent Office (JPO), that make up what are known as the Trilateral Offices. Also, there are a number of Asian IPOs, China and South Korea in particular, which have grown significantly in size and influence in recent years. There are the long established middle players — CIPO and IP Australia being examples. And there is a large number of smaller IPOs, many in developing countries. By 2012, we expect India and Brazil to be important emerging players.
Most of the IPOs come together in multilateral organizations, such as WIPO and APEC-IPEG (Asia-Pacific Economic Cooperation — Intellectual Property Experts Group) where CIPO is an active participant. These fora promote harmonization through international treaties and work on technical issues. In the area of patents, progress on harmonization has slowed due to differences in the desired outcomes and priorities of Member States. This has fuelled efforts amongst many IPOs for bilateral and regional arrangements, at the expense of a universally accepted international framework. Regarding trade-marks, efforts towards greater harmonization have been more successful, as demonstrated by the continuing work and cooperation around the Singapore Treaty on the Law of Trademarks.
Since 2001, CIPO has increased bilateral dialogue and information exchange with a number of IPOs, including the USPTO, EPO, IP Australia, UK Intellectual Property Office, JPO, the State Intellectual Property Office of the People's Republic of China (SIPO) and IPOs from emerging countries in the Southeast Asian bloc.
During the period of this strategic plan, CIPO will not only need to strengthen existing multilateral and bilateral relationships to influence international IP policies and practices and acquire best practices and strategic intelligence, but also to develop new relationships, for example, with IPOs in emerging economies.
3.5 Business forecasts and financial considerations
CIPO is on sound financial footing, as a result of prudent financial management within the Revolving Fund and the fee review in 2004.
During the period 2007-2012, CIPO expects to see modest growth in volumes of applications for patents, trade-marks, copyrights and industrial designs. The forecasted volumes are shown in the following graph.
Overall, CIPO's revenues, based upon the fee schedule set in 2003-04, are expected to level out in 2009-10 whereas expenditures are forecasted to continue to rise. Efficiencies gained from initiatives such as EBR will contribute to maintaining CIPO's positive fiscal position. In addition to these efficiency gains and responsible financial management, CIPO may also need to re-examine the organization's fee structure with the overall goal of maintaining a sound financial future.