1. Both the Government of Canada and the private sector must be satisfied that they are in a “win-win” IT relationship. Do you believe this win/win relationship has existed in the past? How do we ensure it exists in the future?
Establishing a Sustainable, Substantive Relationship
TBS Contracting Policy Statement:
Government contracting shall be conducted in a manner that will:
· stand the test of public scrutiny in matters of prudence and probity, facilitate access, encourage competition, and reflect fairness in the spending of public funds;
· ensure the pre-eminence of operational requirements;
· support long-term industrial and regional development and other appropriate national objectives, including aboriginal economic development;
· comply with the government's obligations under the North American Free Trade Agreement, the World Trade Organization - Agreement on Government Procurement and the Agreement on Internal Trade.
It can be difficult to do business with the Government of Canada (GC) for the following reasons:
· Very lengthy and onerous procurement process that is not outcomes based.
· There are differences in interpretation and application among procurement personnel of the legal, regulatory and policy framework eroding trust and confidence in the system.
· Layers of bureaucracy built into the system.
· Very detailed & prescriptive contracting makes it difficult to provide added value or be innovative in people, process, and/or technology.
· No flexibility to change the “standard terms and conditions”.
· The evaluation process is typically lowest cost as opposed to value-for-money.
· One way communication with industry contributes to the perception that specifications are wired to achieve a specific outcome (supplier).
· Buying behaviour is sporadic…….periods of feast or famine.
To ensure a “win-win” relationship in the future, we believe the procurement policies and culture need to change. There needs to be appropriate measures that will foster a procurement culture that is best value and outcomes based ----a cohesive process that does not grind to a halt because of extensive interpretation of the rules within the policy. Further, the TBS contracting policy statement should include innovation as a national objective.
To establish a sustainable and substantive relationship with industry has to be a two way endeavor. Early, open, and ongoing consultation between industry and government are key for a “win-win” relationship. There are many examples of GC preRFP activities to engage industry, however, when industry provides input etc. nothing comes back from GC. There is no reporting back on the outcome, and/or decisions taken based on industry input. Industry inquiries and request for status update lead to silence or “watch MERX”.
There have also been instances where the GC RFP is so prescriptive with pages and pages of requirements (usually mandatory) that only one (1) bidder is possible. There needs to be an environment that fosters good, healthy competition in order to drive innovation.
2. Do your members invest in the relationship with the Government of Canada in the same way they invest in other sectors (e.g., the financial sector)? What can SSC do to nurture its relationship with suppliers?
Building a Lower Cost, More Effective Technology Platform
Limited to the degree it complies with government’s procurement policy (conflict of interest).
The procurement process makes it very costly to do business with the Government of Canada and the case for making investments is difficult to justify with corporate management. (ref. back to Q1)
Engage in “commercial confidential” type meetings with industry. Increase communications with industry sharing SSC plans, priorities, needs, and commitments. Look for ways to be a “test bed” for development and innovation not only in technology but in people, processes like governance, methods/approaches and transformation.
3. How can SSC balance reducing costs and ending waste and duplication with the objective of spurring innovation in the sector, as suggested in the Jenkins report? Should government strive to be both a first-user and a model-user? If so, what measures could SSC take to achieve these goals?
o Partner with industry advisors, such as those that shaped the process for the “value proposition” procurement model used for the National Shipbuilding Procurement Strategy (NSPS).
o Partner with industry advisors to identify areas where SSC can be a first-user and a model-user that spurs innovation, minimizes impact on mission critical systems, and ties into reducing the overall costs to the taxpayer. In addition to technology solutions, SSC has the opportunity to be innovative in how it delivers the services (process efficiencies), how it steers the transformation, how it is governed, how it leverages its resources, and how it procures.
o Identify industry investment opportunities that pay a dividend…..provides a solid ROI.
o Make innovation part of the procurement framework.
4. Various models have been identified regarding SSC's sourcing of products and services. These include out-sourcing arrangements such as strategic partnerships, co-sourcing alliances and transactional relationships. SSC could also in-source, whereby SSC would design, buy components/services as commodities, integrate and deploy. What is your opinion of these models?
These models work well for very specific requirements. When to use the models is key and largely driven by business strategy i.e. keep what is core to the business of government, look to partner with industry in areas that are not core but essential like back-office systems.
Look at “right-sourcing” as a strategy to combine the best of outsourcing with the best of in-house service capabilities. SSC should partner with industry advisors to:
o identify the different options open to SSC for ‘right-sourcing’
o recommend the most efficient model – what should be outsourced and what should be kept in-house
o ensure that there is a clear separation of responsibilities between the organisation and the sourcing suppliers
o define how the model could be governed
5. Limiting technology diversity across the Government will be essential. What best practices can guide this consolidation of platforms, technologies and processes?
There are many examples and best practices relating to consolidation demonstrating the improvements in resource utilization, simplifying infrastructure management, reducing capital and operating costs while increasing ROI…..virtualization technologies.
SSC should engage industry advisors who have relevant global experience with other public and private organizations to assess and recommend a proven approach.
6. The Government procures IT products and services through two primary means - open tendering for non-security sensitive requirements and the use of pre-qualified suppliers for national security requirements. What works well with these approaches and what can be improved? How can we ensure the principles of fairness, transparency, security and value for money are being achieved?
Unclear if national security is germane or if the question deals with an accelerated vs. regular procurement.
7. The Government is interested in supporting the development of innovative Canadian SMEs. How can SSC assist in this regard?
o Leverage the industry advisors involved in the GC National Shipbuilding Procurement Strategy. Partner with highly skilled and experienced firms to develop the business and relationship models that support innovation.
o Build the requirement into the procurement process.
o Leverage IRBs
o Identify “test bed” and “first-user” opportunities.
8. The Jenkins report recommended that RFPs should, where appropriate, define the needs to be met or the problems to be solved, rather than being overly prescriptive of the solution. Do you agree? Do you have suggestions as to how this could be implemented?
o Consider the GC National Shipbuilding Procurement Strategy as a model.
o Utilize out-comes based specifications as part of the evaluation process.
o There are many factors to consider and SSC should partner with a highly skilled and experienced firm to develop the implementation plan. Industry advisors can help in areas such as:
o Developing the service specifications which set out the outcomes to be achieved and how these will be measured.
o Helping SSC concentrate on the outcomes it wants to achieve and how it will measure progress/delivery - let suppliers identify how they would provide the service, how much it would cost and any additional outcomes that they can offer as part of their delivery. Being over-prescriptive reduces opportunities for innovation and efficiencies.
o Identifying what needs to be included in the specification about performance management and review. Making sure that the timescales and targets set in the specification are challenging yet realistic.
o Developing the plan to review the service, its impact and effectiveness.
o Assess and identify if there are any specific risks associated with the goods or services to be provided and include information in the specification.
o Help identify the wider social, economic and environmental benefits that could be gained.
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