Government Operations Committee on Oct. 20th, 2011

[Denis Blanchette, NDP, Louis-Hébert, QC]

Mr. Lynt, you are probably aware that, in the field of information technology, one of the best practices, which has now been recognized, consists in not creating huge projects, because they always end up costing a huge amount of money.

What do you think of the idea of breaking down IT projects into smaller pieces, and how do you see the role of small enterprises in relation to IT giants?

[Jeff Lynt]

As we've always said, we believe that shared services...and as an example, which could be a very large project--or they could break it down into more of a distributed model--we think small business can provide and does provide niche services. Certainly, in my company we hone those skills, as do many of our member companies. We don't try to be all things to all people.

In my case as a service management expert, if our company provided that expertise, in Service Canada, as an example, we could help them define a distributed model, where we could still have the best in class or the centre of excellence that's required to take on such an initiative. We think we can bring in that expertise as well as provide the experts throughout the system.

There's this mentality that the one big company can provide all of that. They may very well be able to do a good job, and we're not saying they can't, but we're just saying that we shouldn't be precluded. We're not trying to be all things to all people. We think we do a very good job in the niches in which we provide the services, and we think there are better strategies to incorporate them through a distributed model.

[Denis Blanchette, NDP, Louis-Hébert, QC]

Thank you very much.

My next question is for Mr. Rivenell and Ms. Abu-Hakima.

The impression we get is that there is a lot of frustration for people who have to deal with government. Obviously, you are in a good position to talk about that. However, I imagine that you also have to deal with the private sector, be it in the form of small or large companies.

Based on your personal experience, can you compare the problems you encounter in dealing with government versus big business? Are the problems the same or are they really different?

[Dr. Sue Abu-Hakima]

They're different for me.

I can speak French, if you prefer.

[The Vice-Chair, Liberal, John McCallum]

You have about 10 seconds.

[Dr. Sue Abu-Hakima]

The Government of Canada's procurement system is like a rat's nest. I agree with my colleague John that it has to be simplified. It's getting worse and worse.

[The Vice-Chair, Liberal, John McCallum]

We'll go to Peter Braid now.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

Thank you, Mr. Chair.

I thank all the witnesses for being here.

I am going to try to cover questions for most if not all of the panel.

Ms. McCallion, I'll start with you.

This came up through Monsieur Blanchette's question to you. In your comments, you recommend that OSME should perhaps be under Industry, not under PWGSC. I heard Ms. Abu-Hakima say that she probably doesn't agree with that, and I'm not sure that I do either.

The role of OSME, of course, is to advocate for SMEs within the federal procurement process. PWGSC is responsible for federal procurement. It would seem to me as if that's the right fit. If it moved to Industry, would the mandate remain the same or would it change? The second part of the question is, would you be concerned about a potential dilution of the mandate with a move out of PWGSC?

[Cathy McCallion]

No. We're hoping for the opposite. We're hoping for a greater voice under Industry.

My business tends to be fairly flat in structure, but in most organizations there are a president, directors, managers, and people who work for them. If you're always questioning the people at the top and going up against them, then you're going to be pushed out. There are going to be issues in the end.

We're hoping for a situation where they feel comfortable to act on our behalf and question procurement. When you're constantly questioning your colleagues, it can become quite adversarial and uncomfortable. We are hoping for the creation of a new OSME where they are comfortable speaking out against their current colleagues and improving the procurement processes.

I think they want to do a great job for us in the current situation, but their voice is muted.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

It sounded to me, from some of the other panel participants, including Mr. Rivenell, that in fact OSME has advocated fairly strongly for SMEs.

Some of the mandate that you describe sounds to me a bit like the role of a procurement ombudsman, which we also have.

Mr. Rivenell, how did you find out about the CICP?

[John Rivenell]

By accident, actually. We were just at GTEC yesterday. At last year's GTEC, we met somebody who explained the process to us. In practice, I had received an e-mail a month or two earlier, but it was one of 500 e-mails from someone I didn't know, and it just went in the junk folder, I'm afraid.

When we were at the trade show, my colleague Keith Jackson went to the booth, saw somebody, came back, and said we should do this. So to a degree, it's by chance.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

Have you seen any of their outreach since you've been connected with them?

[John Rivenell]

It's difficult for me to answer that because now we're tightly connected with these people and we've been backwards and forwards for the last year. We know the people and we like them. They're good people.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

Are you using IRAP now?

[John Rivenell]

Yes, we are using IRAP. Again, that was one of Keith Jackson's initiatives four or five years ago. Our original problem was that we have an SR and ED. Our original understanding was that the two overlapped and you take one or the other, but that's not true.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

Are you pleased with your relationship with IRAP?

[John Rivenell]

Yes, it's excellent.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

Ms. Abu-Hakima, has the CICP helped your company with the commercialization process for any of your products or technology?

[Dr. Sue Abu-Hakima]

It's early for us, because we just signed the contract on September 15. We pre-announced because we had a big trade show in the U.S. Where it has been very helpful is that because we announced at this U.S. trade show we were just at that we are working with a Government of Canada department, we had a tremendous response from a lot of the U.S. government departments.

I think it will be proven once we close some of these revenues. From the point of view of visibility in regard to whether it's helping, I think it's starting to help. I think it will be advantageous for us.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

That's a testament--

[The Vice-Chair, Liberal, John McCallum]

I'm sorry. Thank you very much.

We'll go to Monsieur Blanchette.

[Denis Blanchette, NDP, Louis-Hébert, QC]

Mr. Hanel, you are the only person I have not put a question to yet. I will now have the pleasure of doing so.

Incidentally, I just want to point out that I find all of you very interesting.

Mr. Hanel, you said a couple of things which really struck me, including the fact that there was not enough of a demand for innovation. Can you tell us exactly what you meant by that?

When you answer that question, I would like you to make a connection with the fact that the private sector in Canada does not feel the need to invest more in innovation.

[Petr Hanel]

Several studies have examined this issue and have tried to find an answer. There are basically a couple of reasons to explain the situation. First, the Canadian market is relatively small. A small innovation company can only count on a market 10 times smaller, or even more than 10 times smaller, than the United States, for example. That's one of the reasons.

Companies that are able to export or that immediately focus on exporting a new technology in their strategy might not face this problem. Unfortunately, many companies are not able to do so.

[Denis Blanchette, NDP, Louis-Hébert, QC]

I have an additional question regarding that aspect. You said that the Canadian market is small. However, given the technology of the Internet, borders are increasingly disappearing.

Since Internet technologies can help businesses market themselves, have there been any improvements? Has this helped Canadian companies?

[Petr Hanel]

It certainly has not been an obstacle. I am not aware of any studies—which does not mean they do not exist—specifically demonstrating the positive effect of the Internet. It is possible that some studies have been done, but I am sorry, I am not aware of them.