Government Operations Committee on Nov. 6th, 2012

[Liseanne Forand]

Thank you very much. That is a good question.

First of all, we foresee this transformation period occurring over a 6 to 10-year timeframe; however, we will be implementing it on a gradual basis. We are not going to wait until the end before everything is implemented.

As I mentioned in my opening statement, this is exactly why the planning phase is so important. We have to know, first of all, where we are coming from and what we have.

You talked about a life cycle. We are going to want to integrate this life cycle into our transformation process in order to replace things as they become obsolete. We are going to replace what we now have.

However, with respect to the major transformations that will be taking place in our data centres and networks, our objective is to build for the future. This is one of our guiding principles. We must be looking forward. That does somewhat explain why we were so organized in our approach with industry. The information technology industry has the best knowledge. We do not simply want to rely on suppliers to determine what we could expect in the future. We want to have a better overall understanding. That is why we are working with people from this roundtable.

We are also talking to other companies, other thinkers, other influential people elsewhere. We really want to build something for the future. We want to integrate the flexibility you alluded to into the entire modernization process.

[Jean-François Larose, NDP, Repentigny, QC]

A problem will result. If we find a miracle solution for the financial planning of changes to come, I think that IBM and Apple will be happy to cooperate with you to get this information. In reality, we have no idea what the next 10 years will bring us.

I find it curious that you are making budget forecasts, claiming on the one hand to have a basis, and on the other hand, acknowledging the need for flexibility and adaptability. I do not believe that tomorrow the figures will reflect today's reality. We have no idea what is in store for us.

We have only to look back at previous initiatives. The Secure Channel Network was supposed to cost $96 million and wound up costing $1 billion. The Government of Canada Marketplace, which initially was to be very inexpensive, ultimately cost $50 million. We always find ourselves dealing with problems in the area of flexibility, adaptation and lack of information.

We also have to think about the complex relationships with the various departments and their characteristics. Do you have any mechanisms that enable you to deal with this technological divide that exists between the departments, while this transformation is proceeding? This could cost millions if not billions of dollars for the Department of National Defence, should there be any delays whatsoever.

[Liseanne Forand]

When we deal with the relationships between the departments, we want to focus on certain aspects in particular. You are quite right in observing that the departments are very diversified. There are all kinds of requirements, capacities and degrees of complexity. Obviously, the Department of National Defence is a huge, very complex department with numerous requirements.

At the same time, when it comes to IT infrastructure, in the sector of concern to us, namely data centres, networks and email systems, we will be able to standardize many areas. We will do this horizontally within the 43 departments. Some processes, from the technological standpoint, are already standardized throughout a government such as ours. We are going to standardize procedures in these areas, while at the same time acknowledging the particular requirements of various departments in other areas.

We think that we will be able to nevertheless make great strides in defining and providing more standardized services throughout the government.

[Jean-François Larose, NDP, Repentigny, QC]

Thank you.

[The Chair, NDP, Pat Martin]

Thank you, Jean-François. That's your time.

We'll go to Kelly Block, for the Conservatives.

[Kelly Block, Conservative, Saskatoon—Rosetown—Biggar, SK]

Thank you very much, Mr. Chair. I too join my colleagues in welcoming you here today. I think this has been a good discussion about the progress that has been made on Shared Services Canada.

I want to follow up on some of the questions my colleague was asking about industry engagement. I want to go back to the process regarding the round tables. Is this a pilot initiative, or do you see this becoming a permanent process whereby you engage in this kind of way?

[Grant Westcott]

We believe—and this was the nature of the conversation with the associations—that we needed to have this conversation on a sustained and continuing basis for it to actually serve us both well. It was important to have transparency around what are we doing and how we are doing it and clarity on the best way to do it.

Right from the beginning, it was thought that it was important that it be considered a regular thing done every quarter. If we have a six- to eight-year program for it to be helpful, the advice and counsel through the duration of it is essential.

[Kelly Block, Conservative, Saskatoon—Rosetown—Biggar, SK]

Thank you.

You also mentioned in your response that you were actively seeking the engagement of SMEs. Would you speak to exactly what it is you're doing to engage SMEs and encourage them to come to the table or to help them even?

[Grant Westcott]

Two of the associations we're working with represent SMEs. We work very hard to make sure their voices are heard. ITAC is an interesting association, because it represents both very large companies and small companies, whereas CITPA and CABiNET really do represent small companies. The best way we think we can move forward is to in fact make sure that they have an equal voice and that we listen attentively to what they have to say.

I think things will be more interesting going forward when we get to this topic of innovation, because small businesses typically are very good at providing greater insight that way. That subgroup has not formed yet, but we think there will be very interesting things to come from that as we get going.

[Kelly Block, Conservative, Saskatoon—Rosetown—Biggar, SK]

Earlier on, you also spoke about the challenge between perhaps what you're doing and the private sector in terms of performance benchmarks. I'm wondering if you could share with us what Shared Services Canada is doing to ensure that in fact you are adopting best practices and industry standards.

[Grant Westcott]

The background behind the government's decision to create Shared Services was the recognition that it was time for the government to start to consider that a new model was necessary in order to support the entire government. That was a kind of underpinning that came forward at that time.

It was based on the fact that in the private sector and in some other governmental areas people had benefited from these large-scale approaches in terms of consolidation and approaches to doing things properly, but from an enterprise perspective as opposed to a subunit perspective of a corporation, for instance.

Basically, we're benefiting from the experiences of other companies. They've been through this. They've reached the end of their journeys. The results have been, by and large, quite positive.

We've spent quite a lot of time since our formation in reaching out to companies like HP, IBM, and others that have gone through the whole journey for their own operations in order to look at how they've done it and the approaches they have put forward. We are adopting the same types of project management approaches, their approaches to governance, and their approaches to organizing business cases going forward.

From that perspective, we're trying to get the benefit of all of those lessons that have been successful in the past. Plagiarism is a great thing.

[Some hon. members]

Oh, oh!

[The Chair, NDP, Pat Martin]

Thank you, Kelly.

Linda Duncan, for the New Democrats.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

Thank you, Mr. Chair.

I've noted this massive list of contracts. If I understand your intention from your materials, strategy, and presentation, you're in the process right now of moving to consolidate a sizable portion of this under one contract.

We've all gone through the experience of trying to get rid of a cellphone contract or a telephone contract on a land line. Have you calculated the costs of buyouts of the current contracts? Is that factored into the cost of implementing this system?

[Liseanne Forand]

There's a great number of contracts. I'd just mention at the outset that on the list you received, when you're looking at 2011-12, the last fiscal year, these were all contracts that were entered into by 43 different departments. That's what we inherited.

We're looking at an approach to consolidating these contracts where we can, when it's best, and when it's most economical to do so. We aren't looking at breaking contracts and redoing them. As they come available for renewal, we look at consolidation or we work with the vendor.

For example, there's a vendor called CommVault. It provides data centre services—support to data centres and storage. We have consolidated all of our CommVault contracts, without any penalty, which will result in savings and cost avoidance over the next three years of $15 million.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

So you're foreseeing no penalties; you're simply going to outrun all the contracts...?

[Liseanne Forand]

We're working with our vendors—for example, large vendors—to see how we can consolidate Microsoft, IBM, or whatever. It's not our objective...I wouldn't want the committee to think that are going to end up with one huge contract for everything we buy, or even in each category. We're going to want to continue to have a diversity of suppliers to make sure we have good competition and good market-based competition.

We're managing the contracts in a way that makes the most sense in terms of what we need to buy, when we need to buy it, the state of the contract, the performances of the contractor and of the supplier, etc. We will be gradually consolidating all of these contracts as we go forward—

[Linda Duncan, NDP, Edmonton Strathcona, AB]

Okay—

[Liseanne Forand]

—but we'll never end up with a single one.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

I have limited time, and I want to give some of my time to my colleagues.

It's reassuring that you are looking to additional smaller service providers. I know this from the experience of running an MP's office: we have a lot of support when we're here on the Hill, but in the riding we are abandoned. Certain suppliers are hired and they don't necessarily make you a priority; they have a whole list of clients.

How are you managing the issue of...? For many departments, like Environment Canada, for example, or Aboriginal Affairs, a lot of their work is done in the regions. How are you ensuring their critical support as you move to more and more reliance on computerized systems and e-mails, and replacing staff with online systems? Do you have as a factor ensuring that regional offices are well served?

[Liseanne Forand]

Yes, thank you for that. We did inherit staff located all across the country. I believe we're in 300 different locations all across Canada, so we've built that into our operational model.

Kevin Radford, who's here with us and who's the senior ADM for operations, has organized his work in vertical portfolios, but also with regional coordinators. We have a regional coordinator in the Atlantic region. We have one in Ontario, one in Quebec, one in the west, and one for the north. Those people are our management eyes and ears on the ground. We work with staff in those regions, and we work with the departments in terms of their regional location.

I met last week with the Deputy Minister for Parks Canada, for example, and that was one of his real preoccupations, because they have a highly distributed workforce. He expressed his satisfaction that we were taking the needs of his workforce into account.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

We're moving toward new innovative technologies, which is great, but one of the challenges is that in certain isolated regions you may not have providers who have any knowledge of servicing that technology. I'm wondering how you're going to factor in all of that.

[Liseanne Forand]

Our predecessor organization, the IT shared services branch at Public Works, had a history of working with regional service providers, particularly in the telecom area. We're going to continue to do that and we are continuing to do that now.

We find, actually, that there is a good diversity of suppliers across the country. Increasingly, even in the far north, the infrastructure capacity is growing. We're confident that over the next few years we are going to be able to increase connectedness, if you will, even across the territories, to a much greater extent than what's there now. We work with Northwestel and organizations like that to make sure those interests are taken into account.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

Thanks.

[The Chair, NDP, Pat Martin]

Sadly, that concludes your time.

Ron Cannan is next.