Evidence of meeting #119 for Government Operations and Estimates in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was need.
A recording is available from Parliament.
Conservative
The Chair Conservative Tom Lukiwski
Mr. Blaikie, welcome back to the committee. You have seven minutes.
Daniel Blaikie NDP Elmwood—Transcona, MB
Thank you very much. I'm happy to be here. Thank you all for coming and offering your thoughts.
It's hard to disagree with what's being said at the general level, and I don't. It's better to be more flexible. Obviously, you want to tap the best talent that's out there in order to be able to move projects forward, and you want to be outcome-focused because you want to ensure when you have a contract that you're actually getting to where you want to be. That sounds like a really obvious statement, but apparently it's not as obvious as one might like.
There are some questions that come up for me. I think part of the way that you end up with the culture that has developed, one that is overly rigid and can get in the way of achieving the outcomes that we want, is to try to be able to compare apples to apples. Also, in government they are not spending their own money, as a private company does, which, if it fails—well, that's the market. You close up shop and move on. Maybe you start up something else, and maybe you don't.
Here we're accountable to other people for the money that's spent, so we need to be able to make the case. If you can't make the case retroactively or if there's a lot of commercially protected information that you can't disclose to people, then what you can do up front in the procurement process is try to be very clear about what it is that you're asking companies to deliver so you have an apples-to-apples comparison.
In order to avoid some of the pitfalls of overly comfortable relationships between particular governments and particular contractors and to not have that become an open-ended revenue stream for a private company, how do you combat that in the relational model? To me, transparency seems like your best bet in order to be able to have a long-term, dynamic, changing relationship in terms of what government is expecting to get out of the contractors it's working with.
I wonder to what extent an adequate level of transparency, in order to have the public be able to evaluate value for money, is going to be resisted by the very people who we would want to recruit under that model, and I wonder if any of you would like to speak to that aspect of the problem.
André Leduc Vice-President, Government Relations and Policy, Information Technology Association of Canada
I'll start. I don't disagree with Kirsten in terms of bringing in the right talent, although reports suggest that Canada has some of the most talented people within the public sector, with more than 60% having university or college degrees. We've got a ton of smart people who really want to work.
What we are lacking, I think, is.... It's a cultural issue, and in all the discussions I've been having for the last year around government procurement, as we start to chip away at the specific issues, it comes down to culture. Because of very prominent failures that we've had —a lot of them on the IT side, so it's part of the role ITAC continues to have in this conversation—the industry wants nothing more than to have a successful implementation of their solution with the federal government.
The question then becomes, why are we having so many failures? You have a high level of risk aversion and everybody's right: we're not setting the problem statement at the front end. We're not setting the outcome and the goal. What government tends to do is to prescribe the technology that they want. If that's going to work, you have to believe that they're prescribing the right technology.
What they can't do is access innovation when they do that, because you cannot, in a procurement process that takes 18 months, two years, three years, access innovation. You're telling an industry that has all of this expertise what exactly you want to the nth degree. How do you tackle that side of the equation when you have an environment that's set up as abundant silos throughout all of the departments, and a command and control regime? It's top down, it's command and control, and people are told what to do. If you have high levels of risk aversion and high levels of command and control, you won't be able to address that cultural issue.
What you need to do is to have a little bit of leadership and vulnerability at the highest levels. If you have this problem, and your expected outcome or goal is here, you need to have a little bit of trust that you're going to partner with the industry to be able to head towards that outcome together. However, we have a high level of distrust. At this moment in time, risk aversion is at an all-time high, and we have a high level of distrust between the private sector and the public sector in the government. It really is going to come down to whether we just go about addressing the procedure and process elements, or whether we start having an honest conversation about how to address this cultural issue of the traditional client-vendor relationship, with the government trying to keep everybody at arm's length and trying to drive down to the lowest possible price, but it's not a negotiated partnership.
Managing Partner, Government and Public Sector, Ernst and Young LLP
On your issue of transparency, there are ways to make sure that you can level the playing field in terms of the information available: contracts, all sorts of procurement documents, all of the outcomes of previous levels of work. If you set the expectation up front that it's going to be publicly available, or at least available to the qualified bidders, it does help, coupled with the fact that the business owners need to be out engaging the private sector around what they need and make themselves accessible.
People hide behind walls. It doesn't mean that it becomes a cozy relationship, but if two people can't talk about what the issue is and what they're trying to do.... Once you can do that in an open way—and there are formalities that you can do to make it all above board—trying to open the tent a bit wider and having more open discussions with people will bring everyone up to the same level of knowledge and let them compete.
You then start to avoid “only so-and-so knows”. You open it up and try to level it from a knowledge perspective. It's particularly important if you're going to be renewing contacts or rebidding work over a certain period of time.
NDP
Daniel Blaikie NDP Elmwood—Transcona, MB
Do you think that's something industry is really interested in or willing to do?
Conservative
The Chair Conservative Tom Lukiwski
Thank you.
Go ahead, Mr. Peterson, please. You have seven minutes.
Liberal
Kyle Peterson Liberal Newmarket—Aurora, ON
Thank you, Mr. Chair.
Thank you, everyone, for being here. It's almost an all-star cast. Most of you have been here before. It's like the TV show, Celebrity Survivor. Everybody comes back for the last round to see who still goes on.
Conservative
Liberal
Kyle Peterson Liberal Newmarket—Aurora, ON
I appreciate how you've taken your time to be here with us again today.
There is so much in common. Everyone is coming from a very similar perspective. There's not much daylight between the opinions you guys are expressing today, and that means those opinions are heard a little better on this side, because there is some corroboration.
Mr. Leduc, you said that there are a ton of smart people in the public sector, and over 60% have university degrees. That leads one to think there must be a problem with the culture. Maybe it's not a problem, but maybe the culture needs to be improved or changed, or let's say “adapted”, without trying to put a negative spin on it.
I was taught when I was studying that if you want to change behaviour in an enterprise, you have to measure and reward the behaviour you want. Is part of the problem that we're not measuring the right things and we're not rewarding the behaviour we want? Isn't that what it comes down to?
Managing Partner, Government and Public Sector, Ernst and Young LLP
I'd love to comment on that.
You're 100% right. There's no downside for not making a decision, and there's no downside for making the safest decision. There is no upside for experimenting, so we do have to create the ability and the incentives so that people are actually able to experiment and over time can experiment on bigger scales. However, right now it's status quo, doing nothing. Sometimes you can do that all day for the rest of your career.
You're right. Where are those performance metrics that link performance to the outcomes we are trying to achieve?
As well, it's to create a safe place. Not every experiment is going to be successful, but let's try for that first viable product. Try things, iterate, be agile. Agility is all based on failing fast and failing small, and that has to be okay, because then you'll get better at the bigger things. That's a key point.
Liberal
President, AdaptiveOrg Inc., As an Individual
There's a culture of big in the government, which means that any time we do anything, it has to be big. As a result of that, there's a great fear in the bureaucracy. The more we can tone things down to much smaller chunks and allow for some failure in the smaller chunks, the more the fear goes away.
There's fear and distrust in the public service. There's not a lot of change. It's a risk-averse culture. There's some work to be done to build the trust. The way that has to be done is to have some consistent leadership, with very clear outcomes, and then going with very small implementations that aren't prescriptive and that allow the downstream teams to make the call.
There's so much oversight now. That's another part of the distrust: there's so much oversight. There's oversight on oversight. There's oversight in my stovepipe, and there's oversight from three other stovepipes over there. All that is constraint. All that is overhead. Knowledge in the organization is at the bottom of the stovepipe right across, and don't forget that I'm at the bottom of the stovepipe, in stovepipe number five over here. I'm knowledgeable in five, and I speak the “five” dialect. It's a little different dialect than maybe the legal dialect or the procurement dialect. I'm in the IT, and I talk about IT stuff, and people don't understand me. When those teams come together, we get communication. When they don't come together, I have somebody who's perceiving the world from his perspective, and he perceives the solution of the problem that way. It goes up through the hierarchy, and as it goes up it's filtered, and it gets skewed. By the time it gets to you, it can sometimes be bizarre. Then what happens is they say to you, “Well, now you have to make a decision.” Am I resonating a bit with you?
President, AdaptiveOrg Inc., As an Individual
You have to make a decision. There you are. You're in a situation. You're at the top of the organization and you're getting all this information that's coming up, and it's not the information you need to make an informed choice.
The first thing is to create a cross-functional team that brings all these dialects together and forms the United Nations of how we create a solution in your organization. That team down there needs to talk to you directly, not through seven filters, and say, “Hey”, and that team needs to have authority. “Steve, I need you to clear the path.” “Kyle, I need you to get this thing solved” if it's the DM or whoever. It has to go sometimes that high.
Liberal
Liberal
Kyle Peterson Liberal Newmarket—Aurora, ON
Okay.
Mr. Akrouche, picking up on that point, you mentioned there's this dynamic between oversight and insight. I think that's how you put it. We all agree, I think, that at least some oversight is necessary, but not at the expense of insight. Can you elaborate on that?
Managing Partner, Strategic Relationships Solutions Inc.
Coming back to the question about an open-book framework, transparency is really key to this. The whole thing is really about openness and transparency. Without that, you can't gain that insight. To gain insight, you need to have mechanisms to gain that insight. You can't gain that insight by standing behind a wall. You need to be working with your partner in some form, within a structure, using a set of processes to be able to gain that insight. You're not going to gain that insight through an audit process. In fact, the audit processes that we've seen in the past, that are embedded in all those contracts, even added more fuel to that adversarial fire. People come in and do an audit, a technical audit, or this or that. A lot of these contracts call for that.
Gaining insight gives you the catalyst or the platform to be able to adjust what you want to do and understand in a mutual way what needs to be done and how you're going to do it, because you didn't have that certainty in the beginning. You need to gain that certainty over time, and you can only gain it if you work together in a collaborative way.
Conservative
The Chair Conservative Tom Lukiwski
Thank you very much.
We now going into our five-minute rounds of intervention, starting with Mr. Kelly.
Conservative
Pat Kelly Conservative Calgary Rocky Ridge, AB
Thank you.
My questions or comments are in a similar vein. I would like to start with Mr. Akrouche.
You mentioned the problems associated with compliance-based oversight. That phrase sort of caught my attention. I'm aware that in many organizations or many industries, compliance overtakes the actual result or goal.
This isn't just limited to government. Even in private industry, when one becomes so seized with the simple act of “butt covering” by complying with a regulation or complying with internal corporate requirements, actually serving the customer—or serving the public, in the case of government—is lost.
At the same time, Parliament exists to oversee and authorize the expenditures of the government, so how do you reconcile the problems of compliance-based oversight with the necessity of oversight?
Managing Partner, Strategic Relationships Solutions Inc.
We shouldn't confuse two things, compliance and performance management.
You need to have a good performance management system in place, but compliance-based oversight has always been, “Okay, you've signed the contract, and there are these 25 KPIs. There are these things you're supposed to do, and all I'm going to do right now is sit and watch you do that. If you don't do that, then I'm going to report that you didn't do that.”
I'm not spending any effort, really, to try to improve the outcome as things change over time. Since I'm a watchdog, I'm just watching to make sure. I'm going to hold your feet to the fire, and all this other stuff. It's a very non-collaborative approach.
In a good relationship management framework, you would see a good performance management component to it. You need to have KPIs. You need to have those metrics. You need to have them as targets so that you can both work together towards achieving those, because when they fail, you fail too.
Together, you need to really realign those KPIs from time to time, and that's the problem with performance-based contracts these days. They tie the continuity of the contract to meeting the KPIs, but everybody knows as soon as they sign that deal that 18 months or two years later, those KPIs are no longer good anyway.
President, AdaptiveOrg Inc., As an Individual
If I had a project, for example, and the Auditor General came in five years later to tell me why it went wrong after the project was done, my question would be, “Why didn't we bring him in on day one, ask him what the requirement was for compliance, and whether it was actually required?” Then we could have built those compliance requirements in at the very beginning in an iterative way.
It's the same thing with government. A classic would be security.
André and I have had this chat about risk. The risk in government is binary. It's no risk. Push the risk to the private sector.
In the private sector, risk is dealt with through an actuary, and they put a dollar amount on it. Can we do that in government? I don't know, but risk and that kind of thing is very challenging.
Compliance we can do, though. Compliance we run into in the private sector, and we just bring the people in on the team. Instead of being the road blocker at the end, they also have to pursue the same goal, not to stop the project but to enable it and to ensure that it complies.
