The Canadian Advanced Technology Alliance (CATA) has put together a proposal for technology test beds in the public sector and calling out to governments at all levels to implement the plan.
The test beds would provide more flexibility for the ministries and individuals to experiment and innovate products and services, said John Reid, president of CATA.
The proposal is a win-win situation for the IT industry and public service, according to Reid, and would help public service attract top talent by providing a mandate and resources to experience and be innovative.
The plan would also help Canada rise its profile an innovator in the international community. “With all sectors looking into the future, there are new opportunity areas. But if you don’t provide vehicles for people to experiment, it won’t happen in Canada,” he said.
The end game, according to Reid, is accelerating enterprise creation in Canada. “It’s going to be the new products and the new services that help pave the way,” he said.
While the plan doesn’t intend to replace the traditional procurement process, it is a way to deal with a long-stranding refrain from Canadian CEOs, Reid noted. “More often than not, the first sale a company makes is outside of Canada,” he said.
“It’s just another vehicle where we would have an opportunity to work with Canadian technologies. That’s important to them because when they go offshore, they can say they have a test site or they have a reference account within their own government,” said Reid.
“Current rules wouldn’t allow Public Works to buy technologies as a trial without a full-blown procurement. Under the Canadian Technologies Office Test Bed the government would be an incubator, buying and trying new products and services,” states CATA.
Current government procurement process are biased towards safety, according to Howard Kiewe, senior research analyst at Info-Tech Research Group Ltd. “Price is a concern, but the main bottom line outcome is you don’t want to end up with your name in the paper in a bad way, in a negative way because you’ve made a blunder in your selection,” he said.
Kiewe suggested a separate, lighter weight procurement process for new products might reduce the cost for companies and allow beurucrats to make decisions that are a “little riskier” and have a “bigger payoff.”
“It’s a controlled risk. You want to do it in a limited way until you are confident that it will work in a broader context,” he said.
CATA presented its Technology Test Bed concept to staff from the office of Public Works and Government Services Minister Christian Paradis on Tuesday and is “very pleased” with the reaction from PWGSC, according to Reid. “We really are getting very positive resonance on this idea,” he said.
“This Government recognizes the important role that SMEs play in our nation’s economy and we will continue to listen to groups like CATA when it comes to improving government procurement,” said Margaux Stastny, deputy director of communications for Paradis, in an e-mail interview.
“As was clearly demonstrated in the case of GENS (the government enterprise network services initiative), our government ’s consultations with industry bear concrete results for businesses and taxpayers alike. This most recent meeting was productive and another will follow in the near future,” she said.
Reid anticipates further interest at local, provincial and federal levels. “You’ll see some governments actually implement this and then we’ll try to accelerate this across all public sector agencies,” he said.
Kiewe finds the proposal constructive. It’s an opportunity for business to deploy an early prototype and get input from their customer, he said, which in this case would be the government.
Input from the consumer is very useful and valuable in new product development to get a winning product, said Kiewe. “If you can do something to get products that are still in early stages of development out into the field, that’s constructive from a design standpoint,” he said.
While it’s obviously good to have a reference from the government of Canada, perhaps more useful is the feedback for small businesses, where most of the innovation will come from, he said.
“It’s also an opportunity for government to influence product development and get something that better meets their needs,” he added.
When projects are completed behind closed doors it is usually too late to make any substantive changes, noted Kiewe. “This kind of iterative approach has been shown to be more successful and also can prevent real bombs from happening,” he said.
Federal government is currently making steps to adjust procurement policies and make the process easier for SMEs. The Canadian government purchases approximately $14 billion in goods and services per year, according to a June 2009 House of Commons parliamentary report, “In Pursuit of Balance: Assisting small and medium enterprises in accessing federal procurement.”
SMEs account for 45 per cent of GDP; 60 per cent of all jobs in the economy; 75 per cent of net employment growth; and about 98 per cent of all businesses in Canada, according to the report. SMEs employ “almost half of the private sector workforce” and “statistics provided by Industry Canada show that 74 per cent of SMEs have fewer than 10 employees.”
“The Standing Committee on Government Operations and Estimates held five hearings on the subject of the ability of SMEs to access federal contracts,” states the report. “What began as a study on the bundling of [IT] contracts became a study on the conditions surrounding SMEs as they try to access federal contracts.”
According to the report, “The Committee heard overwhelming testimony that SMEs are frustrated with the federal procurement process.”
CATA’s Innovation Nation Program aims to create 10 new flagship companies in the ICT sector with annual revenues of $5 billion by 2020. With the Technology Test Bed concept, CATA is now aiming to also provide 10,000 public sector reference accounts for SMEs by 2020.