The Canadian tech sector wants the federal government to move towards an outcome-based procurement strategy that focuses on supporting scale-ups and small and medium-sized enterprises (SMEs), industry representatives said at a Mar. 9 event hosted by the Information Technology Association of Canada (ITAC).
The one of a kind event, held in partnership with Public Services and Procurement Canada (PSPC), Shared Services Canada (SSC) and the Treasury Board Canada Secretariat (TBS), brought together more than 250 stakeholders in the tech community to chat openly with federal decision makers on what they want to see happen in terms of modernizing the procurement framework in Canada.
“The session was very successful in our view, as it was the first time we had the government and industry representatives together at the same time to openly discuss what they want for procurement going forward,” Robert Watson, CEO of ITAC, told IT World Canada.
Attendees collaborated in sessions and devised several recommendations within four key areas of interest: procurement policy in a digital world; innovating contracts, terms and conditions; socially and economically responsible procurement; and leveraging public sector procurement to support SMEs and scale-ups.
Most important, the tech industry pointed out, is making the process more agile and efficient in an age driven by rapid technological advancements.
“The tech industry and solution providers in general have become increasingly frustrated over the fact that while the government has a bold agenda from a digital transformation perspective, it hasn’t updated the already very antiquated and restricted procurement process,” said Kirsten Tisdale, the Canadian managing partner for government and public sector at EY (and keynote speaker at the ITAC event). “[The industry] are trying to solve big complex problems for the government, but they don’t have the flexibility they need to be creative and innovative while working within Canada’s really out of date – to be generous – procurement framework and rules.”
Tisdale explained that currently, the procurement policy is process-oriented and emphasizes “controlling all potential risks,” which has led to rigid, prescriptive solutions. Instead of the government telling the private sector what exactly they’re looking for, she said the general consensus at the event was for the government to define the problem it’s trying to solve and then invite organizations to solve it.
“We want them to move to what we would call an outcome-based approach…that’s led from a business and social perspective as opposed to solely compliance and economic perspectives,” Tisdale said. “In many cases, lowest price is not the best answer – it’s about the value being created, what social impact the project would have, how it would meet environmental goals, and how it could help smaller Canadian companies find their footing.”
Supporting Canadian entrepreneurs, scale-ups and SMEs was also a big topic at the event. As a result, many of the recommendations presented encouraged collaboration and partnerships between several providers within one project.
“We need to be able to harness not just one single provider, which is a system that favours large companies, but the strengths of several companies at once and plug them into an ecosystem dedicated to solving a problem,” Tisdale said. “If the government is trying to develop digital capabilities, for example, maybe it would be a better option to choose a few small entrepreneurial high tech companies with the right combination of skills and capabilities versus going with one great big global player.”
Other recommendations included reducing barriers to enter the procurement process, such as security and insurance requirements, as well as adding terms and conditions for defined periods to renegotiate contracts, supporting under-represented groups, rewarding good performance, and allowing for more “cross-pollination” between public and private sector talent.
While these recommendations did not make it into the most recent federal budget, released by Finance Minister Bill Morneau on Mar. 22, it did include $50 million dedicated to procurement, something ITAC sees as a good first step forward.
“The very encouraging part is that the government is really listening to how we can make it better for companies in Canada to do business with the government, and that’s shown in the budget with the procurement section,” CEO Watson said.
Updating the procurement framework was also included in PSPC Minister Judy Foote’s mandate letter, and ITAC is hopeful that material changes along the lines of what was discussed at its event will happen within a year.
“[The government is] making good moves and actively trying to shape what that new framework will look like in the next 12 to 18 months,” said Kelly Hutchinson, vice president of government relations at ITAC. “They’ve asked for some things they could do relatively quickly that don’t require legislative updates or huge big policy changes, and I think things like that will probably be accomplished within the next year or so.”