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Foreign Affairs, Trade and Development Canada

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Enhanced Representation Initiative in the United States of America

(September 6, 2007)

(PDF Version, 1.04 MB) *


Acknowledgments

The evaluation could not have been made possible without the collaboration of many individuals in Canada and the United States. The evaluation team would like to express their appreciation to all who contributed their time, energy, comments and advice for this evaluation. In particular, we would like to acknowledge:

  • The Evaluation Advisory Committee members, who were generous in committing their time and energy in providing their guidance to the evaluation process.
  • The ERI Secretariat, who went above and beyond expectation in terms of providing documents, data and logistical support. The ERI Secretariat also very gracious in the time, dedication and energy they put into the evaluation.
  • The ERI Partner organizations were also very supportive of the evaluation and offering their time for interviews and providing countless documents.

Finally, but not least, the Heads of Mission, Consulate Canada-Based Staff and Locally-Engaged Staff, stakeholders, Canadian and US based firms and external clients in Washington, Miami, Minneapolis, Denver, Los Angeles, San Diego and San Francisco who were uniformly hospitable in their reception, and helpful in ensuring that the evaluation team was able to complete their data collection in a timely (and friendly) manner.


Executive Summary

The Enhanced Representation Initiative (ERI) was established to provide a coordinated and integrated approach in advancing Canada's interests in advocacy, trade, business development, science and technology, and investment in the United States. ERI is supported by a partnership of seven federal departments and agencies with strong interests in the US, these include:

  • Atlantic Canada Opportunities Agency (ACOA)
  • Agriculture and Agri-Food Canada (AAFC)
  • Canada Economic Development for Quebec Regions (CED)
  • Industry Canada (IC)
  • Foreign Affairs and International Trade Canada (DFAIT)
  • National Research Council Canada (NRC)
  • Western Economic Diversification Canada (WD)

Through this partnership, the ERI facilitates enhanced representation in the US by:

  • creating new missions and expanding or re-focussing those already in existence;
  • providing new program funding for advocacy and business development projects at missions and in Canadian partner organisations; and
  • reaching decision-making circles and engaging key interest groups in both public and private sectors at the community, regional and state levels.

The purpose of this evaluation is to respond to Treasury Board requirements and to provide an independent, evidence-based assessment of the performance of the initiative; which would be valuable to any successive or related initiative. It is guided by three pre-defined evaluation criteria from the Results-based Management and Accountability Framework (RMAF): relevance, cost-effectiveness and success.

The summative evaluation is based upon a descriptive analysis of 146 interviews, 7 site visits and a review of over 50 documents. It employs a mixed-methods approach consisting of quantitative and qualitative analyses, including interviews with key stakeholder groups(1), document reviews(2), and case studies. Over 90% of respondents selected agreed to be interviewed. Of these, 60% were interviewed by phone and the remaining 40% in person. Interview selection was based on a sampling frame of Mission/Consulate employees (LES, CBS), ERI partners, stakeholders and external clients, including Canadian and US companies who have had dealt with the US based Canadian Missions/Consulates. The sampling was stratified accordingly and a representative sample of all ERI related groups was selected (see Exhibit 1.1). Finally, three case studies, representing the South, Southwest region of the US, were selected based on criteria including:

  • a balance between smaller and larger Missions with different capacities to implement ERI
  • new and expanded Missions/Consulates in the South, Southwest Region of the US
  • Missions/Consulates dealing with topical issues respecting advocacy, trade promotion, science and technology, and investment. Case studies supplement and complement the interviews by providing a detailed report on the significance of ERI in three uniquely different regions of the United States. Content analysis and data triangulation were used as the primary analytical tools for developing the Findings of the evaluation.

As noted above, the evaluation was organized around three themes: relevance, cost-effectiveness and success. The evaluation focused on the Initiative's continued relevance in light of Canadian interests with its relationship to the US, as well as partner priorities and the growing integration of the economic space of North America and security requirements in Canada and the US. The evaluation also explored the need that ERI addressed and the extent to which it is responsive to key stakeholders, strategically aligned with partners, and continues to meet the need for advocacy and International Business Development (IBD). Based on a situational and contextual analysis, the study concluded that ERI was a relevant investment and remains a relevant investment. Evidence suggests that ERI has increased the coverage of Canadian influence by increasing the number of offices, human resources, programming, and networks used for improving IBD and advocacy work. Interview data suggests that the increased coverage has provided Canada with more opportunities to influence US decision makers and increased trade and investment in priority areas. In addition, our analysis indicated that ERI's investments are aligned with its partner's strategies and priorities. As an emerging "whole of government initiative", ERI has the potential to be a relevant engine for ensuring that Canada's broader policy goals in the US are pursued in a holistic fashion that reflects the complexity of the Canada-US relationship.

The second theme, Cost-effectiveness, focuses on performance management and is concerned with how the Initiative was planned, actually implemented and reported upon. The general assumption is that well planned, governed and managed systems provide value for Canadians. The evaluation found mixed results with respect to cost-effectiveness. Cost-effectiveness implies an ability to cost a defined set of outputs and outcomes. ERI cost data is linked to operations and projects but is not adequately linked to outputs. Furthermore, results (outputs and outcomes), while articulated in the RMAF, have not been systematically gathered. In general, the study found that the RMAF, a key-planning document that outlines planned results (outputs and outcomes), was developed and accepted by partners but not adequately operationalized.

The study found the Secretariat was successful in building a collaborative and trusting system that supported results and planned staffing, program funding, and infrastructure changes encouraged collaboration of partners. The implicit assumption was that a more cost-effective system might occur through harmonization of the partners work in IBD and advocacy. However, little work was done on harmonizing ERI's results across partners--and on the reporting on these results. Performance management, measurement, and reporting were identified as an area that needs significant work.

With respect to governance, the evidence indicated that the governance structure provided oversight at the operational level and financial oversight, and that the committee structure was a necessary, but not necessarily an efficient, way to engage in the functions they performed. There are important governance issues with respect to the vision of the ERI that affect what is expected from the initiative. It was concluded that the Senior Management Committees (DM and ADM) needed to be more engaged in the Initiative. Finally, the evidence suggests that a number of operational changes might enhance the future initiative.

In considering the Success of ERI during its five-year life cycle, several questions were asked: What capacities were built under the initiative? What capacities have been strengthened that will prospectively improve trade and advocacy programming and its performance record in the future? What difference has ERI made in terms of the delivery of tangible results that have benefitted the targeted beneficiaries? What outcomes and outputs have been attained through advocacy and business development programming? In short the evaluation attempted to capture the results obtained by the initiative. The evidence presented in the evaluation suggests that ERI has contributed to capacity building on several different levels. At the most basic point, it has led to the opening of new offices and has populated both new and existing offices with staff. At a second level, the staff drawn from the ERI partners are sector experts who have enhanced the knowledge of the missions. Also at this level, ERI has introduced Honorary Consuls (HonCons) and networks that provide a broader and more qualitative reach and coordination function to representation efforts. Finally, ERI has contributed to capacity at the partnership level by creating increased collaboration and communications between partner agencies.

With respect to outputs and outcomes, the evaluation provides some documentary evidence and qualitative data that indicates the ERI has increased the awareness among current federal partners of the challenges, diversities, and opportunities related to business development and advocacy in the US. It has also augmented advocacy and trade promotion in the US and supported activities that could contribute to new export sales, especially in relation to SMEs. Based on the above noted information the evaluation concluded with several recommendations. As ERI is coming to its end; these recommendations should be viewed as guidance for the new phase of the initiative.

Recommendations related to design of ERI

The evaluation noted the acceptance of the RMAF by partners, but raised concerns about the willingness of partners to operationalize aspects of the RMAF. The evaluators conclude that in the new ERI there needs to be a re-commitment to the vision and intent of the program and this should be articulated in the RMAF, governance, staffing, etc. It is in this context that we recommend:

  1. That the ERI Secretariat plan and execute a partners Visioning Exercise to develop consensus on:
    • The overall vision for the Initiative, in particular in terms of its nature as a horizontal or 'whole of government' initiative
    • The goals and objectives of ERI, in particular to what extent are the partners responsible for harmonizing their work-planning, implementation, reporting and accountability for results under ERI
    • The specific roles and responsibilities of each of the Departments - potentially articulated in the form of a charter.
    • The role of the Secretariat (and specifically whether it should continue in its current coordination mode or whether it should work to fulfill the RMAF vision of a more strategic role). Partners should be explicit and agree on the roles and responsibilities with respect to the role of the Secretariat.
  2. The results of the visioning exercise to be formally approved by each of the partners and lead to a new approved RMAF.

Recommendations related to Governance

Given the importance of governing horizontal initiatives the evaluation concluded that more emphasis needs to be placed on the role of the DM and ADM committees. This should complement the present role being played by the DG committee in operationalizing the initiative. In this context we recommend:

  1. The DM Committee remain as the overall group responsible for the Initiative, however, its governance role be limited to approval and oversight of the vision of the initiative. The DM should approve the new vision of ERI and meet, at a minimum, once in two years to monitor the implementation of that vision.
  2. The ADM Committee of ERI be incorporated as a sub-committee of the North American Policy Committee and be accountable for ensuring the roles and responsibilities agreed to by their Department. Further, this committee would also ensure that the financial and programmatic plans and results of the initiative be reported upon annually, with appropriate explanation reports for variance from planned results. In addition, this sub-committee would be responsible for ensuring that appropriate ERI information be communicated to the larger ADM group in order to reinforce government-wide or the Whole of Government concept. The ADM committee would operate as a Board of Directors for ERI and become accountable for strategic directions and decisions. Appropriate roles and responsibilities of Board Members should be developed. That the ADM Committee would be responsible for monitoring the progress of the RMAF.
  3. That the DG operational Committee would be conceived as a standing sub-committee of the ADM Committee to direct the management of the ERI. The DG Committee would create the sub-committees it needs to insure proper operational guidance, oversight and accountability. It would also determine the configuration of the Secretariat with respect to the most cost-effective way to ensure the work done by the ABD, HR and Communications committees. This would require the DG committee to determine whether or not a trade off is required between the benefits of collaboration and the transaction costs incurred by having the three standing committees. The work of these committees could in theory be done by the Secretariat and existing resources.(3)

Recommendations related to Performance Management

ERI presently has a performance management framework but has not been able to develop a process with its partners to populate and operationalize the framework. Operationalizing and using the performance management framework is a crucial part of the accountability and learning approach needed for horizontal initiatives. Therefore it is recommended:

  1. The Secretariat should be tasked with developing an appropriate performance management/measurement approach for the new initiative within six months.
  2. All partners at the level of the DG and ADM committees would approve this approach, along with the related roles and responsibilities of partners in performance management/measurement.
  3. The DG Operational Committee should be tasked with ensuring that the performance management/measurement approach be put in place by the initiative.
  4. To the greatest degree possible, existing data capturing mechanisms (e.g. TRIO and MARCUS), as well as public opinion research, be adapted and included in the performance measurement approach.(4)
  5. Further dialogue is needed to emphasize the consultation with, and integration of, regional trade offices (e.g. to recruit for mission, export promotion, identification of pre-export readiness).

Recommendations related to Role of the Secretariat

The secretariat plays an essential role in coordinating the partnership. They have effectively built trust through their approach to facilitating the partnerships and have won the respect of the partners for doing so. However, depending on the vision of ERI and the changes agreed to with respect to this evaluation their role would change. Therefore we recommend:

  1. Using the lessons learned from ERI, the DG Operational Committee should be tasked to define the expectations, cost and staffing of the Secretariat so that it is in line with the vision agreed to by the governance bodies. The Committee should explore the costs and benefits of issues such as leadership, operational structure, level of administrative services, HR processes, etc.

Recommendations Related to Capacity Building

ERI has been broadly successful in its first round of capacity building endeavours for increasing coverage, programming activities networks and staffing. Future capacity requirements should be determined by empirical evidence as well as data from ERI's performance management system. In this context the evaluation envisions ERI becoming more of a learning oriented initiative. Thus we recommend that

  1. The Secretariat, working with appropriate DFAIT divisions and posts, should develop an approach that would allow it to monitor the US coverage (right-sizing) in order to better understand extending or re-orienting Canadian capacity; so as to better respond to trade and advocacy issues in the US.
  2. The Secretariat assess the quantity and quality of staff applying for US Posting to ensure that the incentives(5) are appropriate to attract a pool of qualified staff; this would continue to include discussion on incentive issues such as, education, housing, and spousal support.
  3. The DG Operational Committee would determine if there is a business case to bring to the ADM Committee for recommended changes to the incentives for US Postings.
  4. The Secretariat continue to work with appropriate DFAIT departments to assess the training needs of those going on US Postings (including both CBS and LES) in order to develop improved training programs.
  5. The Secretariat would monitor the efforts of the six "strategic" networks developed in order to ascertain their ability to influence business development and advocacy work.

Acronyms

AAFCAgriculture and Agri-Food Canada
ABDAdvocacy and Business Development
ACOAAtlantic Canada Opportunities Agency
ADMAssistant Deputy Minister
BSEBovine Spongiform Encephalopathy
CanAmCanAm Group - Immigration, Study Abroad, Training
CBSCanada- Based Staff
CBSACanada Border Services Agency
CBSCSCanada Business Services Centers
CCEUCabinet Committee on Economic Union
CCMDCanadian Centre for Management Development
CCSIPCanada-California Strategic Innovation Partnership
CEDCanadian Economic Development
CICCitizenship and Immigration Canada
CSFClient Service Fund
DFAITDepartment of Foreign Affairs and International Trade
DGDirector General
DMDeputy Minister
DNDDepartment of National Defence Canada
ECEnvironment Canada
ERIEnhanced Representation Initiative in the U.S.A
ERICCERI Communication Committee
FEFormative Evaluation
FYFiscal Year
GCSGlobal Commerce Strategy
GLI-2Global Learning Initiative
GoCGovernment of Canada
GoCCARTGovernment of Canada Comprehensive Analysis and Research Tool
HOMHead of Mission
HonConsHonorary Consuls
HRHuman Resources
IBDInternational Business Development
IBDAInternational Business Development and Advocacy Management Committee
ICIndustry Canada
IPCAInternational Photonics Commercialization Alliance
LCBSLiquor Control Board of Ontario
LESLocally-Engaged Staff
MARCUSMeasuring Achievements and Results by Canada in the U.S.
NAFTANorth American Free Trade Agreement
NALCanada-U.S. Advocacy and Mission Liaison Division (DFAIT)
NCPU.S. Commercial Relations Division (DFAIT)
NRCNational Research Council
OGDsOther Government Departments
PALCBPA Liquor Control Board
PERPAPolitical/Economic Relations and Public Affairs Program
RCMPRoyal Canadian Mounted Police
RMAFResult-based Management and Accountability Framework
S&TScience and Technology
SMESmall and Medium-sized Enterprise
TBSTreasury Board Secretariat
TDTemporary Duty
TORsTerms of Reference
TPITechnology Partnering Initiative
TRIOInformation Management System used by the Trade Commissioner Service
U.S.AUnited States of America
WDWestern Economic Diversification Canada
WHTIWestern Hemisphere Travel Initiative

1.0 Introduction

In the 2002 Speech from the Throne, the Government of Canada (GoC) committed to "increase its consular presence to expand fair and secure trade and commerce and to brand Canada in the United States". This strategic direction was taken in recognition of the growing integration of the North-American economic space, the overriding preoccupation of security requirements in the US and Canada and, the need to proactively engage and represent Canadian interests in the US centres of powers, including those emerging centres in the South and Southwest. In this context, the US Enhanced Representation Initiative (ERI) was established, with a total budget of $118.2 million over five years, beginning in the fiscal year 2003/04 and ending in 2007/08. According to the Results-based Management and Accountability Framework (RMAF) developed for ERI, a summative evaluation was to be undertaken in the 2007/08 fiscal year. In addition to fulfilling the requirements of the RMAF as approved by Treasury Board in 2005, the summative evaluation will serve to support Treasury Board submissions to establish funding to implement the Global Commerce Strategy; which was approved by the Cabinet Committee on Economic Affairs in December 2006 and included recognition for sustaining the infrastructure and the concept of partnership established by the ERI. This was reflected in the 2007 Budget, which provides $60 million over two years to reinforce, among others, Canada's presence in the US market. The summative evaluation in this respect will support efforts of other federal departments or agencies for the creation of a new partnership in the context of the North American Platform, as proposed in the Global Commerce Strategy.

1.1 Context

Canadian interests are intrinsically linked to the United States economy, which is considered one of the largest and most dynamic in the world. While this presents a tremendous opportunity for Canada, it also poses a number of challenges, such as:

  • Increasing vulnerability to US domestic policies and actions
  • Ensuring access to US centres of innovation, technology and capital
  • Ensuring influence on the American political system, with its separation of powers and competing special interests
  • Providing sufficient resources to adequately respond to challenges and capitalize on opportunities

The events of September 11, 2001 have also revealed a certain amount of vulnerability for Canada's prosperity in light of increasing US concerns over homeland security. Also, they have brought to the forefront the links between economic prosperity and national security and the need to demonstrate that Canada remains a serious security partner to the US.

The ERI was established to enhance Canada's ability to advocate for and defend its political and economic interests and respond effectively to changing realities in an integrated North American economy.

1.2 Objective of the ERI

The primary objective of the ERI is "address Government of Canada priorities such as stimulating investment in Canada, increasing trade with the US, promoting science and technology development and exchanges, reducing trade barriers and generally advocating key Canadian interests and issues that are considered to be vital to a strong Canada-US relationship (borders, security, agricultural and trade issues, energy and the environment). The Enhanced Representation Initiative targets this objective through broader representation throughout the US and particularly in the new and emerging centres of the South and Southwest" (RMAF 2005).

1.3 Partnership

ERI is supported by a partnership of federal departments and agencies with strong interests in the US, these include:

  • Atlantic Canada Opportunities Agency (ACOA)
  • Agriculture and Agri-Food Canada (AAFC)
  • Canada Economic Development for Quebec Regions (CED)
  • Industry Canada (IC)
  • Foreign Affairs and International Trade Canada (DFAIT)
  • National Research Council Canada (NRC)
  • Western Economic Diversification Canada (WD)

Through this partnership, the ERI facilitates enhanced representation in the US by:

  • creating new missions and expanding or re-focussing those already in existence;
  • providing new program funding for advocacy and business development projects at missions and in Canadian partner organizations;
  • reaching decision-making circles and engaging key interest groups in both public and private sectors at the community, regional and state levels; and
  • enabling fuller engagement of Canadian provinces and territories across the US through an expanded network, and with innovative analytical and communications tools(6). The expanded network and infrastructure of Canadian missions in the US was planned to create 80 new positions, to be staffed by both Canada-based staff and locally engaged employees. In addition, a network of 20 honorary consuls was to be created as champions for Canada and to represent Canadian interests in regions where there was no official Canadian representation.

1.4 Resources

The ERI is an initiative in itself, providing program coordination and incremental resources to other programs and resources set in place throughout the US. The Treasury Board approved a budget of $118.2 million over five years, commencing in 2003-04 and ending March 31, 2008. The Treasury Board froze an allotment of $27 million in 2003 pending the development of an RMAF and Governance Framework. This allocation was released following the approval of the June 2005 Treasury Board submission of the ERI's RMAF.

The ERI serves both as a catalyst for coordinating activities, and as a supplement to existing resources within the partnership, in order to increase missions' capacity and program funding for activities.

1.5 Evaluation Overview

The purpose of this summative evaluation is to assess the relevancy, cost effectiveness and success of the Enhanced Representation Initiative (ERI) in the United States of America. Given that ERI was established to provide a coordinated and integrated approach to advance Canada's interests in advocacy, trade, business development, science and technology, and investment in the United States, its mandate was to expand territorial coverage by opening new Posts or upgrading existing Posts in the United States.

The Secretariat is the operational arm of the Initiative. It is responsible to the partnership for planning, implementing and evaluating annual action plans. ERI is accountable to the Department of Foreign Affairs and International Trade (DFAIT), which in its Departmental Performance Report and Report on Plan and Priorities is responsible to report annually to the Parliament of Canada on the Department's progress.

The summative evaluation was conducted over three months, April to June 2007 using a methodology of mixed methods that included interviews, document review and case studies. Interviews were conducted either face-to-face or by telephone. Field visits were in the United States in four geographic areas, each strategically located: Washington, Miami, Denver/Minneapolis, and California (San Francisco, Los Angeles, San Diego). Three of which were used to develop case studies, to gain a better understanding of the relationship between the capacity building efforts and their results.

1.6 Evaluation Approach and Questions

The Results-based Management and Accountability Framework (RMAF) noted a formative evaluation and a summative evaluation of the ERI were to be undertaken. The formative evaluation was conducted between November 2005 and July 2006 and, it concluded that:

  • ERI partners and the US Mission network have greater capacity for advocacy and business development programming; and
  • In spite the complexities and challenges, the implementation and operations management of the Initiative has gone very well.

Also, the evaluation made several recommendations to increase ERI's capacity to deliver on results. These include:

  • expanding the ERI partnership;
  • preparing a Governance Framework Agreement that spells out partners' financial responsibilities and accountabilities;
  • aligning and synchronizing ERI advocacy and business development programming with other partners; and
  • strengthening the governance of the programme, particularly with respect to policy guidance, strategic planning and performance reporting.

It is worth noting that the ERI Secretariat has committed to implementing the recommendations of the formative evaluation; an action plan was developed and implementation has commenced(7). However, the Report and the related Management Response and Action Plan have not yet been considered and approved by DFAIT senior management. The summative evaluation will also progress towards the implementation of an Action Plan.

1.7 Summative Evaluation Scope and Objectives

The purpose of this evaluation is to respond to Treasury Board requirements and to provide objective, strategically focussed, timely, evidence-based assessment of the performance of the initiative; which would be valuable to any successive or related initiative. It is guided by three pre-defined evaluation criteria from the RMAF, relevance, cost-effectiveness and success.

1.8 Methodology

The summative evaluation is based upon descriptive analyses of 146 interviews, 7 site visits and a review of over 50 documents. It employs quantitative and qualitative analyses, consisting of mixed-methods including interviews with key stakeholder groups(8), document reviews(9), and case studies. Over 90% of respondents selected agreed to be interviewed. Of these, 60% were interviewed by phone and the remaining 40% in person. Interview selection was based on a sampling frame of Mission/Consulate employees (LES, CBS), ERI partners, stakeholders and external clients, including Canadian and US companies who have had dealt with the US based Canadian Missions/Consulates. The sampling was stratified accordingly and a representative sample of all ERI related groups were selected (see Exhibit 1.1). In addition, 50 clients were identified for phone interviews regarding their business development outcomes as it related to their work with Posts. Forty companies responded. Finally, three case studies, representing the South, Southwest region of the US, were selected based on criteria including:

  • a balance between smaller and larger Missions with different capacities to implement ERI
  • new and expanded Missions/Consulates in the South, Southwest Region of the US
  • Missions/Consulates dealing with topical issues respecting advocacy, trade promotion, science and technology, and investment.

Data collection activities are provided in Exhibit 1.1.

Exhibit 1.1 Coverage(10)

Interview GroupNumber of InterviewsComments
ERI Secretariat9100% Coverage rate of ERI Secretariat Operations
ERI Partners31100% Coverage rate of ERI partner organizations (including DFAIT). Interviews covered both management and operations
Mission/Consulates60The evaluation included on-site data collection in 6 Missions/Consulates and telephone consultations with 2 other Missions to represent a sample of ERI-funded Missions.
Stakeholder, External Clients40Data collected from telephone interviews and surveys represented a 74% coverage rate.
Honorary Consuls6Represents a 43% coverage rate of Honorary Consuls
Total Number of Interviews146 

Interview replies are highly inter-correlated, with little variation in responses resulting in a high degree of convergence within and between interview groups. It should be noted that the methodology included a generic interview protocol, which was adapted to each interviewee. Interviewee responses were qualitatively weighted to reflect the level of expertise and knowledge of the respondents(11). In addition data triangulation was used to identify key issues and patterns of responses by interviewees. The case studies supplement and complement the interviews by providing a detailed report on the significance of ERI in three uniquely different regions of the United States. Comparisons of these case studies showed similarities in the relevance, effective application of ERI funds, and the successful intervention of these events in enhancing Canada's territorial coverage and the influence of Canadian perspective in US political, economic and cultural industries.

Case Studies

  • California was selected because it represents the largest contribution of ERI funds to increase Canada's consular presence. This infusion of funds was necessary in view of California's current political and economic influence in the US, and their relative importance to the Canadian economy as our fourth largest trading partner. Of particular significance is California is slightly higher in population over Canada, at 36 million versus 30 million in Canada, but equals in low inflation rates of 2%, GDP and strong housing starts, an indicator of economic propensity. Canada's consular presence has been increased by ERI through the creation of a new Consulate in San Diego, upgrading of the San Francisco Consulate to a Consulate General given its proximity to the State Capital of Sacramento and establishing the Tuscan, Phoenix Satellite office to increase overall territorial coverage of the Los Angeles Consulate. Finally, California afforded the evaluation team an opportunity to understand how the post had affected Canada's representation in terms of S&T as a key economic priority.
  • The Miami Case (with a sub-theme on the Gateway to Latin America) was selected as being of special interest for the purposes of this study, given the fact that it has recently been upgraded from a small Consulate to one encompassing all of Florida, including Puerto Rico, within its diplomatic, trade and consular activities. It is on the basis of this enhanced footing that the Canadian mission in Miami can act as a gateway to Latin America and the Caribbean, a special issue that will be reviewed in this case.
  • The Minneapolis/Denver Case afforded the team an opportunity to study a wholly new ERI Consulate General and a territorially 'downsized' ERI office spanning across several states. It also provided the team a chance to observe posts with high ratios of ERI seconded staff to DFAIT staff. Finally, given the relative profile of the Bovine Spongiform Encephalopathy (BSE) case, it provided a chance to assess ERI's contributions to addressing a major cross-border issue.

Measuring ERI

ERI was established to expand Canadian visibility and presence in the United States by increasing resource capacity in under-represented regions of the US, and to specifically encourage and strengthen Canada-US relations and trade activities. The success of ERI, by definition, is difficult to measure given its multiple, and overlapping objectives, the inability to assess a cause and effect link between an ERI activity and business development outcomes, and the complexity of assessing the effects of advocacy work. Therefore, this evaluation study is focused on assessing ERI's contribution to achieving results as opposed to its direct attribution.

Impact on future ERI developments

  • Canada, based on population size alone, may not have the absorbed capacity, within Canadian ministries, to deal effectively with the entire United States market and as a result, would benefit from a sound strategic direction for maximizing its economic potential in the USA.
  • In-Canada partner support is crucial to support the business efforts of the Consulates in merging and offering competitive market opportunities to enhance US trade.
  • It should be noted that recommendations developed for this study were made to guide the next phase of ERI.

1.9 Limitations

This study was limited by the absence of baseline data and, as a result, relied heavily on interview data from stakeholder groups and documents. The composition of the stakeholder groups differed between the formative and summative, which limits the ability to assess changes over time. Data on performance measurement varies in coverage and completeness due to a non-standard data collection process at both Mission/Consulates, among ERI partners, and at DFAIT. Performance measures contain different definitions and in the absence of standards reduces data comparability and the analytical abilities to measure the progress of ERI as an entity either longitudinally or cross-sectional.

Centralized databases such as TRIO and MARCUS, although operational, have experienced deployment and reliability issues. TRIO, for example, an interactive relational database, deployed at Missions and headquarters, is designed to enhance trade transactions through timely contact information exchange. Operational since 2005, it houses and tracks transactions on businesses representing various trade industries. Although data entry at Missions varies depending on systems access and availability of data entry time, TRIO continues to serve primarily as a planning tool, and offers the foundation for regular statistical analyses on trade patterns. Reliability and validity remain subject to on-going review and refinement in TRIO to ensure data accuracy and quality. However, the nature and volume of business over time would be over-estimated when business names change, either through mergers or acquisitions or dissolution. Longitudinal analyses by business name are less reliable, while cross-sectional analyses of business names appear more stable in terms of data quality.


2.0 Relevance

2.1 Introduction

This evaluation focused on the Initiative's continued relevance in light of Canadian interests with its relationship to the US, as well as partner's priorities and the growing integration of the economic space of North America and security requirements in Canada and the US. The evaluation also explored the need that ERI addressed and the extent that it is responsive to key stakeholders, strategically aligned with partners, and continues to meet the need for advocacy and IBD.

2.2 Findings

Finding 1:

ERI continues to promote Canadian interests in its relationship with the United States by increasing capacity, networking, encouraging, and developing collaborative relationships in the US and among partner departments. In this context, ERI remains relevant in strengthening Canadian presence and in improving Canada-US relations.

ERI, with its increased attention on trade advocacy, offered funding to support activities that would provide a return on its investment. By encouraging trade events, networking opportunities, ERI is more than a simple programme designed to augment Canadian posts in the United States. Rather, it addresses and responds to the complex dynamics of partnership and networking that is increasingly becoming the 'way to do business' for governments around the world. ERI has introduced a series of new approaches to promoting Canadian interests in the world's largest marketplace and pioneered a new type of collaboration among federal departments. Increased synergies have been promoted, and collaborative decision-making encouraged. Honorary Consuls have been assigned broader roles, which has resulted in increased networking, information sharing and key messaging across the US.

There are 16 Honorary Consuls in our city. We meet as a group and talk about our work. What is absolutely fascinating is that none do what Canada does. It makes so much sense to have interested parties network for Canada. Each city and region is different. Politicians listen to their constituencies, business works from relationships. When I talk to other Honorary Consuls, all they do is consular work, what a missed opportunity, they really do not know the U.S. Canada has got this right! (HonCon interview)

ERI, began in 2003, and has only existed with a significant critical mass for about two years. The efforts of the partnership have led to a 60% increase in Canadian consular presence in the United States; thereby, supporting one of the major objectives of ERI to heighten visibility and presence through enhanced advocacy in under-represented areas of the United States. This increase in Canadian presence was predominantly targeted in the South, Southwest regions of the United States to enhance market access.

The evaluation indicates that there are many indications of good progress in tackling relevant and pressing advocacy and business development issues and opportunities. The Consulate General in San Francisco, by way of example, has been fully operational for approximately 21 months, during this time, while the consulate has pursued activities related to both International Business Development (IBD) and Political/Economic Relations and Public Affairs Program (PERPA) goals, they have set their strategic priority as building the networks and relationships required to leverage their expanded presence more effectively. Furthermore, as the three case studies demonstrate, consulates are collaborating with both partners and Other Government Departments (OGD) in new and innovative ways to promote Canadian interests with ERI funds.(12)

While still at an early stage of its evolution, there is evidence from the partners that the ERI 'partnership model' has been helpful in building Canadian capacity to engage in a fruitful relationship with the US, and in bringing a strategic focus on trade and investment. At an operational level, partners have commented that ERI has enabled their staff to work directly with posts in the US (and not be bound by formerly rigid communication channels with Ottawa). The evaluation found that most partners are identifying ERI as relevant to their needs, and a useful ally in meeting objectives and achieving results.

Many interviewees discussed the natural synergy between ERI's two main pillars - advocacy and business development. Linking these pillars helps reduce the isolation of departments and generates new possibilities for improving results.

To elaborate:

Increasingly we at the Post see a blurred line between advocacy and trade. They go together. Look at the issues we are dealing with--security, BSE, softwood lumber. (ERI Partner)

Miami as well got into the BSE issue. We held a very successful Barbeque that allowed us to talk to key officials about Canadian interests - it was also an opportunity to push our trade agenda. (ERI Partner)

The general picture that emerges when interviewing in both Canada and the United States is that Canada requires a network of relationships that are working together and can influence key decision makers and business leaders in the United States. It is important for Canada to provide its official positions, but many times it requires that US citizens or organizations, who are in agreement with Canadian positions, also put forward a position. ERI, the Posts, Honorary Consuls, and the activities and networks it supports, are providing the context within which a Canadian voice is heard.

It is sometimes very important for an American Association to speak on issues that are Canadian issues, softwood, BSE, the Border. The US government listens to these voices, we are often behind them. ERI has helped a lot in building the infrastructure, providing some additional resources and new tools. (US informant in Washington)

Finding 2:

ERI remains relevant in terms of the priorities, needs and objectives of the partners.

An important issue with respect to relevance was the degree to which ERI is aligned and supportive of its partner's strategic objectives. Partners generally agreed that ERI was an important mechanism in addressing their priorities, needs and objectives.

It is not that we haven't done many of the things we presently do, rather ERI has given us a bit of a lift with respect to resources. We now have more flexibility in our access to resources -it's another window and it has become an important window. (Partner interview)

Exhibit 2.1 provides an overview of key partner priorities and how ERI plays a complementary role in helping to achieve results:

Exhibit 2.1 ERI Priorities that are consistent with partners

PartnersDepartmental Priorities 2007-08Addressed ByComment
ACOAImprove the climate for business growth for small and medium-sized enterprises to help them start, expand and modernize their businesses.XBy providing market expansion opportunities through IDB, ERI contributes directly to this priority.
Carry out policy analysis and research to determine areas in which ACOA can act to carry out its mandate most effectively. N/A
Advocate the interests of Atlantic Canada to make new government initiatives more responsive to the needs of Atlantic Canada through Advocacy Champion files. N/A
Help communities build their capacity and confidence in order to identify and co-ordinate the implementation of priorities for economic development in their region.XERI contributes directly to this by assisting cross-border economic development priorities.
Foster improved productivity and competitiveness of innovative technologies, through enhanced efforts to assure the realization of their commercial opportunities.XThrough TPI and other mechanisms, ERI assists in accelerating the commercialization of S&T. This is also a clear priority in ERI’s performance framework.
Explore the feasibility and options for improved productivity and competitiveness in the renewable resource sectors.XThrough TPI and other mechanisms, ERI assists in accelerating the commercialization of S&T. This is also a clear priority in ERI’s performance framework.
Conduct studies and undertake other activities targeting the Atlantic Gateway to devise a corporate strategy N/A
Establish management priorities that focus on the Government of Canada’s governance and accountability agenda, values and ethics, and succession planning Agency-wide.XThis is covered in the RMAF
AAFCStrong economic growthXERI allows partners to pursue IBD activities in support of strong economic growth.
An innovative and knowledge-based economyXThrough TPI and other mechanisms, ERI assists in accelerating the commercialization of S&T. This is also a clear priority in ERI’s performance framework.
A fair and secure marketplaceXBy improving US awareness of the interdependencies of the integrated North American Market, ERI assists in securing market spaces for Canadian firms.
A clean and healthy environmentXBy allowing investments in energy partnering, ERI is accelerating the development of alternative and clean fuels.
A prosperous Canada through global commerceXBy improving US awareness of the interdependencies of the integrated North American Market, ERI assists in securing market spaces for Canadian firms.
CEDIntensify the economic diversification of regions and communities posting slow economic growth.XERI supports economic diversification by assisting Canadian companies in becoming export ready and to allow them to improve access to emerging economic trends such as S&T and innovation.
Reinforce the performance of innovative, competitive SMEs in key sectors.XThrough TPI and other mechanisms, ERI assists in accelerating the commercialization of S&T. This is also a clear priority in ERI’s performance framework.
Implement the Agency’s new programs. N/A
Reinforce the Agency’s results-based management capability and initiate integrated planning.XRMAF suggests harmonizing RBM work with ERI, which would support an integrated planning approach.
DFAITA safer, more secure and prosperous Canada within a strengthened North American Partnership.XBy improving US awareness of the interdependencies of the integrated North American Market, ERI assists in securing market spaces for Canadian firms while addressing issues such as border security and homeland security partnering.
Greater economic competitiveness for Canada through enhanced commercial engagement, secure market access and targeted support for Canadian business.XBy improving US awareness of the interdependencies of the integrated North American Market, ERI assists in securing market spaces for Canadian firms. Further, ERI supports advocacy around making US firms more aware of our competitive advantages.
Greater international support for freedom and security, democracy, rule of law, human rights and environmental stewardship.XBy allowing investments in energy partnering, ERI is accelerating the development of alternative and clean fuels.
Accountable and consistent use of multilateral system to deliver results on global issues of concern to Canadians.XTrade and Advocacy
Strengthen services to Canadians, including consular, passport and global commercial activities.XERI has expanded the sites in which Canadians can easily access consular services by adding and expanding posts.
Better alignment of departmental resources (human, financial, physical and technological) in support of international policy objectives and program delivery both at home and abroad. Issue not explored
ICContinue to modernize marketplace frameworks to support a highly competitive and innovative economy for the benefit of all Canadians.XThrough TPI and other mechanisms, ERI assists in accelerating the commercialization of S&T. This is also a clear priority in ERI’s performance framework.
Ensure the strategic allocation of resources.  
Support the generation and commercialization of knowledge.XThrough TPI and other mechanisms, ERI assists in accelerating the commercialization of S&T. This is also a clear priority in ERI’s performance framework.
Implement strategic frameworks for priority industry sectors that have an important impact on the Canadian economy. N/A
Work with Canadians to position them to take advantage of economic opportunities, support business development, provide long-term growth and promote sustainable development.XBy improving US awareness of the interdependencies of the integrated North American Market, ERI assists in securing market spaces for Canadian firms. Further, ERI supports advocacy around making US firms more aware of our competitive advantages.
NRCResearch and Development for Canada: The economy, the environment, health and safety.XThrough TPI and other mechanisms, ERI assists in accelerating the commercialization of S&T. This is also a clear priority in ERI’s performance framework.
Technology and industry support: Serving as a catalyst for industrial innovation and growth.XIt is a clear priority in ERI’s performance framework to assist in accelerating the commercialization of S&T. The California case study alone offers a myriad of examples as to what extent ERI has supported this priority, (please the study for further details).
Enhancing development of sustainable technology clusters for wealth creation and social capital.XERI supports IC in its pursuit of international technology partnering (including its in-Canada clusters).
Program Management for a sustainable organization. N/A
WDSupport for business competitiveness and growth.XBy providing market expansion opportunities through IDB, ERI contributes directly to this priority.
Improve linkages between strategic infrastructure investments and economic development initiatives.XSupport of new US missions/posts.
Greater emphasis on supporting commercialization and value-added production.XTrade initiatives
Improve internal competitiveness and strengthen trade and economic corridors of importance to the West.XBy improving US awareness of the interdependencies of the integrated North American Market, ERI assists in securing market spaces for Canadian firms. Further, ERI supports advocacy around making US firms more aware of our competitive advantages.
Strengthen accountability, transparency, and performance reporting with members of the Western Canada Business Service Network and improve coordination among WCBSN members and other business and economic organizations. N/A
Implement a modern management agenda that focuses on improving management practices within the department including strengthening accountability to Canadians, integration of human resource planning and risk assessment with business planning, and improving information management. N/A

The strategic alignment between ERI and its partners is critical. Interview data suggests that Canadian federal and business partners alike see the unique advantage of ERI, in turn confirming its relevance both strategically and operationally.

"Science and Technology has really gotten a boost with ERI--we do need the added help and representation in the US." (ERI Partner(13))

"Our expanded networks really paid off in the Bovine Spongiform Encephalopathy (BSE) issue. We where able to get to important local, state and national leaders to plead our case--We were able to enlist colleagues in the private sector. The expanded networks we created really made a difference." (ERI Partner)

"It was a pleasure to go down and work with our Post. I had tried several years earlier and no one returned my call--last year I tried again--it was unbelievable how responsive they were--what a change."(ERI Partner)

"We did virtually no work with the US - ERI opened this up for us." (ERI Partner)

"Our Department gave up procurement in the US almost a decade ago. This is a multi billion-dollar area. Many firms in our area have asked us to help - but we said no. ERI has helped us get back into this area." (ERI Partner)

Finding 3:

The relevance of ERI is demonstrated by its ability to support on programming and quality HR staffing in pursuing advocacy and business development results

ERI's focus on partnership and collaboration has proven an effective strategy for taking on operational challenges. This outcome demonstrates the initiative's relevance in terms of being an appropriate response for promoting advocacy and business development. The following points describe how the partners work collaboratively within the ERI operational framework(14):

  • IBD Projects funded through ERI require signoff with at least one other partner. Partners with related mandates can use that opportunity to ensure that the proposed project is relevant to their priorities in the US.
  • IBD projects are reviewed by ERI for their alignment with the Partnership.

Other key factors in promoting ERI's relevancy include: 1) the extension of the roles and responsibilities of HonCons to include trade and advocacy activities(15), and 2) the development of targeted networks that assist partners in identifying opportunities and advocating for Canadian interests. The ERI collaborative(16) approach has provided opportunities for partners to learn build capacity and develop new skill sets. In other words, they have become more relevant in their jobs in responding more effectively to the needs and/or issues they encounter.

2.3 Conclusions

The evaluation found that ERI is addressing key capacity gaps in Canada's pattern of representation in the US. In so doing, ERI is an important and relevant component in Government of Canada (GoC) strategies to strengthen Canadian interests and exploit opportunities. ERI approaches and tools are seen as appropriate responses to the need to influence the perceptions of key US decision makers, generate awareness of Canadian positions, and more generally improve trade and business relationships. The relevancy of the ERI partnership model is supported by the Initiative's demonstrated capacity to address the Canada-US relationship in a more holistic fashion and to meet the operational challenges facing partners. The analysis indicates that ERI continues to address the strategic priorities of its partner departments. It is apparent that the participatory, 'whole of government' approach to project approval is well suited to ensuring that programming perspectives are consistent with the partner priorities in the US and collectively with GoC policies. Without ERI, Canada would have fewer tools at its disposal to deal with its complex relationship with the US.


3.0 Cost-Effectiveness

3.1 Introduction

Cost-effectiveness issues focus on performance management and are concerned with how the Initiative was planned and actually implemented. This section explores the use of the Results Measurement and Accountability Framework (RMAF) as a guide for action, the governance structure, the performance management system and operational management. The general assumption is that well planned, governed and managed systems provide value for Canadians.

3.2 Results Measurement and Accountability Framework

3.2.1 Findings

Finding 4:

Ambiguities associated with the interpretation of the RMAF amongst various signatories have reduced its applicability as a guiding document for ERI.

The RMAF for ERI was approved in 2005, during the second year of implementation. It was presented as an addendum to the Submission to the Treasury Board Secretariat (TBS).(17) The expectation was that the RMAF was to function as the primary guiding document for the initiative, and for all intents and purposes that has been the case. Authored by the ERI partners through a consensus building exercise, the RMAF was intended to bring the initiative from the "realm of the desired to the tangible", by acting as a "true reflection of the activities undertaken by the partnership as a whole and the goals to which it ultimately strives". The RMAF "… provides strategic direction to the Initiative by reminding all of the ultimate goals and objectives".(18) Further, the ERI RMAF was intended to be an evergreen document based on ongoing performance measurement and evaluation.(19) An analysis of the RMAF found that the document itself conforms to the content requirements for RMAF as described by the TBS. Further, it was also noted that the basic program logic of the RMAF is sound.(20)The results-statements provide a framework for outputs, outcomes, and goals. The 'change theory' is plausible and was endorsed by the ERI partners during the development of the RMAF. The evaluation found that different partners construe the RMAF in different ways, which has affected its utility as a guiding document and the implementation of ERI as a whole. These ambiguities (addressed below) can be broadly categorized as: 1) ambiguities regarding roles and responsibilities, and 2) ambiguities in framing ERI and the results of the horizontal initiative.

RMAFs:

  • Describe clear roles and responsibilities for the main partners involved in delivering the policy, program or initiative - a sound governance structure;
  • Ensure clear and logical design that ties resources to expected outcomes - a results-based logic model that shows a logical sequence of activities, outputs and a chain of outcomes for the policy, program or initiative;
  • Determine appropriate performance measures and a sound performance measurement strategy that allows managers to track progress, measure outcomes, support subsequent evaluation work, learn and, make adjustments to improve on an ongoing basis;
  • Set out any evaluation work that is expected to be done over the lifecycle of a policy, program or initiative; and
  • Ensure adequate reporting on outcomes.


Guide for the Development of Results-Based Management and Accountability Frameworks. Treasury Board Secretariat 2001

Ambiguities regarding Roles and Responsibilities

Early on, the evaluation determined that the RMAF does not fully delineate or adequately describe the roles, responsibilities and accountabilities of the ERI partners, the role of the Secretariat, or the roles of the governance bodies.(21) These shortcomings were noted previously in the Formative Evaluation (FE). While some steps have been taken to address these issues (e.g. developing TORs for the ADM committee), on the whole more progress needs to be made.

Ambiguities in Framing the Results of the Horizontal Nature of ERI

To what extent is ERI responsible and accountable for aggregating and reporting on the results achieved by the partners? Is ERI expected to measure the performance of all federal bodies engaged in business development and advocacy work in the US?

Some stakeholders see ERI as an umbrella initiative for overall US-Canada relations that apply the 'whole of government' approach for coordinated planning and reporting. During the interviews, some senior officials representing partners saw this 'grand approach' as the true vision of ERI. Others, however, indicated this type of outlook was a grave concern. They envisioned ERI as a more modest operational initiative used by departments to coordinate efforts. The RMAF, in many ways, is supportive of the former perspective. But is this realistic? Attaching large output outcome numbers to ERI in the RMAF might have fueled confusion during the implementation of programming and generate expectations for results that are likely not achievable. For effective performance management(22), ERI needs to be able to target results that are within the realm of what it is capable of achieving.

This confusion has carried over into a variety of spheres. For example, in the discussions and consultations related to the Global Commerce Strategy (GCS) and more narrowly the North American Platform (NAP), some partners wondered why ERI and its partners were not more closely engaged in discussions.(23) From its review of the ERI minutes, the evaluation determined that no substantial discussions were held with respect to how these major policies would impact ERI. The implication is that DFAIT, the lead department for the GCS, did not view ERI as a key consultative forum for these initiatives.

Overall the reality of ERI (what it actually does) is not consistent with the vision(24) outlined in the RMAF. In practice, ERI is a more narrow business development and advocacy initiative whose main focus has been to enlarge Canada's presence in the US by strengthening existing posts, establishing new posts and setting up a network of HonCons. The evaluation found that the ambiguities that surround and confuse implementation of ERI programming have contributed to some aspects of the current RMAF not being fully implemented.

Finding: 5:

There is a need for Other Government Departments (OGD) (having business development and advocacy programming priorities) to engage in the ERI initiative.

While ERI is not composed of all federal departments involved in advocacy activities and business development in the US, the data indicates that the initiative does provide support for activities that relate to the mandates of many departments that are not part of the partnership. In fact, in the Miami post, there are OGDs working in the post directly; this demonstrates that collaboration is happening with other departments that are not necessarily part of the partnership(25). In a more aligned world, the composition of ERI would include every department, agency, province and territory that is involved in advancing advocacy and business development in the US. At present, this is not the case. The priority for ERI renewal is to extend membership to include four new departments in 2008 (namely Heritage Canada, Environment Canada, National Defence and Natural Resources Canada). Given how ERI invests in advocacy activities (see project categories set out in the Exhibit 3.1 below), it would be relevant for ERI to consider engaging other federal organizations that have prime, corresponding interests operationally in the US (e.g. border security, energy, environment). In so doing, this would further 'whole of government' ambitions.

Exhibit 3.1 Advocacy Budget for FY2006-07 (as of May 28, 2007)

Project CategoryAmount% of Advocacy Budget
Strategic Representation and Engagement$1,491,967.3843.9%
Border Security$553,714.8216.3%
Energy$345,119.4210.2%
Integrated N.A. Market$313,277.639.2%
Corporate management$274,360.318.1%
Other trade issues$186,603.685.5%
Environment$174,586.415.1%
International Security/Terrorism$56,623.511.7%
Social Issues$3,032.290.1%
Total of ERI Advocacy Funding$3,399,285.45100%

Exhibit 3.1 indicates that significant program funds were expended in areas related to OGDs. Thus potential candidates for partnership could include:

  • Public Safety Canada has clear interests in border security, international security and terrorism. The ERI advocacy budget for these two categories is quite important (representing almost 20%). Public Safety Canada could become a key player since security preoccupations will probably continue to be of interest in the United States. There may also be a continued need for advocacy to provide re-assurance about Canadian security capabilities (e.g. the arrest of 17 terrorists suspects in Toronto in 2006). An integral part of the Public Safety Portfolio is the Canada Border Services Agency (CBSA) which already has people based in US Posts (Note: As mentioned earlier, PSC has deployed its own staff to work in US based Canadian Consulates). PSC, CIC and many others have MoUs in place with DFAIT through Common Services Aboard Program. ERI may wish to consult with these departments with a view to partner with ERI and contribute to the initiative.
  • Citizenship and Immigration Canada (CIC) has interests in border security and international security. Its role in admitting immigrants and visitors is very sensitive to issues related to border security. CIC clearly has interests in the United States since there are already immigration officers in the Washington Embassy and in some posts.

While these agencies already have mechanisms for placing people in posts outside of ERI (as do several current ERI partners), these new departments would be able to avail themselves of the other benefits of ERI members.

Representation in ERI by government organizations involved more directly in business development might be a viable and useful strategy. Potential candidates could include Export Development Canada, Business Development Bank of Canada, and Business Access Canada.

The provinces and territories have been consulted on a few occasions regarding the development of ERI. For instance, they participated in the strategic priority meeting in April 2004 (at which strategic priorities for the ERI RMAF were identified). In addition, there have been two meetings to date involving provinces and territories, plus some one-on-one meetings. Western Economic Diversification (WD) has made individual presentations to the western provinces. Provinces have also been invited to put their own representatives in missions, and this has been done on occasion (e.g. New York).

The evaluation makes the point that there are other OGDs, that may be potential partners that are already linked to ERI through the benefits derived from programming activities (and are beneficiaries of funding allocations to the initiative). In discussing a vision for ERI, the evaluation learned that different partners(26) have different perspectives of how inclusive ERI should be.

3.2.2 Conclusions

The current RMAF conforms to the content requirements for RMAFs as described by TBS, and the basic program logic is sound and valid. However, some ambiguities associated with the understanding of the RMAF by partners have affected its utility as a guiding document and the implementation of ERI as a whole. The evaluation found while the RMAF is sound, different interpretations by partners has reduced the realization of an effective performance management and reporting scheme. The question of adding potential partners to strengthen ERI is an ongoing consideration. Program funding is already being provided in support of advocacy related to OGDs. Wider membership would contribute to the 'whole of government' approach. Some potential candidates have a day-to-day involvement with ERI activities in the US and are already benefitting from what is being achieved by the initiative in these areas.

3.3 Governance

3.3.1 Findings

Governance, in effect, comprises a set of processes and structures by which an organization or program is guided, directed and regulated. It includes the relevant 'orders', specification or purpose of the program; how it goes about its work; some sense of its priorities; and the means it uses to create a context for integrity and accountability. Governance embodies complex and varied responsibilities, including: 1) providing structure (reviewing and renewing elements as needed), 2) ensuring processes and resources so as functions can be carried out, 3) setting a strategic direction, 4) programmatic oversight (e.g. reviewing financial and programmatic performance), 5) communication reporting to key stakeholders, 6) ensuring legal compliance, 7) establishing standards of behaviour, 8) engaging and clarifying issues related to conflicts of interest and other ethical standards, and 9) establishing review and dispute resolution mechanisms.

Finding 6:

ERI governance mechanisms have been successful in exercising financial and operational oversight. However, the mechanism is not providing adequate strategic guidance on performance accountability.

Exhibit 3.2 ERI Governance Structure

ERI Governance Structure

Based on the RMAF design, ERI is governed by three senior-level committees: Deputy Ministers Steering Committee (DMC), Assistant Deputy Ministers Policy Committee (ADMC) and a Director General's Operations Committee (DGC). Three subcommittees address Advocacy and Business Development (ABDC), Communications (CC) and Human Resources (HRC).(27) This governing structure has experienced reasonable success in actualizing both financial and operational oversight of ERI functions. This is evidenced by: 1) the existence of regularized financial planning and reporting as envisioned roved through the governance committees, 2) the existence of activity plans (e.g. project plans, CBS and TD placement proposals, mission business plans, etc.) approved by the governance committees, and 3) the minutes of the committee meetings which illustrate the focus on financial and operational issues. In assessing strategic guidance and oversight for performance accountability, however, the evaluation found that ERI's governance structures have not performed as anticipated in the RMAF.

While the RMAF lays out roles and responsibilities for the governance committees, it is clear that the recommendation arising from the formative evaluation, "… current and future ERI partners prepare a governance framework that is inclusive of partnership principles, explicitly recognizes DFAIT's as the administrative lead department, specifies financial management mechanisms, outlines the partners respective accountabilities, responsibilities and contributions to the ERI, and documents the roles and responsibilities of the ERI Secretariat" has not been adequately addressed.(28) Further, the evaluation found no evidence supporting compliance with formative evaluation recommendation: "…the governance of the program, in particular with respect to policy guidance, strategic planning and performance reporting be strengthened"(29).

Shortcomings in providing adequate strategic guidance and oversight on performance accountability continue. The lack of clarity, in particular around responsibility for monitoring of the RMAF, needs to be addressed. As one interviewee noted:

"… partners signed the RMAF but now they don't know how to work with it. The RMAF infers change by all partners and not just passive engagement. Right now, managing the implementation and the change is left to ad hoc management. In my opinion the RMAF and the performance monitoring it implies have been ignored".

Finding 7:

Deputy Minister Steering Committee and Assistant Deputy Minister Committee do not appear to have been adequately engaged in their governance roles (as envisaged in the RMAF) of providing strategic direction and performance oversight. This has compromised to some extent the 'whole of government' approach (central to how ERI is to function) and as a result, this approach remains unclear.

As outlined in the RMAF:

  • The Deputy Minister Steering Committee (DMC) is responsible for the coordination of the ERI within the overall framework of Government of Canada (GoC) activities and the establishment of policy direction, and is accountable for realization of targeted results. The Foreign Affairs DM of DFAIT chairs the DM Steering Committee. As the ERI partnership has oversight responsibility for all US missions (with the exception of the Embassy in Washington), this committee contributes to the establishment of performance goals for Heads of Mission in the United States, provides ongoing advice and reviews results achieved.(30)
  • The Assistant Deputy Minister Policy Committee (ADMC) is responsible for ensuring the ERI meets the expectations of its partners and the advocacy and business development interests of Other Government Departments (OGDs), provinces and territories. The Assistant Deputy Minister for North America, chairs this committee. The Committee is intended to meet two to three times per year and may, in addition to ERI partners, include representation from any and all OGDs having an interest in Canada-US political and economic relations.(31)

Participation at Meetings

At the time of writing, the DMC had met only once (January 15th 2004). Based on the minutes, this meeting did not provide significant strategic guidance to ERI. While it was asserted that the members of the DMC met regularly in other forums where ERI could be discussed(32), these alternative forums have not proved effective in meeting ERI's governance needs. As a result the evaluation found that key issues, such as the lack of an adequate performance measurement system and lack of annual reporting (which should be of critical importance to the DMC given its accountability for realization of targeted results), have not been contested or resolved.

The only DMC meeting to date, based on a review of its minutes, did not provide anticipated strategic guidance. A review of the minutes of a subsequent ADMC meeting bears this out, noting that it was expected that the DMC would provide strategic guidance on issues such as resource allocation but that this did not occur.

The ADMC has not operated at the strategic interpolation level described for it in the RMAF. A review of the minutes of the ADMC meetings concluded that only one formal decision/directive was issued during the course of the four meetings.(33) The bulk of the meetings were dedicated to updates on ERI activities and on financial updates. While issues such as partnership expansion were discussed, the nature of this discussion was more operational than strategic in nature (i.e. focused on protocols for 'inviting' OGDs to comment on their interest in ERI, rather than on strategic guidance for deciding what OGDs should be approached). This minimal approach to strategic focus, in part, is related to the underperformance of the DMC in handing down strategic directives. In addition, it is noted that the level of commitment of the ADMC to ERI has been demonstrably limited. To date, the ADMC only met four times (out of a projected eight to eleven meetings). Further, participation by partners at the level of the ADMC has been varied; only one partner, DFAIT, attended one of the meetings. During the last two ADMC meetings, proxies represented four of the seven partner ADMC participants. Three of the seven partners have attended two (or fewer) of the four meetings and only one partner has attended all four.

Similar to the assertion made regarding the DMC, members of the ADMC attend at least one other meeting with a focus on strategic horizontal issues (namely the North American Policy Committee). Again, it appears that these alternative forums do not meet ERI's governance needs. ERI continues to lack sufficient ADMC inputs, strategic-level guidance, and oversight for the results outlined in the RMAF.(34) Exhibit 3.3 demonstrates the number of Assistant Deputy Minister Policy Committee Meetings that were held during a four year period.

Exhibit 3.3 Frequency of ADM Policy Committee Meetings

Year200420052006Total
Number of Meetings2114

Exhibit 3.4 Partner Representatives at ADMC Meetings

Number of Partner Representatives at ADMC Meeting01/06/0405/25/0411/22/0506/21/06Meetings Attended
ACOA01012
AAFC01213
CED02001
IC03113
NRC01113
WD02012
DFAIT24224
Number of Partners Represented1746 

Exhibit 3.4 shows the partners that were present at each meeting and their number of representatives. It is indicative of the amount of support the partners showed for this committee and its operations. A number of senior-level interviewees noted their concern that senior management from the ERI partner departments appear to be disengaged from ERI. It was suggested that disinterested individuals posed a threat to results.

Whole of Government Approach

The most significant strategic issue that has not been adequately addressed by the senior governance bodies relates to the 'whole of government' concept as its relationship to ERI (and by extension the question of expanded membership). The federal government has already conducted work in this area. For example, in TBS's "Canada Success 2002", the 'whole of government' reporting is outlined. Other documents may also be of value, such as TBS's presentation on "Pre-Requisites and Enablers for a Whole of Government Approach (2006)", which offers a plan for greater integration in government service delivery. It would appear that ERI could be presented or advocated more strongly as an approach to a 'whole of government' context.

The RMAF and other ERI documentation identified four other departments as potential candidates for expanded membership (namely Heritage Canada, Environment Canada, Defence, and NRCan). The ERI Secretariat has connected with each of these departments on at least two occasions and invitations to attend ERI committee meetings have been taken up at various levels. The last two ADMC meetings, for example, included nine and five non-partner participants respectively (from DND, Environment Canada, PCO, PCH, Heritage, and Northern Development). However, with less than a year left in ERI's mandate, substantive dialogue and strategic decision-making on the issue of expanded membership have not taken place at the DMC (where ultimate direction and authority on this issue should extend from) or at the ADMC.(35)

As one interviewee noted: "ERI does not have a coherent strategy in the US that talks to the 'whole of government' approach." Rather, the process around this fundamental issue has remained largely informal.

Several key questions remain:

  • How is 'whole of government' defined for ERI (e.g. by sector, by issue, by geographic area, multiple factors, etc.)?
  • What are the criteria for identifying potential partners? Is ERI limited to federal departments? Should provinces be members? Should there be different types of membership?(36)
  • What investments need to be made to ensure that an expanded partnership does not erode the trust and transparency built among partners to date?

The DMC and the ADMC have not directed the ERI Secretariat to undertake the analytical work required to address these issues.

Both the chair of the ADM's committee and the ERI Secretariat must share in the responsibility for the underperformance of the DMC and ADMC. The ADM's chair has a responsibility to set an agenda for action but also the Secretariat needs to be proactive in tabling issues of strategic importance at DMC or ADMC meetings. To illustrate, one interviewee suggested: "ERI is struggling in Finding a strategic role for the ADMC committee; it has no raison d'être… (the Secretariat) is not feeding them the type of material needed to get (the ADMs) to come to the meetings (in person or at all)."(37) Further, it was noted that clear mechanisms for feeding issues upwards (from posts/partners, to the Secretariat and then onto various committee agendas) do not appear to exist.

Finding 8:

The Director General Committee has become the de facto leader in ERI's governance process (albeit at an operational level).

The Director General Operational Committee (DGC) is mandated to: 1) establish the overall operational budget for the ERI Secretariat, 2) approve major initiatives, programs and projects elaborated and proposed by each of the Standing Committees, and 3) make recommendations respecting the location and appointment of HonCons. The DG Committee is also responsible for all aspects of evaluation, including terms of reference, commissioning evaluations and implementing recommendations. This committee meets four-to-five times per year and is chaired by the Executive Coordinator of the ERI.(38)

On a purely operational level, the DGC is functioning within expectations and demonstrating significant commitment to ERI at the level of the DGs. In the first three years of ERI, the DGC met 12 times (out of a projected 12-15 meetings). In 10 of 12 meeting, all seven ERI partners were present, with the other two meetings involving six partners. Further, it was noted that on average, at least five of the seven ERI partners were represented by the designated DG (not by a proxy) and that in fully 33% of meetings all seven appointed DG representative were present. Exhibit 3.5 reveals that the number of meetings held during a four year period were inline with the number intended in the RMAF. Exhibit 3.6 makes obvious the partner support at the DG level, by showing the number of representatives present at each meeting, for each partner.

Exhibit 3.5 Meetings of the DG Committee

Year200420052006Total
Number of Meetings16512

Exhibit 3.6 Representation (39)

Representation at DG Meeting

In general, a review of the meeting minutes and the data collection through interviews with both DCG members and others, suggests that the DGC has become the focal point for governance in ERI - albeit at an operational level. Evidence indicates that the DGC meetings focused almost exclusively on reviewing: 1) decisions of the standing committees, 2) projects and expenditures beyond the authority of the standing committees, 3) the HonCons mechanism, and 4) evaluations. It was noted that, in general, the DGC respected the jurisdictions of each of its members and provided due diligence on items that represented substantial program expenditures. However, it was also noted that relatively little written critique was provided with respect to: 1) the program lists that were set forth by each of the partners, 2) setting budgets, and 3) reviewing expenditures, which were more than $50,000.(40) The evaluation found a gap in terms of roles and responsibilities of the DGC as they relate to providing oversight on performance accountability and measurement.

Note: The ADMC and DG committees have a considerable degree of overlap in terms of the nature of their meetings and focus on operational issues. As one interviewee pointed out: "…at meetings [ADMs] often get the same material as the DGs." This overlap may be attributed, in part, to the lack of direction being provided from the DGC (and the gap this creates for the ADMC in fulfilling its mandate).

Finding 9:

ERI's standing committees have achieved mixed results vis-à-vis expectations set out in the RMAF. In practice, their role as the true 'governance' committees is questionable.

ERI's three standing committees - Advocacy and Business Development (ABDC), Communications (CC) and Human Resources (HRC) - are to participate within overall ERI's governance framework. To this end, they have the following roles and responsibilities (as outlined in the RMAF):

  • ABDC: Provides strategic direction, review and approval for advocacy and business development plans and proposals, location of new or enhanced offices including realignments to meet evolving priorities, macro-allocation of program resources, and the establishment of additional positions. Also responsible for establishment and oversight of action of working groups as required.
  • HRC: Provides coordination and oversight on the implementation of human resource staffing, identification of training needs, and establishment of training initiatives, identification of required staffing incentives for the US, development of initiatives to address these, and input into performance appraisal of Senior Trade Commissioners and Senior PERPA managers. Also responsible for establishment and oversight of action of working groups as required.
  • CC: Responsible for communication work plans and materials to ensure that the partnership and its stakeholders are up-to-date on ERI activities, to advise, coordinate, implement/oversee the implementation of communication strategies and initiatives, including mission openings, ministerial visits, which advance ERI objectives and strategic priorities; to ensure that essential linkages are made within the partnership to foster synergy and that communications about ERI initiatives are well coordinated.

The evaluation found that the role being played by these committees is fundamentally operational in nature.

The evaluation reviewed eight sets of meetings from the ERI's Human Resource Committee in order to ascertain the type of work done and decisions made. The minutes indicated significant information exchange as well as discussions on training, selection, selection pool, incentives, spousal packages and so forth. In addition, members of this committee sit on selection panels. Interviews were held with three members of this committee. All indicated that the committee work was extremely valuable to the success of ERI. They felt that there was good information exchange and that it was important for all partners to be informed and understand the process used. It is important to note that their effectiveness depended directly on the degree of support by the Secretariat and respective chairs. Members of both the ABD committee and the HR committees indicated that their involvement in the committee was very positive and rewarding. However, they also noted that these committees were very time consuming and sometimes members felt that they were beyond their competence in advising on decisions. For example, several important issues including the concerns about appropriate incentives for staff serving in the United States came forward to this committee for discussion and advice. Interviewees indicated that they felt uncomfortable engaging on issues with only limited information.

While these committees are valuable tools for discussion and advice, the issue we raise is whether this should be seen as part of ERI Governance as its work is operational and it does not guide ERI. The same can be said for the Communications committee.

"We tried to change the way the communication committee functioned and to help the partners better inform staff about ERI. We sent success stories but it continued to be unclear were we could make a difference. I even cut back my job to three days a week. We were not very useful to ERI." ERI Partner

The Advocacy and Business Development Committee (ABDC) "makes recommendations on programs and operational activities respecting advocacy and business development" (Government of Canada website, ERI). The minutes of the ABDC indicate that this is a committee attended by between 15-20(41) people from partner agencies plus 3-4 ERI staff. Minutes indicate a wide range of information shared and discussions about programs, activity financing and activities. It makes decisions and recommendations related to advocacy and business development. It has authority for funding advocacy activities greater than $50,000 to a maximum of $100,000. The DG Operational Committee has the authority from TBS to determine these limits. Interviews were conducted with 12 members of the ABD Committee. In general they all reported the ABDC as a useful group, which has been instrumental in building collaboration and trust among the partners. However, from the start the operational role of the Communications Committee was less clear, "…at first it was thought that the group's role would involve as much of an external focus as an internal one, strengthening the dissemination of messages within the partnership. However, a different role than that first envisaged is emerging." (Partner Interview)

The FE recommended that the Communication Committee establish a strategy to guide its work. This requirement to redefine communication goals has led the ERI to develop a short-term Internal Communication Plan (from April 1, 2007 to March 31, 2008). This plan in-part responds to the previous formative evaluation in which partners identified the need for a more formal internal communication process. ERI has just hired a new communication staff to take up the challenge posed by the recent plan. As part of the new communication plan, mechanisms will be put in place to ensure that ERI committees share information on business plans, HR, ministerial visits, etc. Communication protocols will also be put in place to better disseminate information about changes, events and projects. While the work of the 'formal committee' may not meet expectations (as noted elsewhere), there is a high level of satisfaction relative to information sharing and transparency that goes on within the ERI Committees. The level of satisfaction among partners reflects the degree of investment and commitment to partnership by the ERI Secretariat. The issue now for the Communication Committee is how to engrain the enthusiasm for ERI being exhibited by the two other committees within its own efforts, and how to extend that energy to others in the Partnership.

"I was skeptical about working on such a large multi department committee. However, over time I have become more convinced that communicating with them on concrete programming issues helps us know each other better." ERI Partner

Finding 10:

ERI's collaborative governance structure has successfully built a 'trusting' partnership.

Stakeholders from all ERI partner departments were in nearly unanimous agreement that the committee process within ERI was fundamental in building a trusting partnership. The DGC, ABDC and HRC committees in particular were noted for their demonstrations of effective dialogue and interdepartmental collaboration (including collaborative problem-solving) that contributed to the building of 'trust' in each other and in the ERI Secretariat:

  • The DGC was noted for its role as a venue for information sharing and senior level dialogue.
  • The ABDC was noted as a critical mechanism for information exchange and, more importantly, for partners to have a voice in orientation programming to their priorities and policy needs. In the words of one ABD Committee member:

"I am surprised at how well we work together as partners... things were tough at the start but now we are working well... there has been a lot of good spirit and cooperation. Things are not perfect but they are a lot better. Working together on the ABD Committee has helped a lot."

  • The HRC was identified as a place where interdepartmental collaboration took place and where partners could ensure that their voice was heard in the decision-making around the deployment of resources. HR committee members made similar comments about the partnership at that level. Many on the HRC worked hard to review staff for short and long term assignments. These assignments were identified as important capacity development activities. While mostly favourable a number of suggestions were made to improve the time taken for committees.

However, interviewees suggested that the transaction costs of ERI's committee based decision-making structures were high (with specific reference to 'long and frequent meetings'). As one interviewee put it, ERI involves,

"…a lot of committee meetings, a lot of paperwork and that often people just don't have the bandwidth to give it full attention."

Evidence from minutes of meetings does not necessarily support the perception that the meetings are particularly time-consuming or frequent. Most committees meeting were held less than once per quarter and, on average, for less than two hours (with the expectation of the DG's committee where the average meeting length was three hours). However, this perception may not fully reflect total costs in terms of time and effort spent. While data was not available to undertake a comprehensive assessment, interview evidence indicates that committee members have the potential to spend significant amounts of time between meetings addressing operational issues. One partner, in fact, had dedicated a full-time staff member entirely to administering ERI. Partner interviewees were in agreement that the high transactional costs had paid dividends in terms of partnership and trust. As an ERI partner noted:

"I was not expecting much from ERI. However, I have been coming three years to the ABDC and it has been a good experience. People are more open and there are more exchanges… I even think people trust each other a bit more… trust is important and it is the result of this group."

Several senior level interviewees suggested that now that trust had been built, ERI could set about the task of reducing the transaction costs through: 1) redefining the roles and responsibilities of senior governance committees (DMC, ADMC, and DGC) so that they had a more strategic and oversight orientation, and 2) housing more of the operational functions of the committees back to the ERI Secretariat or into another parts of DFAIT(42). Comments such as these are rational in a time of restricted funds it is important to note that "trust making" is an ongoing process that often is quite fragile. Thus any changes to the trust building formula developed by ERI should be done carefully and in consultation with the partners.

3.3.2 Conclusions

The evaluation found that ERI's governance function to date has been largely operational. The "whole of government" approach' remains undefined and there needs to be more progress made in defining roles and responsibilities. These shortcomings have contributed to ERI being unable to orient itself and its functions toward measuring its progress toward objectives. ERI's senior governance levels need to become actively engaged in resolving this issue(43). At operational levels, the ERI Secretariat has been highly successful in facilitating operational and financial governance in a transparent and collaborative manner that has built trust among non-DFAIT partners. As such, the ERI partners may be able to agree to governance innovations designed to reduce transaction costs, however any changes should be carefully conceived and agreed to by partners.

3.4 Performance Management Systems

3.4.1 Findings

ERI's planning, monitoring and reporting systems are a major process used to report and control work. Planning processes set the direction, monitoring provides the formal and informal mechanisms that help determine if an initiative is on course (and performing as expected), and performance reporting is the formal means for transparently communicating progress, developments, issues and results achieved to key constituencies and stakeholders. Arriving at an appropriate balance that allows for effective and efficient controls while, most principally, focusing resources on actually working towards objectives is one of the real arts of creating cost-effective management systems. ERI is no exception.

Finding 11:

ERI planning runs the risk of not being fully responsive to, or anticipatory of, key developments and changing environments.

This Finding speaks to ERI's present capacity to support proactively forward-looking analysis. The evaluation found that ERI does not do proactive planning but does rely on partners work in this area. This work by partners is typically scans of the environment and data driven understanding of current trends, development and positions. However, within any initiative, management is required to respond to the changing dynamics of its environment. In the case of ERI we have found little analytical work supporting questions such as: Are there any new economic trends occurring in the US that would affect staffing of Posts or the distribution of HonCons? How have the changes in US-Canada security relationship been reflected in the role and function of the HonCons? Work carried out five to six years ago suggested placements of new Consulates, and HonCons in some locations, and enlargement of some existing posts. All these questions relate to the work of ERI and require that date be gathered. The evaluation team was not made aware of any reviews updating coverage and infrastructure requirements. While we understand that ERI does not have this capacity we can assume that the partners do. The Secretariat should not necessarily assume that the 'right' response for the year 2002 is still appropriate for the current circumstance. Thus ERI runs the risk of not having a good feedback loop on key areas of their concern.

In another realm, the ERI partners have monitored the impact of rapidly rising energy prices over the last five years and its impact on the overall US trade deficit and a stronger Canadian dollar. In turn, Canadian products might become less competitive in the US market place, presenting productivity challenges for Canada. Likewise, the growing pattern of US trade protectionism and the recourse to national legislation (as opposed to NAFTA dispute resolution mechanisms) and litigation as anti-competitive barriers to North American free trade, have increased. Five years ago country of origin considerations did not place as high on the American trade agenda as they do today. As well, border security continues to evolve in new directions, and the current American viewpoint on free flow of certain types of labour as was set out in NAFTA well over a decade ago. The evaluation asks: Who is responsible for determining how ERI and its partners respond to these changes? What is not being done that should be to align operations strategically?

All is not to say that the ERI Secretariat and the posts in the United States are not keeping current in terms of issues that are playing out within their jurisdictions. The point is that in areas of concern to ERI the evaluation has not found refreshed planning documents assess the assumptions that underline the 2002 decisions made about ERI. This could mean that ERI is entering an important era in it evolution, while still employing critical planning assumptions that are outdated. Thus by not keeping up with planning assessment, demographic analyses, opinion surveys and other analytical information gathering tools, ERI's capacity to respond to significant developments (and suggest adjustments to its partners) to improve overall programmatic results may be limited unnecessarily.

Finding 12:

The absence of an integrated performance management system constrains ERI's ability to track performance and carry out informed decision-making. This can negate opportunities to perform more effectively and efficiently - and to learn from experience.

An integrated performance management system is integral to effectively managing for results and building an organization's knowledge capital and operational capabilities through learning from experience. At a fundamental level, management needs to be informed about how programming is performing in order to make the right decisions and implement required adjustments. Informed decision-making is a crucial element in the effective management of any enterprise. What is learned through programming experience is a valuable commodity that needs to be exploited to its fullest advantage.

One of the principle fallouts from the absence of an integrated performance reporting system is the inability to analyze the cost-effectiveness. At present, there is no way to ascertain the relative cost effectiveness of various types of ERI activities. The evaluation asks: Are activities related to promoting Canadian science and technology (to achieve a greater awareness of Canadian products) a more effective use of Canadian resources than measures to promote access to US markets for Small and Medium Sized Businesses (SMEs)? Are some posts more effective in translating their resources into increased awareness of Canada's interests than others? At present, there is no way to answer these crucial questions other than by means of independent analysis.

Such questions however, would not be answered in isolation even if data systems were in place. As will be shown later, the accountability for 'results' for programming such as ERI is largely concentrated at the interface between what it does (outputs) and first level outcomes. In the case of ERI, the outcomes often relate to increasing awareness of Canada's competitive advantage, or the nature of Canadian interests with respect to a particular issue (e.g. BSE, water conservation, softwood lumber). It is difficult to argue that a particular individual action supported by ERI (e.g. a seminar on Canadian agricultural inspection regarding BSE) can be shown to have a direct and measurable effect on how American decision-makers address issues of particular interest to Canada.

This sort of an example also illustrates the complexity of attempting to assess the contributions that relatively small-scale activities can make to the attainment of higher-level goals. What may be needed is a comprehensive system that tracks a wide base of activities to ascertain what has happened collectively as a result of all Canadian interventions. Follow up activities for such a system, however, would have significant organizational, human and cost implications.

The RMAF puts forward a framework for capturing key performance output and outcome data; unfortunately partners have not worked with the ERI secretariat in populating this framework. Thus, the absence of a systematic approach to performance monitoring presents a critical challenge to ERI management. It is clear that the ERI Secretariat (and a number of key managers at DFAIT) are aware of this challenge and that choices will have to be made to balance program delivery versus performance management requirements. DFAIT is presently attempting to address this issue and is considering a comprehensive data capture and reporting system (using tools like TRIO and Marcus). While the current emphasis is on the business development side, results-based advocacy reporting is being addressed as well. While these efforts may prove useful, there are concerns. As one informant surmised:

"… we need information that would support our RMAF. What is being developed is a business tracking system that might help but is not what is required. We need a more professional approach to gathering performance data."

Going forward, ERI needs to build into its performance management system robust considerations of how performance will be monitored and follow-up activities performed. ERI also faces the challenge of developing project approval processes that ensure monitoring is integral to every ERI-supported activity (compliance with this requirement being effectively encouraged).

Finding 13:

ERI performance reporting captures information on activities and expenditures but does not adequately provide output and outcome information.

Reporting by partner departments (for example DFAIT) concentrates on expenditures and activities. The evaluation found that little, if any, reporting has been done on the achievement of crucial output and outcomes. Why is this the case? The largely operational nature of ERI decision-making (which is concentrated at the DG level and is largely transactional in nature) may be a contributor. Decision-making is focused on the approval of new specific initiatives and not so much on how the initiatives are linked to higher objectives. This may be because presently DG decision-making does not have a more senior level clientele (i.e. ADMs or DMs) whose primary 'horizon' should be strategic and the realization of the long-term benefits.

An examination of reports from posts, and those developed by the ERI Secretariat as a whole, show a near exclusive concentration on reporting costs and activities. The 'score cards', recently developed for PERPA staff, perhaps best exemplify this situation. While these cards are broken down thematically (including themes like 'culture' that are not part of ERI), and while they give some flavour of what is being done and how much it may have cost, they are silent on what happened next (the upward link between outputs and first level objectives).

In their narrative elements many of the contributors to these scorecards appear to use language more suitable for press releases in making unsubstantiated claims as to what may have been achieved by a particular event. For example, a film screening of "Away From Her" in Utah where two Denver-based personnel were present (no trade booth) was reported as a significant opportunity to highlight Canadian medical and life science technology. Numerous similar examples populate the new score cards. Turning to reporting of business development matters, current reporting is even sparser - relating simply to what was done, when it was done and how much it cost. This is a far departure form the requirements set out by TBS, which requires that progress towards targeted results is monitored and reported on regularly.

Even though the PERPA advocacy scorecards may have obvious limitations, they represent an evolutionary step towards a more accurate and upwardly linked internal reporting paradigm. They also demonstrate how difficult it may be to encompass the breadth and scope in standardized reporting that would attempt to show at least primary linkages to outcomes. It is important to note the central role that partners play in the performance management and measurement system of ERI. In order for performance management of ERI to work partners must accept to support the Secretariat in harmonizing information so that outputs and outcomes can be reported on.In terms of reporting, ERI is in a classic quandary. It actively and transparently manages the expenditures/activity relationship, but does not link them upwards. Because of this, ERI is less successful in planning and managing for outcomes.

Finding 14:

The absence of a standardized performance management process for the network of honorary consuls limits the ability to analyze their effectiveness.

One of ERI's most transformational features is its redirected and expanded network of HonCons who are now charged with performing business development and advocacy activities. While this network has considerably expanded Canada's presence and is generating positive results, how their performance is planned, managed, and subsequently reported on, remains undefined.At this time, planning and integrating the HonCons network into ERI and the priorities of posts remains a work-in-progress. HonCons work closely with their HOM on strategic issues related to advocacy and trade. Our case studies indicate that this work includes a wide range of activities including introductions of HOM's to political and business leaders, engaging in social and business networking, information sharing about Canada. The question that needs further exploration is how these activities link to the desired outcomes of the Missions. HonCons interviewed were enthusiastic to find out more about how their role affects results. They indicated that their letters of engagement and work plans provided a basis for better understanding how they were expected to spend their time. From a review of work plans and the interviews carried out, the evaluation found that the work of HonCons is linked to post priorities and objectives. Lines of communication and the integration of work appear to function well. However, ERI and its partners do not have in place a performance management framework for their HonCons nor a mechanism to systematically track their work and the results. While HonCons are not usually subject to individual performance assessment, they do recognize the need for better tracking on what they are doing and accomplishing. However some posts have tried to rectify this situation themselves. For example, Miami developed a workplan with the HonCon on which they base an assessment of the past years activities(44). Similar to other dimensions of ERI, the performance management process for HonCons is only partially in place, and more can be done. For example, it is clear from interviews with HonCons and Posts that they report to HOMs. Each HonCons obtains a letter of engagement, which outlines their respective role. As well most of the HonCons we interviewed have work plans to guide the operationalization of their work. HOMs supervises the process. As of now, however, there is no formal basis for judging the success or lack there of the HonCons program. The issue is that there are fundamental components to the HonCons program that should be thought about and reviewed for example on their role, their stipend, their selection, their evaluation to name a few. Without a review and monitoring framework, it will be difficult to perform such review assessments.

Finding 15:

The roles and responsibilities of the Secretariat and partners are not adequately specified in order that RMAF data requirements are captured.

Discussions with the ERI Secretariat indicate that they understand the need for a functioning performance management system. At present, they see their role as a facilitator or integrator of partner programming activities. The responsibility for reporting on results is stated in ERI Allocation Guidelines. Specifically,

  • Advocacy and business development project proposals should achieve results consistent with the ERI program outcomes as enunciated in the RMAF;
  • Partners and posts must report results in compliance with the RMAF requirements;
  • Both Partners and posts must report on the expenditure of ERI funds at mid-year, third quarter and year end.

The financial officer manages the financial input requirements and reporting and this works well. It is less clear with results reporting. Interviews with Secretariat staff suggest that while they are motivated to operationalize the data gathering for the RMAF, a number of issues remain unsettled. First, the partners would need to decide on the specific data collection responsibilities of partners, especially as it relates to the reporting of ERI information.(45) For example, much of the data needed for the Secretariat to populate the RMAF framework either exists within the partner departments or is within the partner department's sphere of influence. The ERI Secretariat needs partner cooperation and facilitation to obtain the data needed to capture the results of the initiative.

A second issue is that of obtaining the capacity needed to create a performance management process. In discussing this issue with the Secretariat it was clear to them that implementing a performance management and measurement system is resource consuming. Primary data capture requires that Partners invest in this process and build the capacity to engage in a performance management process that would support the Initiative. In this type of horizontal initiative, it is crucial that partners and Secretariats roles and responsibilities are clear for this function. Unfortunately, this has yet to be developed for the ERI Initiative.

3.4.2 Conclusions

Planning, monitoring, and reporting mechanisms are essential to the effective governance, management and control of any organization's work efforts. With that said, the development and implementation of these mechanisms is not an easy task for any initiative, and ERI is no exception. Yet by not taking the necessary action to design and implement an appropriate performance management system, ERI is in effect compromising its programming efforts in a very fundamental way.

The ERI Secretariat is aware of the limitations in ERI's planning, monitoring, and reporting mechanisms. However, it can be said that they are impeded from addressing these deficiencies due to financial and human constraints, partner's capacity and data systems, as well as the ambiguities in relation to the roles and responsibilities of partners in the performance management process of the Initiative.

3.5 Operational Management

3.5.1 Findings

Finding 16:

ERI's multi year funding, and the Secretariats ability to manage cash flow through re-profiling, supported efficient use of resources by Partners and Posts.

The 2003 TB Submission enabled the ERI Secretariat to officially manage funding. Therefore, there was no need, for Partner MoUs, contribution agreements, or other standard GoC cost-sharing arrangements, which are usually administered for joint funding. Thereby, ERI was able to offer infrastructure support and program funding in a more cost-efficient, timely and direct approach to Posts. Infrastructure support included the support offered to upgrade Posts and create new Posts in the U.S.A.This ERI funding approach appears to have been more beneficial because partner funds are secured up-front and, as a result, not subject to withdrawal, which means partners have the flexibility to plan for multi-year projects and to fund program events with an almost guaranteed source of funds. The DG Committee, in accordance with the terms and conditions of its governance principles manages the funding allocations.As noted in Exhibit 4.7, the ERI Secretariat has managed the budget in a context of a surplus position. Interviewees indicated, "A few reasons for this situation includes an extended staffing process, slow uptake of program funding, and a lengthy process to identify and appoint new Honorary Consuls."(46) One of the early measures indicating good oversight by the Secretariat was its recognition that the implementation schedule, as per the Nov. 2003 TB submission, was ambitious and would result in ERI funds being underutilized by partners. Acting on this insight it was able to re-profile and make funds available in the next fiscal year. This significantly benefited the partnership. All partners interviewed indicated that this provision helped them avoid possible inefficient use of funds that occurs when departments are in a "use it or lose it" time crunch.

Cost vigilance of the ERI Secretariat is illustrated in Exhibit 3.7. It identifies ERI surpluses lapsed, carried forward, or re-profiled for the years FY 2003-04 to FY 2006/07.

Exhibit 3.7 Financial surplus (47)

BudgetFY 2003-04FY 2004-05FY 2005-06FY 2006-07
Expenditures$3,109,00043.2%$17,476,00079.4%$29,423,00085.7%N/A-
Lapsed (surplus)$927,00012.9%$89,0000.4%$765,0002.2%$9,700N/A
Carried forward (surplus)$2,764,00038.4%$4,054,00018.4%-0%$603,000N/A
Re-profiled (surplus)$400,0005.6%$400,0001.8%$4,150,00012.1%$4,967,000N/A

(48)

Partners and Posts indicated that ERI's project planning, selection and approval processes, while viewed as time-consuming has promoted advocacy awareness, dialogue on business development and, to a degree, improved coordination between partners and Posts. The general perspective held on the project selection was that it is a good process but could also be redesigned to be more cost-effective.

The evaluation noted that some partners and Posts were concerned about administrative challenges (and efficiencies) related to the usage of ERI programming funds. Although Government departments often cost-share project budgets from multiple sources, ERI is different in that it offers a more timely access to program funds to support events that are shared by one or more partners.

The following example indicates that these arrangements can be quite complex:

Initiative NameAgri-Food Showcase Show/Event in Minneapolis
DescriptionThis event focused on inviting major food buyers and wholesalers in Mid West.
Total Budget$110,000
ERI Contribution$25,000
ERI PartnersWD, DFAIT, AAFC
Other PartnersSTEP, Sask. Food , SIR, University of Saskatchewan

Many ERI partners and Posts noted the condition to secure approval from multiple ERI Partners for one or more events proved onerous (as the application requirements and process for each funding source were different). Several interviews at Post noted: "… for any given project, we might have to write three or more funding proposals and reports, each one different." Many suggested that a single flexible funding source - or a one-time streamlined proposal process - could assist in reducing the time burden.

Before leaving this section it is important to note that ERI accounted for the funds on a partner project cost basis. Each activity of partners had budgets, which were accounted for to ERI. Thus providing a timely control system. However, ERI did not develop its financial systems in a way that would allow it to cost the outputs identified in the RMAF. This amongst other things limits the ability to do cost-effectiveness analysis.

Finding 17:

There are some concerns that the project planning, selection and approval processes duplicate effort, are too time consuming for the results, and create inefficiencies. However, solving this requires significant work and analysis for both partners and Secretariat.

Project approval within ERI now involves both processes within Partner Departments as well as within ERI itself. Interviewees suggest that the joint processes can take up to six months. As discussed, these processes start with project ideas that are first vetted within Departments where discussions are had with respect to the best avenue for funding. Interviewees suggest that there are multiple possibilities for funding and staff need to determine the most appropriate funding approach. Bottlenecks in this process can come at several points, often within the Departments and sometimes within ERI. Within ERI, the Secretariat reviews projects and as well project approval meetings (for larger projects) carried out by the ABD and DG committees provide the opportunity for one partner to address concerns about the alignment of project (as proposed by two or more other partners) with their priorities in a common sector. On the positive side interviewees indicated that ERI project meetings were very informative for them as they provided an opportunity to get to know what others were doing. Furthermore, the meetings were an important part of the due diligent role required of ERI Partners. On the other hand interviewees were concerned that meetings did not adequately review partner selection. This is corroborated by an analysis of the minutes of 14 ADBC meetings from 2004-to-2007. The analysis indicated that there was relatively little discussion on partner project alignment or partner support, or any critiques of the proposals. The issue for the evaluation than is can this process be made more efficient. Interviewees offered several suggestions. First, interviewees wondered whether the various funding sources could be consolidated into a single source. Second, they indicated that it might be worth while to look at all the steps in the project funding cycle both within the Departments and within ERI in order to assess which steps provided important "value". The evaluators thought that this was a good suggestion for the Partners to review in the follow on phase of ERI.

Finding 18:

Project allocations for ERI Partners have consistently exceeded their ability to expend resources; this has improved over time.

Managing the allocation of funds is an important part of operational management. Exhibit 3.9 provides data which compares program allocation to program expenditures. As can be seen, program allocations consistently are greater for all partners than program expenditures. This has led to some funds being lapsed, others re-profiled and others be carried forward. During the Initiative the Secretariat has been able to re-profile and carry forward most of its program funds thus protecting its program work. On the other hand Partners have been able to develop planning and operational processes to better utilize funds for meeting their objectives. As a Partner interviewee indicated "at first we were not sure how the funding would work. We did not know what would happen if we had to cancel an activity! But over time we learned that the funding is really a tool for us to do our work. The funding mechanisms used by ERI has made our work a lot more effective."

Not only is the funding mechanism seen as important for staff, but they also have learned over time how to best utilize the funds. The table below clearly demonstrates that over time partners have significantly improved their ability to utilize the expenditures allocated.

Exhibit 3.8 Summary of fund allocated to each partner and how much they expended

Partners2003/042004-052005-062006-07Total
DFAIT
Program Expenditure
Allocations

$0
$0

$2,833,100
$3,902,000

$3,739,700
$4,272,500

$4,972,100
$5,137,700

$11,544,900
$13,312,200
AAFC
Program Expenditure
Allocations

$0
$0

$22,500
$62,500

$437,900
$483,600

$453,500
$506,400

$913,900
$1,052,500
ACOA
Program Expenditure
Allocations

$0
$0

$54,200
$63,750

$332,700
$359,400

$397,900
$453,100

$784,800
$876,250
CED
Program Expenditure
Allocations

$0
$0

$50,000
$63,750

$125,300
$152,900

$306,600
$322,600

$481,900
$539,250
IC
Expenditure
Allocations

$0
$0

$270,300
$302,500

$520,600
$565,500

$649,800
$677,400

$920,100
$1,545,400
NRC
Program Expenditure
Allocations

$0
0

$16,000
$80,000

$228,800
$245,900

$467,900
$484,200

$712,700
$810,100
WD
Program Expenditure
Allocations

$0
$0

$79,300
$79,300

$247,500
$272,500

$231,400
$262,500

$558,200
$614,300

(49)

Source: Program Funding Summary Information for the Summative Evaluation, June 18, 2007. (Programme Allocations and Expenditures include advocacy, Business development and TPI)

The following table illustrates how funds have been allocated and expended by DFAIT and by Posts and breaks down the funds by advocacy, IBD and TPI. It shows how the capacity to expend resources has improved over time. In 2004-05 three quarter of the funds had been expended and two years later 97 percent of the funds were expended.

Exhibit 3.9 Summary of fund allocated to each partner and where they expended

Allocations2003/042004-052005-062006-07Total
DFAIT
Advocacy
IBD
TPI
Sub-Total

$0
$0

$2,940,000
$525,000
$437,000
$3,902,000

$2,857,500
$807,300
$607,700
$4,272,500

$3,629,800
$1,025,200
$482,700
$5,137,700

$9,427,300
$2,357,500
$1,527,400
$13,312,200
Missions
IBD
Total

$0
$0

$1,000,000
$4,902,000

$1,329,680
$5,602,180

$2,028,082
$7,165,782

$4,357,762
$17,669,962
Expenditures2003/042004-052005-062006-07Total
DFAIT
Advocacy
IBD
TPI
Sub-Total

$0
$0

$2,214,000
$426,600
$192,500
$2,833,100

$2,782,000
$645,900
$313,800
$3,739,700

$3,540,000
$957,900
$474,200
$4,972,100

$8,534,000
$2,030,400
$980,500
$11,544,900
Missions
IBD
Total

$0
$0

$865,474
$3,698,574

$1,167,730
$4,907,430

$1,991,814
$6,963,914

$4,025,018
$15,569,918
% of Funds Expended0%75.5%87.6%97.2%88.1%

It is interesting to note, that there is increasing ability of partners to utilize project dollars for business development. However, as noted above, interviewees indicated that ERI was only one source of project funding. In Posts for example Client Service Funds (CSF) are available to Trade Program Managers to focus on activities that would provide high value services to clients. It is a client-focused fund. Exhibit 3.10 provides a comparison of ERI and CSF funding.

Exhibit 3.10 Comparison of CSF and ERI funding rules (50)

ExpenditureCSFERIComment
Salaries
OvertimeNoYes 
Interns - short termYesYes 
Short termYesYes 
Medium to long termNo"Yes"ERI allows hiring for multiple projects; length of term is management's discretion
ConsultantsYesYes 
Travel
Professional developmentNoNo 
Regional ConsultationsNoYes 
Clients - For profitNoPartialManagement discretion
Clients - Not for profitNoYesManagement discretion
ConsultantsYesYesEngaged for IBD projects
HospitalityYesYesIf a project meets other ERI or CSF criteria
Supplies and ServicesYesYesProject specific only
AdvertisingYesYesProject specific only
Grants and contributionsNoYesContribution Agreements only
CapitalNoNo 

Operationally, staff is able to look at the different funding sources and select which meets their needs. It has been generally accepted that ERI funding is project based which may have multiple clients such as a sector audience and is less restrictive. Of interest however, is that over the past four years CSF funds available to Posts in the US have declined from $2.1 million US dollars to $.92. While we have not collected data from other Partners, we query whether ERI is being substituted for Partner business development funding.

Finding 19:

The strategies used to 'pilot' new posts (and for upgrading others) in a low-cost and flexible manner has generally been successful.

The strategies used for opening new posts (and upgrading others) were intended to allow the initiative to 'test' assumptions about the need for presence in certain areas using low-cost, high flexibility models. For example, many of the new smaller/satellite offices were located in professional service centers to lower costs, promote flexibility, and allow for quick implementation. This type of experimentation identified in the RMAF provided an innovative approach to expanding Canadian presence in the US.

In most cases, the 'capacity-building' activities includes the procurement of infrastructure, the staffing of offices with appropriate Canada-Based Staff (CBS) and Locally Engaged Staff (LES) and the acquisition of services by missions. Infrastructure requirements of the ERI must present minimal commitment. That is why new missions, to the best of the ERI's ability, are being established in leased 'executive suits' which provide basic administrative support as part of the lease arrangements, thereby enabling mission staff to concentrate on the delivery of operational activities. (RMAF p.32)

Evidence suggests that these strategies have paid off in some ways, but need to be more carefully analyzed as there are several unintended negative consequences that would a suggest a need for better review and management. For example:

  • An analysis provided by the LA Post indicated that the cost per square foot of using professional service centers tends to be more cost-effective when needs are short term or when the scale is one-to-two people sharing a single office. They further concluded that that the economies of scale intended by using the same professional service centre provider across the US were not realized. While direct geographic comparisons of costs can be misleading, research completed by the Posts suggests that locating outside of service centers had the potential to be less expensive.
  • While in Washington and San Diego, the evaluation was made aware that the inadequate IT arrangements available in service centers were impacting satellites (e.g. relatively weak Internet connections, limited access to the 'normal' IT packages available to consulates). This can be problematic in several ways. For example, slow Internet connections have led to a reduction in the use of TRIO (which, if used comprehensively, has the potential to be a strong source of corporate memory) due to long wait periods.
  • Further, other offices raised concerns about issues such as having to send computers to Los Angeles by courier in order to complete simple tasks such as resetting a password thus reducing an individual's working capacity considerably for several days. As one informant noted, 'coming from the private sector, I cannot believe how bad the IT in the [satellite] consulate is'.
  • The professional service centers also limit the 'visibility' of the consulates (absence of signage and name plates are familiar elements in 'branding' consulates elsewhere).

It would appear, based on the data and analysis collected through the evaluation, that there is enough concern on the part of the Posts visited to warrant closer scrutiny of this issue by the ERI Secretariat. This is true for all aspects of the expanded infrastructure. In addition to the issues raised above, there has not been, as far as the evaluation could determine, any further work on how shifting trends in the US might affect staffing or HonCon trends. While the early work done in ERI in building the ERI networks of posts and HonCons was relevant, the key to the future is the analysis of 'on going relevance'. ERI does not have the mechanisms in place as yet to provide decision-makers with the data they need to assess the placement of posts.

Finding 20:

ERI has demonstrated an ability to secure competent human resources from partners for posting to the US.

The process of staffing new and upgraded posts has required ERI to develop and maintain mechanisms for identifying and selecting personnel. Based(51) on the interviews with the secretariat, partners and posts, and external stakeholders, it appears that the partnership has been largely successful in securing highly qualified staff to fill the range of ERI-funded CBS, TD and LES positions. The comments of external interviewees were taken into particular consideration in this regard. US based external interviewees were uniform in their endorsement of the expertise of ERI staff, both in terms of sector expertise and having the right 'human skills'.The majority of the partners interviewed indicated that the staffing process was transparent and generally efficient.(52) Interviewees suggested that the 'filtering' function of the DG Committee and the Human Resources Committee enables ERI as a whole to allocate human resource to meet special and partner needs. Exhibit 3.11 is a summary table of the process used to select staff.

ERI secondees, heavily or solely, populate some Posts. Minneapolis and Denver have only one DFAIT position each, while San Diego is 100% populated by non-DFAIT ERI-funded staff.

Exhibit 3.11 ERI Selection Process (53)

 Non-DFAIT ERI PartnersDFAIT
Announcement of posting opportunitiesERI Secretariat prepares 'posters' and sends out to all partners to publish internallyCommon system for both - dependent on their own internal communication systems and on common government system.
Pre-ScreeningRequired pre-screening processNo pre-screening for ERI
Candidates forwarded to ERI for screeningCommon for both
ERI forwards Candidates to HR Committee for screeningCommon for both
ERI forwards Candidates to DGsCommon for both
InterviewsCross partner selection committees are assembled - for the most part the HR Standing Committee - for each type of position (PERPA, STC, TC)The interviews are regarded as transparent, fair, and representative of all partner department interests.
ReferencesERI uses professional references based on the competencies for both
PoolThe ERI selection process allows candidates from DFAIT and other Partner organizations to be screened into an ERI 'pool' of qualified candidates.
ProposalsFrom the pool, the committee matches candidates against positions
Post involvement in selectionRecommendations then goes to the HOM
Formal NominationDone through DFAIT assignment officers

While generally seen as successful, the staffing process for US posting is not without its critics and criticisms. First, it was noted that non-DFAIT partners undertake a pre-screening of applicants, not required by DFAIT, and are surprised at the relatively low acceptance rate of non-DFAIT staff. In fact, DFAIT staff accounted for some 60 percent of placements. The chart below provides an analysis of ERI posting and temporary duty by partner. It demonstrates that non-DFAIT partners are under-represented when compared to DFAIT postings, however they are equal to in Temporary Duty.

Exhibit 3.12 ERI Staff and Temporary Duty by Partner Organization

YearPartners
DFAITAAFCACOACEDICNRCWD
TDSTDSTDSTDSTDSTDPTDS
2003-5---1--------
2004010010103080-0-
200501232411-03010-
2006373211411-0-1-
20074132-212-220-2-
Total7478575743130130

TD= Temporary Duty / S= Staff

Many partners suggested that one of the causes of this lay in the relative weighting of selection criteria. For example, former experience overseas and bilingualism are reportedly (or at least in the perception of the partners) treated as binary 'yes/no' questions that can disqualify a candidate outright without taking into account their relative strengths of the clients other credentials and experiences(54). Some of the partners have relatively few candidates with both of these qualities. Several secondees noted that the timelines from application to selection were elongated and that often key paperwork and other information/decisions were late in coming. It was claimed that such delays hindered some from applying for posts, and others who had won positions were unable to take the positions. Though the number of related declines is not serious, it does point to a need to review the HR processes regularly. Finally, a number of conditions of employment are different between the US and other postings. While the evaluation did not do an analysis of the benefits packages obtained by US staff, it is common knowledge that children's education, healthcare, housing and spousal employment(55) are concerns when going on a posting. Staff indicates that they were not as well informed as they might be about such drawbacks. While the HR committee is aware of these issues and has the responsibility to make recommendations, these issues continue to persist. Another series of concerns revolve around career development and training. On the career side, some candidates posted in the US (particularly from non-DFAIT partner organizations) indicated that they felt isolated and became concerned how the posting would affect their career prospects. Some partners (including DFAIT) have expressed concerns that abbreviated training offered may not fully orient individuals to the key policies and procedures. It seems that on many occasions, individuals were not aware of training opportunities prior to posting and/or the late arrival of the posting confirmation prevented them from taking part in training sessions. In looking at ERI's budget, the evaluation found that several hundred thousand dollars were allocated for training.

"We put forward a lot of our top people this year - the best of our best - and only one was selected for posting."ERI Partner

"Training is a vital part of the HR program and has three prongs: funding for catch-up training of LES at missions, developmental training of potential ERI candidates for postings, and focused pre-posting training opportunities for partner candidates. Under the training umbrella, we have supported the LES/CO course, increasing considerably the number of spaces available to US candidates. Another initiative was to fund an extra set of GLI-2 courses and pay for extra seats to get US officers and partner candidates through more quickly."(ERI Partner Interviewee).

The last item related to this Finding involves temporary duty assignments (TDs). TDs allow a candidate the opportunity to experience life at post and to further its department's program at post during that time. ERI funded 17 TD assignments in 2006/07 for a total expenditure of $236,547.(56)

Breakdown by partnersAAFCDFAITACOAICCEDWD
Number of TD assignments in 2006/07342242

In 2008, estimates anticipate 15 TD requests (at an average cost of $20,000 each). TD assignments are becoming increasingly popular and the specific costs and benefits will need to be assessed.

Finding 21:

An examination of the Honorary Consul component of ERI suggests that this element of the initiative is emerging as a cost-effective tool for extending the reach of posts.

As per the RMAF, a key initiative of ERI is the establishment of HonCons throughout the US. The selection of locations was based on a proven access to business and political leaders in relevant sectors, and on the ability to provide linkages for Canadian representation in a given region. HonCons identify economic opportunities and link to political decision-makers in their area and state. They experience a rigorous screening process in Canada (including ERI) as well as an approval process in the US. The HonCons idea is not new but many see ERI's reorientation of the position (away from consular functions towards closer linkages to Canadian advocacy and trade promotion priorities) as an innovation. From the outset the 'new' HonCons approach introduced by ERI was seen as a cost-effective way to extend the coverage and reach of the posts. As of April 2007, 16 HonCons were appointed as set out below:

Exhibit 3.13 Timeline of HonCon Appointments

Fiscal YearU.S. Cities
2003-04New Orleans (LA), Portland (ME)
2004-05Pittsburgh (PA), Memphis (TN), Omaha (NE), Cleveland (OH), Richmond (VA), Portland (OR)
2005-06Tampa (FL), Salt Lake City (UT), San Antonio (TX), Charlotte (NC), San Juan (PR)
2007Helena (MT), St. Louis (MO), Des Moines (IA)

Each HonCons obtains a stipend and an expenditure amount that is budgeted at $100,000 per year. For the existing positions, a budget of about $1.4 million per year is set aside, about 40 percent of this is allocated for specific programming activities that are planned and about 25 percent is set aside for a stipend. Analysis of financial data shows that there is a degree of unevenness in the expenditure rates for HonCons. Some, like Pittsburgh and Portland in certain years have consumed virtually all their allocation while others like Richmond or Omaha have consumed less than half in the same amount of time. HonCons are expected to provide:

  • Posts and partners with a ready-made network of contacts that can begin to provide influence or give posts access to influential decision-makers immediately
  • Posts with a means to be constantly physically present in areas not easily covered through remotely located posts
  • Posts and partners with up-to-date context monitoring. Further, the HonCons can often provide contextual analysis based on local knowledge.
  • Support on business development initiatives (though this is sometimes limited based on the expertise and experience of the HonCons in question).

Based on a series of interviews with the HonCons across the US. They expressed support for the expanded role of the HonCons, and indicated that they are clear about their roles and are appropriately managed. They see their job as one of importance to Canada. HonCons provide on going contact and communication with the HOMs. All had suggestions for ways of improving Canadian representation. Some HonCons stated that they appreciated the opportunity they had once a year to network with their colleagues and at the same time meet other HOMs. There was no shortage of ideas and suggestions from the HonCons we interviewed about ways Canada can improve its business development and advocacy work. One HonCon stated:

"Where I live there is great potential for Canadian Research Centers to work with our Universities. Unfortunately, up till now I have not been able to work with the Post to find an appropriate vehicle for a visit… but it will come. I am sure there can be great synergy between Canadian Research and our Universities in areas of technology research. We just need time."

The HonCons interviewed were a highly motivated group of Canadian supporters and that they were very much in tune with the program expectations. The following examples provide an indication of what HonCons actually do:

  • The Honorary Consul in New Orleans, Louisiana organized meetings for a Nova Scotia Agri-Food Mission;
  • The Honorary Consul in Pittsburgh, Pennsylvania hosted a visit of representatives from the Canadian Technology Triangle; it also arranged a meeting with the Governor of Pennsylvania.
  • The Honorary Consul in Portland, Oregon organized a study visit by the Minister of State for infrastructure to gather information related to urban planning, housing and infrastructure development.

Finding 22:

The Secretariat plays an essential role in the "new paradigm" of horizontal management.

Managing across departments is a complex and often difficult endeavour that involves working collaboratively across organizational boundaries. As the CCMD(57) roundtable indicated in 2001: "There are no hard and fast rules to horizontal management, it is an art more than a science." In that roundtable they identified several important themes, which they suggested for further discussion and research:

  • The need for leadership that marshals the powers of influence and persuasion. Such initiative creates shared mental models and vocabularies that help give an initiative a working culture. In such a relationship leadership is best exercised through dialogue and active listening.
  • The need to develop a culture that values collaboration and builds trust.
  • The need for reflection and adjustments that maintain the momentum of the reasons that drove the horizontal initiative in the first place. In this sense, they suggested that one needs to understand that horizontal initiatives have a life cycle.
  • The need to maintain contact with vertical structures for the sake of securing resources and the authority needed to act in the main bureaucracy.
  • The need to adapt support systems so that they work for all partners.

The role of the Secretariat has proven to be difficult, because one needs to coordinate various groups with no authority. Thus persuasion is the central tool for obtaining support of their activities. The Secretariat's role spans a wide assortment of activities, including(58):

  • Ensuring the smooth functioning of the Initiative;
  • Facilitating the governance mechanism that engages partners at all levels of decision-making and is at the heart of the Initiative;
  • Ensuring oversight and sound financial management of the considerable resources under management by the ERI;
  • Managing an orderly process of plan and project approvals in accordance with established priorities and procedural guidelines;
  • Leading the unique cooperative ERI human resources process with an integrated candidate selection, training and assignment program;
  • Managing specialized programs such as the Honorary Consuls;
  • Communicating with the partnership, with OGDs and other stakeholders such as the provinces;
  • Managing in a dynamic environment where accountability cannot be compromised and momentum needs to be maintained;
  • Enhancing level of strategic planning in a coordinated one point of contact way;
  • Supporting the various committees;
  • Assuring appropriate performance management system;
  • Conducting coordinated broad scale outreach consultations with partners and OGDs.

The ERI Secretariat represents about 5% of total allocations (some $6.3 million over five years). It is made up of a group of seven professionals including an Executive Coordinator (DG Level) and a Director. It has been managed as a 'coordinating and facilitating' unit that tries to integrate and reflect the perspectives of each partner. In this sense one can say that the ERI Secretariat 'reacts' to circumstances presented by the partners. However, it requires the cooperation of the partners to get things done. Interviews with partners are very supportive of the facilitating work of the Secretariat. Almost 90 percent of all partners interviewed indicated that they feel that the Secretariat tries to be a 'fair representative' of all the partners' interests, not simply an extension of DFAIT.

Staff and managers in the Secretariat have reported considerable pressures in administering what is, in essence, a rapidly evolving initiative that faces new challenges to ensure that ERI's objectives are met. ERI's managers report that coordination among partners for finance, program selection, human resources, and so forth consumes both time and financial resources. However, both ERI and the partners appear to agree that, at the outset at least, the collaboration caused by coordinated administration procedures were important elements in building a transparent and trusting partnership. The collaborative nature of ERI has required the Secretariat to focus a large part of its resources on building 'social capital' among its partners, to demonstrate to them that ERI is a partnership in practice as well as in theory. It was raised that:

"… a major reduction in the Secretariat could take place in functional areas (HR, Accounting, Communications)… now that the partnership is more established… with many of the functions of the Secretariat being picked up by the normal work of the department."(DFAIT Interview)

However, such changes in procedure could have important administrative and managerial implications and needs to be done in collaboration with partners in order for the quality of work and the trusting relationship to remain.

CCMD has reported that horizontal communication is one of the key success factors for partnerships. ERI partners uniformly report a high degree of satisfaction with their interpersonal engagements and with the Secretariat. They point out that, in general, this has translated into increased levels of confidence in ERI. Individual ERI partners report that the Secretariat's internal communications work has increased their respective understanding of the benefits of a combined approach to advocacy and business development in the US, but unfortunately many indicate that this message has not been gotten out broadly. While most of the success of communication has been on a personal or interpersonal basis, one must acknowledge that the more formal communication tools that ERI has attempted to develop namely, the Extranet, the annual report, the communiqués, and so forth have not been as successful in getting out ERI's key messages. Recently, there has been a new communication strategy written, which now needs to be implemented. It should be noted that, the formative evaluation, the secretariat and the partners all have indicated the need to improve communications tools so that greater numbers of partners, staff, and important stakeholders know about the work of ERI and how to engage with the initiative.

3.5.2 Conclusions

Operational management covers a wide assortment of issues including the funding approach, project selection, project allocation and use, infrastructure, human resources and the role of the Secretariat. In general, the evaluation found that careful attention was paid to the efficient use of resources. Flexibility to invest in new initiatives and the acceptance of carry-over and re-profiling of surplus amounts has benefitted ERI and its partners. ERI's collaborative project planning and selection process is perceived as successful in promoting partnership, trust. and collaboration between partners and posts. The evaluation found that partners did use their project allocations, which led to surpluses and the need for re-profiling and carryover. The work of the Secretariat and partners has changed this so now there is a closer match. The various operational processes to support the selection of staff have proved to be beneficial and as has the use of HonCons to improve the coverage knowledge base of HOMs. The study acknowledged the complexity of the Secretariat role in coordinating a horizontal partnership; partners commend the work of the secretariat in building a collaborative and trusting relationship in ERI that supports the operations. This has aided the partners. Finally, it should be noted that more quantitative cost-effectiveness analysis could not be done because of the inability to capture the costs of outputs.(59)


4.0 Successes: Capacity Changes and Results

4.1 Introduction

When considering the Success of ERI during its five year life cycle, several questions were asked: What capacities were built under the initiative? What capacities have been strengthened that will prospectively improve trade and advocacy programming and its performance record in the future? What difference has ERI made in terms of the delivery of tangible results that have benefitted the targeted beneficiaries? What outcomes and outputs have been attained through advocacy and business development programming? In short the evaluation attempted to capture the results obtained by the initiative.

4.2 Capacity Changes

4.2.1 Findings

Finding 23:

ERI partners report that the new and upgraded consulates have substantially improved their respective capacities to pursue business development and advocacy roles in the US. The expanded physical presence has augmented service delivery.

Interviews and case studies(60) supported the view that increased territorial coverage in specific geographical areas in the US was strategic in location, size and access to key sources of US political and economic influences. Simply put, there is consensus that the 'right choices' were made, and the opening of new offices has led to much needed coverage within previously under-represented, yet important, geographical areas in the US.

The exhibit below describes the extent to which the strengthening of posts was carried out by juxtaposing maps that identify Canada's 'presence' in the US prior to and post ERI implementation. As can be seen, ERI has expanded dramatically coverage within the United States and has heightened visibility in key areas in the South and South West. Interviewers unanimously suggest that such expansion has the potential of significantly increasing Canadian influence in trade and advocacy:

Exhibit 4.1 Representation in the US before and since the ERI

Canada's Representation in the US Before ERICanada's Representation in the US Since ERI

The missions consistently report(61) such examples. They indicate that there has been an increase in the quality and frequency of interactions with a variety of US sources of influence. For example:

  • San Francisco noted that following a reallocation exercise in the mid 1990s, the San Francisco Consulate was reduced in size and was asked to report directly to the Consulate General in Los Angeles. This reduced the ability for direct contact to be initiated and maintained with the California State Capital in Sacramento. Only after the San Francisco Consulate was upgraded in 2005 to a Consulate General with ERI funds, could more regular and intense contact be established with the State Capital to increase dialogue on such high profile policy matters on energy, technology and innovation.
  • Interviewees in Denver and San Diego felt that the establishment of the missions in those cities sent a strong message that Canada was serious about its relationship with the US. They also noted that the quality of the relationship attained by having physical offices in Denver and San Diego was unattainable when these territories were being served from overstretched missions in Minneapolis and Los Angeles. Officers in Minneapolis and Los Angeles noted that before their territory was "right-sized" they simply did not have the person-power to be meaningfully engaged in 'extended territories'.In San Diego members of the ERI-supported office now sit on the boards of business and trade associations that are providing considerable reach in terms of contacts and exposure. This, the evaluation heard, was not possible when the region was served out of Los Angeles. The same types of responses were heard in Miami and Washington DC. All interviewees indicated that the expansion made a positive difference both quantitatively and qualitatively.

Finding 24:

ERI has strengthened human resource capacities in targeted US missions.

At a basic level, ERI's newly-funded positions clearly enhanced the capacity of posts. The evaluation repeatedly heard, with more people…you can do more things. Exhibit 4.4 indicates that a total of 92 new positions have been created to work on ERI, this is 12 more than was originally planned for in the RMAF. Of these, 29 are Canada Based Staff and 63 are Locally Engaged Staff, furthermore, the capacity has benefited from a diversity of staff coming from ministries besides DFAIT. The following table shows which posts have benefited from ERI hiring. The table also differentiates between CBS and LES by mission.

Exhibit 4.2 ERI- Funded Positions - by Mission and Position Type

ERI - Funded Positions

Exhibit 4.3 shows the breakdown of ERI funded positions by program. Almost twice as much staff has been devoted to international business development, in comparison to advocacy. Approximately 75% of all positions are related to increasing programming capacity in the US. Before the implementation of ERI, US-based bi-lateral positions totaled 475.5. ERI funded 92.5 new positions for a total of 568 US-based bi-lateral positions in 2007. Of this amount, 21 positions were cut which resulted in a net of 71.5 additional US-based positions. Therefore, ERI represented an overall increase of 15% of US positions, over pre-ERI.

Exhibit 4.3 ERI-Funded Positions - by Program

ProgramCanada-Based StaffLocally Engaged StaffTotal
Intl. Business Dev.182745
Advocacy51823
Common Services014.514.5
HOM & Assistant303
Consular347
Total2963.592.5

Finding 25:

ERI's cross-postings of personnel, temporary duty placements, and mechanisms are improving the capacity of posts to address partner priorities in the US.

As per the evaluation's interviews, the majority of partners and posts alike agreed that the cross-departmental posting opportunities (both for CBS and TD) and the dedicated locally engaged staff roles were particularly important elements in terms of capacity building to enhance Canadian representation. ERI not only increased the number of people in the field; it also introduced a new breed of cross-posted officers who brought additional knowledge capital (in particular sector expertise) to programming efforts.

While these HR strategies were clearly beneficial in many ways to programming, they also introduced challenges and concerns for people working on ERI. The table below identifies the benefits and challenges of the ERI CBS, TD and LES placements (as developed from comments provided by a variety of stakeholders):

Exhibit 4.4 Cross-Posting and Locally Engaged Staff Benefits and Challenges

PerspectivesPositive BenefitsChallenges
CBS Placements
ERI Partner PerspectivePartner staff in headquarters expressed their satisfaction at having an on-the-ground sector expert with in-depth knowledge about sector content, the Canadian context, the local context, partner priorities and/or of the 'culture' and 'ways of doing' in their home organization. Some partners that having someone from their department in the field improved the overall level of awareness and cooperation between government bodies both within and outside ERI initiatives.Because of the shortage of capacity in some Partner Departments, providing staff for assignments presented a workload strain
Post Management PerspectivePost managers generally reported that having ERI partners seconded to work in the posts added a new perspective and a depth of content knowledge not normally available with DFAIT IBD and PERPA staff who often are not sectoral experts.Concerns were raised about the level of preparedness of seconded partner personnel both from the perspective of knowing the IBD and PERPA modalities and in terms of their ability to make a smooth transition to living and working in a different country and governmental department. The former often resulted in elongated orientation periods for ERI placements. The latter sometimes led to disillusionment and early departure from posts.
Seconded Staff PerspectiveGrateful for the opportunity to go on posting and develop an understanding of DFAIT's way of working in the field. Felt that this knowledge would benefit both themselves and their home departments in Canada upon their returnStaff sometimes felt 'abandoned' by home organizations and concerned that the benefits of their being in the field were not being fully realized.
LES Placements
ERI Partner PerspectivePartner staff in headquarters expressed their satisfaction at having an on-the-ground sector expert with expert knowledge about sector content and the US contextNone indicated.
Post Management PerspectivePost managers expressed their satisfaction at having an on-the-ground sector expert with expert knowledge about sector content and the US contextExpressed some concerns about turn-over rates with LES's

Expressed concerns about the urgent need to renew LRS contracts which expire in March 2008 in order to avoid loss of investment in staff who are now well trained and oriented.

ERI LES PerspectiveNone indicatedExpressed some concerns about their ability to know the Canadian context for their sector of involvement

In at least one case, was unclear as to who their ERI partner(s) in Canada should be

The benefits identified above appear to be more or less evenly distributed across both business development and advocacy functions (with some variations among partners depending on their particular foci). Some partners, such as the smaller agencies who have fewer posted people, might not equally benefit from the cross-postings. Several informants thought that ERI partners should place a priority on ensuring that people from regional offices, as well as Ottawa, be encouraged to apply for ERI postings.

ERI partners anticipated a longer-term benefit from cross-postings once personnel returned to their home department. They felt that these people would return to Canada with a better understanding of DFAIT, new skill sets, an expanded knowledge base, and a strong network of US contacts, which in turn would improve their performances levels at home. The evaluation offers that this benefit may only be realized over the longer term once a critical mass of returnees is in place.

Most informants viewed these HR practices as a success. In the words of a senior administrator of a partnering department:

"We have really benefitted from having [him] in the United States. We are in constant communications either we to him, or him to us. He knows what we need and is able to provide us with invaluable information. It has really helped us a lot. It has been a help to DFAIT as well. [He] really knows his stuff. He tells us staff at the Post often seeks his advice on business development matters. He sounds quite proud. It has been a great experience and real benefit to all…."

Finding 26:

Honorary Consuls have enabled the posts to better capitalize on opportunities for Canada's 'voice' to be heard.

The evaluation agrees with the following extract from the ERI Overview: "The principal reason for selecting an HonCon is to increase the HOM's knowledge of and contacts in, the less visited parts of the territory, thereby enhancing the ability to better undertake advocacy and business development." After more than three and a half years 16 HonCons have been approved and are now in positions. All 20 locations have been identified, and 19 people have been selected for these posts. The evaluation's information collection activities confirmed that most observers generally agree that the HonCon mechanism has had immediate and clear benefits in furthering Canada's interests in the US. Some of the examples provided were:

  • Missions were provided with an 'instant' presence in a region or territory and a ready-made network of relevant contacts
  • More regular 'on-the-ground' networking and monitoring was carried out than what occurred with a remotely-located officer
  • Contextual analysis was provided through a 'local' lens which aided in understanding the local effects of international issues
  • HonCons could clearly and succinctly read the mood of local communities on issues that are important to Canada

In assessing HonCon activities, the evaluation came to the general conclusion that people were engaged in a wide range of activities that supported the outcomes of ERI. For example:

  • All the HonCons interviewed have identified networks of local business leaders with whom they have regular contacts. They related activities in which they have either used these contacts to help Canadian firms or indicated that they will be using these contacts in the future.
  • Six of the HonCons interviewees indicated that they had set up meetings for HOMs with senior state or federal officials who were visiting their area.
  • All of the HonCons talked to had provided venues for the HOMs to address local business and political leaders about Canada.

Finding 27:

The development of effective networking capacities has extended the ability of ERI partners to influence Canada-US relations.

The evaluation found that the ERI networking dimension (the 'network' of networks) is clearly one of the initiative's most positive features. While the tangible benefits of networking are difficult to identify and measure, consultations with the partners indicated that the intangible benefits are recognized and valued.

Networking amongst partners is fundamental to ERI as the initiative was designed to be collaborative. Requirements for joint project proposals have resulted in a larger interface between partners that in turn promotes productivity in terms of ERI implementation more generally.

Recently, six strategic networks have been created through ERI to develop public diplomacy programming and bring a larger focus to issues with long-term importance to the US and Canada. These networks are also seen as a way to give the missions a greater role in policy-making and in long-term thinking. As this development is quite recent, it would be premature to assess what outcomes are attributable to this initiative.

Exhibit 4.5 lists the ERI-supported networks and describes the activities that have been carried out since inception in order to achieve the intended mandate.

Exhibit 4.5 Strategic Networks in the US

Network/Leading MissionMandateActivities
BORDERNET/Detroit- Promote Canada as a trusted North American security partner by emphasizing that Canada has been steadfast through independent and joint efforts with the U.S. in preventing terrorists from entering North America;

- Continue the successful Smart Border process by championing measures and solutions that balance U.S. security concerns and Canadian economic interests.
- Stakeholder border tour to the Seattle/Vancouver and San Diego/Tijuana Corridors. Participants included business association leaders from Canada and the United States from key sectors in supply chain and ERI partner department representatives. (March 2007)
LAKESNET/Chicago- Refocus the attention of US decision makers particularly at the elected official level, in the economic environment, political, energy, transportation, and infrastructure dimensions of the Canadian links to the Great Lakes Basin and regional economy;

- Create a long term plan/vision for Canadian involvement on Great Lakes issues from the US side;

- Raise Canada's profile on Great Lakes issues.
- Held the Great Lakes Regional Bi-National Conference in February 2007. The conference brought over 120 participants (elected officials, private sector, academics, non-governmental organizations and government officials from Canada and the U.S.).

- LAKESNET will build on conference outcomes to further the long-term vision of Canada on Great Lakes.
HISPANET/Los Angeles- To gain a better understanding of the Hispanic communities in the U.S., including their composition, influence and interests, to enable Canada to more effectively advocate on a full range of Canada-U.S. issues.- Held a forum in March 2007 called "Hispanics in the U.S.: Their role and Relationship in the North American Community". HISPANET also commissioned a compilation of existing data Hispanic communities impact on the US political, economic, and social landscape.
ECOMPNET/Atlanta- Raise the profile of Canada as a key economic partner for the US and Mexico;

- Increase recognition that all three countries benefit from an integrated North America;

- Enhance trilateral/bilateral cooperation to improve North American economic competitiveness.
- Panel of discussions (launched in March 2007) designed to explore key elements of competitiveness in North America and highlight the role of Canada as a vital economic partner.
ENERNET/Dallas- Raise Canada's profile as a critically important component of U.S. energy security;

- Promote greater cooperation between missions, ERI partners, provinces, and other government departments in all fields of energy innovation.
- Held training and planning sessions in 2006-2007. Sessions acquainted network mission staff with energy technology in Canada and enabled them to plan public diplomacy activities at and between missions to enhance Canada's profile.

Note: Networking would be strengthened if ERI's 'whole of government' approach was a reality, and if additional key federal partners (like Natural Resources Canada and National Defense) had become partners at the outset.

Finding 28:

Partners and posts generally agree that ERI's programming funds have expanded their options for pursuing advocacy and international business development.

The evaluation found that partners have benefitted from ERI in terms of having access to additional funding to pursue business development and advocacy priorities. What is also significant, however, is that partners (including those in partnership with DFAIT and staff seconded from partners through ERI in the posts) generally reported that ERI program funding is distinctive in that: 1) it allows them to fund activities that would not normally qualify under the CSF mechanism, and 2) the funds require them to collaborate with ERI partner departments. As a result, many partners and posts report that they are able to pursue innovative programming lines related to both IBD and PERPA. For example, the trade office in Princeton collaborated with ACOA, WD, IC and NRC to develop a biotechnology partnership between Canada and New Jersey. This partnership allows the creation of ties among researchers, universities and institutes to identify opportunities to collaborate in stem cell research. Other partners suggested that the flexibility of ERI funding has allowed them to incorporate new and innovative activities into both IBD and PERPA functions. In the past, when access to programming funds was more limited, posts and partners found themselves pursuing normative programming. Without ERI, events such as the 'duelling barbeques' in response to BSE might not have been possible or pursued.(62)

Partners and posts indicated that various program-funding streams available to ERI partners, including CSF, TPI and CCSIP, are seen as complementary rather than overlapping. One partner noted: "CSF funds are useful for working with industry and for ad hoc activities - whereas ERI is useful for ERI priorities that do not fall under the CSF heading". TPI activities have allowed participants to collaborate, leading to increased commercialization of technologies. Various activities of the International Photonics Commercialization Alliance (IPCA) were financed by TPI funding. This Alliance has been a successful means to build market intelligence networks, develop new commercialization opportunities, and foster collaborative relationships with key industry members. High participation at various events such as Photonics West provides a good example of the type of success that ERI and TPI funding allowed. Ten Canadian firms and six associations participated in the Canada Pavilion at Photonics West in 2007. Based on a survey conducted by NRC, every participant had a chance to make solid business contacts and commercial leads during the event. Note: The IPCA, developed by the National Research Council in 2005-06, is a group of international businesses, photonic clusters, and government organizations from Canada and the US working in the photonics sector.

The evaluation found that many CBS and LES (most of whom were not familiar with the pre-ERI situation) do not make a significant distinction about ERI funding and other funding pools. ERI is seen as 'part of the system' and is expected to continue into the future (similar to CSF). As noted previously, however, there were calls for streamlining of processes for accessing funds through multiple streams.

Finding 29:

ERI partnering is linked to positive results in terms of collaboration, coordination and leverage. There is evidence of a greater collective synergy that contributes to programming successes.

The evaluation found numerous examples where ERI programming carried out in a collaborative partnership have added value over and above what any single partner could have achieved. To elaborate:

"In the context of the ERI, WD collaborated with DFAIT to administer funds on 19 ERI projects in 2005-2006. The primary focus of these activities was to increase exposure of Western Canada's technology sectors and capabilities in US markets… and among US and R&D organizations and investors. Projects were supported in many sectors and many have led to ongoing negotiations and working relationships between western Canadian firms and R&D and other originations and US partners. Funding provided by WD and other federal partners for the ERI has significantly augmented Canada's presence in the US, particularly in several Western US markets of major importance to Western Canada." (WD 2005 p.39)

The benefits of increased leverage were also noted in cases where key contentious issues (e.g. softwood lumber and BSE) transcended the geographic 'territories' of some partners. There is more general evidence that indicates the posts used the leverage advantage to promote business development.

Prior to ERI there was an understanding that partnership was a good thing, but there were few incentives to partner. Under ERI, interviewees suggested that the incentives forced them to work the 'way they should'. In addition, ERI's transparent committee characteristics have resulted in greater synergies in programming efforts.

Indications are that ERI can also be linked to:

  • The introduction of new and innovative innovation types of project partnerships (e.g. joint ERI funding proposals between the Denver and Minneapolis posts in partnership with AAFC, de facto IBD and PERPA ERI project collaborations undertaken within posts).
  • An enhanced awareness of the value of partnering and the increased skills in how to organize successful partnership arrangements (at the post-level). This had improved the overall quality of initiatives (including with non-ERI partners). One interviewee noted: "I now think quite differently about partnering… how to plan an effective partnership. Before I tried to do everything myself… ERI forces me to work with others… it is not my natural style but it has worked out very well."
  • An increased level of collaboration with OGDs, both on ERI and non-ERI initiatives, with an emphasis on the importance of provincial government partners. The consistency of the qualitative evidence supporting these claims from partners and posts is substantial.

At another level, ERI partnerships have promoted greater systemic awareness about the importance of priorities and planning. Partners are required to work together in selecting proposed projects that meet common priorities. However, the evaluation found the ERI approach to partnering through projects is not without its limitations (for example):

  • Some partners (including the DFAIT posts) reported that the partnerships tend to be on paper only. They only appear to involve cooperation between partners throughout the project planning, implementation and reporting stages, but are not partnerships in reality. As one post informant bluntly put it, "I design my proposal… call around to the people I know until one of them agrees to send me an email indicating that they are signing onto the project… and then I go ahead with the work." Another post interviewee noted, "Sometimes [partners] will share contacts, but for the most part, whatever partner initiates the project will be the one that does all the work both in Canada and in the US."

While this practice is a concern there is little the Secretariat can do; project partners need to police themselves in building the true spirit of partnership, which comes from collaborative activity.

4.2.2 Conclusions

The results of capacity building are evident on many fronts:

  • New and upgraded consulates have augmented business development and advocacy capacities, resulting in more responsive services for targeted clientele.
  • Partnership work and networking have increased the capacities of individuals to carry out responsibilities more effectively (with expanded knowledge bases and new skills).
  • Honorary Consuls have been instrumental in exploiting opportunities for Canada's 'voice' to be heard.
  • Networking strategies have successfully extended the capacities of ERI partners to influence key decision-making and promote business development.
  • The leveraging of ERI funds amongst partners has generated higher programming returns and expanded reach.
  • Greater collaboration and coordination amongst partners has been achieved (albeit with some concerns that need to be addressed).

The evaluation found that ERI partnerships have been strengthened by: 1) partnership requirements for ERI program funding, 2) interdepartmental personnel postings, and 3) the implementation of ERI-supported networks.

4.3 Program Outputs and Outcomes

4.3.1 Findings

Finding 30:

ERI has enhanced the GoC's current and future capabilities for meeting new challenges facing Canadian interests in the US.

Through the evaluation interviews, a general consensus emerged that ERI (in expanding presence throughout the US) had enhanced Canada's capability to tackle new challenges impacting on national interests going forward. The importance of improved access to important decision makers across the country cannot be overstated. To elaborate:

"We have found that Posts around the country often have an easier time accessing Senators and Congressman than we do in Washington. The increased network of Posts has helped us in this regard. We have more coverage and access to decision-makers. I should say this ought not only to refer to Federal decision-makers. We now have more access to Governors and other important State officials. They are the future presidents and federal legislatures… We also get a heads up on issues by having enhanced presence." (DC Embassy interview)

Partners are now able to access individuals and networks of American decision-makers that are 'outside the Washington Beltway'. By significantly strengthening our presence in the US, Canada can now reach out more directly to state and local decision-makers and industry leaders whose impact can be crucial. In short, ERI has promoted recognition that the US is a large, regionally diverse nation and that the 'centre' does not necessarily speak for, or control the entire nation. In this way it has given Canada greater ability to respond to the challenges posed by various interests groups in the United States.(63)

Finding 31:

The restructuring and 'rightsizing' of Canada's presence in the US have been successful in improving both the depth and breadth of representation in areas of strategic importance to Canada.

The evidence suggests that the current configuration of representation provides reasonable territorial coverage in areas where Canada has a significant density of political, economic or social interests. Interviewees throughout Canada and the US were consistent in their support for the 'right-sizing' of territories, opening and upgrading of missions, and establishment of HonCons. All of these strategies have had predominately positive effects on Canada's net capacity to pursue business development and advocacy priorities in the US.

The results were apparent in all three case studies:

  • For Miami, adding a HonCon to the center of the state provided the post with a way into a growing research area that had previously not been explored. Also, it opened up opportunities for engaging Miami as a 'gateway' into Latin America, a concept that could have important benefits to Canadian businesses.
  • The Minneapolis/Denver case showed that the splitting of territories allowed the Minneapolis office to reinitiate networks that had been neglected. For example, they were able to engage with decision-makers in South Dakota for the first time in eight years.
  • External informants suggested that the opening of the Denver Consulate enriched the depth and quality of relationship in a way that could not have been achieved at a distance (i.e., if the Minneapolis post had merely been increased in size).

Similar observations were noted in California where external informants noted that the downsizing and relocation of certain functions to Los Angeles reduced their overall level of interactions and engagement; a trend reversed when the consulate was upgraded again. Territories are now smaller more manageable pieces; ERI has also created a new set of networks to coordinate territorial work. These networks have helped to integrate the work of different posts and orient people in different locations around priority issues. As mentioned earlier there was some criticism about the use of the 'executive model approach'. Note: The sheer size differences between Canada and the US limit the ability of Canada to have an adequate presence in the United States. This raises the issue of absorptive capacity to 'cover' the US. The issue of 'right sizing' is complex and needs on going monitoring. As such, sound strategic management direction in this regard would be useful.

Finding 32:

ERI has increased the awareness and understanding among partners of the challenges, diversities and opportunities related to business development and advocacy in the US.

Building awareness amongst partners does not happen on its own, the Secretariat plays an instrumental role. ERI has been active in developing a greater understanding within partners about: 1) the US economy generally, and recognition for its economic diversity, 2) key issues that impact on the Canada-US dynamic (often from a regional perspective), 3) the wide range of opportunities well-suited to Canadian opportunism, and 4) how DFAIT operates in the field internationally. The opening of new posts and the cross-posting of ERI partners to DFAIT missions are both identified as contributors to this result. ERI has also enhanced the partner's understanding of what Canadian firms need to do to become 'export ready' (both in the traditional sense and in terms of new business development opportunities such as S&T).

This higher degree of awareness was made evident in all three case studies. In the Miami, using the Post as a 'gateway into Latin America' was identified as a new opportunity for Canada. New opportunities in S&T were noted in the visit to California. In Denver and Minneapolis, the strengthening of the relationship between the posts and the western provinces created new areas of work and identified opportunities for exploitation.

Federal partners report that, as a result of ERI, they have been able to develop more effective strategies to respond to challenges and/or opportunities in the US. In some cases, individual partners have worked out new strategies, and in others a collective effort involving two or more partners was involved.

Finding 33:

There is some evidence that ERI has increased levels of outputs in relation to both advocacy and trade promotion.

The primary accountability for the attainment of results lies at the conjuncture of what the initiative does (outputs) and what it is achieving (immediate outcomes). Within this context, the data indicates that ERI has increased the quantity, quality and relevance of Canadian advocacy and international business development initiatives. This Finding is consistent with the perception of the partners.

It is clear that the added human resources, the new and upgraded offices and the availability programming funds have collectively led to an increased number of activities directed towards ERI priorities. The two tables below consolidates information on the intended and specific outputs of ERI for International Business Development and Advocacy (as derived from programming reports and consultations with the posts, external contacts and ERI partners in Canada). They also provide the manner in which these outputs were intended to be measured and comments as to how that relates to the overall Initiative and its objectives.

Exhibit 4.6 International Business Development (64)

Intended OutputsSpecific OutputsIndicatorsComments
Collecting market intelligenceU.S. market opportunities sector analysisLeads identified
Briefs, reports and profiles prepared
ERI has led to increased market analysis by posts. Evidence from the posts and external informants suggests that leads are being generated through ERI activities. The posts use primarily use TRIO as a system for recoding client information and contact details. However, evidence suggests that TRIO is underutilized and that the resulting data is unreliable.
Analysis of impediment to investmentReports on investment barriers

Business leads disseminated
This is being undertaken in relationship to market sector analyses, described above.
Promoting Canadian exports in the U.S.Promotional events and other business development initiativesCanadian SMEs and other advised

U.S. business calls

Promotional events
There were approximately 31 promotional events or other initiatives in 2005 and approximately 91 in 2006.
Promoting U.S. investment in CanadaPromotional eventsEvents and productsThere were 10 investment initiatives in 2005 and 96 in 2006.
Investment attraction activitiesInquiries Calls
Incoming missions
This data has not been systematically collected.
Promotional events and other business development initiativesEvents and business outcallsThis data has not been systematically collected. However, events, such as the Governor of California’s recent trade mission to Canada, suggest progress in promoting business development initiatives.
Developing the export readiness of Canadian firmsProvision of export advisory servicesSMEs identified and advised

Seminars, Workshops, Missions

Although ERI has no specific data on this output our interviews with SMEs that had interaction with the consuls led to an understanding that there were many trade missions, seminars, workshops, meetings, etc. coordinated to help develop export readiness.
Enhancing the development of technology and its commercializationTPI missions to the U.S.Missions and workshops, ERI-Funded IRAP missions, Technology industry missionsThere were approximately 18 TPI mission to the US. Of these 11 were missions and 7 were Workshops/Conferences and/or Forums.

Exhibit 4.7 Advocacy Outputs, Indicators and Comments

Intended OutputsSpecific OutputsIndicatorsComments
Engaging Canadian stakeholdersAdvocacy coordination eventsNature of meetings
Organizations engaged
Educating Canadian stakeholders with events, trainings and partnerships has not really taken place. Very little money is being spent in Canada on advocacy. The bulk of it is going to activities in the U.S. No data on number of advocacy trainings or events.
Advocacy trainingsCourses

Participants

Participating organizations
Unable to comment.
Strategic partnershipsNature of partnerships (report cards)
3rd party events (CanAm)
Issues on which ERI engaged partners
There are numerous examples of strategic partnerships arising as a result of ERI. For example:

- International Photonics Commercialization Alliance

- Connect2Canada
Coordinating messaging and researchAdvocacy materials & toolsDeveloped by type

Updated by type
The research part is important in order to understand Canadian issues and strategically assess what should be done. However, research has been limited. Some Posts (Miami, SF etc.) have used research funds to clarify their niche. Still a need for a common messaging. Right now, each mission decides what it wants to do case by case instead of being more strategic.
Web-based messaging (CanAm Site)Hits from origin of hits
Results of Google advertising
 
Establishing priority advocacy issuesThematic advocacy strategiesTimely production and coordination of strategies of priority issuesERI contributions to thematic advocacy strategies relying on $3 million funding to do it and staff support. As a concept, ERI is very much involved. ¾ of Canada’s advocacy funding in the U.S. comes from ERI. ERI has provided a strategy and management framework that was not there before.
Mission advocacy plansTimely production and implementation of plansAvailable from mission but each mission has a different format.
Engaging U.S. decision-makersNetworking outreach and building strategic partnershipsNature of meetings, briefings, conference, visits, speeches

Projects under ERI advocacy funding
There are numerous examples of networks and strategic partnerships arising as a result of ERI.
Engaging U.S. mediaMedia coverage of Canada-U.S. issuesNature of media coveragePosts are responsible for gathering this type of data. Little synthesis of this information available to ERI.
Media Tours/OutreachNature of media presentations

Nature of media engagement strategies
Unable to comment.

Exhibit 4.8 General Outputs since Inception

Intended OutputsSpecific OutputsIndicatorsComments
Managing the partnershipGovernance eventsNumber of governance meetings1 DM meeting, 5 Assistant Deputy Ministers Policy Committee meetings, 14 DGs Operations Committee meetings, 16 ABD meetings, 9 HR Committee meetings, 11 ERICC meetings
Communications ProgramOutreach events

Communiqués
Web pages
The Secretariat engaged in variety of outreach events both with partners and OGDs. An Extranet website was developed, as well as a handbook, an annual report and reports given and used by partners.
Program Development and ManagementType of development initiative/projects

Type of policies, procedures, plans and reports

Type of strategic planning events
Financial reviews
Performance monitoring analysis and reports
The Secretariat works in a responsive capacity. ERI partners are generally unfamiliar with the RMAF, which require changes by all the partners. Partners are not committed to RMAF. Right now, change and implementation is left to ad hoc management. However, the Secretariat has been very good at financial tracking.
Increasing Canadian Representation in the U.S.Missions infrastructureSignificant mission interactionsSecretariat interactions with mission focuses on infrastructure, financing and security. Most missions up and running.
Staffing programTraining Provided29 Canadian based staff, 63.5 Locally-engaged staff, 39 training days were provided by ERI in the U.S., 14.5 training days were provided by ERI (IBOC training at U.S. posts), 30 training days were provided by ERI for LESTraining is done but it is not systematic or mandatory.
Honorary consuls ProgramNumber of appointments

Reports from Honorary consuls
14 HonCons (of a projected 21) have been appointed to date. Honorary consuls reports directly to HOM. There is not standard format. Secretariat does not get reports on HonCon activities.

The observations presented above are accompanied by a significant mass of testimonial evidence culled from documents and evaluation interviews:

"DFAIT has been able to finance many additional advocacy projects, and is creating five new term positions at the posts to support regional advocacy initiatives. Complementing ongoing advocacy are constant endeavours such as the ERI-funded Connect2Canada effort. It works through a virtual network of "Friends of Canada" across the US who receive regular information updates on Canada's news and policies." (Annual report, p.49)

"We can point to new awareness of Canada in that region (Raleigh-Durham) thanks to the new Consulate. Its collaboration with Duke University alone has already created the largest Canadian studies program in the US." (ADM Policy Committee, November 22, 2005, p.3)

"Over 600 projects financed in whole or in part by the initiative in 2006-07, new relationships forged, honorary consuls building networks…" (Briefing to IBDA Management Committee March 21, 2007 p.8)

"The Team Canada Atlantic Tier II trade mission brought 41 Canadian companies and government officials to Orlando, Tampa and Miami. This mission was a follow up to the Tier I mission and it provided excellent opportunities for members of the Atlantic Canadian Business community to develop relationships in Florida. It also allowed the Miami mission to build and expand upon the network of contacts throughout Florida, created since the upgrade to Consulate general in 2004." (TCA Coordinator's Final Report)

"Funding provided by the Canadian government's ERI will support the operations of the International Photonics Commercialization Alliance. Created to provide links between Canadian and American photonic organizations. Support from Canadian consulates in Buffalo, NY and Boston." (Success Stories - IPCA Launched at Photonics Center Event)

"From an ACOA perspective, the ERI had greatly opened up the US market. The Miami upgrade to Consulate general, for example, has expanded the potential of that market for region companies. Team Canada Atlantic has generated $38 million of sales on $5 million of investment in the US. The minister for both ACOA and Foreign Affairs commented that, the Miami visit had paid dividends." (ADM' policy committee, Wednesday June 21, 2006, p.2)

Based on these positive comments, the evaluation concluded that ERI has been making considerable progress towards achieving its intended outputs. More specification and quantification can occur once a performance measurement system is put in place.

Finding 34:

Evidence points toward ERI-supported activities contributing to new export sales (especially in relation to SMEs).

The data strongly suggests that ERI has contributed to an increased and more diversified Canadian export sales to the United States. Evidence from the posts, partners, and most importantly from Canadian clients, links the increased Canadian presence in the US with improving the ability of some exporters to convert prospects into sales and to establish new and sustained lines of business. This Finding is particularly relevant for several targeted sectors and SMEs. Note: The evaluation cautions that is it is not at all reasonable to link ERI and the overall pattern of Canada-US export trade. Global factors beyond the scope of ERI shape trade volumes.

While the evaluation found that partners and posts are not systematically documenting how their work is associated with commercial successes, some examples were provided:(65)

  • The post in Philadelphia partnered with DFAIT regional office in Prince Edward Island to organize a buyer's mission to the Island's annual Seafood festival. The post identified several seafood buyers in the Philadelphia region and PEI recruited local food companies. The event was very successful and resulted in $800,000 of purchases two week after the mission. In addition to that, shellfish buyers in Philadelphia are forecasting $11 million in purchases of PEI shellfish over the next year.
  • The largest importer and retailer of wine in the United States, the PA Liquor Control Board (PALCB), did not stock Canadian wines. The consulate in Philadelphia, through meetings with Pennsylvania Governor and PALCB Chairman, assisted in bringing Canadian wines to the state. A mission was organized by the post in Philadelphia to Ontario where meetings were held between LCBS and PALCB officials. Meetings were also organized with vineyards in Niagara and members of the Wine Council of Ontario. This resulted in the launching of 12 Canadian wines in 66 Pennsylvania Specialty Stores. To date, sales have totalled $78,000.
  • A small women/minority-owned ethnic food company based in Ontario succeeded in getting some of its products into the largest supermarket chains in the US. This is due to efforts of the Philadelphia Consulate efforts, City of Toronto and AAFC regional office in Ontario. A training session was held in Toronto in 2006 to educate food companies about selling their products in the US. Several companies attended and Mayan Indian Gourmet is one of the early successes. Over the coming 12 months, the companies received product order estimates of $180,000 from a U.S. supermarket chain. The company is also in discussion with other grocery chains representatives met during the event. For the company, it represents a minimum revenue stream of about $15,000 per month.

Finding 35:

ERI contributes to Canada's science and technology objectives in the US.

The evaluation found that ERI had promoted an increased awareness among partners that the 'nature' of business development in a knowledge economy driven by S&T is different from more traditional sectors. In the pharmaceutical industry, for example, it is not uncommon for products to take ten years to reach marketability. Several external informants agreed that most S&T initiatives require three-to-five years windows for commercialization. This gives credence to the fact that, only two years into ERI, it is difficult to fully gage impacts on the commercialization of S&T. Nevertheless, it is apparent that ERI has been supportive of awareness raising and partnership building in various S&T sectors. Some activities have led to commercial agreements.

The Technology Partnering Initiative (TPI) is seen as a major ERI investment in S&T. Created in 2003, TPI is to be delivered in collaboration with 23 missions in the US. In August 2004, the administration of TPI projects was transferred to DFAIT's US Commercial Relations Division; although the funding still came from ERI coffers. The rationale for this shift, as stated in the ERI Report 2005/06,is the need to link technology to investment and trade promotion, as well as to enable a central focus and coordination of specific technology partnering activities. As the table below demonstrates, ERI (through TPI) has supported a large number of S&T related events during the last several years. Surveys and assessments of these events, along with other qualitative evidence from both US and Canadian participants, suggests that these have clearly led to increased awareness about the S&T capabilities on both sides of the border.

Exhibit 4.9 TPI Summary

Number of activities supported 2006-07Partners involved in TPIERI ContributionTotal Project Support
0ver 80All partners, most posts, most Provinces, 6 other Departments2 Million budgeted over 3 years, $700,000 in 2006-07Most projects are under $10000 the range is 1500 to 117000. Ranges from 10% of the total cost to 100%.

This table displays the number of TPI activities supported by both a partner and ERI and the total allocation combined for 2006/07. It is meant to draw a picture as to the extent ERI and the partners supported S&T in that year alone.

There is significant testimonial evidence to suggest that these initiatives have led to accelerated S&T commercialization:

"ACOA also focused on regional awareness and promotional activities in the US in sectors such as Bioscience and information communication technology. As a result, over 130 investment meetings were held, leading to three investments within these sectors." (ACOA, 2006 p.33)

"In the context of the ERI, WD collaborated with DFAIT to administer funds on 19 ERI projects in 2005-2006. The primary focus of these activities was to increase exposure of Western Canada's technology sectors and capabilities in US markets and among US and R&D organizations and investors. Projects were supported in many sectors and many have led to ongoing negotiations and working relationships between western Canadian firms and R&D and other organizations and US partners. Funding provided by WD and other federal partners for the ERI has significantly augmented Canada's presence in the US, particularly in several Western US markets of major importance to Western Canada." (WD 2005 p.39)

"The National Research Council's developed the International Photonics Commercialization Alliance (IPCA) in 2005-06 under ERI funding. A number of the IPCA activities are supported by ERI. For example, the alliance participation to Photonic West, in San Jose where the IPCA hosted the Canada pavilion organized in close coordination with the post in San Francisco's head of mission and trade commissioners. 16 Canadian companies represented the country's photonics industry in the Canada booth. A mission in Tucson was also organized and about 20 business contacts were made. According to its stakeholders, "ERI has brought positive results. Funds from ERI were crucial to the launching of the IPCA and allowed the two countries to work closer together in the photonics sector. This has potential to bring substantial benefits to Canada." The second phase of the alliance (06-07) plan an expansion to centres of photonics in the rest of Canada and in the US." (2005-06 Annual Report p.21-22, interviews with NRC people, and IPCA website)

"ERI funding supported an innovative collaboration between NRC researchers and scientists to search for pharmaceutical treasure from the sea. The collaboration is taking place between researchers at Florida Atlantic University and those at NRC's new Institute for Nutrisciences and Health (NRC-INH) in Charlottetown, PEI. The recently signed MOU will enable trainee transfer, sharing of expertise, compound transfer and intellectual property rights and ownership. Prior to this MOU researchers from NRC's Institute for Marine Biosciences (NRC -IMB) satellite laboratory in Charlottetown (NRC-INH) traveled to Florida Atlantic University Boca Raton Campus for a research symposium that focused on marine compounds and their benefits to human and animal health. Research collaborations between the two parties (FAU and the Institute in PEI) are an ideal fit in which natural products can be identified in Florida and tested in PEI. The results of the first project:New collaborative research partnerships formed between two NRC and two FAU partiesNew research opportunities have been identified where unique compounds from Harbor Branch Oceanographic Institute can be tested in animal models of human disease at NRC-INHFlorida partners notified of commercialization opportunities in Eastern Canada and at least one biotech company expressed interest in relocating to the growing Charlottetown Biocluster."(2005-06 Annual Report p.21-22, interviews with NRC people, and IPCA website)

Based on questionnaire data from TPI missions in 2005 and 2006, a number of inferred conclusions can be drawn. First, the data suggests that the majority of participants (85.7 percent) have undertaken follow-up activities after their mission. The bulk of these activities related to sharing of technical information, though three participants reported agreements related to product commercialization. As the November 2006 Follow-up Report points out however, 28 percent of the participants indicated that the TPI missions did not advance their opportunities to enter into business collaboration to accelerate commercialization of their firm/institution's technologies. Furthermore, about 21 percent of the participants rated the TPI as ineffective in forming business collaboration and furthering commercialization of their business technology, given their specific experience with the Initiative. The report identifies several areas for improvement. The ABD Sub-Committee on the TPI also recommended "… surveying clients for their feedback re: the success of the technology partnering events. It will be incumbent on partners to provide project information to DFAIT/NCP." (Interim Report of ABD Committee on the TPI)

Under ERI (and in general) technology partnering is not, of course, the exclusive domain of TPI. Missions that have not been slated for TPI funds, have been encouraged to do technology partnering projects with IBD funds, ERI regular programming funds or by requesting additional funds from DFAIT/NCP. Indeed a large number of IBD funded projects could potentially be classified as technology partnering. This has led to some questioning of the need for a 'separate fund', or whether this could just be rolled into IBD funding. The key, as noted by one participant in the TPI sub-committee meeting of March 22, 2007 meeting minutes, is to have adequate incentive to promote partnering.

It is also important to reiterate that, in addition to the ERI and TPI funding, S&T partnering and commercialization have also benefited from the additional personnel and the new/upgraded posts. The surveys with selected business clients and the review of information from posts show an accelerating pattern of both export promotional activities as well as initial of related sales.

Finding 36:

Business clients report important outcomes linked to ERI's investments in business development activities.

The evaluation was informed that DFAIT Trade discontinued client satisfaction surveys several years ago. This coupled with the absence of any systematic reporting of performance information meant that client feedback on initiatives was not documented and readily available. Again the evaluation had to rely largely on stakeholder perceptions and qualitative information to assess if ERI is contributing to the outcomes as identified in the RMAF.

To augment this data, a telephone survey was conducted with a sample of 50 clients (identified by trade officers at five posts). Telephone interviews were conducted between July 3 and July 10, 2007 with businesses from across Canada that export to the US. To date 40 businesses were contacted. Ten have yet to return calls.

The response from the Canadian exporters was very supportive of the trade commissioners, the consulates, and the level and quality of services provided. Over 90% indicated that they would not have been able to gain access in the US without the help they received, nor would their companies have grown as quickly or effectively without the support. Time and again respondents commented on the quality of services received. In particular, they consistently praised the contacts provided and the missions, conferences and trade shows organized. Examples of the feedback received during the business interviews carried out in 2007:

"Instrumental to making contacts with US buyers."

"We would not have made near the growth in the US market in such a short amount of time without their aid. Their contacts and advice were essential to our current success."

"Invaluable network development, intelligence and coordination of activities."

"Strategic advice excellent and very pertinent, especially with minority issues."

"We are a small company and never could have moved into the US market without their resources and support."

Eight of the larger more established companies mentioned that because the ERI offices are managed so differently, it can be difficult to know the protocol for obtaining needed information. It was suggested some commonality in this regard would be helpful. Furthermore, they spoke to the need for more information regarding the expanded presence in the US and the usefulness of a directory of important phone numbers. The small businesses were generally happy with the support they received and the relationships that were established with the consulates. When asked to identify the most helpful support they received, most respondents identified business contact information.

The table provides reviews the most popular type of information businesses was asking of the consulate. The information was collected from the telephone survey of selected businesses:

Exhibit 4.10 Support from Trade Officers

Support received from Trade OfficersTotal Responses
Information about export to US4
Information about regulation and procedures4
Business Contact information15
Local market information7
Other12

The evaluation learned that some 80% of the companies interviewed described trade officers as being very helpful in providing useful information that assisted them in improving their business strategies. Respondents were asked about the perceived significance of the information received by the companies from the consulates, and the impact it had on their awareness of opportunities in the US, (and the ability to export). The companies indicated that they were generally satisfied in this regard, and often indicated that they were able to increase their business sales to the US over the past year.In terms of the outcomes identified in the RMAF, again the perception of those interviewed was exceptionally positive (see below):

  • 81% of exporters found the commissioner to be very helpful and of great use to them in exporting to the US
  • 60% said the information received from the commissioner enabled them to improve their business strategy
  • 66% said they were significantly more aware of business opportunities in the US
  • 80% said they were significantly more ready to export to the US
  • 70% said they were very satisfied with the support they had received from the trade commissioner, 0 said they were dissatisfied
  • 82% reported an increase in sales to the US in the past year

It is important to note that the telephone survey was neither a random nor representative sampling of businesses receiving services. Nevertheless, this exercise indicated a number of lessons that could have some value going forward:

  • Clients are generally willing to discus their specific activities but are hesitant to discus specific sales or market information.
  • Trade officers need to be involved in such surveys as they have a wealth of knowledge about their clients and their client system.

Finding 37:

Feedback from Missions indicates that there is inadequate In-Canada partner and Regional Office capacity related to the Canadian Market Place.

ERI has focused most of its attention on building the capacity to respond to Canadian trading and advocacy requirements in the United States. However, many interviewees commented on the need for ERI partners in Canada to build its capacity about Canadian marketplace and in particular to identify pre-export ready firms to support their colleagues in the US based Canadian Consulates/Missions. Interviewees in all the Posts suggested more feedback from their ERI partners would assist in developing stronger trade ties in the US marketplace. They indicated that there seems to be a shortage of Canadian based capacity to respond to the market opportunities they are identifying. Furthermore, they suggested that ERI partners need to continually coordinate their work with regional offices where possible in approaching industry, academics, and research councils in the attempt to map and identify the types of activities and knowledge in Canada. They recognize that this takes significant time and effort and wonder whether the capacity exists for such work.

One other comment was raised on whether trade services should be subject to user fees for Canadian firms who approach foreign-based Canadian Consulates. Other Consulates do charge a user fee for trade services and although this is not a new approach or issue, it was the subject of discussion and it may be an option for further investigation.

4.3.2 Conclusions

ERI's outputs and outcomes have increased the awareness among current federal partners of the challenges, diversities and opportunities related to business development and advocacy in the US. It has also augmented advocacy and trade promotion in the US and supported activities contributing to new export sales, especially in relation to SMEs.


5.0 Conclusions and Recommendations

5.1 Conclusions

5.1.1 Relevance

Based on a situational and contextual analysis, the study concluded that ERI was a relevant investment and remains a relevant investment. Evidence suggests that ERI has increased the coverage of Canadian influence by increasing the number of offices, human resources, programming, and networks used for improving IBD and advocacy work. Interview data suggests that the increased coverage has provided Canada with more opportunities to influence US decision makers and increased trade and investment in priority areas. In addition, our analysis indicated that ERI's investments are aligned with its partner's strategies and priorities. As an emerging "whole of government initiative", ERI has the potential to be a relevant engine for ensuring that Canada's broader policy goals in the US are pursued in a holistic fashion that reflects the complexity of the Canada-US relationship.

5.1.2 Cost Effectiveness

The evaluation found mixed results with respect to cost-effectiveness. Cost-effectiveness issues focus on performance management and are concerned with how the Initiative was planned, actually implemented and reported upon. The general assumption is that well planned, governed and managed systems provide value for Canadians. The evaluation found mixed results with respect to cost-effectiveness. Cost-effectiveness implies an ability to cost a defined set of outputs and outcomes. ERI cost data is linked to operations and projects but is not adequately linked to outputs. Furthermore, results (outputs and outcomes), while articulated in the RMAF framework, have not been systematically gathered. In general, the study found that the RMAF, a key-planning document that outlines planned results (outputs and outcomes), was developed and accepted by partners but not adequately operationalized.

The study found the Secretariat was successful in building a collaborative and trusting system that supported results and planned staffing, program funding, and infrastructure changes encouraged collaboration of partners. The implicit assumption was that a more cost-effective system might occur through harmonization of the partners work in IBD and advocacy. However, little work was done on harmonizing ERI's results across partners--and on the reporting on these results. Performance management, measurement, and reporting were identified as an area that needs significant work.

With respect to governance, the evidence indicates that the governance structure provided oversight at the operational level and financial oversight, and that the committee structure was a necessary, but not necessarily an efficient, way to engage in the functions they performed. There are important governance issues with respect to the vision of the ERI that affect what is expected from the initiative. It was concluded that the Senior Management Committees (DM and ADM) needed to be more engaged in the Initiative. Finally, the evidence suggests that a number of operational changes might enhance the future initiative.

5.1.3 Success

The evidence presented in the evaluation suggests that ERI has contributed to capacity building on several different levels. At the most basic point, it has led to the opening of new offices and has populated both new and existing offices with staff. At a second level, the staff drawn from the ERI partners are sector experts who have enhanced the knowledge of the missions. Also at this level, ERI has introduced Honorary Consuls (HonCons) and networks that provide a broader and more qualitative reach and coordination function to representation efforts. Finally, ERI has contributed to capacity at the partnership level by creating increased collaboration and communications between partner agencies.

With respect to outputs and outcomes, the evaluation provides some documentary evidence and qualitative data that indicate the ERI has increased the awareness among current federal partners of the challenges, diversities, and opportunities related to business development and advocacy in the US. It has also augmented advocacy and trade promotion in the US and supported activities that could contribute to new export sales, especially in relation to SMEs.

5.2 Recommendations

ERI is coming to its end; as such these recommendations should be viewed as guidance for the new phase of the initiative.

Recommendations related to design of ERI

The evaluation noted the acceptance of the RMAF by partners, but raised concerns about the willingness of partners to operationalize aspects of the RMAF. The evaluators conclude that in the new ERI there needs to be a re-commitment to the vision and intent of the program and this should be articulated in the RMAF, governance, staffing, etc. It is in this context that we recommend:

  1. That the ERI Secretariat plan and execute a partners Visioning Exercise to develop consensus on:
    • The overall vision for the initiative, in particular in terms of its nature as a horizontal or 'whole of government' initiative.
    • The goals and objectives of ERI, in particular to what extent are the partners responsible for harmonizing their work-planning, implementation, reporting and accountability for results under ERI.
    • The specific roles and responsibilities of each of the Departments - potentially articulated in the form of a charter.
    • The role of the Secretariat (and specifically whether it should continue in its current coordination mode or whether it should work to fulfill the RMAF vision of a more strategic role). Partners should be explicit and agree on the roles and responsibilities with respect to the role of the Secretariat.
  2. The results of the visioning exercise to be formally approved by each of the partners and lead to a new approved RMAF.

Recommendations related to Governance

Given the importance of governing horizontal initiatives the evaluation concluded that more emphasis needs to be placed on the role of the DM and ADM committees. This should complement the present role being played by the DG committee in operationalizing the initiative. In this context we recommend:

  1. The DM Committee remain as the overall group responsible for the Initiative, however, its governance role be limited to approval and oversight of the vision of the initiative. The DM should approve the new vision of ERI and meet, at a minimum, once in two years to monitor the implementation of that vision.
  2. The ADM Committee of ERI be incorporated as a sub-committee of the North American Policy Committee and be accountable for ensuring the roles and responsibilities agreed to by their Department. Further, this committee would also ensure that the financial and programmatic plans and results of the initiative be reported upon annually, with appropriate explanation reports for variance from planned results. In addition, this sub-committee would be responsible for ensuring that appropriate ERI information be communicated to the larger ADM group in order to reinforce government-wide or the Whole of Government concept. The ADM committee would operate as a Board of Directors for ERI and become accountable for strategic directions and decisions. Appropriate roles and responsibilities of Board Members should be developed. That the ADM Committee would be responsible for monitoring the progress of the RMAF.
  3. That the DG operational Committee would be conceived as a standing sub-committee of the ADM Committee to direct the management of the ERI. The DG Committee would create the sub-committees it needs to insure proper operational guidance, oversight and accountability. It would also determine the configuration of the Secretariat with respect to the most cost-effective way to ensure the work done by the ABD, HR and Communications committees. This would require the DG committee to determine whether or not a trade off is required between the benefits of collaboration and the transaction costs incurred by having the three standing committees. The work of these committees could in theory be done by the Secretariat and existing resources.(66)

Recommendations related to Performance Management

ERI presently has a performance management framework but has not been able to develop a process with its partners to populate and operationalize the framework. Operationalizing and using the performance management framework is a crucial part of the accountability and learning approach needed for horizontal initiatives. Therefore it is recommended:

  1. The Secretariat should be tasked with developing that would lead to an appropriate performance management/measurement approach for the new initiative within six months of the formation of the new partnership.
  2. All partners at the level of the DG and ADM committees would approve this approach, along with the related roles and responsibilities of partners in performance management/measurement.
  3. The DG Operational Committee should be tasked with ensuring that the performance management/measurement approach be put in place by the initiative.
  4. To the greatest degree possible, existing data capturing mechanisms (e.g. TRIO and MARCUS), as well as public opinion research, be adapted and included in the performance measurement approach.(67)
  5. Further dialogue is needed to emphasis the consultation with and integration of regional trade offices. (e.g. to recruit for mission, export promotion, identification of pre-export readiness)

Recommendations related to Role of the Secretariat

The secretariat plays an essential role in coordinating the partnership. They have effectively built trust through their approach to facilitating the partnerships and have won the respect of the partners for doing so. However, depending on the vision of ERI and the changes agreed to with respect to this evaluation their role would change. Therefore we recommend:

  1. Using the lessons learned from ERI, the Executive Coordinator should prepare and options paper for the DG Operational Committee. The paper should define the expectations, cost and staffing of the Secretariat so that it is inline with the vision agreed to by the governance bodies. Also the paper should explore the costs and benefits of issues such as leadership, operational structure, level of administrative services, HR processes, etc.

Recommendations Related to Capacity Building

ERI has been broadly successful in its first round of capacity building endeavours for increasing coverage, programming activities networks and staffing. Future capacity requirements should be determined by empirical evidence as well as data from ERI's performance management system. In this context the evaluation envisions ERI becoming more of a learning oriented initiative. Thus we recommend that:

  1. The Secretariat, working with appropriate DFAIT divisions and posts, should develop an approach that would allow it to monitor the US coverage (right-sizing) in order to better understand extending or re-orienting Canadian capacity; so as to better respond to trade and advocacy issues in the US.
  2. The Secretariat assess the quantity and quality of staff applying for US Posting to ensure that the incentives(68) are appropriate to attract a pool of qualified staff; this would continue to include discussion on incentive issues such as, education, housing, and spousal support.
  3. The DG Operational Committee would determine if there is a business case to bring to the ADM Committee for recommended changes to the incentives for US Postings.
  4. The Secretariat continue to work with appropriate DFAIT departments to assess the training needs of those going on US Postings (including both CBS and LES) in order to develop improved training programs.
  5. The Secretariat would monitor the efforts of the six "strategic" networks developed in order to ascertain their ability to influence business development and advocacy work.

Appendix 1 - Findings

A1.1 Miami Case Study

Introduction

Canada and the United States are highly interdependent as two poles of the world's largest trading relationship; a significant portion of which is complementary. As hoped for by the leadership of both countries at the time of its negotiation, the monetary value of trade between the two countries has tripled since the coming into force of the North American Free Trade Agreement (NAFTA). The Agreement removes obstacles to North American trade and, when disputes arise, has put in place a clear and consistent mechanism to resolve differences, thereby injecting a degree of consistency and predictability to trade relations between the signatories.(69)

Canada's International Business Development (IBD) strategy in the U.S. has identified five sectors for particular attention: Aerospace and Defense; Agriculture, Food and Beverage; Bio-Industries; Environmental Industries (including clean energies, green building products); and Information and Communication Technology (ICTs).(70)

The case studies, which make up part of this Evaluation, assess how the Enhanced Representation Initiative (ERI or "Initiative") responds to the changing needs of the Canada-U.S. relationship. Of significance in this regard are several issues of particular interest to Canada, such as: trade, security, productivity and competitiveness, science and technology, the extent to which the Initiative supports Canadian small and medium-sized businesses (SMEs) in accessing the U.S. market, and in attracting U.S. investments. The main study touches on all of these issues, the case studies provides us with insight on some of the issues.

The Evaluation Team viewed the Consulate General of Canada in Miami (the "Post") as being of special interest for the purposes of this study given the fact that it has recently been upgraded from a small Consulate to one encompassing all of Florida and Puerto Rico, within its diplomatic, trade and consular activities. It is on the basis of this enhanced footing that the Canadian mission in Miami can act as a gateway to Latin America and the Caribbean; a special issue, which will be reviewed in this case.

This case study assesses the relevance, cost-effectiveness and success of the ERI as applied to the Consulate General of Canada in Miami and, in particular, its role as Canada's gateway to Latin America and the Caribbean.

Methodology

This study employed a variety of approaches to data collection: face-to-face interviews, phone interviews and document review. The majority of interviews were conducted during a field mission to Miami, which took place April 30 - May 1, 2007. Respondents included Post staff, academics, media representatives and representatives of Canadian firms. The case study is organized into five main sections: Introduction, the Context and Rationale of the Consulate General in Miami, Findings on ERI's Cost-Effective Management Practices, Successes, and Conclusion.

Context and Relevance

In 2003, Canada was the largest export market for 39 U.S. states, highlighting its importance to them in their business development strategies. The Canada-Florida trade relationship is multi-faceted, encompassing sectors such as tourism, agriculture, the buying and selling of energy, and coordinated security measures. Florida represents a substantial and dynamic market for Canada given the fact that it has the fourth largest population of the United States (18 million), a figure that is growing as more immigrants from Latin America and the northern U.S. settle there. Florida's economy is diversifying beyond its traditional reliance on tourism and agriculture, with an increasingly prominent presence in such sectors as life sciences, information technology, aviation and aerospace, homeland security and defense, and financial and professional services. Its market represents the fourth largest gross state product in the U.S., making it the eighth largest economy in the western hemisphere. Nevertheless, tourism continues to form the backbone of Florida's economy. Nearly 1.9 million Canadians visit the state each year, including the "Snowbirds" who spend some or all of the winter in the south, and Canadian-born permanent residents of the state. Canadian visitors spent a total of $1.4 billion in Florida in 2003,(71) netting a total of $274 million in tax revenue for the state(72). Canada is the largest source of foreign direct investment in Florida. The complementary nature of the Canada-Florida trade relationship is particularly reflected in the agricultural sector (see Exhibit A.1). In 2006, two-way trade between Canada and Florida totaled U.S$6.8 billion, and supported 289,000 U.S. jobs.(73)

Exhibit A.1 Florida's Leading Exports & Imports from Canada 2005 (74)

Florida's Leading Exports to CanadaFlorida's Leading Imports from Canada
Orange juice & concentrates$141,000Softwood lumber$233,000
Computers$105,000Pharmaceuticals$211,000
Navigation equipments$85,000Petroleum & coal products$154,000
Fresh tomatoes$79,000Newsprint$154,000
Aircraft parts$74,000Trucks$136,000
Fertilizers & fertilizers materials$71,000Meat$92,000
Ships, boats & parts$68,000Basic plastic shapes & forms$86,000
Motor vehicle parts$58,000Metal-fabricated basic products$78,000
Aluminium, including alloys$41,000Aircraft$76,000
Coffee$36,000Electrical lighting equipment$69,000
Total$758,000Total$1,289,000

The imports and exports noted in the table above contribute to making Canada Florida's largest economic partner. As the following table shows, this relationship has been steady over the past five years.

Exhibit A.2 Canadian Total Exports & Imports to Florida - Total for all Products (C$ x 1,000) (75)

 20022003200420052006
Exports$5,143,000$4,781,000$4,940,000$5,462,000$5,419,000
Imports$3,148,000$2,876,000$2,771,000$2,825,000$2,969,000

"We are very interested in getting NRC more interested in working with us in Miami. In particular we think that the University sector holds some important potential relations with research centers in Canada. --All it takes is time and capacity and much, much more can be done. In fact our HC, can play a very big role in such a relationship." (Discussion amongst evaluator, Miami trade officer, and a Florida University Professor).

Finding 1:

Expanding Canada's consular representation in Florida is consistent with the objectives of ERI, its partners and stakeholders.

Over the past 25 years Florida has become an increasingly important state in the United States. Economically, Florida is home to more than 200 banks and more than 100 financial institutions providing international banking services. In the U.S., Miami is second only to New York in the number of international banks housed in the City. In addition, the "Canada-Florida Economic Relationship" paper, published in 2004, revealed "Canada is Florida's number one source of in- bound tourism, the number one source of foreign direct investment, [and] the number two destination of Florida exports." Canadian exports to Florida have risen significantly in recent years; leading this growth has been Canadian technology firms, pharmaceutical groups, and security infrastructure. According to Statistics Canada, Canada had an export growth rate with Florida of 11.2% from 2002-2005. Florida is also a potential gateway to Latin America for Canadian firms. In addition to the business development rationale Florida is an important state in the political makeup of the United States. Over the past decade its Governor has been amongst the most influential politicians in the U.S. Miami is the largest international air-cargo hub in the U.S. It is the most important U.S. mainland monitoring of illicit drug and human cargo, thus relevant to security concerns, which are another area of Canadian interest. Furthermore, Florida is becoming an important center for academic excellence. It is home to an improving network of private and public Universities, which are increasingly sought after by Canadian Universities. Discussions with partners indicate a further growing Canadian interest in Florida. ACOA, Agriculture Canada and Industry Canada have all worked closely with the Post. In addition, there are on-going discussions with several other partners on ways to improve the trade in areas such as Small and Medium Sized Enterprises (SMEs) and Science and Technology. In 2004, Canada's presence in Miami was expanded from a small trade consulate, also responsible for Puerto Rico and the U.S Virgin Islands, to a full Consulate General. The new mission, officially opened in November 2004 by the Minister of International Trade, has a total of 30 staff, with two-thirds being new appointees, most of them as a result of ERI. In addition to the expanded mission, two Honorary Consuls (HCs) were named, in Tampa and San Juan, during 2005-06, reflecting Florida's growing importance for Canadian companies, visitors and investors(76). The new Consul General took up her duties in August 2005. Throughout our data collection in Florida and Canada, all parties were positive about the link between increasing the size of the Miami Post and its potential in Florida to position Canada, and Canadian firms, to improve their results in both advocacy and trade. Of interest to our study was an interview with a Post staff who indicated that the expansion of the Post had contributed to increasingly erase the lines between advocacy and trade: "This was a relatively small consular and trade office. We rarely got together and linked these areas together. However, since the ERI expansion, it seems that advocacy helps trade and our trade people help our advocacy work. We are in it together."

Miami as a Gateway to the Americas: an emerging strategic issue

Over the past several years, the Post has been developing the idea that the Miami facility should not be seen simply as another U.S. installation but rather as a gateway to South America and the Caribbean. This is not a new idea but does present an innovative approach to Canadian advocacy and trade work. We took this issue as an example of one of the effects that are emerging from the work associated with ERI. Florida's economic future is intimately tied to its role as a logistical, cultural, managerial and technological bridge between North America, Latin America and the Caribbean(77). The state's gateway economy evolved over the years due to the geographic location of its southern ports and airports, which were within cost effective proximity to the Caribbean basin, as well as to Central and South America. The gateway concept has now expanded into a far more strategic role for Florida's economy; due to the unique demographic profile of greater Miami with its large population of immigrants from every nation and culture in Latin America and the Caribbean. Approximately forty percent of U.S. exports to Latin America and the Caribbean transiting through the South Florida custom district(78). Many companies open a South Florida office to serve their Latin American and Caribbean markets, thus alleviating the need to open several small (and costly) local offices in the region. South Florida serves, in effect, as the business capital of Latin America, given that about 1400 multinational companies have offices in the area(79) from which their Latin American operations are managed. Most of these companies are in the services and high tech sectors. Canadian companies, too, are very active in this regard, with 227 of them establishing a foothold in South Florida; of these, 60 percent use their offices in the state as headquarters for their Latin American operations. Miami is home to 53 foreign consulates, more than any other city in the U.S., save New York. It provides a unique platform for the Government of Canada to network with business and diplomatic elites and, through them, with their vast network of contacts in Latin America and the Caribbean. As noted in a recent strategic White Paper, "Canada's is the only non-Latin consulate in Miami that regularly attends the In-Trade meetings that bring together the largest Latin American consulates on a monthly basis to share best practices."(80) The Post is committed to working in three languages and its strategy incorporates the gateway.

Finding 2:

ERI has been instrumental in supporting the concept of Miami as a gateway to Latin America and the Caribbean.

The Consulate General in Miami has played an important role in defining and positioning Miami as a gateway to the Americas. Using ERI funds, an empirical study was done to provide a basis for understanding possible tangible key results for the Government of Canada and Canadian businesses for positioning Miami as a Canadian Gateway for Latin America(81). ERI is acknowledged for its work at increasing the operational capabilities of this Post. Putting more resources into Florida has supported more analysis and thinking about how to best position Canada for both influencing trade and advocacy. Following discussions with senior staff at the Secretariat it is clear that the Post has been the prime mover in developing and putting into effect the gateway strategy. The Consulate General's staff has taken the initiative in identifying not only the principal gateway industries, but also those Canadian companies that have their Latin American and Caribbean market offices based in Southern Florida.(82)

Finding 3:

The "Gateway concept" is an example of a decentralized approach to understanding how various areas in the U.S. have unique comparative advantages for improving advocacy and trade relations with the U.S. and in this case all the Americas.

Bringing concrete on the ground experience into a strategic perspective is an important idea that lies behind ERI. It is the recognition that the New York or the Washington beltway is quite different from Denver, Miami, San Diego or Atlanta. Each of these areas has unique economic, social and political perspectives that can help Canada better understand and relate to the U.S. However, such perspectives need to be identified, clarified, harnessed and used, in order for their potential to lead to results. The "Gateway Concept," is an example of how ERI resources could affect Canadian approaches to trade. The proposal to use Miami as a Gateway into Latin America and Caribbean trade is well developed in the Post's research; but it is not the research that we want to point to. Rather, what we found interesting is the ability of the Post to use ERI to advocate to affect a programming or policy change in Canada. Such an effort puts the Post into a dynamic versus a more static strategic relationship with Canadian policy makers. A remaining question though is what forums ERI opens up for policy oriented ideas. Presently, it is unclear if ERI plays any role other than a funding role in the vetting of these ideas. Should it additionally also be an advocate? Considerations like this would need to be addressed by a more detailed vision of ERI; a vision of ERI which would make it much more strategic than it is presently.

Finding 4:

The Gateway Concept is integrated into the strategy of the Miami Post. As it evolves, it needs to be integrated into a performance measurement system. The role of ERI in supporting such work is not clear.

We were interested in Finding out to what extent the Gateway Concept is affecting the work and work practices of the Miami Post. At a practical level, Miami is able to operate in three languages and the Head of Mission (HOM) in Miami is working on improving her Spanish - thus enhancing the Post's ability to engage with a broad range of partners. At a programming level, funds have been requested to support the Gateway idea, thus making the concept more operational. As we looked at the Post's strategy we also saw clear signs that a performance system is emerging. Exhibit A.3 provides the currently defined strategic approach to the Gateway concept.

Exhibit A.3 Strategic Approach for the Gateway Strategy

Short-Term ObjectivesShort-Term Results
Strengthened cooperation with North American partners in the Hemisphere and beyond in support of shared goals; while maximizing the advantages for Canada of Florida's position as the "Gateway to Latin America and the Caribbean":

- Canadian business are better informed on the best way to leverage MIAMI for Latin American business, i.e. meetings, liaisons and activities for Latin American business, not just state of Florida;

- Canada is included in hemispheric discourse, events, speeches, articles, activities, etc;

- Increased knowledge among Canadian Government and partners of "Gateway" security issues in MIAMI, as demonstrated through joint forces in FL;

- Increased number of joint (Canada-U.S.) exercises with airlines;

- More integrated working relationship with Canadian partners.
Begin to work towards our strategic objective with regard to Florida as the Gateway to Latin America and the Caribbean by first assessing the implications for Canada using the Findings of the study commissioned in 2006-7, by leveraging existing opportunities, building new opportunities in the business community (e.g., a CEO luncheon on the Gateway as part of the Team Canada Atlantic Mission), as well as engaging regional Canadian partners. Finally, each program represented in the Mission will articulate strategies and business plans which will seek to achieve the Mission objectives.

While this framework provides a starting point for a performance measurement system, more needs to be done to actually develop such a system. It is currently unclear, what role ERI can or should play in this undertaking--if any.

Management Practices: improving cost effectiveness

The Miami Post has paid considerable attention to improving its planning, implementation and monitoring systems so that its practices can be more cost effective. For our purposes we will focus on the operational investments for Miami, and try to ascertain qualitatively its cost effectiveness. We will also determine whether there is an established cost framework for the system and the governance arrangement of the post.

Finding 5:

ERI's resources, financial and institutional, provide the conditions that allow the Post to bolster its advocacy and business strategy efforts. This has led to some economies of scale.

Canada's main objectives in its bilateral relationship with the United States are to increase its presence in the south by expanding fair and secure trade and commerce, and to enhance its "brand visibility." To achieve these results, the ERI Secretariat has invited key Canadian departments to partner in the initiative.The "whole of government" approach encourages the Consulate General in Miami to increase interaction with its Canadian partners. For example, in 2006-2007 four of the partners, namely, ACOA, Industry Canada, Agriculture Canada, and NRC, engaged in ten (10) business-development activities with Miami. We spoke to several of the partners about the extent to which these business activities were aided by the Miami post. In general, all indicated that they were significantly supported by the work the Post did. Furthermore, partners indicated that the process of forcing people to work together, while in some instances bureaucratic and ceremonial, were found to be helpful and a value added part of the programming. Furthermore interviewees indicated that work processes required to make their events successful were considered well done and collegial. Of interest is the challenges faced by the partners in this process. At issue is how does one manage the capacity constraints faced by the partners. Does Canada have the absorptive capacity within its departments to respond to all the potential requests of Posts? One interviewee asked about business development indicated "we have so many opportunities to engage in issues associated with Science and Technology. Florida has a large number of increasingly important University research and development (R&D) centers. We have the NASA and the space center. We have a wide assortment of medical research facilities. All these areas are open to Canadians--yet it has been hard to get our partners down." For example, the Consul General indicated that she would like more contact with "National Research Council as there are many science and technology opportunities in the state, including a very significant set of Florida universities." The Evaluation Team noted the desire on the part of both the Post and the Partner departments to try to ascertain how to meet not simply their own but also each other's strategic priorities.

Finding 6:

There remains uncertainty regarding the strategic vision of ERI.

An import theme running through interviews with Senior Managers in the Miami Post was "What is Ottawa's vision for ERI"? From the start the HOM was quite forthright in articulating a need for a strategic framework for ERI within which the Post can operate. The RMAF was seen as not adequate in this regard. "What is the vision of ERI? We need to understand what the strategic direction is and how we can feeding into it. Presently we have vague ideas and concepts. This might be good enough for a start but as we are four years into ERI we need to have more and more -we need a clearer picture. For example, it would be helpful if DFAIT, ERI and/or the partners set forth a strategy for the U.S. What are we trying to accomplish? How do Posts fit? We need to treat Posts more like businesses and less like bureaucracies--Direction would help." Related strategic question that emerged from our interviews are: What are the objectives of the Canadian relationship with the United States? As we have been informed, it is the Privy Council Office that probably has identified these larger objectives, and that in general there is a high degree of political sensitivity that leads to them not be disclosed. The closest document for understanding the relationship and Canadian objectives would be the North American Platform. However, this only touches a part of the relationship.

Finding 7:

The Evaluation Team was favorably impressed by the overall direction taken by the Post's management in its use of ERI funds and in its application of the Secretariat's strategic directives.

The Initiative in its first year focused largely on sectors where the priorities, noted above under Finding 1, had already been identified. Since then, the medium-term strategy has  been on attracting more Canadian companies to invest in Florida, something which can now be more easily accomplished given the mission's expanded workforce. The Consulate General in Miami can better respond to clients' demands, and direct them to the appropriate resources. The Initiative's Miami strategy has been forged on studies(83) and reports that have contributed to a better understanding of clients' needs, and is aligned with Canada's strategic objectives and priorities for its relationship with the U.S. Exhibit A.4 identifies how ERI resources are used to support the IBD objectives.

Exhibit A.4 IBD Initiatives 2006-2007 (84)

Project TitleERI Post's BudgetPartner (s) Sign Off
International Food Expo$10,000AAFC
Opportunities in cruise lines for Atlantic Companies$5,000AAFC
Opportunities in Puerto Rico - Montreal and Halifax$5,000Industry Canada
IBS (Construction show)$10,000Industry
Simulation Show Orlando$7,000Industry and NRC
MIGS (Montreal International Games Summit)$3,000Industry
CTIA Wireless 2007$7,000Industry
National Business Aviation Association Show$10,000Industry
Conference on green buildings$5,000Industry
What's Hot in Cool Canada?$17,100ACOA, Industry, NRC
Total$79,100 

As stipulated in the Post's work plan, training has been provided to staff on various issues, such as languages, emergency preparedness, conflict resolution for front-line staff, online and headquarter-based programs. Of the Post's staff, at present 85 percent are bilingual and 70 percent are trilingual, which supports DFAIT's objective of making the Miami mission a gateway to the Americas. This has been accomplished even though two-thirds of the positions have been staffed over just the past two years. This current process encourages cooperation between the Post and its partners in the U.S. In the Miami mission, a high degree of cooperation was noted between functions (Political/Economic Relations and Public Affairs Program, PERPA and International Business Development, IBD), thus employing all relevant Post resources to advance Canada's interests. The PERPA section supports the IBD team with advocacy content for interviews or media outreach, while the IBD team tries to leverage PERPA activities to entertain contacts or meeting new ones. The Post's team meetings deal with both strategic and management issues. All Post functions integrate planning and review processes of strategic and operational tasks to create an effective control system.

Finding 8:

The management of the Honorary Consuls seems to be carried out effectively, and lends itself to achieving the stated objectives.

Honorary Consuls, who report to the Consul General, have a yearly work plan, on the basis of which they assess whether or not their objectives are being achieved. The document covers all aspects of the Honorary Consuls' responsibility, namely: IBD, public affairs, and political, academic, cultural and consular relations. The primary responsibilities of Honorary Consuls are to:

  • Provide access for senior Canadian officials to key U.S. decision-makers and influencers;
  • Meet with major U.S. corporate and political entities for the express purpose of delivering Canadian advocacy and business development messages, and provide intelligence to the Consul General;
  • Advise the Consul General on key aspects of Canada-U.S. relations as seen form the local perspective;
  • Represent the Consulate General, as appropriate, at events that provide an opportunity for promoting Canada;
  • Provide information to key clients with respect to Canadian trade, investment, science and technology, and trade policy issues; and
  • Provide consular assistance (but only as requested by the Consul General. All other consular and immigration enquiries are directed to the appropriate officers at the Consulate General).

The Evaluation Team discussed the work plans with the two Honorary Consuls reporting to the Post. Both found the work planning process to be a useful tool for guiding their work with Canada, and for accounting for their time. In both instances work planning is a new activity and the HonCons indicated that they would need to get more experience with the process. On a final note the interviews with the two HonCons indicated that they saw their role as one that integrated with their Post colleagues. This is a very positive sign.

Finding 9:

While strategic planning and drafting of work plans are evolving and improving, the performance management and measurement function is only at early stages. ERI is seen as having an important role in facilitating improvements in this area.

As required by DFAIT, the Post engages in an annual financial and program planning exercise. This exercise helps coordinate the work of the Post with that of the partners. ERI reviews program plans. Interviewees comment that it is a helpful process, though some of the consultations are seen as being routine. "We might get a call from a partner who is interested in a project in Miami--they do not really need our help-but because of the ERI requirement we sign on. This doesn't happen often but there is a bit of gamesmanship going on." In general we were told in Miami that the ERI planning processes for both IBD and advocacy have been effective and relevant. However, there are many areas of the Post that are not integrated into the strategy. Though, beyond our TORs it is worth noting that ERI as a "whole of government" approach might explore ways for Posts to engage in integrative multi-departmental planning. In Miami there was a general openness to developing more collaborative planning and discussions across all Departmental lines. In all, interviewees indicated that planning was working well. Interviewees indicated how their work plans link to the Post plan. The normal departmental processes including regular meetings to discus progress being made on the work plan was being carried out. This is an important first step in a performance management system. However, in discussing the link between work plan objectives and the posts monitoring system we found some gaps. At this point these are suggested indicators. At present interviewees have told us that there is no standard set of indicators presently being used to monitor Post strategic plans. In other words the unit of analysis--Post-does not have a standardize performance management system in place. Thus annual reports are idiosyncratic to each Post. Standardization for performance management is seen as important in Miami. Not only does the Consul General support the idea, but sub groups are working toward such standardization. The IBD group has been collaborating with colleagues to develop an approach that would let them provide better data and reporting at the Post-level. While there is a planning and a reporting system being used, there is no consistent measurement system being applied. At present, the Consul General and other staff perform an oversight role with respect to funding by DFAIT and to partners' activities. In addition to the post list we were given a list of indicators from the IBD group and as identified in the International Business Development Miami Business Plan 2006-07.

"A Mission strategy for the Department of Foreign Affairs and International Trade should be just that. Currently we have a Mission Strategy that basically provides a shell for six separate programs that are managed, resourced, and reported on separately. We need to integrate all those working in the mission into one strategy."

  • The IBD indicators comprises:
    • Number of outcalls;
    • Number of events;
  • Business development indicators are:
    • Number of business reports;
    • Number of business leads;
    • Number of service requests (SR) completed;
    • Number of new active clients;
    • Success stories.

In Miami there is support for improving the performance management and feedback system. Presently the ERI Secretariat plays a relatively small role in the performance management system of Posts (reviewing plans, collecting reports). Given the difficulties in putting these systems together support from ERI would be beneficial.

Success, Capacity Benefits and Results

Finding 10:

The Post's business strategy suggests that significant changes have occurred at the Consulate General in Miami since the inception of the ERI program.

The Post has a four-pronged business strategy: business development and investment promotion, migration integrity, consular assistance, and culture and information exchanges between Canada and the United States. ERI has played an important role in this new and expanded Consulate General, accounting for the hiring of fourteen additional personnel, of which there are four new Canada-based staff (CBS) and ten locally engaged staff (LES). There have also been significant changes in infrastructure and programming at the Post. Programming expenditures have increased from $24,000 in FY2003-04 to $212,1000 in FY2006-07, which represents a nine times increase. Exhibit A.5 shows theses changes in details.

Exhibit A.5 Changes in Miami Infrastructure

YearOperationsProgrammingTotal
2003-04$2,161,600$24,000$2,185,600
2004-05$3,161,400$94,700$3,256,100
2005-06$3,907,500$117,900$4,025,400
2006-07$4,004,300$212,100$4,216,400
2007-08n/a$110,500$110,500
Total$13,234,800$559,200$13,794,000

(85)(86)

Finding 11:

The Post has improved its capacity to implement ERI activities over the past two years. However, such capacity building will remain fragile unless appropriate long-term funding strategies are put in place.

Outputs associated with increased capacity

  • 220 business clients served;
  • 120 local outcalls;
  • 160 new clients;
  • 16 successful large-scale events;
  • More than 70 leads generated for ERI and other partners.

The Initiative's primary goal is to foster advocacy and business development by influencing U.S. trade and other policies. This is a complex undertaking because while Posts serve as a source of information and of contacts, thereby facilitating private sector work, they are just one of many players engaged in trying to influence Canada-U.S. trade. On the other hand, ERI funding has made the Canadian diplomatic missions in the U.S. more strategic by both compelling them to articulate a business and advocacy strategy, and having sectorally focused staff designated for the purpose. With time and as they acquire more experience, more opportunities are being sought by the Post. Staff says they have more ideas and can focus on their priorities: "We are making progress in our ability to link up with both our partners in Canada and the U.S."

Finding 12:

The outputs of its programs are a source of pride for the Post's personnel, who are actively working with a whole set of tools they feel will help them improve their ability to do their work.

In the IBD sector, there have been ten events that took place in FY2006-07. These events were mostly trade shows, matchmaking and networking events, and conferences. They were organized with the participation of partners. In the advocacy sector, outputs constituted over 50 events and activities in terms of outreach, advocacy, academic linkages and cultural performances. Events were centered on primary advocacy issues such as Western Hemisphere Travel Initiative (WHTI), environment files like the climate change issues, and increasing the awareness of Canada's role as a primary supplier of energy to the U.S. Regarding academic outreach, the Posts partnered with the Florida International University to facilitate a workshop on green. Finally, out of 22 arts and cultural activities, four occurred under ERI funding. The advocacy strategy of the Post is closely linked to ERI priorities. The table below provides examples of ERI priorities and the number of events that are linked to those priorities in Miami.

Exhibit A.6 Miami Advocacy Plan FY 2005-06, 2006-07

PrioritiesFY 2005/06FY 2006/07
Strategic Representation and Engagement10 events10 events
Increase Confidence in Border Security2 events1 event
Increase Awareness that Canada is in the international fight against terrorism and international security4 events9 events
Increase perception that drug policy, same sex marriages policy and health care differences are not important in our long-term relationship1 event0 event
Increase awareness that good stewardship of the environment is a shared responsibility4 events4 events
Increase awareness that Canada is the U.S. largest and most secure energy partner4 events1 event
Increase recognition that the U.S. benefits significantly from an integrated North American Market4 events7 events
Defend Canadian interests on other trade issues5 events1 event

Finding 13:

Success stories provide the best data with respect to the outcomes of the ERI initiative in Miami.

The Evaluation Team found that generally there is a strong desire to understand and create result profiles at the Post. Staff point to success in terms of changes in trade flows in Miami--but the question remains whose success it really is? "From 2003-2005, the Canadian dollar soared 35 percent vis-à-vis the U.S. greenback, and yet Canadian exports to Florida jumped 32 percent. More importantly, Canadian exports of technology-driven products jumped 103 percent. Most of that growth came from highly targeted Business to Business (B2B) sales, generated by the sales promotion efforts of Canadian exporters who visited Florida, often supported by trade missions organized by the Canadian Consulate General in Florida and corresponding trade promotion entities in Canada."(87) In general staff are skeptical about how to judge the success of trade and advocacy work. Success stories ground the work for them. Below are five interventions they assess. The staff was very helpful in working with the Team to obtain success stories and to provide names of clients who have been served. Objectives are linked to a set of activities. Some activities are paid for by the Initiative, others by revenues from DFAIT, while yet another group does not entail any expenses. Although a logic system is being employed by the Post, which links objectives to activities, with each activity classified as either being successful or not successful, several staff members found this process to be highly cumbersome to plan and manage.

  1. What's Hot in Cool Canada?
    • Through such events as the one-day outreach conference titled "What's Hot in Cool Canada?" the Post is making energetic efforts to showcase Canadian expertise as being at the forefront of such sectors as ICT security, "green" construction practices, fuel cells and life sciences. A roundtable discussion with Canadian specialists in these and other science and technology areas. Around 200 people are expected to attend, including members of the business community, venture capitalists, journalists, as well as members of the local, state, and federal governments.
  2. Western Hemisphere Travel Initiative (WHTI)
    • Le Soleil de la Floride, a free francophone publication with an annual subscription of 350,000 copies, and the main organizer of CanadaFest, the annual gathering of U.S.-bound "Snowbirds," recently featured an informative article on the Western Hemisphere Travel Initiative (WHTI) and the newly-promulgated regulations affecting U.S.-bound Canadian travelers. In its advocacy work regarding WHTI, the Post takes the view that passport requirements for Canadians traveling to the U.S. are cumbersome and hurts both countries, especially tourism-dependent states such as Florida.
  3. Food and Beverage Show
    • IFE Americas, the Ninth Americas Food and Beverage Show, is the largest Americas-focused trade show in the hemisphere. The show brings together more than 300 exhibitors from 28 countries, as well as over 5,500 buyers during three days of exhibits and conferences. It brings new ideas and new companies together in the world's second fastest growing sector.
  4. International Builders' Show (IBS)
    • The International Builders' Show is the largest annual residential and light commercial show in the world, with over 100,000 international visitors expected. At the 2007 IBS, to be held in Orlando, Florida, the Canadian presence will once again be a significant one, featuring more than 100 exhibitors and an estimated 1,000 delegates. This is an important opportunity to respond to the ERI mandate to promote Canadian businesses, as Canadian companies are supplying the building and construction industries across North America and around the world, and are at the forefront of new technologies in the sector.
  5. Trade Missions to Florida
    • ACOA is a Partner that has been greatly committed to ERI, and its efforts are particularly visible in Miami. ACOA organized two missions to Florida in May and November of 2005, of which Tier 1 took place in Miami and Fort Lauderdale and the Team Atlantic Canada Tier 2 in Tampa and Orlando, with the full support of the Post. The two missions included 86 companies, four premiers, four provincial ministers, federal senators and numerous ERI partners. The anticipated sales following this mission are expected to be in the region of $60 million, including investment leads and signed science and technology memorandums of understanding (MOUs). A study conducted by Corporate Research Associates Inc. found highly positive results stemming from the May and October 2006 Team Canada Atlantic trade missions, with 24 of the 32 participating business delegates anticipating solid sales over the next two years as a result.(88) The services provided by the Consulate General were also rated as either excellent or very good, with a majority of participants stating, in particular its "matchmaker" services were very helpful. Florida is the host of major trade shows in Miami in which the Post has played an important role in giving participating Canadian companies maximum exposure. Finally, the 2006-07 results show that the Post has been actively identifying opportunities for Canadian businesses. The Consulate General in Miami has been instrumental in sealing key business deals, including Bombardier's $100M local rail project, and "Fruits & Passion's" first American investments.

Finding 14:

Miami has been successful in raising awareness and investment opportunities for Canadians as well as for Americans.

The Post received extensive local support at its events in 2006-07. For example:

  • Media interest (15 articles directly attributable to the Post, including a four-page insert in World City magazine detailing Canada's trade, technological and energy importance);
  • Accolades at various forums (World Trade Center, Chambers of commerce);
  • Invitations from the local community and access to senior interlocutors (governors, politicians, CEOs, NGOs); and,
  • The PERPA section was highly effective in raising awareness on issues such as WHTI.

In addition to its pivotal role in political and economic advocacy, the Post has played an important part in academic outreach. For example, the Consulate General and Florida International University are to host an all-day workshop titled "Green Buildings and Sustainable Construction Technology: A Roadmap for the Future," promoting Canada's leadership in the environment and construction sectors.

Exhibit A.7 ERI IBD objectives and the related activities at the Consulate General

IBDWhat was done
Develop investment attraction, retention and re-investment.Simulation Show in Orlando

CTIA Wireless 2007

National Business Aviation Association Show

Conference on green buildings

What's Hot in Cool Canada 2

Deepen and broaden exports and the export base with increased emphasis on technology and the services sector.International Food Expo

Opportunities in cruise lines for Atlantic companies

Opportunities in Puerto Rico - Montréal and Halifax

IBS

Simulation Show in Orlando

Montreal International Games Summit

CTIA Wireless 2007

National Business Aviation Association Show
Increase export-ready Canadian companies.Opportunities in cruise lines for Atlantic companies

Opportunities in Puerto Rico - Montréal and Halifax

Montréal International Games Summit
Increase technology partnerships.CTIA Wireless 2007

National Business Aviation Association Show

Conference on green buildings

What's Hot in Cool Canada 2

Conclusion

The two and a half day Miami visit and case provided the evaluation team with an opportunity to test its instruments and obtain an operational perspective on ERI. It was a good introduction to the way in which Posts take on business development advocacy and other work to enhance the Canadian relationship with the United States. In Miami's case, we were impressed with the energy of the team and the willingness of staff to work together toward their goals. Both locally engaged and Canadians took on the Post objectives and worked to attain success. While we were generally positive about the case, we note that while planning processes are in place, monitoring and performance management systems are not. Furthermore, we are sympathetic to the perspective that ERI should not be seen simply used as a funding mechanism, but rather that it should have a vision and perhaps be better linked into an articulated U.S. strategy. Developing such a strategy might be beyond the role of the partners.


A1.2 Upper Mid-West Case

Introduction

Canada and United States are highly interdependent as two poles of the world's largest trading relationship, a significant portion of which is complementary. As hoped for by the leadership of both countries at the time of its negotiation, the monetary value of trade between the two countries has tripled since the coming into force of the North American Free Trade Agreement (NAFTA). The Agreement removes obstacles to North American trade and, when disputes arise, has put in place a clear and consistent mechanism to resolve differences, thereby injecting a degree of consistency and predictability to trade relations between the signatories.(89)

Canada's International Business Development (IBD) strategy in the U.S. has identified five sectors for particular attention: Aerospace and Defense; Agriculture, Food and Beverage; Bio-Industries; Environmental Industries (including clean energies, green building products); and Information and Communication Technology (ICTs).(90)

The case studies, which make up this evaluation, assess how the Enhanced Representation Initiative (ERI or "Initiative") responds to the changing needs of the Canada-U.S. relationship. Of significance in this regard are several issues of particular interest to Canada, such as trade, security, productivity and competitiveness, science and technology, and the extent to which the Initiative supports Canadian small and medium-sized businesses (SMEs) in accessing the U.S. market, and in attracting U.S. investments. While the main study touches on all these issues, each case study provides insight on some of them.

The selection of the consulates in Minneapolis and Denver as focal points for a case study was based on a number of factors:

  1. Both posts were the recipient of several staff cross-posted from partner organizations under ERI;
  2. The Denver post was established as a direct results of ERI, while the territorial coverage of the Minneapolis post was directly affected by the establishment of the Denver post;
  3. The Canadian Consulate General in Minneapolis was directly affected by another major ERI initiative - specifically the founding of the Consulate General in Denver;
  4. The Canadian Consulate General in both Minneapolis and Denver played key roles during the BSE crisis.

Further, both consulates share a history of collaboration and are pursuing common interests in both agriculture and Science and Technology (S&T).

This case study assesses the relevance, cost-effectiveness and success of the ERI as applied to the Consulate General of Canada in Minneapolis and Denver and, in particular, their roles in the BSE crisis.

Methodology

This study employed a variety of approaches to data collection: face-to-face interviews, phone interviews and document review. The majority of interviews were conducted during a field mission to Minneapolis and Denver, which took place on May 14th - 18th, 2007. Respondents included Post staff, academics, media representatives and representatives of Canadian firms.

Context and Relevance

Finding 1:

The Minneapolis and Denver Consulates, as enhanced under ERI, are providing representational coverage to territories of reasonable importance vis-à-vis the priorities of ERI as an initiative, the ERI partners and Canada as a whole.

Under ERI's "rightsizing"(91), the Consulates in Minneapolis and Denver cover a total nine states divided as follows:

  • Consulate General of Canada in Minneapolis: Territory consists of Minnesota, Iowa (except the Quad-Cities portion which is covered by the Chicago Consulate General), Nebraska, North Dakota, South Dakota
  • The Consulate General of Canada in Denver: Territory consists of Colorado, Montana, Wyoming, and Utah.

The territories covered by the Minneapolis and Denver Consulates, when taken as a group, constitute a region of considerable economic and political importance to Canada. These territories collectively represent a significant trade partner for Canada as demonstrated in the charts below:

Exhibit A.8 Top Canadian Export Partners 2006 (92)

RankCountryCanadian Total Exports 2006 (Millions CAD)
1Entire US$359,258
2Minneapolis Consulate Region$16,314
3UK$10,133
4Japan$9,416
5Denver Consulate Region$7,755

Exhibit A.9 Top Canadian Import Partners 2006 (93)

RankCountryCanadian Total Imports 2006 (Millions CAD)
1Entire US$217,581
2China$34,486
3Mexico$16,001
7Minneapolis Consulate Region$7,813
12Denver Consulate Region$4,136

As a whole, these states have several other distinguishing features in terms of their importance to Canada. Three of the nine states in this group make up 45% of Canada's continental land-border with the US. Further, these states represent a significant locus of power for several major trade sectors, with a particular emphasis on agriculture and energy. The territory also represents a significant aerospace and defense hub, including hosting the primary commend centre of NORAD in the Cheyenne Mountain complex.

Focusing on the states covered by the Minneapolis Consulate, there are several compelling reasons for seeking to enhance Canada's capacity for representation:

  • The states in this region constitute an important trading partner for Canada representing the 2nd largest export destination (after the combined US) at $16.3 billion in 2006 and Canada's 7th greatest import region at $7.813 billion. The net trade is $24.093 billion with a trade balance of $8.501 billion.Canadian energy, petroleum, natural gas and agriculture sectors are greatly supported by trade with the region as the dominant exports, contributing to the creation of many jobs and supporting the economy. As well, transportation goods and agricultural products are relevant imports.
  • North Dakota represents an important state for Canada-US border relations in terms of environmental, social and economic issues. Interviewees have characterized the Devils Lake controversy as the single most contentious cross-border environmental issue today. In the 1990s, a series of wet summers caused Devils Lake, North Dakota to rise more than seven meters, swallowing more than 28,000 hectares of farmland and forcing 300 households to move.(94). One proposed solution is to pump the water into the Hudson Bay drainage basin, creating opposition due to the immense environmental damage by interrupting this ecosystem.
  • The Minnesota, Colorado and Iowa territory has an emerging biotechnology industry in the areas of agriculture, veterinary and medical biotechnology. Statistically, 8% of the biotechnology firms in the United States are located in these three states. There is also considerable crossover between agricultural and medical biotechnology with many firms engaging in Research and Development (R&D) for both sub-sectors.(95)

Exhibit A.10 Minneapolis Consulate - Territory(96)

TradeBilateral TradeImports from USLargest Import TypeExports to USLargest Export Type
Iowa$5.9 billion$2.5 billionTransportation$3.4 BillionNatural Gas
Minnesota$13.5 billion$3.6 billionTransportation$9.9 billionPetroleum
Nebraska$1.6 billion$845 millionTransportation$765 millionAgriculture
North Dakota$2.3 billion$524 millionTransportation$1.8 billionEnergy
South Dakota$793 million$344 millionAgriculture$449 millionAgriculture
Total$24.093 billion$7.813 billion $16.314 billion 

The territories now serviced from the new Denver Consulate General are of equal political and economic importance to Canada:

  • The region is an important trading partner for Canada representing the 5th largest export destination at $7.755 billion in 2006 (see Exhibit 1.2) and Canada's 12th greatest import region at $4.136 billion (see Exhibit 1.3). The net trade is $11.85 billion with a trade balance of $3.619 billion (see Exhibit 1.4). Colorado also hosts the 3rd largest Aerospace industry in the US. Since 1958, Canadian and US forces have jointly defended North American airspace through NORAD, headquartered at Cheyenne Mountain.
  • The Denver territory is home to several high-ranking Senators.
  • The Denver territory also encompasses the sites of several significant cross-border disputes - some of which are focused on issues related to water access and water rights. These include the proposed Pit Coal Mine in Alberta and St. Mary's River access. Further, other environmental issues such as coal bed methane development in BC - which has perceived environmental ramifications for the US and has led to a reported 58,000 complaint emails being sent to the Governor of Montana - also speak to the significance of the region.

Exhibit A.11 Denver Consulate- Territory (97)

TradeBilateral TradeImports from USLargest Import TypeExports to USLargest Export Type
Colorado$3.4 billion$847 millionAgriculture$2.6 billionPetroleum
Montana$3.65 billion$354 millionPaper$3.3 billionPetroleum
Utah$2.3 billion$735 millionTransportation$1.6 billionAircraft
Wyoming$2.5 billion$2.2 billionCoal$255 millionPetroleum
Total$11.85 billion$4.136 billion $7.755 billion 

Aside from the above, interviews with ERI partners in Canada - in particular AAFC, Industry Canada and WD - made it clear that the enhancing of Canada's representation in the Minneapolis and Denver territories was in-line with their programming priorities and areas of focus in the US. The area was of such importance to AAFC, for example, that they worked with ERI to secure a dedicated CBS position in each office to support advocacy and trade activities. Further, an analysis of the programming in each also supports this contention. In 2006-2007, 86% of programming in Denver involved IBD partnerships with Industry Canada and/or Western Development. In the same period, WD was involved in fully 38% of all IBD programming in Denver.

Finding 2:

The decision to reduce the territory covered by the Minneapolis Consulate General - by establishing a new Consulate General in Denver - was based on strong rationale.

Prior to ERI, the Minneapolis office covered nine states with a total of 13 PERPA and IBD officers. Under this model, there were apparent gaps in 'coverage'. South Dakota(98) had for example not been visited by a consular official in approximately eight years, nor was there any apparent network of relevant contacts in place for that state. Further, staff in the Minneapolis post who predate the introduction of ERI, recalled that states such as North Dakota, which have specific issues with Canada related to its shared border - such as environmental concerns about the drainage restructuring of Devil's Lake - were also being under-serviced in relative terms. External contacts in other states, such as Colorado, suggested that their awareness and engagement with Canada was minimal when their main point of contact was located in Minneapolis. Under the ERI right-sizing, the Minneapolis Consulate reduced its scope of responsibility to five states while reducing its staff by only a single member, thus concentrating representation capacity and allowing the post to rebuild representation relationships and networks in under-served states. This proved to be timely and valuable during the BSE crisis.

Evidence from American informants who have been cooperating with the posts, suggests that while it would have been technically possible to service the four states now covered by the Denver post by expanding (almost doubling) the number of staff in Minneapolis, relationships have been enriched by the constant physical presence in Colorado - an economic and political hub in the region. The three other states serviced from the Denver post - including Montana, which is a politically sensitive state for Canada both in terms of its importance in Washington(99) and the fact that it shares borders with three provinces have also enjoyed more regular contact from the geographically proximate Denver Consulate. As one informant put it, the 'proximity makes a difference'. This is predicated on the fact that within the US, identification between states is important. Thus, interviewees noted that the state of Montana 'identifies' more readily with a Colorado-based Consulate then it does with a Minnesota-based one. It was interesting to note that the ERI partners in Canada with regional offices in the west of Canada in particular noted the relevance of these states to their programming priorities which also had a north-south orientation.

Finding 3:

ERI's mechanisms for enhancing human resource capacity - including cross-posting partner staff (both through temporary duty and long-term placements), local hires and through the Honorary Consuls system - have placed relevant resources at the disposal of the consulates.

In addition to having physical offices in new places, all informants - including ERI partners, mission managers and American contacts -agreed that ERI had succeed in placing high-quality human resources at the disposal of the missions. In terms of the long-term CBS placements, local informants suggested that having 'sector experts', who also have detailed knowledge of the Canadian context, was invaluable. As one external contact noted, 'we speak the same [technical] language and that makes a lot of difference'. As another put it, 'the people who have landed here as part of ERI have been fantastic…they get to understand DFAIT really well but they also bring a different perspective - a fresh perspective'. ERI partners also noted that having 'their people' in the field - people with an intimate knowledge of Canadian system and/or market in a given sector - was highly valuable. AAFC in particular indicated that this had improved their contact and integration with the field as they had two AAFC-dedicated CBS positions (one in each office). Further, both ERI partners and local informants noted that having access to resource people with networks of contacts in a specific sector in Canada was also valuable. As a complement to the CBS's, interviewees also noted that the TD function of ERI had placed key people in the field. The Denver officer, for example utilized a TD position to undertake research on the food industry to feed into their overall IBD strategy. Post interviewees stated that such studies could not be easily completed within the existing HR base of the posts.

Interviewees with post staff and managers suggested that the newly introduced ERI HonCons added significant potential reach to the posts for both advocacy and business development purposes. One Head of Mission suggested that the '[HonCons] have been fabulous. They really plugged into our programming…' Another post staff member noted that the '[HonCon] has been helpful in making various recommendations on who to invite to things interpreting how a political issue may play out...he does not really advocate but facilitates'. Another noted that their HonCon, ' really opened doors for us' attributing the implementation and success of several major cultural events to the HonCon.

BSE: Contribution Not Attribution

In May 2003, the US border was closed to Canadian cattle and beef products after a case of bovine spongiform encephalopathy (BSE) was reported in a cow in Canada. This issue resulted in a protracted cross border dispute that had a corrosive effect on Canada-US relations by seriously disrupting the highly integrated and efficient North American beef industry - to the economic detriment of both(100). The Canadian governments response to the BSE crisis was a multi-faceted effort involving diplomacy at a number levels through a variety of channels. At the same time, the Canadian response to the BSE crisis was hampered by the duality of the issue. On the one hand, the BSE issue was beyond the scope of Canadian intervention given that the border closure - ordered by a US court on the basis of a successful legal action brought against the United States Department of Agriculture (USDA) by the Ranchers-Cattlemen Action Legal Fund (R-CALF) - was technically an US internal legal matter. On the other hand, a larger advocacy campaign designed to influence decision-makers without directly intervening in the court challenge was undertaken (in part using ERI resources) and this campaign has been noted for contributing to the longer-term development of a stable integrated beef industry. In this section of the report, an assessment of the reasonable contribution of ERI to this advocacy process is presented.

Bovine Spongiform Encephalitis (BSE or 'Mad Cow' Disease) - BSE is a fatal disease that affects the central nervous system of cattle, often termed 'Mad Cow' Disease due to symptoms such as staggering witnessed in infected animals. BSE is reportedly transferable to humans through infected tissues and, in its human variant, is also fatal.

Finding 4:

ERI's resources made a notable contribution to Canada's lobbying efforts around BSE.

In general terms, it was found that ERI's resources - including resource investments in physical offices, human resources and programming - made a contribution to the success of Canada's advocacy efforts related to ERI. This Finding is supported in both the document reviews and interviews conducted, where there was considerable mass of evidence to support that ERI contributed to the BSE advocacy effort in several ways:

  • Enhanced Presence and Coverage: ERI has contributed to enhanced territorial coverage. As one post interviewee noted 'When BSE hit, we had no network in South Dakota'. Under ERI, this situation has been remedied to a large degree. As noted in an ERI-related report "outreach programs to the South Dakota Cattleman's Association create a positive working environment where the key issues can be discussed."
  • Human Resource Contributions: As one post manager noted, having 'AAFC staff in the offices was extremely helpful' in terms of BSE. It was noted that having these dedicated positions allowed for much deeper coverage of any given issue. AAFC interviewees in Canada echoed this sentiment.
  • Programming: There are numerous examples of BSE related programming under ERI -
    • 2004: US Congressional Staffers Tour of Alberta, Calgary. The goal of this event was to bring US Congressional and Senatorial staffers to Alberta to view the impacts of the border closure due to BSE on the Alberta cattle industry. Ten state 'staffers' plus several US cattle industry representatives were provided with presentations, information briefings, and on-farm and feedlot tour with by the Canadian Cattlemen's Association, Alberta Government, Cargill Foods and the Canadian Cattle ID Agency.
    • 2005: Western Canadian Agribition, Regina. The Minneapolis post partnered with Industry Canada (Regina) and the AAFC Regional Office, Regina, to sponsor two representatives from the Minneapolis-based North American Bison Cooperative to meet with counterparts from the Canadian and Provincial Bison Associations to exchange ideas and discuss current trade issues of concern. Pedigrees, investment opportunities and disease issues were discussed. It was also noted that BSE/border closure has had a serious impact to the industry. Results were the establishment of stronger working relationship between the two Associations.
    • 2005 Duelling Barbeque, Denver. The post in Denver hosted a barbeque to focus attention on the BSE border closure issue. Based on testimonial and other evidence, this event - which was hosted by Montana Governor Owns at his official residence and included a range of key political and business leaders - garnered excellent media attention concerning affects that closure was having on both sides of the border.

To a certain degree, these contributions have to be qualified. It is important to note, for example, that the onset of the BSE crisis predated the ERI investments in the physical presence in Denver Consulate territory - and the right sizing of the Minneapolis Consulate territory - by a year or more. This is demonstrated in the chart below.

Exhibit A.12 Timeline of ERI in the Upper Mid West and BSE Crisis (101)

YearMinneapolisDenverBSE Timeline
2003-2004  May 2003 – US announces ban on all beef imports from Canada after BSE identified.
2004-2005Territory reduced to Minnesota, Iowa Nebraska, North Dakota, South Dakota.

1 Canada-based staff added
Post Opened

5 Canada-Based Staff added

Canada-Based Staff (Agriculture) added
 
2005-20061 Canada-Based Staff (Agriculture) added1 Canada-Based Staff addedJuly 14 2005 – Border reopened to selected cattle (aged >30 months) and products
2006-2007  Four more cases of BSE confirmed in Canada

This is not to imply that the territories - such as Colorado and Montana - had no activities (ERI or otherwise) related to BSE prior to the opening of the Denver Consulate. However, as noted above, the physical proximity of the Denver Consulate (characterized by several interviewees as the 'centre' of the BSE effort) allowed for much more regular engagement. Finally, this time lag was significant in that even after the opening of the Denver Consulate and the rightsizing of the Minneapolis Consulate territory, there was a period of time required to mobilize fully. As one upper mid-west interviewee noted, 'we spent about 18-24 months building the networks once we were on the ground'.

Finding 5:

ERI resources continue to make a contribution to consolidating Canada's influence in terms of BSE.

While the border was opened in July 2005, the situation of importing of Canadian cattle and beef products has not returned to its pre-crisis norm. For example, animals greater than 30 months of age are not accepted by the US.(102) Further, R-CALF continues to appeal the July 2005 ruling that reopened the border with in-court appeal dates planned for July 2007.(103) Against this backdrop, ERI resources have been actively pursuing initiatives intended to incrementally build support at the grassroots industry and political levels, which in turn have significant influence at other levels.

The ERI supported advocacy efforts around BSE aim to reach out to a broad audience of the industry populace - one that goes beyond the single-issue mandate of R-CALF (an organization that is predominately concerned with small ranchers). Thus, for example, ERI has supported the development of messaging for audiences that highlights, for example, that in Colorado alone the border closure cost more than 800 US beef processing facility jobs. ERI also supported other connections, such as the relationship building between the Denver Consulate the Governor of Montana and other State leaders on BSE related border closures of Canadian cattle.(104)

It is interesting to note that since the border re-opened in 2005, despite at least four new cases of BSE being identified in Canada, the border as remained open. While that cannot be clearly attributed to ERI's investments and resources, interviewees both in the US and Canada confirm that there is an apparent contribution to the effort.

Cost Effectiveness of the ERI Investments in Minneapolis and Denver

Finding 6:

ERI has led to the development of new modes of planning and programming that have the potential to improve delivery of cost-effective results.

The Minneapolis and Denver Consulates are delivering program that is in-line with ERI Canada's strategic priorities as articulated by ERI partners. The charts below provide a sample of the types of IBD initiatives being pursued.

Exhibit A.13 IBD Initiatives 2006-2007(105) Denver

Project TitleERI Post’s BudgetPartner (s) Sign Off
Montana Study$20,688WD
Clinical Trials Awareness Seminar and Trade Mission$10,550IC
Bio Trade Mission to Denver’s BioWest Conference$16,321IC
Homeland Defence Symposium$8,968IC
National Space Symposium and Lockheed Martin Seminar$14,628IC
Alberta/Colorado Energy Services Mission$18,845IC, WD
Integrated Energy Systems Conference$5,000IC, IT
Total$95,000 

Exhibit A.14 IBD Initiative 2006-07 Minneapolis

Project TitleERI Post’s BudgetPartner (s) Sign Off
Iowa ABI Conference$2,500WD
ND/Canada Trade Initiative$10,000IC
Biobased Industry Conference Iowa$6,500-
BC Wood Global Buyers Mission$3,000WD
US Seafood Buyers Mission to BC$3,000AAFC
South Dakota Initiative – MAAVC Converence$3,000IC
Heart Health and Disease Conference$2,500WD, NRC
KPMG Study Presentation$10,000WD
South Dakota International Business Conference$4,000IC
Corporate Technology Inventory: ICT$10,000IC
Advanced Manufacturing Initiative at the FEWA/FEMA/AIMRA Annual Conference$9,000IC
LifeScience Alley Annual Conference$5,000WD
Manitoba Food Processors Specialty Food Mission to Twin Cities Food and Wine Shown/aAAFC
SIAL Montrealn/aAAFC
Investment Lead Generation Project$10,000WD
Post Reserve$16,750 
Total$95,000 

As was also noted in Miami, advocacy and trade/business development are increasingly merging into a single issue. In the Upper Mid-West region, issues such as BSE and the softwood lumber dispute are prominent examples of this. As one ERI partner noted, 'PERPA really led the BSE issue, but we [IBD] were clearly involved'. In areas such as private-academic partnerships - around issues related to S&T - the advocacy/business development interface is also apparent. It is not clear that this is attributable to ERI. Some interviewees in the posts suggested though that the traditional PERPA/IBD split was being eroded in part by the fact that new ERI staff do not carry that tradition into the positions with them. In some cases, ERI staff within similar portfolios answer variously to either trade managers or advocacy mangers in different posts.

At the same time, beyond the PERPA and IBD question, it was observed that posts have started to develop new modes of planning for program delivery that have a potential for cost-effectiveness and improved results. The Minneapolis office, for example, developed a comprehensive statewide 'North Dakota Strategy' led by the PERPA team but with distinct collaboration with the IBD team from that post. This strategy was designed, as referred to by one interviewee, as a way of 'blitzing' a state where Canada had interests but was very under represented. As suggested by a post interviewee, 'The North Dakota Strategy was not an ERI initiative but it has ERI elements in it - the HonCon who supported us in implementing the programming for example, and a number of ERI funded projects (such as the Border Summit held in Grand Fork funded under ERI). We could not have had a North Dakota strategy without the territorial rightsizing that happened under ERI - if we still had eight states, we could not have done this…' Building on the success of the North Dakota Strategy, the Denver office has developed their Montana Strategy - with support from ERI resources. As was noted in Minneapolis, it is highly unlikely that such a coordinated strategy for addressing this state could have occurred without ERI resources. Both offices indicated that having coordinated strategies in place- made possible through ERI - has greatly improved the impact of investment in the targeted states.

Nevertheless, post informants suggested that not all the new programming strategies introduced under ERI have yet reached their potential in terms of planning and utilization. Most of the HonCons, for example, have only recently been appointed. While there have been some demonstrations of where HonCons can provide relevant support as outlined above, in the words of one informant 'we have not really figured out how to best utilize them and what they bring to the table'. Further, the network of HonCons in that region has not yet fully materialized.

"Our services have become more mature. ERI contributed to that - it allowed us to use more money to do broader scope to seek more feedback and participation. ERI is results based - CSF is less so - so ERI forced us to change the way we did things and looked at things. We started to ask ourselves 'why are we doing this activity'?"

Post Interviewee

Under ERI, post interviewees also indicated that ERI had allowed them to pursue not only more programming but also better, more relevant programming. In the words of one interviewee, we can now pursue both 'both [increased] quantity and quality of programming' that is of interest to partners. For example, one post noted that 'CSF is limited to certain trade sectors, but in some cases, 'hot' issues like alternative fuels cannot be addressed. With ERI, we were able to pursue activities like alternative energy technology partnering.' Posts provided anecdotal evidence that their counter-parts from other countries were more limited in their range of activities and this provided the Canadian consulates with an advantage. US contacts corroborate this, indicating that in many instances the Canadian consulates were able to go after more than just 'one-sided business deals' where Canadian companies simply had something to sell. Rather, it was noted that the Canadian consulate had the flexibility to facilitate industry partnerships (such as technology partnerships) where both the US and Canadian side brought value to a table and that relationships with higher potential for sustainable and longer-term financial benefits for both. As one US sector association representative noted, 'there are 17 consulates in this city and we only engage with one, the Canadian one, as they really had something to offer - they try to develop an industry, not just get a sale'.

Finding 7:

Evidence suggests that ERI partnership models have created partnerships that enrich the prospects for creating positive results in the mid-west.

As noted by both the mid-west posts and the ERI partners in Canada, the partnership requirements for accessing ERI programming funds have the potential to improve efficiencies in event planning by connecting the networks of the posts with the networks of the partners in Canada. It is interesting to note that in both Denver and Minneapolis, the rate at which people reported 'paper partnerships' appeared considerably lower than in other cases.(106) In the Denver and Minneapolis offices, stronger relationships were reported with partners that had people placed in the post through ERI and even more so when the partner had an ERI-dedicated position in the post. As one interviewee noted, '…we have been working with AAFC and they are a partner - we are not going to go down the road without ensuring that the messaging is aligned'. It was also noted by both post, and partner interviewees, that when these paper relationships do happen it is not malicious or circumlocution of the system. Rather, it was noted that that people simply do not have enough time to engage in every project meaningfully and that, in some cases, new priorities arise that keep them from meeting their intended commitments.

"ERI - at first it was bad and we did not know how to deal with it, then it went from being bad to being integrated - in a very organic way. Now it is a part of life."

Post Interviewee

The evaluation, however, also noted that there was little evidence to suggest that partners in the posts and in Canada were coordinating the development of workplans that took into account the specific interests of the ERI partners or the intended results outlined in the RMAF.

Finding 8:

The upper mid-west consulates raised concerns about the cost-effectiveness of the planning process.

As was noted in other data collected for this evaluation, the upper mid-west offices noted that there were high transactions costs involved in funding projects - both under ERI and through other funds. It is common in posts to undertake multi-fund initiatives. The Denver Consulate Business plan for 2007-2008, for example, identifies 10 major initiatives. Of these ten, six initiatives involve two or more funding sources. For the same period in the Minneapolis consulate, three of the four major IDB initiatives that require funding involve multiple sources. While most staff was pleased to have access to various funding streams, many reported that the transaction cost of having to apply for funding from, and report back to, multiple sources for a single initiative was time consuming. Some informants made a request for a single planning and reporting template or a unified fund.

"The funding process [is not great]… the applications hurt, they are a waste of time and energy."

Post Interviewee

Finding 9:

The upper mid-west case study yielded observations and concerns about human resources processes under ERI.

Informants in the upper mid-west consulates expressed several concerns about the HR processes under ERI. While no concerns were raised about sector competencies of non-DFAIT ERI partner staff taking up posts in these consulates, some concerns were expressed about their familiarity with DFAIT systems, standards, and norms of operations. As one informant pointed out, 'DFAIT staff train for over a year before taking a field posting, ERI partner staff get much less support and orientation'. As was noted in other missions in the US, at the post level, steps were being taken - largely by regular DFAIT staff - to assist their ERI colleagues in making the transition to their new posting and 'way of doing'. ERI-posted staff also expressed concerns about slow timelines for approving deployments, about the incentive and salary normalizing packages for taking up posts in the US, and about their perception of limited support for relocation.

It was interesting to note that Minneapolis has only one 'regular' DFAIT CBS, while Denver has two.

Success Capacity Benefits and Results

ERI does not exist in a vacuum. Prior to ERI, all the states currently in the territories covered by the Denver and Minneapolis office had Canadian representation (largely concentrated in Minneapolis) that pursued a variety of goals and objectives related to Canada's interests. Canadian companies were active throughout the region - in some cases, such as Wyoming, Canadian companies are the largest taxpayers into state coffers. Canadian interests were promoted with decision-makers to the extent possible with the resources at hand. Under ERI, the existing capacities have been enhanced not replaced and not built from a zero-base. As such, it is difficult to definitively determine what would or would not have happened without ERI, or indeed to determine what might stop happening should ERI cease to be. This is exacerbated by the relative inadequacies and challenges of ERI's performance measurement system. As such, the goal of this section is to draw reasonable causal conclusions about the apparent contribution of ERI to business development and advocacy goals outlined in ERI's RMAF.

Finding 10:

ERI has clearly contributed to the development of relevant capacities to address business development and advocacy issues of priority to ERI partners in the Minneapolis and Denver territories.

At a most basic level, ERI has contributed to the establishment of new, and the enhancement of existing, capacities to pursue Canadian business development and advocacy goals in the upper mid west.

Exhibit A.15 Timeline of ERI Expansion in The Upper Mid West

YearMinneapolisDenver
2003-2004  
2004-2005Territory reduced to Minnesota, Iowa Nebraska, North Dakota, and South Dakota.

1 Canada-based staff added

Post Opened

5 Canada-Based Staff added

1 Canada-Based Staff (Agriculture) added

2005-20061 Canada-Based Staff (Agriculture) added1 Canada-Based Staff added


Advocacy – Making Sense out of Randomness

Chaos theory attempts to describe the behaviour of nonlinear dynamic systems. During its analytical phase, the evaluation noted that assessing the results of advocacy has a certain chaotic element. Interviewees, for example, referred to chance meetings at ERI-funded events that led to connections (e.g. invitations to address influential groups) that could not have been planned for, or predicted. However, it is clear that ERI funded activities add increments of probability to unpredictable systems. It is apparent that without ERI, many of these ‘chance’ interactions would not have taken place.

These, along with access to ERI project funding, constitute a building of capacity at the most fundamental level. At the same time, ERI has allowed for a more qualitative form of capacity building through its HR programs. The placement of partner personnel and the hiring of sector-specific CBS positions have significantly contributed to the capacity of posts in the mid-west to provide both business development and advocacy activities at a higher level of sophistication. ERI partners in Canada and local partners in the US both indicated that having 'experts who can interact with experts' is invaluable. ERI partners in Canada also indicated that, by having a department member posted in the field, they were better assured that their priorities were being addressed. This was particularly noted by AAFC which has two sector dedicated CBS's posted in the region.

At an activities level, there has been a significant increased output by the Denver Consulate General. As one interviewee suggested, 'we are here because of ERI, if we were not here, we would not be doing anything'. While this might not be wholly true, evidence from external informants suggests that there has been an increased 'presence' and interaction with Canada since the opening of the Consulate. One external informant in Denver noted that his company had been active in the region for several years but had not really engaged with the consulate in Minneapolis. The Minneapolis office, as noted above, has demonstrated an increase concentration of activities in its reduced territories. The chart below reflects this increased level of activity.

Exhibit A.16 Changes in Denver/Minneapolis IBD Program Spending (107)

YearDenverMinneapolis
OperationsProgrammingOperationsProgramming
2003-04$89,636n/a$1,044,013$159,300
2004-05$557,404$76,800$1,104,934$163,900
2005-06$1,380,301$159,850$1,036,705$150,800
2006-07$1,252,747$154,788$1,072,150$129,500
2007-08n/a$135,200n/a$156,800
Total$3,280,088$526,638$4,257,802$760,300

In the case of the Denver Consulate, the programming funding increased incrementally until 2006-7 when growth levelled off as the consulate ended its "start-up blitz." In the case of the Minneapolis Consulate, ERI spending has been relatively constant after 2003, however, it is important to remember that this spending was covering a greatly reduced territory.

Finding 11:

Evidence from the posts suggests that ERI's investment in advocacy initiatives is leading to intended results at the output and outcome levels.

The table below provides an example of ERI advocacy priorities and how those are linked to the Minneapolis Consulate.

Exhibit A.17 Minneapolis Advocacy Plan FY 2005-06

PrioritiesFY 2005/06
Strategic Representation and Engagement8 events
Increase Confidence in Border Security4 events
Increase Awareness that Canada is in the international fight against terrorism and international security1 event
Increase perception that drug policy, same sex marriages policy and health care differences are not important in our long-term relationship1 event
Increase awareness that good stewardship of the environment is a shared responsibility8 events
Increase awareness that Canada is the U.S. largest and most secure energy partner2 events
Increase recognition that the U.S. benefits significantly from an integrated North American Market14 events
Defend Canadian interests on other trade issues1 event

As was noted by several interviewees, the measure of success in terms of advocacy is rendered in terms of what does not happen (i.e., instances where decision-making potentially harmful to Canadian interests does not get developed). However, as a secondary measure, examples of where potentially adverse situations have been identified and interventions that lead to mitigated effects are also of importance. In this regard, in the upper-mid west there are examples of such 'mitigation' that have plausible links to ERI's investments:

  • A post interviewee provided the following example: 'During the spring 2006 sitting of the Minnesota state legislature, a new amendment was added to a proposed environmental bill at the proverbial 11th hour. The amendment would have required Canadian companies providing electricity to Minnesota which is one of the states largest providers of electricity - to demonstrate its compliance with treaties of jurisdictional relevance only in Canada. This amendment was problematic on several fronts. First, it was a demonstration of overt extra-territorial reach - into Canadian federal and provincial jurisdiction - by an American state government. Second, it had significant ramifications for the Canadian company in terms of costs and sales. The Consulate in Minnesota was contacted by two American colleagues, both of whom had participated in ERI funded events, including one who participated on a BorderNet Tour, who alerted the Consulate to this potential threat. Based on this knowledge, the Consulate General was able to mobilize its Canadian networks and within 12 hours a letter from the Premier of Manitoba, expressing concerns about the proposed legislation, was delivered to the Governors Office and other advocacy had been mobilized at different levels.
  • An external interviewee, from a Canadian company, noted that the success of his firm in overcoming its challenges in securing permits to pursue opportunities in Utah was, from his perspective, attributable to the work of the Denver Consulate General.
  • Yet another external interviewee from an academic institution, described the Canadian Consulate in Denver has having been 'instrumental' in making connections relevant to Canadian organizations related to a newly launched degree program in energy sector management
  • A post interviewee provided another example. 'The difference between Washington and here is that in Washington there are lobbyists. Here we are talking to local production - the constituency, you can make a difference but it is longer-term prospect built on relationships but it is longer lasting.' In March 2004 the US introduced countervail and antidumping sanctions against Canadian pork producers. After 18 months working with the production level here - and with the lobbyists in Washington - the sanctions were lifted.' The interviewee was unclear as to whether this happened faster or more effectively because of ERI, but was able to note that ERI provided the capacity that allowed the networks for addressing this issue to be built.

In short, the evaluation found a significant mass of success stories with links to ERI - either through personnel, new offices, reduced territory loads, or projects - to suggest that ERI is contributing to the increased flow of goods and services into the US and that Canada is better positioned to influence decision makers.

Finding 12:

Evidence from the upper mid-west posts suggests that first and second order business development results are being achieved on a case-by-case basis.

The evaluation found significant evidence that ERI investments in the upper mid-west were contributing to business development results:

  • Investment in Canada: In 2006, a total of $170M Cdn was invested in a Canadian-based natural resource company with potential for further investments over several decades. The Denver post facilitated interactions to ensure mutual interests were identified and met.
  • Technology Awareness: The Minneapolis Post, in partnership with AAFC - along with Minnesota Agri-Growth Council, BIOTECanada and the University of Minnesota, hosted a one-day symposium highlighting new US and Canadian biotechnology applications in the food and agriculture sector. This was the first international event undertaken as part of Canada's International Biotechnology Week and involved 75 US and 6 Canadian delegates and included four Canadian speakers.
  • Technology Sharing: A TPI funded event in Saskatoon - in partnership with Western Economic Diversification Canada brought together the University of Saskatchewan, Colorado State University and the Colorado Bioscience Association exposed American counterparts to tour a number of facilities including Canadian Light Source, the Vaccine and Infectious Disease Centre and the National Research Council Plant Biotechnology Institute. As a result, the University of Saskatchewan, as the only Canadian organization, was invited to join a technology partnership of 20 international partners.
  • S&T Commercialization: The Technology Initiative - funded under TPI - involved matching the needs of a US company to Canadian companies and organizations with related technologies. This involved collaborating with the Canadian Advanced Technologies Alliance as well as technology firms, technology transfer offices of several universities, and provinces.
  • Export: The Montana Strategy reportedly supported six Canadian oil and gas pipeline companies investing $2.6 billion in energy trade.(108)

Again, the evaluation found a significant mass of success stories with links to ERI - either through personnel, new offices, reduced territory loads, or projects - to suggest that ERI is contributing to increased business for Canada with the US.

Conclusion

The mission to the Minneapolis and Denver Consulate Generals concluded that:

  • The targeting of the upper mid-west made relative sense from an economic and political standpoint in terms of both broader Canadian and more specific ERI partner interests
  • ERI resources in the upper mid-west have contributed to the development of new, more cost-effective planning and programming approaches that incorporate key ERI partners
  • ERI results in terms of enhanced representation for advocacy and business development is contributing to improved awareness among state-level decision-makers, increased influence, improved business development connections, sector advocacy

Finally, it was also apparent that US colleagues were genuinely impressed with and appreciative of the enhancements to Canadian representation in the upper mid-west.


A1.3 California Case Study

Introduction

Canada and the United States are highly interdependent as two poles of the world's largest trading relationship, a significant portion of which is complementary. As intended for by the leadership of both countries at the time of its negotiation, the monetary value of trade between the two countries has almost doubled since the coming into force of the North American Free Trade Agreement (NAFTA).(109) The Agreement removes obstacles to North American trade and, includes a conflict resolution mechanism to deal with disputes, thereby injecting a degree of consistency and predictability to trade relations between the signatories.

Canada's International Business Development (IBD) strategy in the U.S. has identified five sectors for particular attention: Aerospace and Defence; Agriculture, Food and Beverage; Bio-Industries; Environmental Industries (including clean energies, green building products), and Information and Communication Technology (ICTs).(110)

The case studies are supplement this evaluation on the Enhanced Representation Initiative (ERI) has responded to the changing needs of the Canada-U.S. relationship. Of significance in this regard are several issues of particular interest to Canada, uch as trade, security, productivity and competitiveness, science and technology, and the extent to which ERI supports Canadian small and medium-sized businesses (SMEs) in accessing the U.S. market, and in attracting U.S. investments. While the main study touches on all these issues, each case study provides more detailed insights.

The Evaluation Team considered the multiplex system of Canadian representation in California - including the Consulate General in Los Angeles, the Consulate in San Diego, and the Consulate General in San Francisco with its Trade Office recently relocated to Palo Alto - as being of special interest for the purposes of this study for a number of reasons:

  • The San Diego Consulate is, both in terms of infrastructure and personnel, fully the result of ERI investment
  • The San Francisco Consulate General provided an interesting opportunity to examine a Consulate that had previously been upgraded to the level of Consulate General; with a Trade Office (not defined as a separate Consulate) recently moved from San Jose to Palo Alto.(111)
  • The Los Angeles Consulate General provided an example of a mission that a) had its territory and responsibilities reconfigured due to the upgrading of the San Francisco office to Consulate General status and b) took on a new role as the management hub for the new San Diego and Phoenix Consulates (the latter with a Trade Office in Tucson).

Further, the three California missions are located in intensive Science and Technology markets. Enhancing Canadian participation in Science and Technology is a key element in Canada's policy for ensuring global competitiveness.(112)

This case study assesses the relevance, cost-effectiveness and success of the ERI as applied to the three missions, Los Angeles, San Diego and San Francisco and to a lesser extent the satellites in Tucson, Phoenix and Palo Alto; in particular, the role of San Diego and San Francisco in supporting Canadian involvement in S&T.

Methodology

This study employed a variety of approaches to data collection: face-to-face interviews, phone interviews and document review. The majority of interviews were conducted during a field mission to California, which took place on June 11th - June 15th, 2007.(113) Respondents included Consulate staff, academics, media representatives, American companies and organizations, and representatives of Canadian firms.

The study is organized into five main sections: Introduction, the Context and Rationale of the Consulates (General) in California, Findings on ERI's Cost-Effective Management Practices, Successes, and Conclusion.

Context and Relevance

With a history of relations reaching back more than 180 years, there exist many commonalities between Canada and California as the foundation of their longstanding commercial link. Of similar populations (California at 36 million and Canada with 32 million), in 2005 California and Canada ranked as the world's eighth and ninth largest economies respectively (at $1.6 and $1.1 trillion dollars). Further, both California and Canada are considered to be open, liberal societies with a myriad of shared values including commitments to environmental protection.(114)

California is the most populous state in the U.S. and thus, by sheer numbers alone, represents a substantial and dynamic market for Canada. However, the economic relationship between California and Canada is complex and driven as much by the intensity of commercial ties as by the size of the market. In addition to sharing extensive trade in the better known computer technology and entertainment industries, Canada and California are also linked through their shared interests in arrange of industries including ICT (wireless, e-security, e-learning), Biotechnology, Cultural Industries (music, film/television and sound), Agrifood/Fish, Consumer Products, Aerospace & Defence, Environmental Industries and Clean Energy.(115) California is Canada's fourth largest export market, surpassing the UK and Japan. Conversely, in 2006, Canada became California's second largest trading partner after Mexico. In 2006, the two-way merchandise trade alone exceed $37B.(116)

Exhibit A.18 California's Leading Exports & Imports from Canada 2005 (USD x 1,000) (117)

California’s Leading Exports to CanadaCalifornia’s Leading Imports from Canada
Computers$1,380,000Automobiles$9,300,000
Motor vehicle parts (excl. engines)$315,000Trucks$1,510,000
Aircraft parts (excel. engines)$237,000Organic chemicals$526,000
Trucks$204,000Office machines/equipment$433,000
Fuel oil$294,000Petroleum/coal products$324,000
Medical supplies$187,000Meat$308,000
Medicine$6,177,000Newsprint$273,000
Electronic Tubes/semiconductors$173,000Synthetic rubber/plastics$267,000
Consumer Electronics$159,000Motor vehicle parts$259,000
Medical Equipment$150,000Containers$257,000
Total$9,276,000Total$13,457,000

The data noted in the table above contributes, in their aggregate, to making Canada California's second largest economic partner. As the following table shows, this relationship has been steady over the past five years.

Exhibit A.19 Canadian Total Exports & Imports to California - Total for all Products (USD x 1,000) (118)

 20022003200420052006
Exports$10,080,000$11,230,000$12,110,000$13,210,000$14,190,000
Imports$16,770,000$17,930,000$20,770,000$22,050,000$22,670,000

Finding 1:

The expansion of Canada's consular representation in California is consistent with the intended outcomes of ERI, its partners and stakeholders, along with the general interests of the Canadian public.

California constitutes the 6th largest economy in the world.(119) Despite a period of relative economic stagnation reaching from the mid-1970's to the late 1980's, devastating race riots in the 1990's and spate of natural disasters, California has maintained a position of relative economic and political power in the U.S. California has the largest state economy in the U.S. As of 2006, no fewer than 52 Fortune 500 companies were headquartered in California, the third highest concentration by state in the US.(120) From 2002 to 2006, Canada's export trade to California grew by 41%.(121) California also demonstrates relative dominance, both in the U.S. and worldwide, in several industries and market sectors of importance to Canada. For example:

  • In 2005, nearly 40% of all publicly held U.S. biotech firms were located in California.(122)
  • California is the largest agricultural export economy in the US as well as a major importer of food from Canada (including meat and meat offal, grains, pasta, food industry residues and waste, and prepared fodder) to feed its increasingly urbanized population.(123)
  • Driven by the California state-level Proposition 71, intended to circumvent U.S. federal funding restrictions on stem-cell research by providing over $3B in funding directly to researchers and institutes, California has nominally become the world's leader in stem-cell research, followed by Canada.

As noted above, California is Canada's fourth largest trading partner. While trade has fluctuated in some industries, in general the economic relationship between Canada and California has been on an upward trend since the introduction of NAFTA. For example(124):

  • By 2005, Canada was supplying 23% of California's natural gas supply
  • In 2005, Canada was supplying approximately one-third of California's hydro-electric power
  • After a 2001 post-9/11 peak of 1.3M visitors, Canada still received more than 877,000 Californian visitors in 2005
  • The long-time practice of 'near-shoring' of both TV and movie production to lower-cost locations in Canada continues

Discussions with ERI partners such as Industry Canada, NRC, ACOA, WD and AAFC, reinforce the importance of California to their work in trade and advocacy. This is also supported by the level of interaction between these ERI partners and the posts in terms of IBD activities. Industry Canada, for example, partnered with DFAIT on 48% of all ERI initiatives in California. In Los Angeles, AAFC was the main partner on 26% of all ERI projects.(125)

California is the home of numerous leading defence manufacturers; the state is known to be a national centre for the manufacturing of military transporting aircraft, advanced weapons and surveillance technology equipment. Private companies in the aerospace and defence sector employed 153,788 people in 2002, accounting for 12% of the country's total sectoral employment. The majority of the production is concentrated in Los Angeles and San Diego.(126)

In addition to the strong economic position of California in the U.S. and relative to Canada, California also enjoys significant political power in the U.S. and has been a lead state in pursuing social and economic agendas in the area of health-care and the environment; of particular relevance to Canada. Further, Californian politicians occupy key positions in the United States Federal government:

  • Nancy Pelosi (Speaker of the House)
  • George Miller (Chairman of the Committee on Education and Labour)
  • Tom Lantos (Chairman of the Committee on Foreign Affairs)
  • Henry Waxman (Chairman of the Committee on Oversight and Government Reform)
  • Bob Filner (Chairman of the Committee on Veterans Affairs)
  • Senator Barbara Boxer (Chairwoman of the Committee on Environment and Public Works)
  • Senator Dianne Feinstein (Chairwoman of the Committee on Rules and Administration)

Governor Schwarzenegger also has demonstrated the ability to influence public opinion in the US. He recently undertook a mission to Canada leading to tangible outputs including the signing of a low carbon emission agreement between California and Canada, and signing a number of agreements with Premiers of several Provinces in Canada including the establishment of a Western Regional Climate Change Initiative, encouraging a number of potential connections between U.S. and Canadian firms.

Finally, it is interesting to note that California continues to be a major centre of academic excellence in the U.S. The University of California, over its multiple campuses, is one of the largest campuses in the world and its different campuses are recognized for their expertise in hundreds of fields of inquiry. California universities are also leaders in the commercializing of S&T initiatives. California has a relatively high rate of 44%, of biotech spin-off firms founded by University-based researchers/ entrepreneurs, which is high when compared to other industries.(127)

Finding 2:

The pattern of ERI's expansion in California is consistent with both trade and advocacy goals of most ERI partners.

Based on assessment of current economic and political trends in the US, the current and emerging interests among ERI partners, and the projections for next wave of economic development, it appears that ERI's needs analysis, and selection of sites for enhanced representation and redistribution of territories was appropriate. Interviewees, including Consulate representatives, ERI partners, local contacts and Canadian companies/organizations, all provided consistent support for this. For example:

  • As noted in the Denver and Minneapolis case study, interview data suggested that the 'right-sizing'(128) of the Los Angeles Consulate General's territory in California - through the introduction of the San Diego Consulate (under the supervision of the Los Angeles Consulate General) and increasing staff in the San Francisco Consulate General - allowed staff in the Los Angeles Consulate General to focus their efforts condensed territories resulting in more extensive networks and relationships.
  • Interviews also suggested that the upgrading of the San Francisco to a Consulate General had both an impact on the reach and depth of service provision in the northern part of California and also had an affect on US-based partners who reported feeling 'abandoned' when the Consulate was downsized in the 1990's. In addition to improving access to Sacramento - the State capital - and improving the coverage provided to important high-tech economic districts such as Silicon Valley, the majority of those interviewed simply 'felt better' with having a full-service consulate in close proximity. For example:
    • "When the services became concentrated in Los Angeles, we more or less lost all touch. You cannot easily service an area as large as this from a distance." (External Interviewee in San Francisco)
    • "When the focus of service was in Los Angeles, they did what they could but they simply could not get here on a regular basis." (External Interviewee in San Diego)
    • Partners, such as AAFC, noted that having an ERI dedicated LES position in San Francisco has been a significant advantage in terms of advancing their agendas in those regions.
  • The establishment of a Consulate in San Diego, under the direction of the Los Angeles Consulate General, appears to have been both a timely and adequately scaled investment. San Diego and its environs are home to 10% of all publicly held biotech firms in the US(129). Further, San Diego has growing defence, medical and high technology industries that have contributed to economic growth rates of 17% over the last 20 years, more than double the U.S. national average. At the time that the Consulate was established, Mexico was the only other country with a consular presence in San Diego. Since then, other countries, including Australia have also established a presence, recognizing the growing economic importance. Thus, Canada had the advantage in being 'first on the ground' and has set the standards by which other governments are being judged. In one external interview it was noted 'I am encouraging the Australians to follow a Canadian model for engaging with us.' Interview data found that prior to the opening of the consulate in San Diego, Canada was not really 'on the radar' except for some periodic visits from the Los Angeles office. It was found that opening an office in San Diego sent a strong message that Canada was serious about its relationships.

When these circumstances are considered, the locations and depth of Canadian presence in California appears to be based on a generally sound rationale.

Exhibit A.20 Timeline of ERI Expansion in California

YearLos AngelesSan DiegoSan FranciscoSan Jose/Palo Alto
2003-2004Assumes responsibility for San Diego MissionMission Office Opened  
2004-2005 1 Canada-Based Staff added

2 LES’s added
  
2005-2006Transfers responsibility for northern California – including the state capital of Sacramento – Nevada and Hawaii to upgraded San Francisco mission.1 Canada-Based Staff added

1 LES’s added
Expanded Mission Office Opened

2 Canada-Based Staff added

4 LES’s added
Mission Office Opened

2 Canada-Based Staff added

3 LES’s added
2006-2007   Mission Office moving to Palo Alto

Interview data also found that there were some 'growing' pains that, over time, have begun to rectify themselves. For example, while sound rationale was provided for opening a Trade Office in San Jose, the relative importance of Silicon Valley for IBD activities has prompted the relocation of that office to Palo Alto. At the outset of ERI, the time required for developing and managing the offices (in San Diego, Tucson and Phoenix in particular) was greater than anticipated, though more recently an effective multi-office management system has been developed which means that the transition will be more efficient. While the 'transition of responsibility for Nevada from Los Angeles to San Francisco has not been fully complete, the question of whether there should be a physical presence in Sacramento, the state capital, was also raised. Given the relatively recent upgrading of the San Francisco Consulate General, the selection of the Honorary Consul for Hawaii, at the time of data collection, was not yet finalized.

Science and Technology: Securing Canada's Economic Future

From a Canadian perspective S&T is understood to refer to a full range of research activities undertaken by governments, universities and the private sector, which contribute to knowledge and technological development.(130) Innovation is defined as the commercialization of new products and services (or new ways of delivering products or services).(131)

Finding 3:

ERI's investments in California are directly relevant to Canadian policy and priorities with regard to science, technology and innovation.

Around the world, there has been general recognition that advances in science and technologies are significant drivers of both sustainable economic growth and social well being.(132) Canada is no different in this regard. 'Mobilizing Science and Technology to Canada's Advantage', released in March 2007, has set clear priorities for science and technology - including partnering and innovation - as key elements of the Canadian policy for ensuring global competitiveness.(133) The Initiative is consistent with, and fully supportive of, the key objectives of the North American Security and Prosperity Partnership (SPP) signed in March 2005 by the Presidents of the United States of America and Mexico, and the Prime Minister of Canada. Further, several ERI partners - including Industry Canada, the National Research Council, and Agriculture and Agri-Food Canada, are part of the Canadian federal 'S&T Structure' tasked with meeting the priorities of Canada's innovation agenda including a) accelerating knowledge creation and commercialization b) supplying highly qualified people to support a knowledge-based economy c) modernizing business and regulatory practice and d) helping communities to attract S&T investments.(134)

"The issue is not whether ERI is relevant for Canada in California. If anything, it is overdue. San Francisco should not have been downgraded in the first place."

Consulate Interviewee

An assessment of ERI's priorities and investment strategy clearly indicates a strong degree of alignment with the priorities outlined above:

  • The ERI Logic Model includes both Short and Medium Term Outcomes related to S&T including:
    • Intended Outputs - a) Raised Awareness in the U.S. of Canadian Technological Capabilities; b) Increased Canada-U.S. sharing of technologies
    • Intended Outcomes A) Increased commercialization of S&T in Canada
  • ERI's investments in California have placed both office and people at the centre of key S&T centers in the US - in particular in San Diego and San Francisco but also Los Angeles
  • ERI's program has placed sector experts - both Canada-Based Staff (CBS) from partner's organizations and sector-specific LES positions - in key S&T related offices in California. The Consulate in San Diego views itself largely as an issue-focused 'Science, Technology and Innovation post'. As was noted, 'we spend 100% of our time on S&T and 100% on Innovation'.
  • ERI has made funding available for both partners and posts to pursue S&T programming. In particular, in 2003 the ERI partnership developed the Technology Partnering Initiative with the goal of accelerating the commercialization of emerging and promising new technologies, products and applications by assisting Canadian firms to develop strategic alliances with U.S. companies and institutions. In 2006-2007, the California posts were among the largest recipients of TPI fund allotments, with Los Angeles leading at $60K.
  • S&T is a cross-over area, at times including elements of advocacy, trade, investment and technological partnering. ERI's contributions to improved PERPA and IDB cooperation have contributed to an enabling environment where multifaceted S&T programming can be pursued.

In sum, it is clear that ERI has directly contributed to capacity development in a way that has created the conditions for pursuing Canada's S&T agenda in what is the world's most important S&T hub.

Finding 4:

By creating the conditions for success, ERI has contributed to progress on both Canadian and partner priorities, as well as its own intended results in S&T.

Canada-California Strategic Partnership Initiative

While ERI has contributed to the development of the SnT relationship between Canada and California, it is not the only factor. Industry Canada, for example, has developed the Canada-California Strategic Partnering Initiative to “achieve world-class research strength in areas such as cancer stem cell research, infectious diseases, sustainable energy, and ICT/Broadband. Strategic international and inter-sectoral collaboration among governments, researchers, industry, and investors is pointing the way toward new approaches to positioning Canada as a global R&D and innovation leader.”

It is important to note that ERI’s TPI funds have played a key part in the development of CCSIP. ERI-TPI funds, for example, have been used in organizing CCSIP Summits, support participants in attending CCSIP activities and in hosting the CCSIP Advanced Energy and Nanotechnology workshops. Further, under ERI non-DFAIT partner staff, such as those from NRC, have played an integral role in the development of CCSIP.

In looking at S&T results, at least three issues related to performance measurement arise. First, as noted in the main body of the evaluation report, performance measurement systems that capture the either IBD or PERPA-type results are not compiled into specific data sets. Further, while posts and partners do make specific efforts to capture performance data, there are several barriers to the quality of data. Evidence from the posts suggests that systems such as TRIO are underutilized, rendering the data on issues like call and follow-ups unreliable. It was also noted that many Canadian organizations were disinclined to provide follow-up information, in particular on financial transactions that may have resulted from Consulate assistance.

A second issue related to S&T performance measurement stems from the nature of S&T in general. By definition, S&T is pre-commercial. Evidence, including observations from external experts interviewed, suggests that the timeline for commercialization of S&T initiatives is generally 3-5 years. Or, as one post-interviewee suggested, 'in areas like pharmaceuticals, you need up to 10 years (and $1.0B US) to get a significant new drug to market'. Given that the ERI posts in California have only been fully operational for approximately two calendar years, and that both the San Francisco and San Diego posts reported they required periods of up to a year to become integrated into the local business community, it is not surprising that there are few examples of 'commercialization' of S&T.

Third, it is extremely difficult to demonstrate direction attribution for results, though it is possible to suggest contribution to results. In addition to traditional IBD and PERPA activities that might have had an S&T orientation, other significant initiatives such as the Canada-California Strategic Innovation Partnership may have also contributed to successes in this regard. Many consulate staff suggested that, from a practical standpoint, they did not differentiate between CSF, TPI, ERI and CCSIP funding. Rather, they view these as tools, which they use in whatever combinations they find necessary to reach their goals.

Thus, in assessing results in term of S&T three lines of evidence were pursued 1) Evidence of utilization of ERI investments for S&T purposes with apparent relevance to the S&T sector; 2) Evidence of partnerships and other agreements that may suggest the potential for accelerated knowledge development (and accelerated rates of commercialization therein); and 3) Evidence of products and services making it to market with the support of ERI-developed capacities.

On the first front, there is considerable evidence of activity in the area of S&T under ERI in California. In 2006-2007 approximately 39% of all ERI projects (not including TPI investments) in California had a S&T focus. Five of these are highlighted below:

  • Game Developers Conference 2007 - Post partnered with Telefilm Canada, Alliance numeriQC, New Media BC, etc in hosting a networking event for 300+ participants. The objective was to provide Canadian companies network with potential partners and clients and to promote Canadian expertise to a local and international audience.
  • International Sustainable Energy Forum - Using a combination of workshops, presentations, and panel discussions the forum focused on information related to renewable options for executives and government officials. The forum provided Canadian companies an opportunity to pitch to venture capitalists, and find strategic partners in a dynamic California, U.K. and Netherlands market. It also emphasized opportunities north of the border; with a view to attracting Californian clean energy companies, and international R&D and investment to Canada. The partners in this ERI initiative were Industry Canada and ACOA.
  • Secretary of Agriculture A.G. Kawamura - Post was able, through a series of meetings, to provide introductions for Canadian companies to the Secretary of Agriculture for California as part of Governor Schwarzenegger's May 2007 Trade Mission to Canada. Clean technology focuses on the production of cellulosic ethanol using materials such as rice and, California is in need of a sustainable solution for the rice plant material left over from its thousands of acres of rice files after each harvest.
  • Vancouver - Post facilitated environmental engineering such as turbine engineering as part of a feasibility study for a tidal project in San Francisco Bay.
  • The Armed Forces Communications and Electronics Association (AFCEA) West 2007 - Under ERI, the Post enhanced Canadian representation at the conference which led to business development transactions.

In terms of evidence of partnerships and other agreements, there is also ample evidence to suggest that these are occurring with ERI support:

  • Digital City Network Signing Agreement -supports the commercialization of innovative digital media technologies and advancements. It will encourage the international cities in the network and their respective industries and research institutions to collaborate and partner on initiatives related to the digital industry.
  • Collaborative agreements for the development of recombinant monoclonal antibodies against validated targets in ovarian cancer.
  • Collaboration on Stem Cell Research - The San Diego post worked to introduce Canadian researchers to work in stem cell research. The research collaboration is focused on developing a stem cell based solution for the treatment of auto-immune diseases by reprogramming components of the immune system to stop attacking healthy tissue while maintaining their role in fighting external pathogens.
  • On May 30th, 2007; "During a press conference at MaRS Discovery District, California Governor Arnold Schwarzenegger announced collaboration between University of California Berkeley's Stem Cell Center and Canada's International Regulome Consortium to coordinate research and collaborate on projects of mutual benefit. Continuing California's leadership in potentially life-saving stem cell research, California Governor Arnold Schwarzenegger, along with Canada's Premier of the Province of Ontario Dalton McGuinty, together highlighted the depth of collaboration between Californian and Canadian stem cell research scientists."(135) Both Canadian and US interviewees suggested that the success of this trade mission was based in part on the ERI supported Consulate in San Francisco and a history of ERI work in supporting the CCSIP.

Finally, there is some evidence that products and services reached the market with the support of ERI-developed capacities. For example, a Canadian company was started in the post-9/11 era to develop cost-effective counter-terrorism solutions to protect airports, critical infrastructure, and communities from radiation threats. This company was of interest to American security contractors and firms. With the support of ERI, it was connected with several US firms and agencies. This firm also took part in an industry show hosted by "The Security Network" (a US based organization) and it was recognized with an award for 'Most Innovative Product'. Reportedly, they have gone on to complete several transactions and are entering into partnerships with US firms for other initiatives. Its success in the San Diego market can be directly linked to ERI's investments in that area.

Cost Effectiveness of ERI's California Expansion

Finding 5:

The magnitude of ERI's expansion (institutional and financial) in California is in keeping with the importance of the location and Canada's interests there as articulated through the ERI partners.

With two Consulate Generals, a Consulate and Trade Office, California hosts the largest number of Canadian representation offices of any state in the US (followed by New York with two Consulate Generals). Given the sheer population and geographic size of California, and its relevance to Canada's long-term economic health, this pattern of investment appears reasonable. Canada is California's second largest trading partner. Comparative evidence suggests that countries with comparable or lesser economic interests, such as Japan (California's third largest trading partner at $13.98B) and the UK (California's seventh largest trading partner at $3.3B), have a similar pattern of consular representation with equivalent numbers of resource people.(136) In addition to this, an assessment of qualitative data collected from external interviewees suggests that building Canada's presence in California by dispersing resources broadly (e.g. opening new offices, adding staff to four physical sites, etc) - versus having merely intensified resources in Los Angeles - allows for greater face-to-face contact with local partners which has an intrinsic value in the message that it sends to local partners. Further, interview data suggest that servicing territories at a distance - as was done pre-ERI - typically yielded poorer results in terms of the quality of relationships. The decision to move the San Jose office to Palo Alto - allowing for improved coverage of Silicon Valley - appears to be grounded on a solid analysis of Canada's representation needs and interests. This move also provides some evidence of active monitoring ERI investments and strategic decision-making designed to ensure that ERI's use of resources is serving the best interests of the Canadian partners and taxpayers.

The pattern of Partner involvement in California through ERI also suggests that ERI's activities in that state have allowed for expanded programming that would have not been possible without ERI HR investments and funding. Industry Canada, for example, noted that ERI enhancements to Canadian representation in California were of particular relevance given their objectives in S&T and allowed them to expand their activities in ways that could not be achieved working from Canada. Reference was made in particular to the new Technology Partnership Officer positions (e.g. in the Los Angeles Consulate General) and to placement of several IC staff in consulates in California (in particular San Diego where both the CBOs are IC secondees). Further, five of the seven ERI partners have supported consulate-generated initiatives with ERI funding. As an example, the Exhibits below identify the use of ERI resources to support IBD activities generated from the consulates.

Exhibit A.21 IBD Initiatives 2006-2007 (137) San Francisco / San Jose

Project TitleERI Post’s BudgetPartner(s) Sign Off
Bio-Partnering Event$3,000IC
AAAS Meeting$3,500IC, NRC
BC Contract Mission$5,000IC
Game Developer’s Conference$6,000IC, ACOA
Atlantic Canada Webinars$2,000IC, ACOA
Cleantech 2007$3,500IC, ACOA
International Sustainable Energy Forum$20,000IC, ACOA
Seafood Mission$9,500AAFC
Winter Fancy Food Show$14,000AAFC
Photonics West Conference$5,600NRC
Site License – Global Private Equity Solution$2,000-
Wireless Mission & VCAB$5,100IC
Total$79,200 

Exhibit A.22 IBD Initiatives 2006-2007 (138) San Diego

Project TitleERI Post’s BudgetPartner (s) Sign Off
Bio 2006 Conference$3,000IC
Nanomedicine Workshop and outreach Calgary Edmonton$1,500NRC
Nanobionexus Canadian spotlight event$2,700NRC
Bio Officers Meeting + outreach Toronto and Ottawa$1,000-
Reverse Mission Biocontact + Outreach Montreal$3,500IC
Reverse Mission Biopartnering + Outreach Vancouver$3,5000WD
Canada-US Ocean Energy Roundtable$1,000IC, WD
ASIS International$3,000IC, WD
AFCEA West 2007$12,000WD
AB Wireless Mission to San Diego-WD, IC
CN Wireless Mission to San Diego$7,000IC
Salk Institute Research / Science Mission to BC$4,000WD
BC Research / Science Mission to San Diego$4,000WD
Global Connect AGM in Toronto$8,000NRC
Total$54,200 

Exhibit A.23 IBD Initiatives 2006-2007 (139) Los Angeles

Project TitleERI Post’s BudgetPartner (s) Sign Off
Taste of Canada$8,300AAFC
Taste of Canada$4,300AAFC
Afri-Food Planning Meeting$200AAFC
Canadian Food and Beverage Show$1,600AAFC
SIAL Agri-food$2,200AAFC
Outreach Agri-Food and Consumer$800AAFC
Outreach Agri-Food and Consumer$800AAFC
Outreach Agri-Food and Consumer$1,000AAFC
Outreach Agri-Food and Consumer$1,000AAFC
Speaker Agri-food and Consumer Alberta$900AAFC, ITC
Buyers Mission Seafood$2,300AAFC, ITC
Training Agri-Food and Consumer Canada$1,600AAFC
ISSCR Conference in Toronto$400IC
LARTA Medicinal devices investment program$6,000NRC, WD
Sponsor Southern California Biomedical Council Investor Conference$3,500IC
Medicinal Device Territory Event$1,600WD
International Centre for Infectious Diseases mission$1,000IC
Solar Power 2006$805IC
Maintenance, Repair & Overhaul$985IC
North American Technology & Industrial Base Organization 2006 Steering Committee Meeting$615IC
Armed Forces Communications Electronics Association West 2007$10,000WD, IC
Oceans 2006$2,056IC
Sculpture to Wear$10,000ACOA
BC Wood Global Buyers Mission$1,600WD
Construct Canada 2006$1,600IC
Outreach in CanadaCancelledIC
CTIA Wireless 2006$1,500IC
Simulation, Gaming & Entertainment Canada$1,500IC
X-Change VAR Conference$24,000IC
Montreal Game Summit$1,500IC, ITC
Environment Initiative$5,000-
Rail and Urban Transport$4,000-
Territory Outreach$2,500-
Program IBD$6,500-
KPMG Competitive Alternatives Study$1,320WD
Automotive Aftercare Products Expo 2006$800IC
Investment Seminars$5,000IC, WD
Photonics West 2007$800NRC
SoCa/Bio Annual Investor Conference$2,000IC
Economic Developers Association of Canada 2006 Conference$2,000WD
Global Private Equity Solution Database$2,000IC
Banff Venture Forum$1,000WD
PARI-Quebec$528NRC
Canada California Strategic Innovation Partnership Summit II$1,338NRC, IC
LARTA Venture Forum$10,000NRC, WD
Automated Function Prediction Meeting Support$0NRC, IC
Total$138,447 

The advocacy strategies of the new and upgraded Consulates appear to be closely linked with ERI priorities as demonstrated in the tables below:

Exhibit A.24 San Francisco Advocacy Plan FY 2005-06, 2006-07

PrioritiesFY 2005/06FY 2006/07
Strategic Representation and Engagement10 events10 events
Increase Confidence in Border Security3 events3 events
Increase Awareness that Canada is in the international fight against terrorism and international security2 events3 events
Increase perception that drug policy, same sex marriages policy and health care differences are not important in our long-term relationship3 events1 event
Increase awareness that good stewardship of the environment is a shared responsibility4 events5 events
Increase awareness that Canada is the U.S. largest and most secure energy partner3 events5 events
Increase recognition that the U.S. benefits significantly from an integrated North American Market6 events1 event
Defend Canadian interests on other trade issues2 events1 event

Exhibit A.25 Los Angeles (Including San Diego) Advocacy Plan FY 2005-06, 2006-07

PrioritiesFY 2005/06FY 2006/07
Strategic Representation and Engagement13 events14 events
Increase Confidence in Border Security5 events6 events
Increase Awareness that Canada is in the international fight against terrorism and international security3 events2 events
Increase perception that drug policy, same sex marriages policy and health care differences are not important in our long-term relationship3 events0 event
Increase awareness that good stewardship of the environment is a shared responsibility4 events4 events
Increase awareness that Canada is the U.S. largest and most secure energy partner2 events0 event
Increase recognition that the U.S. benefits significantly from an integrated North American Market6 events5 events
Defend Canadian interests on other trade issues4 events2 events

Finding 6:

The decision to use executive suites to established new Consulates appears to have had unintended implications that may warrant further consideration.(140)

Interviewees in the US, and in Canada, suggested that the Consulates appear to have been established as 'pilot' ventures in order to assess the feasibility of enhanced representation in that region. As such, the decision to locate the satellites in executive suites was based on a desire to 'pilot' these locations using a low-cost, flexible option for providing both physical space and administrative services. Further, it was also suggested that pursuing a more traditional Consulate rental arrangement would have required more extensive support from the DFAIT Property Bureau and the Information technology Bureau that might have delayed the opening of the offices further and/or required more financial resources than ERI had at its disposal. An analysis of the San Diego Consulate suggests that there have been some unintended implications to this experimentation that would need further examination from the initiative in the future. For example:

Based on the missions to California and the Upper Mid-West, it appears that ERI has introduced a ‘natural evolution of representation’ that may form the pattern for future expansions. This evaluation appears to have four stages 1)HonCon representation; 2)Trade Office; 3)Consulate and 4)Consulate General. The first two stages appear to allow for ‘testing’ of a region in terms of need and depth of Canadian representation required for both advocacy and business development goals. The latter two stages being reserved for sites deemed to be of more significant long-term value. The goal of this model is not to drive toward the higher levels, but rather to determine the right-sized investment in a given territory.

  • Cost per square foot: The LA Consulate General and the Tucson Trade Office estimated space costs at $2.15 and $1.00 per square foot respectively. Conversely, the San Diego Consulate and Phoenix Trade Office located in executive suite cost $2.85 and $10.00 per square foot respectively.(141) In addition, informal research by the Consulates suggested that more traditional rental arrangements were available at lower costs than the executive suites. While comparisons between office are difficult to make, this preliminary data may warrant further investigation.(142)
  • Added Flexibility: The decision to locate Consulates in professional service centers was, according to interviewees, intended to allow for leasing flexibility. Interviews in Los Angeles and San Diego, suggested that there are self-managed stand-alone properties available with the same flexible terms as was found with leasing arrangements in professional service centers.
  • Quality and Utilization of Services: In San Diego, it was suggested the quality/speed of the Internet connection was poor. For example, it took minutes for pages of the TRIO software to load. The San Diego Consulate also noted that some services such as the reception and telephone answering services were not being utilized (e.g. the Consulate has its own direct phone lines).

Finding 7: Interviews with Consulate staff throughout California yielded observations and concerns about ERI that were consistent with those observed in the Upper Mid-West case.

The California case study serves as a means of verification for a number of observations and issues raised in the main body of the evaluation and/or observed in the Upper Mid-West case. For example:

  • Many interviewees at the Consulates reported that ERI funds gave them flexibility to undertake projects that would not qualify for support through other funding streams such as Client Service Fund (CSF). However, in California, there were a greater number of outliers who suggested that they saw no particular difference in ERI and non-ERI funding streams. The reason for this is not readily apparent.
  • While most program-level interviewees were pleased with the various funding streams, many reported that the transaction cost of having to apply for funding from, and report back to, multiple sources for a single initiative was time consuming. Some informants made a request for a single planning and reporting template or a unified fund.
  • There were some concerns raised that non-DFAIT partner deployments under ERI often were under-prepared for their assignments in terms of understanding basic elements of IBD and PERPA. At the same time, ERI partner deployments expressed concerns about possible bias in the ERI selection processes, such as extended timelines for selection and their perception of limited support for relocation.
  • Some interviewees who were in their roles during the start-up phase of ERI, recalled that the early years of ERI were 'confusing'. Interviewees noted that they were unclear as how ERI worked and that very little information, training or guidance was provided to help them to understand the system. While interviewees now generally note that they understand and are comfortable with ERI's system, newly appointed staff reported receiving little or no information from ERI to help them understand the goals and functional aspects of the initiative.

Finding 8:

In California, ERI has successfully become an integrated element of the Canadian representation. As such, notions like 'ERI planning' are rapidly becoming dated.

The majority of the managers and officers in California Consulates began their placements after the launch of ERI. Indeed, a majority of those interviewed were placed in Consulates through ERI. With some exceptions, such as long-term LESs or career DFAIT officers who have been on previous postings, most Consulate staff have no experience with a pre-ERI posting in the US. As such, making comparisons about programming pre- and post-ERI is difficult. Furthermore, most interviewees do not differentiate between ERI and non-ERI programming funds. Rather, ERI funds are viewed by the staff as one in a larger suite of mechanisms (including CSF, CCSIP, etc) for achieving their goals. As one interviewee noted, 'We don't think, ok now I am planning/doing ERI work. We just do our work and use whatever tools we have at our disposal'. As a consequence, the notion of 'ERI' planning is virtually non-existent. Rather, it appears that Consulates prepare their workplans on the basis of needs and priorities and then set about deciding what pools the funding will come from based on the availability of funds and the alignment of the projects with the criteria of the different funding pools. This in itself is a testament to the success of the ERI Secretariat in not 'branding' itself as a stand-alone initiative.

It is interesting to note that in the first 18-24 months, the programming pattern focused on developing their understanding of the market and advocacy issues in their areas and building the networks they needed in order to be able to pursue their goals. In doing so, it appears that these offices pursued, similarly to the Upper Mid-West case, an awareness-raising blitz at the beginning. This accounts for the higher activity levels in the first two years of ERI. In San Francisco, for example, there were 40 events in 2005/2006 compared to only 32 in 2006/2007. The 2007-2007 plan for San Francisco notes that this initial networking and awareness raising period is now over and the focus will now be shifting towards nurturing these networks to support results achieved.

It is also interesting to note that the Los Angeles hub has developed an integrated planning model (that extends beyond ERI) for managing its three satellite offices that includes a monthly meeting held in the four territories on a rotating basis. San Francisco has a similar approach to integrated planning with its Trade Office in Palo Alto.(143) At the same time, it was observed that the bifurcation of responsibilities for the state between two Consulate Generals under ERI have made the development of a single holistic 'state strategy' - as seen in Florida - a more complex activity. A number of senior Consulate staff also noted that the lack of a clarified US strategy contributed to the challenge of aligning planning.

Success Capacity Benefits and Results

Prior to ERI, California had Canadian representation that pursued a variety of goals and objectives. Canadian companies were active in California. Canadian universities were connected to Californian universities. Canadian interests were promoted with decision-makers. Under ERI, the existing capacities have been enhanced not replaced, but in the absence of baseline data, the nature and extent of a pre-ERI rate of influence cannot be determined. As such, it is difficult to estimate the consequences of what would happen without ERI. The goal of this section is to highlight were ERI has clearly enhanced capacities and to draw reasonable causal conclusions about the apparent contribution of ERI to business development and advocacy goals outlined in ERI's RMAF.

Finding 9:

In California, it is apparent that capacities have been enhanced under ERI, and that outputs and outcomes are being achieved.

ERI investments in California have only become fully functional and operational within the last 24 months. Despite this short timeline, ERI has contributed to enhancing the capacity of Consulates and ERI partners to pursue Canadian business development and advocacy goals in California. The history of the physical and Human Resource (HR) expansion is detailed earlier in this case study. These capacities, along with access to ERI project funding, constitute capacity building at the most fundamental level. ERI has also supported a more qualitative form of capacity building in California through its HR programs. The placement of partner personnel and the hiring of sector-specific LES positions have significantly contributed to the capacity of posts in California to pursue both IDB and PERPA programming at a higher level of sophistication. For example, ERI partners in Canada and local partners in the US both indicated that having 'experts who can interact with experts' was invaluable in improving the quality of IBD and PERPA activities. ERI partners in Canada also indicated that, by having a department member posted in the field, they were better assured that their priorities were being addressed.

Exhibit A.26 ERI-Funded Positions- In California

MissionCanada-Based StaffLocally Engaged StaffTotal
Los Angeles011
San Diego235
San Francisco4913
San Jose011
Total61420

In 2005/6 and 2006/7 advocacy plans the overarching strategic focus was on developing a network of contacts identifying potential advocacy opportunities and partners, and staff key positions within the section. The 2007/8 plans indicate that this phase of start-up has ended and announces an intention to begin to leverage its networks to fully establish its presence in strategic regions.(144)

In Los Angeles, the territorial responsibility of individual officers was reduced under ERI. Officers reported that they were able to put more time and energy into fully developing networks and opportunities under these conditions. However, in new Consulates, like the one in San Diego, there was an initial start-up period required for establishing the office, identifying and orienting human resources, building networks, and educating local partners about the opportunities presented by the presence of a Canadian Consulate. Therefore, there was a delay in operationalization. It is also important to note both the San Diego and San Francisco office experienced staffing delays and in retaining resources in ERI positions, which contributed to the delays in start-up efforts.

Despite these delays, there has been a clear increase in productivity in both San Diego and San Francisco. As noted in several interviews 'San Diego is obvious, without ERI there is no San Diego Consulate and most of the activities there would not have happened'. Both Los Angeles-based officers and local partners in the San Diego region, suggests that this analysis is largely valid. Evidence from external partners suggests that the same is true of the San Francisco office, where interviews stated that after the downsizing of the office in the 1990's they had little or no ongoing contact with the Los Angeles Consulate General. Therefore, the upgrading of capacities in 2005 renewed connections with partners, leading to renewed activities as demonstrated by the table below. The increased capacity is also evident in the changes in program spending at certain posts. The San Diego Consulate has demonstrated a steady rise in program spending since its inception. The San Francisco/Palo Alto site also demonstrated increased spending after its human resources were upgraded in 2005-6:

Exhibit A.27 Changes in Program Spending (145)

 San DiegoSan Francisco/Palo Alto
YearOperationsProgrammingOperationsProgramming
2003-04n/an/an/an/a
2004-05$164,301$51,200n/a$128,000
2005-06$307,259$66,800$503,415$87,550
2006-07$334,012$82,300$1,443,747$103,350
2007-08n/a$105,800n/a$137,700
Total$805,572$306,100$1,947,162$456,600

Arising from this, there are numerous examples of short and medium term Outcomes - as defined in the RMAF - in a number of areas. For example:

  • Advocacy: The San Francisco mission found that prior to their arrival, contact with state officials in Sacramento was limited. When they first began their upgraded operations, few state officials had met with Canadian representatives and, reportedly, were unaware of the importance of Canada as a trading partner. At the time, Governor Schwarzenegger was planning trade missions to countries, such as China, but Canada was not apparently 'on the map'. The Consulate General in San Francisco is confident that their intensive advocacy work in Sacramento contributed directly to the decision to undertake a trade mission to Canada. External interviews confirmed that the San Francisco office had, in the last two years, made considerable inroads in making decision-makers in Sacramento aware of Canada's interest in California.
  • American Awareness of Investment Opportunities in Canada: A major manufacturer moved its operations from California to BC with support from the San Diego Consulate. This led to the creation of 270 jobs in Penticton, BC.
  • Raised Awareness of US Canadian Technological and Market Opportunities for Canadian Firms: The homeland security industry in the US has resulted in an evolution in the nature of purchase patterns. Unlike industries, such as the auto industry, the emphasis in security is not on 'buying American' but rather on ensuring that technologies are simply 'best of breed' no matter what the country of origin. The San Diego Consulate capitalized on this by introducing a Canadian Firm to several American firms and agencies. With ERI support, this firm also took part in an industry show hosted by The Security Network (a US based organization) and was recognized with an award for 'Most Innovative Product'. Reportedly, they have gone on to complete several transactions and are entering into partnerships with US firms for other initiatives. Its success in the San Diego market can be directly linked to ERI's investments in that area.

Interviewees in California made reference to their involvement in several different networks funded under ERI. HISPANET was of particular relevance to the Consulates in Los Angeles and San Diego. HISPANET started in September of 2006 as a direct result of ERI funding. It is one of the six networks financed by the Enhanced Representation Initiative. The focus of the Hispanic network is on the political and economic growth of Hispanic population. Its purpose is to gain a better understanding of the Hispanic communities in the US, including their influence, composition and interests in order to enable Canada to more effectively advocate on a full range of Canada-US issues. The network conducts events among academics, NGOs, government representatives, and private sector to offer strategic focused dialogue on trade. The HISPANET coordinator is based in Los Angeles.

Inaugural event of HISPANET: March 8-9, 2007 entitled Hispanics in the US: Their Role and Relationship in the North American Community. The forum brought together representatives from the private sector as well as academic, government and think tank experts on the Hispanic community. Each officer brought one of their main Hispanic contacts, and as a result, outreach and networking were facilitated. The major outcome of the forum included the drafting of regional engagement strategies, which will be further refined by the research on the US Hispanic demographic commissioned by DFAIT. The forum had an actual cost of CAD$36,360.72.(146) As a result of the forum, HISPANET officers (from across the US Consulates) left with a better understanding of the Hispanic community and its importance relative to Canada. Of particular importance was the understanding that Latin American policy issues are at odds with Canadian interests.

Finding 10:

ERI has had mixed results in enhancing partnerships in developing horizontal cooperation in Canadian representation in California.

There are some clear examples of horizontal cooperation between relevant Canadian government departments in representing Canadian interests in California. In terms of staffing, 50% of the ERI partners have placed staff in California Consulates as demonstrated in the chart below.

Exhibit A.28 ERI Positions in California

CaliforniaPostPartner
2007LNGLSDFAIT
2006SJOSELES
2005LNGLSDFAIT
LNGLSNRC
LNGLSDFAIT
SFRANLES (AAFC)
SFRANDFAIT
SFRANDFAIT
SFRANDFAIT
SFRANDFAIT
SNDGOIC
2004LNGLSIC
SNDGOIC

Further, the San Diego Consulate is entirely comprised of non-DFAIT ERI partner departments. While these examples do not necessarily reflect a Whole-of-Government approach, they do demonstrate that ERI has created opportunities for cooperative representation arrangements that are atypical in terms of non-DFAIT partner participation and leadership.

ERI has also created a degree of horizontal cooperation in terms of its project funding. ERI requires departments collaborate on ERI funded projects by having at least two partners on each proposal. In some cases, multiple posts and/or multiple ERI partners are involved. However, evidence from interviewees both in the Consulates and in Ottawa suggests that this collaboration is not always genuine. Several interviewees stated that in the majority of cases, the project is initiated by one partner who seeks another one to 'sign off' on the proposal, but that the work of implementing the project is typically only done by the initiator. While it is not possible to determine the frequency of these "paper partnerships", triangulated data from other posts and from ERI partners in Canada suggests that this is a commonplace occurrence. As one interviewee noted, 'I call up someone I know and get the email that says they agree to the project, and that is where collaboration ends'. Further, it was noted that the majority of partnerships are between DFAIT (usually in the Consulate) and one other partner; collaboration between non-DFAIT partners being rare. This suggests that in California, true horizontal cooperation (on a Whole of Government basis for example) is yet to be achieved. However with that said, ERI has set up the process for collaboration and it is now the onus of the partners to do it in the fashion it was intended, or not.

It was interesting to note that, despite the positive attributes of HR cross-postings made possible through ERI, non-DFAIT staff in California expressed concern over being 'abandoned' by their home departments without regular contact or a reporting relationship. One interviewee noted 'Does [my home department] know what I am doing here? I don't think so; I contact them, they don't get a hold of me. They don't mention us in their reports even.' Another concern was raised about the deployment of non-DFAIT staff in roles outside of their home department's area of responsibility. Under ERI, technically, any ERI partner can forward staff for any position whether relevant to their home department or not. Evidence indicates that this has happened on at least one occasion. As one interviewee noted 'Sure, they may be doing a great job but does it really serve the interests of the home department or ERI?'

Conclusions from the California Mission

The five-day mission to California allowed the evaluation team to reach several conclusions concerning ERI's investment:

  • The targeting of California for enhanced representation is highly relevant to a full spectrum of Canadian interests, and in particular Canada's S&T agenda
  • ERI resources in California generally appear to have been used cost effectively, though the use of executive suites appears to have had some disadvantages in terms of cost and services.
  • Resources appear to have been targeted effectively, though greater gains may be had through a more holistic state-wide planning approach as well as having a clearly articulated U.S. strategy on a Canada-wide basis.
  • ERI partnership results are evident in California, though some room for improvement is apparent.
  • ERI results in terms of enhanced representation for advocacy and business development is contributing to improved awareness among state-level decision-makers, increased influence, improved business development connections, S&T partnerships and, in some cases, investment and sales benefiting Canadian and American firms.

Finally, it was also apparent that US colleagues were genuinely impressed with and appreciative of the enhancements to Canadian representation in California.


Appendix2: Management response and Action Plan

Because of its size and vitality, the United States economy presents a tremendous opportunity for Canada in the areas of trade, technology and investment.

In recent decades there has been a significant shift in U.S. population and economic strength toward the south and southwest of the U.S.A., regions where Canada is not as well known as in the older north and northeast. President Bush's election in 2000 reflected this and heralded a new era in which Canada would have to work much harder to win support from the U.S. administration on key issues.

The events of September 11, 2001 underlined the links between economic prosperity and national security and revealed a certain amount of vulnerability for Canada's prosperity in this time of major U.S. concern over its national security. Canada's most important economic interests are at stake in the United States, and more must be done to assert Canada's views, resolve existing problems and head off new ones.

The resources of the Government of Canada in the U.S.A. in 2002 did not allow an appropriate and effective focus on advocacy and business development in such a large territory. In November 2003 the Treasury Board approved a submission from the seven departments that had formed a partnership for Enhanced Representation in the U.S.A. This provided a budget of $118.2 million over five years with approximately $60 million sourced from the fiscal framework and an equal amount from Partners, beginning in September of fiscal year 2003-2004.

The Treasury Board Submission upon which approval was based indicated that a Summative Evaluation would be completed by mid 2007 to assess the effectiveness of the initiative, how resources were managed, the overall success of partnership development and the potential to extend the initiative for an additional term. The evaluation was completed in September 2007.

Overview of the Summative Evaluation

The ERI Partnership is pleased to accept the Report of the Summative Evaluation. With less than one half year remaining in the approved term of the ERI, the Partnership recognizes that its response will be largely "in trust" for the new North American Platform Program Partnership which will succeed the Enhanced Representation Initiative.

The Partnership is pleased that the Summative Evaluation has found numerous positive results in the concept, implementation and operationalization of the Enhanced Representation Initiative. The ERI remains relevant in terms of the priorities, needs and objectives of the Partners. The ERI continues to promote Canadian interests in the United States by increasing capacity and networking, and by encouraging and developing collaborative relationships in the U.S.A. and among Partner departments. In this context, the ERI remains relevant in strengthening Canada's presence and in improving Canada-U.S. relations. The relevance of the ERI is demonstrated by its ability to support the posts on programming and with quality HR staffing as they pursue advocacy and business development results.

The restructuring and "rightsizing" of Canada's presence in the U.S. have succeeded in improving representation in regions of strategic importance to Canada. ERI Partners report that the new and upgraded offices have substantially improved their respective capacities to pursue business development and advocacy roles in the U.S. The expanded physical presence has augmented service delivery. The strategies used to "pilot" new posts in a low-cost and flexible manner (and for upgrading others) have generally been successful.

To operationalize the expanded network, the ERI has demonstrated an ability to secure competent human resources from Partners for posting and is improving the capacity of posts to address Partner priorities in the U.S.A. The Honorary Consul component of the ERI is emerging as a cost-effective tool for extending the reach of posts and better capitalizing on opportunities for Canada's "voice" to be heard.

The ERI has enhanced the government's capabilities for meeting new challenges facing Canadian interests in the U.S.A., and the development of effective networking capacities has extended the ability of ERI Partners to influence Canada-U.S. relations. The ERI has increased the awareness and understanding among Partners of the challenges, diversities and opportunities related to business development in the U.S.A. Partners and posts generally agree that ERI programming has expanded their options for pursuing international business development as well as contributing to Canada's science and technology objectives in the US.

ERI partnering is linked to positive results in terms of collaboration, coordination and leverage. There is evidence of a greater collective synergy that contributes to programming successes. There is evidence that the ERI has increased levels of output in relation to both advocacy and trade promotion. Business clients report important outcomes linked to the ERI's investments in business development activities. Evidence points toward ERI-supported activities contributing to new export sales (especially in relation to SMEs).

The ERI's collaborative governance structure has successfully built a "trusting" partnership. The Directors General Operations Committee has become the de facto leader in the ERI's governance process (albeit at an operational level). The Secretariat plays an essential role in horizontal management. Mechanisms implemented by the Secretariat have been successful in ensuring financial and operational oversight. The ERI's commitment to multi-year funding, and the Secretariat's ability to manage cash flow through the movement of surpluses to future years, have enabled the efficient use of resources by Partners and posts.

Successes in implementing and operationalizing most of the vision of the ERI have been balanced by some missed opportunities. For example, governance, driven by the Directors General Operations Commitee, has focused on the short and medium term. In the process, the Deputy Minister Steering Committee and Assistant Deputy Minister Policy Committee have not been adequately engaged in their governance roles (as envisaged in the RMAF) of providing strategic direction and performance oversight. As a consequence, ERI planning has run the risk of not being fully responsive to, or anticipatory of, key developments and changing environments. This may also have compromised to some extent the "whole of government" approach. There remains a need for other government departments (OGDs) having business development and advocacy programming priorities in the United States to engage in the ERI Partnership initiative.

At the operational level, the ERI's standing committees have been found to achieve mixed results vis-à-vis expectations set out in the RMAF. Two of the three committees have performed as anticipated. The success of the Communications Committee may have been compromised by unrealistic expectations and ambiguities associated with its role.

ERI performance reporting captures information on activities and expenditures but does not yet provide sufficient output and outcome information. This may be a result of the RMAF not providing adequate strategic guidance on performance accountability with respect to the roles and responsibilities of the Partners and the Secretariat so that the data specified in the RMAF can be captured. The absence of an integrated performance management system constrains the ERI's ability to track performance and carry out informed decision-making. As a result, opportunities to perform more effectively can be missed.

There are also some concerns that the ERI project planning, candidate selection and approval processes duplicate effort, are too time consuming for the results, and create inefficiencies in terms of individual Partner planning and approval processes.

Finally, while much of what has been achieved by the ERI has met the needs stated in the 2003 Treasury Board submission, feedback from Missions indicates that there is still inadequate in-Canada Partner and Regional Office capacity related to the Canadian supply side. This validates the need to constantly review the sufficiency of the logic model underlying the initiative as well as the resources required to achieve expected results.

ERI Summative Evaluation RecommendationsManagement Response & Action Plan
Recommendations related to design of ERI:

The evaluation noted the acceptance of the RMAF by partners, but raised concerns about the willingness of partners to operationalize aspects of the RMAF. The evaluators conclude that in the new ERI there needs to be a re-commitment to the vision and intent of the program and this should be articulated in the RMAF, governance, staffing, etc. It is in this context that we recommend:
The Partners accept this Recommendation.
1) That the ERI Secretariat plan and execute a partners Visioning Exercise to develop consensus on:

- The overall vision for the initiative, in particular in terms of its nature as a horizontal or 'whole' of government' initiative
- The goals and objectives of ERI, in particular to what extent are the partners responsible for harmonizing their work-planning, implementation, reporting and accountability for results under ERI.
- The specific roles and responsibilities of each of the Departments - potentially articulated in the form of a charter.
- The role of the Secretariat (and specifically whether it should continue in its current coordination mode or whether it should work to fulfill the RMAF vision of a more strategic role). Partners should be explicit and agree on the roles and responsibilities with respect to the role of the Secretariat.
1) The ERI Secretariat conducted a Workshop/Visioning Exercise in October to develop consensus among potential members of the new NAPP Partnership in respect to: - its strategic objectives, which will define its scope; and
- its governance framework, which will define the rights and responsibilities of Partners.
The outcome of this exercise was a Governance Framework Agreement, to be signed by eventual Partners of the NAPP. The Agreement refers to the development of an RMAF, and to the role of a NAPP Secretariat in managing performance measurement.

Subsequent discussions will be held to further define objectives and programming when the NAPP Partnership is fully formed.

A draft RMAF has been developed for the NAPP. It is specific as regards the Secretariat's responsibility for overseeing performance measurement.

The new Partnership will be horizontal in nature with a "whole of government" perspective.

2) The results of the visioning exercise to be formally approved by each of the partners and lead to a new approved RMAF.2) Each NAPP Partner will be a signatory to the Governance Framework Agreement.
Recommendations related to Governance:

Given the importance of governing horizontal initiatives, the evaluation concluded that more emphasis needs to be placed on the role of the DM and ADM committees. This should complement the present role being played by the DG committee in operationalizing the initiative. In this context we recommend:
The Partners accept this Recommendation.
1) The DM Committee remain as the overall group responsible for the Initiative, however, its governance role be limited to approval and oversight of the vision of the initiative. The DM should approve the new vision of ERI and meet, at a minimum, once in two years to monitor the implementation of that vision.1) This recommendation concerning the responsibilities of the Deputy Ministers will be proposed to the new NAPP Partnership for adoption.
2) The ADM Committee of ERI be incorporated as a sub-committee of the North American Policy Committee and be accountable for ensuring the roles and responsibilities agreed to by their Department. Further, this committee would also ensure that the financial and programmatic plans and results of the initiative be reported upon annually, with appropriate explanation reports for variance from planned results. In addition, this sub-committee would be responsible for ensuring that appropriate ERI information be communicated to the larger ADM group in order to reinforce government-wide or the Whole of Government concept. The ADM committee would operate as a Board of Directors for ERI and become accountable for strategic directions and decisions. Appropriate roles and responsibilities of Board Members should be developed. That the ADM Committee would be responsible for monitoring the progress of the RMAF.2) This recommendation has been accepted by the DFAIT ADM for North America, and will be recommended to the new NAPP Partnership as follows: Members of the NAPP ADM Policy Committee will also be members of the broader North American Policy Committee. Their participation will provide a broad "whole of government" perspective to the NAPP in respect to the implementation of the NAPP strategy and will enable ongoing issues to be addressed by the Partnership.

The ADM Committee of the NAPP will task the DG Operations Committee and the NAPP Secretariat to implement planning and performance measurement initiatives as required for effective management.

The ADM Committee of the NAPP will be briefed semi-annually on ongoing plans and on performance achieved by the Partnership.

3) That the DG operational Committee would be conceived as a standing sub-committee of the ADM Committee to direct the management of the ERI. The DG Committee would create the sub-committees it needs to insure proper operational guidance, oversight and accountability. It would also determine the configuration of the Secretariat with respect to the most cost-effective way to ensure the work done by the ABD, HR and Communications committees. This would require the DG committee to determine whether or not a trade off is required between the benefits of collaboration and the transaction costs incurred by having the three standing committees. The work of these committees could in theory be done by the Secretariat and existing resources.3) The ERI Partners agree with the thrust of these recommendations.

Partners are of the view that the DG Committee should not operate as a sub-committee of the ADM Committee. As a sub-committee, the DGs would be reduced to a working group. In the new partnership, a DGs Committee reporting to the ADMs should be the "first level" operations decision-taking group.

Caution should be exercised concerning the suggestion that "The work of these [standing] committees could in theory be done by the Secretariat and existing resources." Some functions (for example, candidate selection for assignments, which must involve members of the HR Committee) cannot be executed solely by the Secretariat. The recommendation also infers that there exist alternate services that could relieve the ERI Secretariat and/or Partner representatives of work responsibilities; such corporate resources are not always available.

Partners accept in principle the recommendation that there be a review of the need for three standing committees, and of their functional relationship with a Secretariat. This should be done by the DG Committee of a new NAPP Partnership.

Recommendations related to Performance Management:

ERI presently has a performance management framework but has not been able to develop a process with its partners to populate and operationalize the framework. Operationalizing and using the performance management framework is a crucial part of the accountability and learning approach needed for horizontal initiatives. Therefore it is recommended:

The ERI Partnership accepts this Recommendation.
1) The Secretariat should be tasked with developing that would lead to an appropriate performance management/measurement approach for the new initiative within six months of the formation of the new partnership.1) The ERI Secretariat will prepare a performance measurement framework for the new NAPP Partnership, to be completed by February 29, 2008 and presented to the ERI DGs' Operations Committee in March 2008. If approved, it would be recommended to the NAPP Partners.
2) All partners at the level of the DG and ADM Committees would approve this approach, along with the related roles and responsibilities of partners in performance management/measurement.2) The ERI Partnership supports this recommendation for the new NAPP Partnership.
3) The DG Operational Committee should be tasked with ensuring that the performance management/measurement approach be put in place by the initiative.3) The ERI Partnership supports this recommendation for the new NAPP Partnership.
4) To the greatest degree possible, existing data capturing mechanisms (e.g. TRIO and MARCUS), as well as public opinion research, be adapted and included in the performance measurement approach.4) The ERI Partnership accepts this recommendation in principle. The ERI Secretariat will be instructed that the availability of data capture mechanisms be considered in the design of the overall NAPP performance measurement framework.
5) Further dialogue is needed to emphasis the consultation with and integration of regional trade offices. (e.g. to recruit for mission, export promotion, identification of pre-export readiness).5) The ERI Partnership accepts this recommendation in principle. The new performance measurement framework must broadly reflect the logic model (activity/output/outcome structure) of the new Partnership.
Recommendations related to Role of the Secretariat:

The secretariat plays an essential role in coordinating the partnership. They have effectively built trust through their approach to facilitating the partnerships and have won the respect of the partners for doing so. However, depending on the vision of ERI and the changes agreed to with respect to this evaluation their role would change. Therefore we recommend:

Using the lessons learned from ERI, the DG Operational Committee should be tasked to define the expectations, cost and staffing of the Secretariat so that it is inline with the vision agreed to by the governance bodies. The Committee should explore the costs and benefits of issues such as leadership, operational structure, level of administrative services, HR processes, etc.

The ERI Partnership accepts this recommendation and has tasked the Executive Coordinator to prepare a business case for a Secretariat meeting the requirements of the new Partnership.
Recommendations related to Capacity Building:

ERI has been broadly successful in its first round of capacity building endeavours for increasing coverage, programming activities networks and staffing. Future capacity requirements should be determined by empirical evidence as well as data from ERI's performance management system. In this context the evaluation envisions ERI becoming more of a learning oriented initiative. Thus we recommend that:
The ERI Partnership accepts this recommendation.
1) The Secretariat, working with appropriate DFAIT divisions and posts, should develop an approach that would allow it to monitor the US coverage (right-sizing) in order to better understand extending or re-orienting Canadian capacity; so as to better respond to trade and advocacy issues in the US.1) It will be the DFAIT North America Branch that will be responsible.
2) The Secretariat assess the quantity and quality of staff applying for US Posting to ensure that the incentives are appropriate to attract a pool of qualified staff; this would continue to include discussion on incentive issues such as, education, housing, and spousal support.2) The ERI Secretariat has had ongoing involvement with DFAIT HR Branch and the North America Branch on this issue. This task will be included in the recommended mandate of the NAPP Secretariat. DFAIT has overall responsibility.
3) The DG Operational Committee would determine if there is a business case to bring to the ADM Committee for recommended changes to the incentives for US Postings.3) The ERI Partnership accepts this recommendation to have the DG Committee review the incentives (principally through the Foreign Service Directives) and to present recommendations to the NAPP ADMs' Committee.
4) The Secretariat continue to work with appropriate DFAIT departments to assess the training needs of those going on US Postings (including both CBS and LES) in order to develop improved training programs.4) The ERI Partnership accepts the recommendation to have the Secretariat review with DFAIT the skills requirements of positions and preparations for assignments to the U.S, and to develop appropriate training programs.
5) The Secretariat would monitor the efforts of the six "strategic" networks developed in order to ascertain their ability to influence business development and advocacy work.5) The ERI Partnership accepts this recommendation in principle but notes that the DFAIT North America Branch is responsible for the strategic networks. NAPP Secretariat involvement would need to be articulated in the mandate of the NAPP Partnership.

1. ERI Secretariat, Members of ERI Partner Committees, Consulate Staff, Client Groups (Businesses, Firms)

2. Document and File review consisted of ERI management documents, Government of Canada documents, meeting notes, papers and so forth.

3. Presently some of the functions of the ERI Secretariat could be carried out by and within DFAIT. There is an assumption that if this could be done cost savings could be attained. This seems logical but needs to be studied and agreed to by the Partners.

4. We are aware of an assortment of public opinion polls used by DFAIT's Communication unit. It would be helpful for the performance measurement system to collaborate with this unit as it tries to understand the "perception effects" of clients, targeted decision makers and other stakeholders.

5. The evaluation found the incentives for US Postings to be an issue that needs resolution.

6. The engagement of provinces was not evaluated in the summative evaluation

7. The Management response and action plan were approved by the DG Committee in September 2006.

8. ERI Secretariat, Members of ERI Partner Committees, Consulate Staff, Client Groups (Businesses, Firms)

9. Document and File review consisted of ERI management documents, Government of Canada documents, meeting notes, papers and so forth.

10. Volume 2 of this report provides a list of all interviewees and telephone survey respondents.

11. When quotes are used in the text they not only represent the ideas of the interviewee but are example of a pattern of responses found in our interviews.

12. For an example of posts working with OGDs please see the Miami case study specifically for examples of OGD liaisons working in the post directly.

13. When referring to an ERI partner, we do not identify the level for anonymity purposes.

14. For further examples of collaboration between partners on activities please see the three case studies.

15. Multiple examples of the benefits of HonCons and their expansions are available in the case studies.

16. Note: What needs to be stressed is that the collaborative approach introduced by ERI represents a departure from past practices

17. Typically, the Treasury Boards requires that RMAFs be submitted along with TBS Submissions, however, this is not always the case in practice - in particular for projects conceived soon after the release of the new TBS RMAF policy.

18. ERI RMAF. p.1

19. ERI RMAF. p.1

20. The program logic for the RMAF is that improved coverage would lead to better business development opportunities as well as improved ability to influence key US decision makers. The logic remains clear and defendable. However, without a performance measurement system it can not be adequately tested. See section on Performance Management.

21. During the course of the evaluation, several senior managers queried us with respect to our perspective on whether or not ERI could work without a Secretariat. They were interested in the evaluation perspective despite our explaining to them that it was outside our TORs. What emerges for us from these interviews is the insight that there are no consistent review procedures for assessing the Secretariat by the Partners.

22. If the follow on program for ERI is one that includes all partners work a study is required to explore the level of harmonization possible and the possible approaches for reporting on output and outcome data..

23. The critique was not that the Departments weren't involved, but rather that the ERI forum was not used as forum for discussion.

24. While the RMAF had indicated a second half visioning exercise, none occurred.

25. See Miami case study in appendix for further details.

26. In our interviews, interviewees in the Posts were the most vocal about developing ERI as a larger "whole of government initiative". Some Partners raised concern that their voices would not be heard if the Partnership became bigger.

27. ERI RMAF p.50

28. ERI Formative Evaluation. p.51. In ERI's Action Plan on the Evaluation Recommendations, it was noted that the analytical work required in regard to this recommendation had been downloaded, as of April 2007, to the ABDC.

29. ERI 2005-2006 Annual Report p.52

30. ERI 2005-2006 RMAF p.19-20

31. ERI 2005-06 Annual Report p.60

32. Interviewees who asserted this did not define exactly which forums were being referred to.

33. This decision indicated that ERI should prepare a report on performance for the DMC.

34. An analysis of the DMC and ADM meeting minutes found that there was not reference to, for example, the lack of annual reporting or other performance reporting. Alternatively, the formative evaluation served as the sole source of performance analysis for these committees.

35. While the equivalent does not seem to exist in Canada, the Government of Australia has developed a tool designed to assist its public service in assessing whether there is a business case for initiating Whole of Government models around an issue or program. See www.apsc.gov.au/connectedgovernment

36. It is interesting to note that a majority of all interviewees called for expanded partnership. However, more senior-level interviewees were cautious about the affect the expansion could have on the 'voice' of the non-DFAIT partners, while operational-level interviewees were focused on being able to work their non-ERI partners using while taking advantage of ERI's resource flexibility.

37. This may not be specific to ERI. One interviewee suggested that 'there is a real difficulty to have the real players to come and participate in the meetings. Departments tend to be very independent.'

38. ERI 2005-06 Annual Report, p.60

39. This representation is not indicative of votes represented but rather partners present.

40. Note: System RMAF oversight responsibility does not rest with the DG Committee. Moreover, we found that no ERI governance group took responsibility for performance management oversight.

41. On average 4-6.

42. Interviewees stated that changes such as these could not have been made until the trusting partnership was established.

43. Note: In the absence of the strategic vision for the ERI, the focus on governance understandably moved to an operational program and financial level.

44. See Miami case study for more information. (Appendix)

45. In discussion with partners, while they can fill out forms about their activities it is less clear to them whether other types of performance data should be sent to the Secretariat. This needs to be carefully thought through.

46. ERI Annual report, Pp.57

47. ERI Annual report, Pp.58 + ERI Secretariat data

48. At time of writing details on expenditures were not available

49. Actual Expenditure for Advocacy, Business development and TPI.

50. ERI Secretariat

51. After discussion with ERI Secretariat, the evaluation team sampled a group of selected candidates and the positions they undertook.

52. The staffing program was first viewed "as slow and bureaucratic". This may have been expected given that ERI was putting in place new processes and procedures in Partner Departments. Now, four years later, this process is generally seen as highly positive for the candidates and the government department.

53. HOMs expressed a desire to be involved have greater involvement in the staff selection processes by being able to provide inputs at the level of the HR Committee.

54. The interviewees from partner organizations, where, for example, the linguistic profile for position has greater flexibility, may assume that such flexibility can be applied elsewhere. As several partner interviewees noted, 'any Canadian company hoping to work in the US needs to be proficient in English, if these are the clients, why would [ERI staff] need to be bilingual?' It is understood by the evaluation that selection criteria are governed by the Foreign Service Directives and that such arguments do not take into account the nature of Canada as a bilingual country. However, it is nevertheless important to note some ERI partners felt that they were less able to take advantage of posting opportunities for this reason.

55. During the data collection, TB raised questions about the Spousal Employment Program. The Program, offers career transition services to spouses of employees posted in the U.S. We did not look at this Program because it has been discontinued.

56. Final Budget for ERI HR Program Activities 2007/08 (May 11, 2007)

57. CCMD is the Canadian Center for Management Development, presently named The Canada School of Public Service; helps ensure that all public service employees have the knowledge and skills they need to deliver results for Canadians.

58. This list is a combination of the annual report and areas identified in the evaluation.

59. Without going into a technical discussion on cost-effectiveness, suffice it to say that many of the RMAF outputs can not be costed because the key cost factor is the cost of staff--and their time is neither tracked nor costed.

60. See Appendix for case studies of Miami, California, and the upper Mid-West

61. Note: It is important to keep the significance of ERI in perspective. Unlike prior ad hoc arrangements employed in the US to promote advocacy and business development, ERI is a formal, approved horizontal initiative with a mandated strategic mission functioning one of the largest and most dynamic economy in the world. ERI is seen by those interviewed as an effective response for establishing a sustained, expanded Canadian presence in the US to achieve long-term results.

62. For additional examples from posts please see the three case studies in the Appendix.

63. Interviewees also raise the counterfactual. Several suggested that many of the mechanisms and systems developed under ERI could have been achieved without a specific initiative. Indeed, many of the mechanisms were already in existence. Several ERI partners traditionally post staff oversees, new missions are regularly opened around the world, and IBD and PERPA activities occur every day. These interviewees simply linked ERI changes to the availability increased resource levels. The evaluation is of the opinion that this perspective misses the synergy that is observed on the 'ground' and within the ERI partnership. ERI is unique in the depth of partnership achieved in developing and managing enhancement modalities collaboratively, and in ways that have added value.

64. This material is extracted from the RMAF.

65. There are also a myriad of examples in the case studies. Please see appendix.

66. Presently some of the functions of the ERI Secretariat could be carried out by and within DFAIT. There is an assumption that if this could be done cost savings could be attained. This seems logical but needs to be studied and agreed to by the Partners.

67. We are aware of an assortment of public opinion polls used by DFAIT's Communication unit. It would be helpful for the performance measurement system to collaborate with this unit as it tries to understand the "perception effects" of clients, targeted decision makers and other stakeholders.

68. The evaluation found the incentives for US Postings to be an issue that needs resolution.

69. Foreign Affairs and International Trade Canada, "Opening Doors to the World: Canada's International Market Access Priorities 2006", p.13-14.

70. International Trade Canada, "U.S. Commerce Strategy - Summary Version" (ppt presentation), January 11, 2007

71. "The Canada-Florida Economic Relationship; An Economic Study." Consulate General of Canada, p.9 (November 2004)

72. "Fact Sheet: The Canada-Florida Economic Relationship."

73. Source: Statistics Canada, May 2006

74. Source: Statistic Canada, converted at a rate of US$1.00=C$1.2116

75. Statistics Canada, 10 May 2007.

76. San Juan existed prior to ERI.

77. Ibid., p.2.

78. Ibid., p.1

79. Miami Mission Strategy: 2007-2008.

80. Miami as a Gateway to the Americas: Prospects for Canada-Florida Partnerships (March 2007), p.10.

81. Miami Mission Strategy: 2006-07.

82. "Miami as a Gateway to the Americas: Prospects for Canada-Florida Partnerships," Consulate General of Canada in Miami, p.3 (April 2, 2007).

83. See for example "The Canada-Florida Economic Relationship", prepared by the Consulate General of Canada in Miami by InfoAmericas, November 2004, 34 pages.

84. ERI IBD Initiatives, Posts in the U.S., 2007-07.

85. Operations constitute all mission non-programming expenditures (i.e. building, staffing). Operating is abased on Actual expenditures to 2007-08. Data from ERI Secretariat.

86. Programming funding for IBD Funding (Program Funding by Mission, June 24)

87. Notes on trade promotion ROI.

88. Team Canada Atlantic, May 2006 Florida Trade Mission Exit Study, p.2-3.

89. Foreign Affairs and International Trade Canada, "Opening Doors to the World: Canada's International Market Access Priorities 2006", p.13-14.

90. International Trade Canada, "U.S. Commerce Strategy - Summary Version" (ppt presentation), January 11, 2007

91. The term rightsizing was used by ERI to describe its process of reallocating territorial responsibility to new and enhanced missions, while reducing the territorial responsibilities of other existing missions.

92. Trade Data Online (TDO)

93. Trade Data Online (TDO)

94. www.cbc.ca/manitoba/features/devilslake/

95. www.agr.gc.ca/redirect.phtml

96. Washington Canadian Embassy, Canada welcomes commitments by APEC leaders on global economic crisis

97. Washington Canadian Embassy, Canada welcomes commitments by APEC leaders on global economic crisis

98. www.ita.doc.gov/td/industry/OTEA/state_reports/s-dakota.html

99. One of Montana's long-standing Senators currently Chairs the US Senate Finance Committee

100. www.canadainternational.gc.ca/washington/index.aspx

101. Adapted from www.cbc.ca/news/background/madcow/timeline.html

102. www.cidrap.umn.edu/cidrap/content/other/bse/news/jan0507imports.html

103. This information was provided by a post- interviewees and confirmed several in Canadian newspapers from July 2007.

104. 2006 Denver ERI Report

105. ERI IBD Initiatives, Posts in the U.S., 2007-07.

106. In data collection with partners in Canada and with other posts, it was noted that in many cases, the 'project partnerships' funded by ERI were at times merely agreements in principle but not in practice. Interviewees in some cases noted, that they 'sign-off' on projects but then do little or nothing to support their implementation.

107. Operations constitute all mission non-programming expenditures (i.e. building, staffing). Operating is abased on Actual expenditures to 2007-08. Data from ERI Secretariat.

108. PDF* (5.76 MB)

109. OECD 'International Trade Statistics by Commodity' 2005 as quoted in the Migration Policy Institute's 'United States-Canada-Mexico Fact Sheet on Trade and Migration'. October 11, 2005. pp.1.

110. International Trade Canada, "U.S. Commerce Strategy - Summary Version" (ppt presentation), January 11, 2007

111. As described by the Head of Mission in San Francisco - "we (San Francisco and Palo Alto) are a single office with two sites. This is in contrast to the situation of San Diego which is defined as a Consulate in a hub and spoke arrangement with Los Angeles".

112. 'Mobilizing Science and Technology to Canada's Advantage'. Government of Canada, March 2007

113. The evaluation team spent one working day in Los Angeles and two days each in San Diego and San Francisco.

114. "Shared Value, Shared Vision: California's Economic Ties with Canada". Bay Area Economic Forum. March 2007 pp.1-7

115. Economic Profile - San Diego, California - USA

116. "Shared Value, Shared Vision: California's Economic Ties with Canada". Bay Area Economic Forum. March 2007 pp.1-7

117. "Shared Value, Shared Vision: California's Economic Ties with Canada". Bay Area Economic Forum. March 2007 pp.11-12

118. "Shared Value, Shared Vision: California's Economic Ties with Canada". Bay Area Economic Forum. March 2007 pp.11-12

119. http://www.tradeport.org/news/accolades.html

120. Fortune500

121. "Shared Value, Shared Vision: California's Economic Ties with Canada". Bay Area Economic Forum. March 2007 pp.11-12

122. Zhang, Junfu and Patel, Nikesh. "Dynamics of California's Biotech Industry". Public Policy Institute of California. 2005. pp.iii.

123. Agriculture and Agri-food Canada - http://atn-riae.agr.ca/us/3948_e.htm

124. "Shared Value, Shared Vision: California's Economic Ties with Canada". Bay Area Economic Forum. March 2007 pp.15-17

125. Post IBD Workplans

126. International Trade Canada, The Aerospace and Defence Market in California, March 2006, 61 pages

127. Zhang, Junfu and Patel, Nikesh. "Dynamics of California's Biotech Industry". Public Policy Institute of California. 2005. pp.57-58.

128. The term 'Right-Sizing' is used by ERI to refer to their process of redistributing responsibilities for territories and enhancing human resources in the US.

129. www.sandiego.gov/economic-development/glance/friendly-city/signsof.shtml

130. 'Science and Technology Partnerships. The Canadian Way'. Science and Technology Program of the Canadian Trade Commissioners Service. March 2006

131. www.economiecanadienne.gc.ca/english/economy/innovation.html

132. Final Communique: Science, Technology and Innovation for the 21st Century. Meeting of the OECD Committee for Scientific and Technological Policy at Ministerial Level, 29-30 January 2004

133. 'Mobilizing Science and Technology to Canada's Advantage'. Government of Canada, March 2007

134. 'Science and Technology Partnerships. The Canadian Way'. Science and Technology Program of the Canadian Trade Commissioners Service. March 2006. pp.1&9.

135. Office of the Governor Press Release: Governor Schwarzenegger Highlights California-Canada Partnership on Life-saving Stem Cell Research, 05/30/2007

136. Trade information from "Shared Value, Shared Vision: California's Economic Ties with Canada". Bay Area Economic Forum. March 2007 pp.13. Comparative analysis provided in conversation with Martin Uden, UK Consul-General for San Francisco

137. ERI IBD Initiatives, Posts in the U.S., 2007-07.

138. ERI IBD Initiatives, Posts in the U.S., 2007-07.

139. ERI IBD Initiatives, Posts in the U.S., 2007-07.

140. The term 'executive suite' is a generic one that defines as a 'turnkey work environment' that is fully equipped and functional and does not require the investments and start-up costs of a traditional office. Executive suites are also noted for typically offering additional business services (e.g. reception functions, technological support, etc) as part of their overall service package.

141. A detailed breakdown of this analysis, including the criteria, was not provided.

142. While not part of this case study, interviewees in California noted that the decision to use the same service provider for executive suites across the US does not appear, based on their informal research, to be yielding cost savings based on 'economies of scale' compared to others using the same executive suites.

143. The San Francisco Consulate General refer to the two entities as "one Consulate with two trade offices".

144. San Francisco Advocacy Plans

145. In the case of San Diego, 2003-04 is not applicable (n/a) as the office had not been opened. In the case of San Francisco, the office expansion did not take place until late 2005-6, thus all prior years are not applicable in terms of HR expansion. It is interesting to note, however, that in 2004-5 San Francisco also registered $128K in program spending - the reasons for this outlier are not clear.

146. LNGLS 2006-07 Final PERPA Plan

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