|BBD||Global Business Opportunities Bureau|
|BDC||Business Development Bank of Canada|
|BFM||International Business Development, Investment & Innovation|
|CSF||Client Service Fund|
|DEC||Departmental Evaluation Committee|
|DFAIT||Department of Foreign Affairs and International Trade|
|EAC||Evaluation Advisory Committee|
|EDC||Export Development Canada|
|GCS||Global Commerce Strategy|
|IBD||International Business Development|
|IBOC||International Business Opportunities Centre|
|ICT||Information and Communications Technology|
|IRC||International Readiness Committee|
|LSP||Life Sciences Practice|
|NRC||National Research Council Canada|
|NRC-IRAP||National Research Council Canada Industrial Research Assistance Program|
|OGDs||Other Government Departments|
|PAA||Program Activity Architecture|
|PEMD-TA||Program for Export Market Development - Trade Associations|
|SME||Small and Medium Enterprise|
|SWOT||Strengths, Weaknesses, Opportunities and Threats|
|TBS||Treasury Board Submission|
|TCS||Trade Commissioner Service|
|ZID||Office of the Inspector General|
|ZIE||Evaluation Division, Office of the Inspector General|
The Life Sciences Practice (LSP) was developed in 2007 as a pilot approach to building stronger sectoral expertise within DFAIT. DFAIT had begun to make a series of changes starting in 2006 to better meet the needs of industry. Both Headquarters and Regional Offices (ROs) moved to organizing around sectors. Multi-Post sector groupings were established in Europe and strengthened in the United States.
The introduction of the LSP as the first structured practice was part of this trend. The structured practices were intended to be formal sector units that had officers and private sector specialists. They were to be dedicated to developing strategies and pro-active initiatives for clients and prospective clients in the sector.
The LSP was the first structured practice. The Practice Lead was hired from the private sector. Investment and innovation staff were embedded within the unit. The initial work of the LSP focused on putting in place key documents such as a Strength, Weaknesses, Opportunities and Threats (SWOT) analysis and an initial sector strategy. The Strategy was intended to act as a framework for the proactive work in life sciences by the Trade Commissioners.
This evaluation was carried out by the Evaluation Division (ZIE) of DFAIT. It looked at a range of issues including: the relevance of the pilot to the needs of industry; its alignment with and ability to advance government priorities; its performance to date in terms of results; and the efficiency and economy of LSP's approaches. It employed a mixed methods approach relying on reviews of documents, interviews with key stakeholders and data analysis. All information received was critically reviewed before using it to draw conclusions. The findings represent the consensus which emerged from the data analysis.
|Finding #1:||A consensus exists that the sector practice model is a more strategic approach and has the potential to better serve the needs of industry.|
The concept of building internal sector expertise is strongly supported within DFAIT and with outside partners. LSP is guided by an advisory board with strong private sector representation which should help to ensure that the approaches developed are meeting the needs of industry.
|Finding #2:||While the need for sector practices is acknowledged, there continues to be, on the part of some, a lack of clarity on the exact mandate of the LSP (and other practices) and its intended role. This is true both inside and outside DFAIT.|
LSP was introduced at a time when DFAIT was undertaking other restructuring to implement the Global Commerce Strategy. The overall restructuring caused some confusion in the environment on how LSP fit within the broader changes. Over time, the messaging around the practices also began to shift in terms of their role and purpose. This further exacerbated the lack of clarity on the role and mandate of the structured practices. Recent efforts to clarify LSP's relationship with the ROs, Posts and Geographic groups have improved the situation somewhat. However, a consensus exists within and outside DFAIT that there is a need to clarify the role and mandate of the practices, particularly as new ones come on stream, with each taking slightly different forms and approaches.
|Finding #3:||The principle of the structured practices is well aligned with DFAIT's strategic outcomes.|
The introduction of LSP as the first structured practice represented a new approach that builds on the principles of the Global Commerce Strategy and integrative trade. It provides an opportunity to truly support integrative trade approaches and specific sector support. While the innovativeness of the concept requires adjustments to the current ways of doing business within DFAIT, it provides an opportunity to develop a more strategic approach for service delivery to clients.
|Finding #4:||It is unclear the extent to which there was a consensus among the other government partners on the initial Strategy and some of the underlying assumptions made by LSP.|
One of the questions to be covered by the evaluation was the extent of alignment of the work of the LSP with federal government priorities and programs of key governmental partners. Feedback in this area indicated that the Sector Strategy represents DFAIT's approach to life sciences but is not a whole of government approach. While other government departments (OGDs) provided advice on the Strategy when it was formulated, it did not influenced the work of these departments to a great extent. In addition, some of the assumptions underlying the Strategy were not broadly accepted. For example, the initial Strategy took a position that low value outflow of technology from Canada (i.e., outlicensing, acquisitions, etc.) was not to be supported. Not all partners agree with this since they believe the global marketplace is more complex, requiring a mixture of approaches.
|Finding #5:||Initially, LSP did not effectively build on the roles and responsibilities within DFAIT, with OGDs and other stakeholders to advance the industry as a whole.|
At the time of the LSP start-up, the ROs, Posts and OGDs had existing networks within the life sciences areas, contacts within the industry, and methods for coordination. LSP did not initially use these existing resources or build on the existing networks and programs. Limited meaningful consultations took place during the first year.
LSP formulated the initial Strategy and presented it to the Advisory Board for approval. Input was sought from Posts but interviewees felt that the Strategy was not informed by their views or expertise. OGDs active in the life sciences area had discussions with LSP but did not feel there was a strong partnership in place. While DFAIT has traditionally had the mandate for international trade, it has not had the exclusive international mandate around S&T and innovation.
There was also limited engagement with other stakeholders in life sciences such as the provinces, universities, and institutes that play a large role in the overall industry. In the development of the current Strategy, these issues are now being tackled with broader consultations and engagement.
|Finding #6:||Initial evidence suggests that the LSP model can support the improvement of business opportunities for life sciences companies.|
While it is too early to judge results emerging from the work of LSP, there is evidence that the approach can be effective in providing support to Posts and achieving company level results. LSP has participated in various events which have increased the profile of Canada and built awareness of Canadian capabilities in international markets. It has helped assist firms in developing leads and contacts, some of which have already resulted in agreements. They have assisted Posts in areas such as providing information on companies operating in various markets. LSP has also played a role in national level policy making in areas such as the recent changes in the Income Tax Act that will now allow more favourable treatment of foreign venture capital firms.
|Finding #7:||A difficulty for the future is measuring the extent of success of LSP. There is currently a lack of clear performance targets for tracking results.|
Initially the objectives of the LSP were seen in terms of results at the level of a firm --increased opportunities, partnerships, foreign direct investment, etc. While LSP can contribute to these results, their achievement is linked to the performance of a wide range of other players including Posts and ROs. The contribution of LSP to these is one aspect of performance but currently it relies on anecdotal evidence. Benchmarks and targets also need to be established for support to the Posts and ROs. Both these areas need to be tracked and measured. The current exercise within DFAIT/BBD to establish performance indicators for the practices will be an important step toward clarifying this issue.
|Finding #8:||The tools being developed by LSP are seen to be useful but need to be further refined with input from stakeholders.|
Strong support exists for the sector strategies as a method to focus efforts. Current consultations for the upcoming Strategy will hopefully move the Strategy to wider buy-in from industry, DFAIT, and OGDs.
The SWOT analysis was seen to be useful, particularly for Trade Commissionerss new to the sector. A need exists now for greater information on specific sub-sectors level. This was cited repeatedly since many of the points in the SWOT are generic which was the original intention. There is now high demand by the Posts for more specific information by sub-sector on Canadian capabilities.
Allocating a portion of the Client Service Fund (CSF) to sector priorities in the Strategy is an effective way of aligning resources to targeted results. It also ensures that the CSF is aligned with industry needs. The difficulties in disbursing the LSP CSF however, is viewed as partially due to the new process used in the first year by CSF, and linking the allocation of funds to the LSP Strategy. In addition, the review by the Advisory Board of the individual CSF proposals was seen as an inappropriate use of the Board's time, and inconsistent with its strategic mandate and role.
|Finding #9:||Strong support exists for having more information on Canadian companies and capabilities. The company profiles were not seen to be that useful by Posts, although, anecdotal evidence indicates some early success.|
Interviewees viewed the International Readiness Committee (IRC) favourably in terms of gathering more information on companies and ranking their readiness. Difficulties were seen with the use of the information, however. Originally, the intention was to have 30 companies and profiles. Twenty five companies were identified and profiles developed for 14 (11 either declined to participate or requested to hold off for 6 months to a year due to operational elements). Many of these were firms that were already well known in the markets. Specific posts were initially requested by LSP to focus all their proactive activities on these core companies. The pool was viewed by the interviewees to be too small to warrant such extensive focus by everyone. Interviews also indicated that there needs to be flexibility in the sector approach in order to respond to potential opportunities that are outside the IRC assessed list of companies.
|Finding #10:||The expectation that the practice lead could provide both sector expertise and manage the unit was unrealistic.|
The value of the practice leads is their sector expertise, strategic thinking, and ability to leverage support from a wide range of stakeholders for the strategies developed. Requiring the Practice Lead to create and manage the overall practice, with no DFAIT / Post experience, was unrealistic. This compromised both the set-up of the unit and the ability to provide the level of sector support possible and needed.
|Finding #11:||The principle of staffing practice teams with private sector specialists is a good one, but current DFAIT regulations and hiring practices make this difficult to accomplish.|
One of the original rationales for setting up the practices was to bring sector experts, particularly from the private sector, into DFAIT to support its work. This is critical for fulfilling their role in terms of knowledge of the industry. LSP faced significant challenges in filling positions within the group from the private sector on a timely basis, and retaining staff. Even the newer practices are facing challenges in terms of contracting the level of expertise required for their Leads, even on a part time basis.
|Finding #12:||The integration of investment and innovation expertise within the LSP team has allowed an integrative trade approach, focused on consistent priorities.|
Having a complete team in-house has allowed a consistency of approach and priorities between trade, investment and innovation. Other practices coming on stream will not have the positions integrated. This model works as well but it will be important to ensure that the functions do not become stove-piped--with the practice, investment and innovation groups focusing on different priorities and approaches. This will take agreement across the management structures.
|Finding #13:||The LSP was initially perceived to adopt a prescriptive and directive model, not a guidance or support approach, for initial implementation. This caused difficulties within the DFAIT system and decreased effectiveness by raising resistance to change.|
The respective roles of ROs, the Posts and LSP became clouded during the initial implementation. LSP's direct working relationship with firms led to ROs feeling they were not consulted, which in turn resulted in confusion on the part of clients. Originally, Posts thought the LSP was intended to support their work but those interviewed said that they realized they were expected to implement priorities and activities set out by the LSP, with limited consultation on the local market conditions and opportunities.
The pilot implementation approach taken made the change management issues more acute. Trust was lacking among the various players. A collaborative environment was not fostered. Resistance increased as a consequence. Staff at Posts perceived that the existing approach in serving clients was disregarded as not effective and hence irrelevant. In the last year, LSP has begun to shift to greater consultation with and involvement of the ROs and Posts in decision making. Significant improvements in the corporate communication efforts in 2009-2010 have helped in addressing the early challenges. There seems to be a mutual effort to improve collaboration between the LSP and the geographic group as well.
However, the respective roles of the LSP, Posts, ROs and Geographics have not been fully clarified.
|Finding #14:||The Advisory Board is a good method for bringing outside expertise into DFAIT decision making and priorities. The role of the Board is not well understood, however, and its potential contribution is not being fully realized.|
The LSP Advisory Board composition is a strength; members actively engage at the meetings. However, Board members interviewed were not completely clear on their role or what is expected of them in terms of contributing to the development and implementation of sector support. An information session where new board members could learn about their role and mandate and the business of DFAIT was viewed as necessary. The Board members could play a more strategic role in terms of providing more insights into global trends, Canadian competitiveness, etc. which could be integrated into the approaches taken.
The Evaluation Division (ZIE) of the Department of Foreign Affairs and International Trade (DFAIT), in the Office of the Inspector General (ZID), is mandated by the Treasury Board Secretariat (TBS), through its Evaluation Policy,(1) to conduct evaluations of all direct spending of the Department for programs (including Grants & Contributions), policies and initiatives. All evaluation reports are presented for approval to the Departmental Evaluation Committee (DEC) chaired by the Deputy Ministers.
The evaluation of the Life Sciences Practice (LSP) was conducted as part of Direct Program Spending coverage and was requested to facilitate an examination of the first sector practice model. The target audience for this evaluation is the Assistant Deputy Minister of International Business Development, Investment & Innovation (BFM) and the Global Business Opportunities Bureau (BBD), as well as implementers of the Global Commerce Strategy (GCS).
The Evaluation Division at DFAIT has included an Evaluation of the Life Sciences Practice in its Five-Year Evaluation Plan approved by DFAIT's Departmental Evaluation Committee. The evaluation serves as a management tool to ensure the program is on track in achieving its objectives while ensuring the right governance and management systems are in place and maximizing relevant, efficient and effective program delivery. The purpose of the evaluation is to provide DFAIT's Evaluation Committee with a neutral and an evidence-based assessment of the relevance and performance of the Life Sciences Practice, and the applicability and effectiveness of Sector Practice approach for meeting the needs of other Canadian industries.
Starting in the mid-2000s, DFAIT recognized the need to build stronger sector expertise within the organization. The client surveys of 2002 and 2004 had highlighted the need for the Trade Commissioner Service (TCS) to have better sector knowledge in order to respond to the needs of industry. In response, DFAIT began implementing a series of changes to meet these needs. In 2006, a sector bureau was created at Headquarters (HQ) and all Regional Offices (ROs) moved to organizing around sectors. Sector groupings also were developed at the Posts. For example, five formal multi-post sector networks were established in Europe, and the United States (US) Life Sciences Network was strengthened.
To continue in this direction, DFAIT decided to establish a series of sector practices. Two types were envisaged. The structured practices were intended to be formal sector units that had officers and private sector specialists. A practice lead, who was a private sector specialist, would provide strategic advice. The structured practices were dedicated to the development of strategies and pro-active initiatives for clients and prospective clients in the sector. The virtual practices were intended to see one or more people working with an informal domestic and post network to develop initiatives in the sector. They could be located in a region to serve a concentration of clients in the sector. The members of the practice could also be embedded within another organization such as an industry association.
Started in the fall 2007, the LSP was the pilot for the structured practices. Since that time, other structured practices have now been established including Aerospace, Information and Communications Technology (ICT), Clean Technologies and Infrastructure Services.
The sector practices were introduced as a way to provide more coherent, strategic and pertinent services to TCS clients. The practices were meant to follow an integrative trade model combining trade, investment, and innovation. The aim was for the practices to facilitate the best return on investment for Canadian companies and Canada from the DFAIT network. The original design envisaged the following roles for the key sector players.
Source: DFAIT Presentation, "Business Sector Practices: A Proposed Model," 11-09-2008
The LSP was to act as a central knowledge hub for information sharing on the life sciences sector in order to better support Posts and business clients. The initial advantages identified for these new practices included:
Ultimately, the LSP was intended to reach the following results:
The initial listing of the functions of the structured practices included the following items:
A Practice Lead with sector expertise was hired from the private sector to head the LSP. The intention was to combine private sector and departmental sector expertise into one unit that would develop a comprehensive global strategy to take advantage of global opportunities, while responding to clients interests and needs in the sector. In the case of the LSP, innovation and investment personnel were embedded within the practice.
The initial work of LSP focused on the development of a SWOT analysis and, from this, a sector strategy for 2009-2010. The SWOT analysis was an overview of the Life Sciences industry in Canada and provided background on life sciences for the Posts.
The Sector Strategy for 2009-2010 set out specific objectives to be pursued in the US and European Union (EU) markets. This included guidance on what kind of support was to be given, areas that were priorities for action and what was not a priority. The intention was to have the Strategy act as a framework for the proactive work in life sciences by the TCS in these markets. An updated Strategy 2010-2011 is currently being completed by LSP.
LSP established an International Readiness Committee (IRC) in conjunction with the National Research Council Canada's (NRC) Industrial Research Assistance Program (NRC-IRAP). The IRC consisted of LSP, NRC-IRAP, DFAIT Regional offices (ROs), Business Development Bank of Canada (BDC), Export Development Canada (EDC), and BIOTECanada. The IRC was established to identify and assess companies ready to pursue international business opportunities. This information was used to develop company profiles that were then provided to the TCS to pursue opportunities within various markets.
To support the concept of sector practices within DFAIT, the Client Service Fund (CSF) is now being allocated partially through the structured practices. LSP set criteria for proposals and approved initiatives for the FY 2009-2010. For 2010-2011, 50% of the CSF are being handled through the sector practices.
The Global Business Opportunities Bureau, as of December 2008, was redesigned as part of the Transformation Agenda to better serve Canadian businesses, and to ensure the availability of specialized support and services to DFAIT's network of Posts and regional offices. The Bureau is designed to be the department's focal point on integrative trade from an innovation and sector perspective. The Life Sciences Practice is housed here.
A 15 member Life Sciences Advisory Board has been established with representatives from the private sector and key government partners such as NRC, BDC and EDC. Other departments such as Health Canada (HC) and Industry Canada (IC) are observers. The Life Sciences Advisory Board is intended to provide input into sector strategies and feedback on industry needs. The Advisory Board also participates in the review of the CSF proposals.
The specific objectives of the evaluation were as follows:
The evaluation focused on a series of issues and questions covering the overall relevance and performance of the LSP. These issues are based upon the requirements set within the new TB Evaluation Policy and its associated directives. The questions listed below present the key themes of the evaluation.
Evaluation Issue 1: Continued Need for the Program (Initiative)
Evaluation Issue 2: Alignment with Government Priorities
Evaluation Issue 3: Alignment with Federal Roles and Responsibilities
Evaluation Issue 4: Achievement of Expected Outcomes
Evaluation Issue 5: Demonstration of Efficiency and Economy
The conduct of the evaluation was overseen by an Evaluation Advisory Committee (EAC) comprised of representatives from DFAIT and the LSP Advisory Board. The Committee convened twice during the course of this evaluation. The initial meeting in June 2009 reviewed the Evaluation Work Plan and the overall evaluation process. A meeting of the Committee was held in April 2010 to review and provide comments on the preliminary findings of the evaluation.
The evaluation was structured around an evaluation framework. The framework presents a summary of the following:
The framework acts as a general guide for the evaluation and is the basis on which the data gathering and interviews will be conducted.
The evaluation focused on multiple lines of evidence.
A range of documents were reviewed to examine the relevance and performance of LSP's services and activities. These documents included: the initial DFAIT documents on the approach to be taken to the practices; DFAIT documents on the transformation process underway; an internal review of the practice experience; studies done of the sector approach being implemented in other organizations such as EDC; various market assessments; communications on the practices and sector approach; IBD results frameworks; background information from the US Posts; and internal correspondence.
The key LSP documents and tools were reviewed including: SWOT analysis; Sector Strategy; updates on the progress of the practices; Advisory Board minutes; sample company and investor profiles; and other tools.
Key Stakeholder Interviews
Over 50 in person and telephone interviews were held with key stakeholders. This included DFAIT staff at Headquarters, Regional Offices and Posts in the US, EU and Asia. LSP staff were interviewed as were staff from the other practices, DFAIT bureaus, missions abroad and regional offices. Key government departments that are working with the LSP were interviewed including Industry Canada, NRC, EDC, and Health Canada. Opinions were solicited from private sector organizations active in life sciences including members of the LSP Advisory Board.
Data was analyzed from both primary and secondary sources and a process of triangulation was used to determine the findings and conclusions. All information was critically reviewed before using it to draw conclusions. Information collected from interviews was checked by triangulation with several informants, while preserving the confidentiality of each interviewee. No one opinion was taken on any issues. The findings represent the consensus which emerged from the data analysis around the evaluation's key issues and questions.
The introduction of the LSP was at a time of other changes taking place within DFAIT. It was important, within the evaluation, to assess the feedback received based on the difficulties with this broader change management within DFAIT versus the specific performance of the LSP. In addition to this, the evaluation faced a series of challenges.
First, the evaluation team did not have ready access to the relevant documents during the planning phase. These had to be assembled over time as the evaluation proceeded and various stakeholders provided information. This slowed the start-up of the evaluation. Second, the lack of resources at the LSP meant that limited assistance could be provided to the evaluation.
Third, the lack of a results framework and performance information made it difficult to assess progress vis-à-vis the outcomes beyond anecdotal evidence - what the LSP aims to achieve and how success is judged.
|Finding #1||A consensus exists that the sector practice model is a more strategic approach and has the potential to better serve the needs of industry.|
The concept of building internal sector expertise was strongly supported within DFAIT and with outside partners. The practices have represented a logical evolution in the shift of DFAIT towards building sector expertise to assist clients. With the withdrawal of Industry Canada from providing sector support, DFAIT has filled an important gap. The practices are seen as a good method to better coordinate sector support and generate sector knowledge.
The LSP practice concept was presented to the Minister of International Trade's SME Advisory Board which endorsed the idea. The Board stated the Life Sciences pilot is a good approach and DFAIT should move forward with developing plans for three other sectors. The LSP also met the desire of the Board to focus on innovative, knowledge based industries. The SME Board has continued to express its strong support for the implementation of the sector approach by the DFAIT.
The Advisory Board structure is seen to be a good mechanism for seeking strategic input from the private sector and partner departments and agencies. This provides a sounding board to assess whether the initiatives are supportive of the needs of the industry. To continue being relevant, the practices need to ensure that a strong link is maintained to the private sector.
|Finding #2||While the need for sector practices is acknowledged, there continues to be, on the part of some, a lack of clarity on the exact mandate of the LSP (and other practices) and its intended role. This is true both inside and outside DFAIT.|
The introduction of LSP came at a time when DFAIT was undertaking other restructuring to implement the Global Commerce Strategy. The GCS was conceived in 2006 and began implementation in 2007. To address the shifting global economic environment, it introduced new approaches to supporting the competitiveness of Canadian businesses. This included introducing an integrative trade approach bringing together trade, investment and innovation to support new global market and partnering opportunities. The TCS developed new tools and approaches to its work. The Trade branches were restructured in mid 2008 and the new International Business Development, Investment and Innovation Branch was established.
This overall restructuring caused some confusion in the environment on how LSP fit with these broader changes. The "Global Opportunities Bureau Restructuring - Qs & As" was issued in October 2008 to address the organizational changes around the shifts in sector responsibilities and the expansion of sector practices within the broader DFAIT framework. Clearly there were concerns by staff on many fronts including job security and shifting roles.
Broadcast announcements and presentations were the primary tool to initially inform people of the practices. These communications focused more on issues such as why the life sciences sector was selected and organizational structures for its implementation. The purpose of the LSP, its mandate, and specifics of the relationship with Posts remained unclear to many.
The messages also evolved over time. The initial communications in 2008 regarding the LSP indicated that the practice was to develop a Global Life Sciences strategy and lead its implementation by providing direction to Posts and ROs. It was also to act as a dedicated point of entry to the Department on life sciences issues.
What terms like "lead" meant were not clarified and eventually lead to confusion. At the start, Posts believed that the LSP's role was to support the Posts and the sector teams already established such as the multi-country sector team for Life Sciences for Europe and the US Life Sciences Network. They soon realized that "they were supposed to support the LSP and its objectives."
As the practices were further rolled out in 2009, the DFAIT presentations and communications focused on areas such as the introduction of the new practices and processes to develop new global sector strategies and action plans. The language of the presentations shifted to practices "working with" the ROs, relevant Posts and existing multi-post networks in developing and implementing the strategies, and stressing more consultative approaches.(2) The practices were also positioned in the broader approach to integrative trade and the communications plans around this.
More recent presentations in late 2009 have focused on the practices being knowledge hubs, supporting the DFAIT network (ROs and Posts) and gathering and coordinating other players. There is strong support for LSP to play the role of a knowledge hub, but, those interviewed believe that this role is yet to be fully developed. The limited capacity to respond to potential need for support, and the staffing challenges within the LSP have been some of the contributing factors to date.
This evolution of messaging has created confusion. Consensus exists within and outside DFAIT that there is a need to clarify the role and mandate of the practices, particularly as new ones come on stream with each taking slightly different forms and approaches.
The recent efforts to clarify LSP's relationship with ROs, Posts and Geographic groups have meant that the potential for LSP's contribution to the overall work of DFAIT is materializing. The communication effort started recently should assist with this. Further efforts are needed, however, in clarifying the role and mandate of the practices and building a common understanding to move forward.
|Finding #3||The principle of the structured practices is well aligned with DFAIT's strategic outcomes.|
Under DFAIT's current Program Activity Architecture (PAA), the Life Sciences Practice falls under Program Activity 3: International Commerce. This is intended to support "Greater Economic Opportunity for Canada, with a Focus on Growing/Emerging Markets." The DFAIT Strategic Outcome is "International Services for Canadians: Canadians are satisfied with Commercial, Consular and Passport Services."
The LSP provides support to these objectives and is aligned with both DFAIT's Transformation Agenda and the Global Commerce Strategy. The introduction of LSP as the first structured practice represented a new approach that built on the principles of the Global Commerce Strategy and integrative trade. The LSP provided an opportunity to truly support the bringing together of trade, investment and innovation to support the development of a specific sector. The approach was intended to better align the support for the life sciences sector with the needs of industry and enhance the ability of DFAIT's network to respond to opportunities for Canadian firms. By having greater knowledge of sectors and global competitiveness issues, the practice was intended to focus resources on having the greatest impact in terms of results.
One of the original drivers of the structured approach was a demand from the private sector for more strategically focused sectoral support. While the innovativeness of the concept required adjustments to the ways of doing business within DFAIT--and faced resulting change management issues--it also provided an opportunity to develop a more strategic approach to service delivery for clients.
|Finding #4||It is unclear the extent to which there is a consensus among the other government partners on the initial Strategy and some of the underlying assumptions made by LSP.|
The alignment of the LSP with broader Government of Canada priorities is more difficult to determine. In a number of documents, it is noted that the practices are intended to align with Government and partner priorities such as EDC, BDC, NRC, IC, etc.(3) The assumption is that by developing links with key partners and stakeholders, the priorities and programs can be better aligned and coordinated across the agencies.
This question of alignment was discussed with OGDs. Two points were highlighted by a range of partners. First, while the initial Life Sciences Strategy was reviewed by OGDs, it did not influence their priorities or approaches to a significant extent. The Strategy is seen to be DFAIT's approach to life sciences, not a whole of government approach. Each group has its own priorities and areas it is pursuing, regardless of the LSP Strategy. They see their role as providing some advice and facilitating the process within LSP but not coordinating to any extent.
Second, the original LSP Strategy and approach had a number of assumptions which were not, for the most part, discussed or debated with partners. For example, the LSP initial Strategy took a position that the outflow of technology from Canada (i.e., low value out-licensing, acquisitions, company relocation outside Canada) was not to be supported by the TCS in the life sciences area.
Not all partners agreed with these assumptions since they believe the global marketplace is more complex than this. Circumstances exist where both inflow and outflow of technology can provide net benefits for Canadians. The nature of the global marketplace makes these kinds of black and white distinctions not as effective an approach.
The original discussions with partners tended to focus on the detailed interventions in the Strategy, not the overall objectives or underlying assumptions. Feedback was requested from partners on specific initiatives. Broader questions of how to tackle the global marketplace for the life sciences industry were not raised or explored. If the Strategy is to act as the framework for the Trade Commissioners' proactive work then this is problematic since the OGDs also rely heavily on the extensive TCS network at missions for support and guidance in their international work.
|Finding #5||Initially, LSP did not effectively build on the current roles and responsibilities within DFAIT, with OGDs and other stakeholders to advance the industry as a whole.|
When LSP started, the sector approach had already been adopted in the ROs, Posts and OGDs as mentioned above. They had networks within the life sciences areas, contacts within the industry, and existing methods for coordinating industry efforts. As mentioned above in Section 1.2.1, the original intention was for LSP to work with these networks to build a synergy of efforts and develop sector strategies for moving forward.
When the pilot started, due to the HR and communications limitations, the LSP did not consult as extensively as needed. Interviews indicated that the LSP did not initially use these existing resources or build on the existing networks and programs effectively. Consultations were seen to be inadequate during the first year. LSP formulated the Strategy and presented it to the Advisory Board for approval. Input was sought from Posts and ROs but interviewees felt that the Strategy was not informed by their views or expertise. Rather, it represented the approach LSP staff wanted to take and the LSP's interpretations of both Canadian capabilities and market opportunities.
LSP had discussions with OGDs active in life sciences, who are participants or observers on the Advisory Board. OGDs feel that there is not a strong partnership in place. There was (and continues to be) a sense of competition, not sharing of ideas and information. There is still a significant amount of work that will need to be done to promote a strong partnership focused on broader Canadian objectives. While DFAIT has traditionally had the mandate for international trade, it has not had the exclusive international mandate around S&T and innovation.
Other stakeholders in life sciences such as provinces, universities, and institutes play a large role in the overall industry. There has been limited engagement with these groups in the past to develop methods for building synergies with their efforts. Industry and OGDs see this as a shortcoming. In March 2010, DFAIT presented the new LSP Sector Strategy to ADMs from provinces, territories and regional development agencies to broaden the network. Reportedly, the Strategy was well-received by the participants, and the session was effective as a forum for reaching out to stakeholders.
To have the broadest impact, it is important that the practices work with a range of stakeholders and build on the existing strengths within the various partners and DFAIT groups. There needs to be a shared understanding that all stakeholders who work in
different areas of DFAIT, federal government and provinces and territories are supporting the life sciences sector and assisting Canadian firms in maximizing opportunities.
|Finding #6||Initial evidence suggests that the LSP model can support the improvement of business opportunities for life sciences companies.|
The in-house ability to have sector expertise and industry experience is seen as an important resource for supporting industry and DFAIT's provision of services to firms. Having a method to focus on priorities and the tools to do this was also seen to be important for the overall achievement of results.
It is too early to expect or observe LSP's systematic and measureable impact on the industry. However, some anecdotal evidence is emerging on the type of results that can be supported by LSP including support to Posts and company level results in terms of leads and investments. At this point, the activities that show progress include the following types of interventions.
LSP has also been assisting with some broader policy issues facing the life sciences industry. Two examples can be cited. LSP worked with Health Canada and Natural Resources Canada on the medical isotope issue that emerged with the closure of Chalk River Laboratories. LSP worked with key Posts to find sources internationally that could supply isotopes to Canada and find countries where production facilities could be expanded. This information was then given to the government partners to pursue further.
More recently, the Budget announced in March 2010 by the Department of Finance finally tackled the issues around Section 116 of the Income Tax Act. This section was cited frequently in discussions during the evaluation (by DFAIT, OGDs and industry) as a deterrent to venture capital companies considering investment in Canada. Its provisions substantially increased the costs and risks of venture capitalists operating in the Canadian market.
The Canadian Venture Capital Association has been making representations on this issue for many years. LSP joined forces with the Association and provided information to decision makers on the importance of the changes for the future of the life sciences industry.
|Finding #7||A difficulty for the future is measuring the extent of success of LSP. There is currently a lack of clear performance targets for tracking results.|
The activities noted above show some of the areas where LSP has been focusing. To actually track the results of its efforts will require more than simply looking at discrete activities, however. There need to be measures that can be used to assess whether or not LSP is progressing towards its objectives and how success will be measured.
Initially the objectives of the LSP were seen in terms of results at a firm level--increased opportunities, partnerships, foreign direct investment, and improved competitiveness of Canadian companies in life sciences.(4) While LSP can contribute to these results, their achievement is linked to the performance of a wide range of other players including Posts and ROs. Attribution of these results to LSP is difficult but these are the longer term efforts of a range of partners to which LSP can contribute.
Clear results must be identified which relate to the contribution of LSP to these broader results. The TCS has been working for several years on a results framework, one now being used to provide benchmarks for performance and tools to collect the information on whether these benchmarks are being achieved. The practices need to identify within this what their contribution or value added can be.
Benchmarks and targets also need to be established for support to the Posts and ROs. One of the objectives of the LSP is to assist other parts of DFAIT to better serve clients. This needs to be tracked and measured. To do this will require explicit targets and results.
The current exercise by the sector practices bureau to establish performance indicators for the practices will be an important step toward clarifying this issue. The proposed performance indicators were presented to and endorsed by the Minister's SME Advisory Board. The Board suggested that indicators need to include quantitative data, such as dollar value of contracts from targeted firms, job creation and Canadian Direct Investment Abroad (CDIA).
This, along with a clarification of the role of the practices, should help other parts within DFAIT and outside groups have a better understanding of the objectives of the practices and what they are trying to achieve.
|Finding #8||The tools being developed by LSP were seen to be useful but need to be further refined with input from stakeholders.|
One of the areas of focus of the LSP since it began has been the development of a series of tools which can be used to build stronger support for Canadian companies in the life sciences sector. The major tools developed to date were reviewed with those interviewed to obtain feedback.(5)
The development of sector strategies was one of the primary roles of the LSP and subsequently other structured practices. The Strategy was intended to reflect the capacity and interests of the sector and take an integrative trade approach, looking for areas of opportunity to expand Canada's global role. The Strategy was a method for providing DFAIT with a strategic direction for a sector that could be proactively pursued.
Strong support exists for sector strategies as a method to focus efforts. Many of the sectors such as life sciences are complex, with many differing sub-sectors with varying prospects and Canadian capabilities in the global market. In general, there was agreement that having a framework for setting priorities and actively pursuing opportunities based on Canadian capabilities and interests was important.
The acceptance of the initial Strategy, however, faced challenges for two reasons. First, the initial Strategy was developed with limited meaningful consultations with Posts and ROs. In general, it was felt that the LSP reviewed market opportunities, Canadian capabilities, and to a limited extent Canadian interest on their own. The ROs and Posts felt that their knowledge on capabilities, and understandings of the market opportunities in various locations were not effectively used in the formulation of the Strategy.
The process was seen to lack transparency. The rationale for certain decisions, e.g., prioritization of some sub-sectors over others, were not clear to staff at Posts and ROs. The interviewees' view was that the Strategy was presented and Posts and ROs were expected to implement it.
The lack of adequate consultations in the first year meant limited buy-in and understanding from the ROs and Posts to the Strategy. The resistance to spend all their proactive time on the designated priorities was partially a result of this process and the feeling that their knowledge was not being used or taken into account.
The development of the current Strategy is based on increasingly broader consultations and this should hopefully move the Strategy to wider buy-in from industry, DFAIT, and OGDs. At the time of the interviews however, there was still a "wait and see" attitude.
The first LSP strategy was also seen by some as too macro. Sub-sectors such as biotechnology are complex and require a more extensive review of the actual opportunities and capabilities. There was a need to drill down and focus on areas of competitive advantage for Canada to find good matches. Australia was cited as a good example where such detailed approach is adopted and works well.
Strength, Weaknesses, Opportunities and Threats Analysis
The SWOT analysis was seen to be useful, particularly for Trade Commissionerss new to the sector. The original intent was to develop a higher level overview of life sciences. A need exists now for greater information on the specific sub-sector level. It was a common view among interviewees that many of the points in the SWOT are generic.
There is high demand by the Posts for more specific information by sub-sector on Canadian capabilities. This could be an important area for LSP to provide more extensive support to Posts.
Client Service Fund
Allocating a portion of the Client Service Fund to sector priorities in the Strategy is an effective way of aligning resources to targeted results. It also helps to ensure that the CSF is aligned with industry needs.
The implementation of the CSF shift faced some issues, however, as indicated by the return and lapsing of the LSP's CSF allocation. The difficulties in disbursing the LSP CSF was partially due to the new process used in the first year by CSF, and linking the allocation of funds to the LSP Strategy. Posts were not fully aware of the new CSF allocation process and requirements.
The Advisory Board review of the individual CSF proposals was seen as an inappropriate use of the Board's time, and inconsistent with its strategic mandate and role. Board members preferred to not review small proposals for funding. Their input is important in terms of setting the framework and priorities for funding not reviewing individual submissions.
|Finding #9||Strong support exists for having more information on Canadian companies and capabilities. The company profiles were not seen to be that useful by Posts, although, anecdotal evidence indicates some early success.|
The International Readiness Committee was established to develop a method for identifying Canadian companies that were ready for international opportunities or would benefit from repetitive exposure to the Department's broader promotional efforts. LSP wanted to leverage DFAIT's extensive network to achieve business successes with these firms.
The selected companies were profiled in depth on their needs and these profiles were then given to the network for proactive follow-up in various markets. The profiles were designed to deliver competitive intelligence to Canadian firms on potential opportunities. Initially 80 companies were evaluated with 25 being selected and 14 firms agreeing to participate. The profiles were developed and sent to Posts in specific markets of interest. The intention was to have the Posts identify any leads in their territory, which would then be followed up on by the lead (ROs, IRAP or the LSP).
The IRC was viewed favourably in terms of gathering more information on companies and ranking their readiness. There is clearly a desire to have more information on Canadian capabilities and interests and independent assessments of readiness.
Difficulties were seen with the approach to using the company information, however.
There is agreement across all the stakeholders that more information is needed on Canadian capabilities and on a range of firms. Currently, individual databases are being built at the regional levels that only provide a partial picture. Having more detailed information on capabilities, interests, and readiness was seen to be important for effectively tapping opportunities. This information needs to be organized in a manner that is easy to access and allows Posts to make logical decisions regarding which opportunities to pursue.
|Finding #10||The expectation that the Practice Lead could provide both sector expertise and manage the unit was unrealistic.|
The value of the practice leads is their sector expertise, strategic thinking, and ability to leverage support from a wide range of stakeholders for the strategies developed. Requiring the Practice Lead to manage the overall practice, with no DFAIT/Post experience, was unrealistic. This made it difficult to both the set-up of the unit and the ability to provide the level of sector support possible and needed. Past experience has shown that creation of a new unit by experienced DFAIT managers involves considerable time and resources. This task was a significantly bigger challenge for a manager new to the public service.
By mid-2009, it was identified internally by DFAIT that this arrangement needed to be shifted for the future practices. A presentation by the Global Business Opportunities Bureau indicated that "engagement of a Private Sector Expert needs to be balanced with a Rotational Director to ensure that private sector expectations are balanced with DFAIT culture and operating norms."(6)
The formation of the more recent practices, such as the Aerospace and ICT, are a more appropriate use of the practice lead role. This is also the approach taken by other organizations such as EDC where sector experts and management of units are separated. EDC, for example, restructured in 2006 around six industry sectors. Teams were created that included sector advisors. The advisors were integrated into the teams and reported to the sector team managers. This arrangement removed advisors from managerial and administrative responsibilities and allowed them to focus on more strategic activities.
|Finding #11||The principle of having private sector specialist staff within the practices is a good one, but current DFAIT regulations and hiring practices make this difficult to accomplish.|
One of the original rationales for setting up the practices was to bring sector experts, particularly from the private sector, into DFAIT to support its new approach. Having some private sector personnel integrated into the team is critical for fulfilling the LSP role in terms of knowledge of the industry. The value added of the practices is the knowledge they can bring to the table.
LSP faced significant challenges in filling positions from the private sector on a timely basis, as well as retaining staff. At the time of start-up, the LSP only had 3 of 8 positions filled. It was almost a year before the majority of staff were in place. Long delays were seen in DFAIT hiring practices, for example, the time required to obtain security clearances. The staffing regulations are extensive and inflexible in some ways. The newer practices also are facing challenges in terms of contracting the level of expertise required for their leads, even on a part time basis.
These delays made the start-up period more difficult and were time consuming. The requirements of the human resource systems highlight some of the challenges in putting in place more innovative approaches within DFAIT.
|Finding #12||The integration of investment and innovation expertise within the LSP has allowed an integrative trade approach, focused on consistent priorities.|
The LSP has investment and innovation staff embedded in the practice. This approach has ensured that the various streams are coordinating their efforts and working towards a common strategy. This has allowed a consistency of approach and priorities between trade, investment and innovation.
The new practices coming on stream will not have embedded staff, but would receive innovation and investment expertise from the respective divisions. The advantage of this approach is that these experts can work in an environment where they have more direct access to expertise on investment or innovation issues. For example, investment personnel can receive guidance on new investment approaches from the Invest in Canada group.
One potential downside of the new approach, however, is that the functions could become potentially stove-piped. Particular emphasis needs to be put on collaboration and close coordination among sector practices, the Invest In Canada bureau, and the Innovation division. The development of strategies by the practices is an important part of building a sectoral approach. Tough choices need to be made about the focus for a specific year. This always involves trade-offs among various sub-sectors and priorities. The benefit of the strategies is that they act as a basis for common action to achieve results.
For the practices without the embedded experts, an agreement on the priorities across the International Business Development, Investment & Innovation Branch is needed. There needs to be a mechanism for the investment and innovation groups to coordinate on these priorities with the practices. Unless the importance of this is made clear from senior management, the risk is that each group will develop and pursue their own priorities within the sector with limited coordination.
|Finding #13||The LSP was initially perceived to adopt a prescriptive and directive model, not a guidance or support approach, for initial implementation. This caused difficulties within the DFAIT system and decreased effectiveness by raising resistance to change.|
As mentioned previously, the introduction of the LSP came at a time of a wide range of other changes in DFAIT ranging from the introduction of new service approaches such as integrative trade to a major reorganization of functions. This environment heightened the overall uncertainty of staff and the complexity of the change management required.
While lessons can be learned from the approaches of the private sector to change management, applying these to the public sector is more complex. The public sector operates under serious constraints not seen in the private sector which must be integrated into the approach taken. Systems are less flexible. A wide range of stakeholders must be engaged. The dynamics of the interactions within the public sector are more complex, including matrix reporting relationships for staff.
Staff (as is the case within DFAIT) are often faced by continual "change management" in the working environment. This makes them take a more wait and see attitude. Some studies have shown that when a new change is being implemented, a quarter of staff may be receptive to change, a quarter resistant, and the rest undecided.(7) But even those who are receptive initially can be easily lost if sustained approaches to change are not followed.
The manner in which the LSP pilot initially approached fulfilling its mandate did not sufficiently take into account the change management aspects of this new approach and the existing structures. The pilot saw its mandate as being the establishment of a strategy and then leading the implementation of that strategy--as the initial communications on the practices indicated. LSP developed the Strategy and expected Posts and ROs to implement it.
Resistance that was raised was seen as simply a symptom of change management--people not wanting to change how they worked. In fact, the dynamics were more complex than this. The issues cited in both the interviews for this evaluation, as well as an internal review done by DFAIT in early 2009(8) highlighted some of the factors that contributed to the resistance.
The respective roles of ROs, the Posts and LSP became clouded during the initial implementation. The degree to which the ROs felt they were involved in working with firms targeted negatively impacted collaboration with the LSP. The ROs felt their lack of involvement caused confusion with their clients with whom they already had established relations.
At the start of the pilot, there was confusion about the role of the LSP vis-à-vis Posts. The "support" role of the LSP was not defined and communicated effectively, leading to perceptions that were not consistent with the vision of LSP as a sector practice. Posts were expected to implement priorities and activities set out in the Life Sciences Strategy, which they believed was developed with limited consultation on the local market conditions and opportunities. Posts found that their suggestions regarding the sector approach were not well received. The inconsistent messaging regarding direction/advice from the geographic divisions and the LSP contributed to the confusion at Posts. They were not clear on the direction they were supposed to follow.
LSP initially set up a system where IRC members (IRAP, ROs, LSP) who would put forth a company's name, would develop the profile for that company and would be the lead on the file. The lead would establish direct contact with the firm, and once there was interest, the company would work with relevant Posts. This was a new process to Posts who usually establish direct contact with companies from the start. Interviews with Posts revealed that the new system of IRC company selection was not effectively communicated to them or understood by all.
By LSP taking a prescriptive approach, the change management issues were more acute. Trust was lacking among the various players. A collaborative environment was not fostered. Resistance increased as a consequence. Staff at Posts perceived that the existing approach to serving clients was disregarded as not effective and hence irrelevant. Their knowledge of local opportunities was dismissed.
In the last year, LSP has begun to shift towards greater consultation and involvement of the ROs and Posts in priority setting and decision making. Significant improvements in the corporate communication efforts in 2009-2010 have helped in addressing the earlier challenges. However, the respective roles of the LSP, Posts, ROs and Geographics have not been completely clarified and need to be.
In the interviews, the approaches being taken by some of the other practices coming on stream, based on lessons-learned from the LSP pilot, were positively perceived. The other practices were building on the existing roles--not duplicating efforts--and were more consultative.
|Finding #14||The Advisory Board is a good method for bringing outside expertise into DFAIT decision making and priorities. The role of the Board is not well understood, however, and its potential contribution is not being fully realized.|
The LSP Advisory Board composition is seen as a strength of the practice approach. Having private sector representatives on the Board provides an excellent method for testing ideas and ensuring that industry has a say in the support provided in life sciences. The Board members actively engage at the meetings and have useful input.
Interviews with LSP Board members indicated that they were not completely clear on their role, or what was expected of them in terms of contributing to the development and implementation of sector support. Terms of references were not developed before the first Board meeting. The Board members have been asked to react to strategies developed by LSP and provide input in areas such as reviewing all the CSF proposals. Beyond this it was unclear what is expected. As new sector practices were created, a terms of reference document for all advisory boards was prepared in September 2009.
There was also a feeling that the LSP needs to focus more on strategic input from the Board, and less on operational/tactical assistance. For example, as mentioned previously, reviewing individual CSF proposals is not a good use of time but setting priorities for CSF is. Reacting to a strategy allows Board input but not their proactive guidance. The Board members could play a more strategic role in terms of providing more insights into global trends, Canadian competitiveness, etc. which could be integrated into the approaches taken.
Clarifying the strategic value-added role of the Boards would enhance their function. An information session where new board members could learn about their role and mandate and the business of DFAIT was viewed as necessary as well.
The LSP pilot represented a new way of doing business within DFAIT. Continuing the movement towards a stronger sector focus, it attempted to build sector expertise within DFAIT, focus efforts on clear priorities and provide support throughout the DFAIT network. After a difficult start, it is now gaining more momentum. With the other new structured practices on board, the principle of practices is now increasingly accepted. Groups inside and outside DFAIT believe the LSP can be an important method to better coordinate sector support and generate sector knowledge. The desire for more knowledge on Canadian capabilities in sub-sectors is particularly strong.
DFAIT is a complex matrix organization. Any change management within an organization needs to work off the strengths of the system and players to build momentum for change. This leverage approach is critical given the limited resources available. The way a change is approached is as important as the ideas behind the change. Many of the initial problems with the acceptance of the LSP were around issues of the approach taken and the lack of adequate consultation or recognition of existing expertise within the networks.
The structured practices can provide an important link in matching Canadian capabilities and interests with foreign opportunities. To do this effectively, ways need to be developed that provide value added to existing DFAIT and external networks.
The practices are now at a critical point in their development. DFAIT needs to be clear about the role they are to play within the broader picture of sector promotion. There needs to be agreement across management (including different branches) on the approach. DFAIT also needs to be clear with outside partners on its goals and be open to finding ways to build on strengths of outside partners to achieve its results.
A better strategy to engage industry also needs to be developed. The current role of the Advisory Board serves DFAIT purposes but does not allow a more dynamic relationship that could inform how sectors like life sciences should be approached and how to maximize the impact of DFAIT's work. Relationships with OGDs (including groups like provinces) and other players in the life sciences need to be enhanced. The greater the synergy that can be developed, the more support the Canadian industry can have in its efforts to operate effectively in global markets.
|Recommendation #1||It is recommended that an agreement and a decision be reached within DFAIT on the mandate and roles to be played by the structured practices including LSP. A clear and consistent communications strategy then needs to be developed to ensure there is a common understanding both within DFAIT and between DFAIT and its partners.|
The concept of practices has evolved since their original introduction in 2007. There is now greater clarity on not just the value but the role that can be played by the practices. However, the evolutionary nature of its introduction has left lingering confusion. This is being exacerbated as new practices come on stream that are taking different approaches.
The mandate and role of the practices need to be agreed across DFAIT. This then needs to be communicated in a consistent and clear manner to stakeholders within and outside DFAIT.
|Recommendation #2||It is recommended that LSP, and the other practices have access to the right skills and human resources to fulfill their mandate. Access to professional communication and change management expertise would enhance buy-in and success. Without this, the ability to provide high quality sector expertise may be undermined.|
Having strong sector expertise means that it is important to source personnel both within and from outside DFAIT. In order to be a knowledge hub, sector resources need to be available to the practices in order to provide value added. Some of this expertise also relates to finding people able to assist in communications and change management issues. These have proven to be important for the potential success of the LSP but have not been addressed adequately to date.
|Recommendation #3||While the practice teams do not need to specifically have investment and innovation experts within the unit, it is recommended that efforts across relevant divisions be coordinated and conform to the Sector Strategies developed.|
While the embedding of investment and innovation staff has been effective under LSP, it is not essential for the practices. There are certain advantages to having the investment and innovation groups remain whole. What is critical, however, is ensuring that the efforts do not become stove-piped for various sectors. Having different priorities for a sub-sector being promoted by a practice, Invest in Canada and the innovation group will undermine the principle of setting priorities and focusing resources. Consultations and coordination across the groups are imperative and their importance must be communicated from top management.
|Recommendation #4||It is recommended that the role of the LSP Advisory Board be reviewed and rethought to ensure that their expertise is effectively used. The Board could play a greater role in areas such as strategic thinking about priorities, providing insights into global trends, and building a medium term approach to supporting life sciences.|
The Advisory Board plays a key role in ensuring that the approaches taken by LSP are driven by industry needs. Bringing together private sector experts presents a unique opportunity to tap their expertise and understanding of global markets to improve DFAIT services.
The Advisory Board members' expertise is not used optimally. The Board members are placed in reactive positions--reacting to strategies developed by the LSP or reviewing individual CSF submissions. This has caused some Board members to wonder why they are participating and what is expected of them.
The value of the Board is the potential insights they can provide to industry thinking, trends, priorities, and approaches. They have a unique perspective on where various sub-sectors are going in the future and where real capabilities may lie. These medium and long term perspectives could be a valuable input into the thinking around how to support the future growth of life sciences. This type of thinking is also an area that Posts believe would be useful for their work. Where is the Canadian life sciences industry going? What are its real strengths? How can they best support this? Annual planning and priorities provide an immediate framework. Medium term thinking allows that yearly framework to be developed within a broader context.
|Recommendation #5||It is recommended that a results framework with specific performance measures be developed to clearly articulate and track the performance of the LS Sector Strategy in both supporting clients, and the ROs and Posts.|
The broad results statement for LSP provides the big picture of what is trying to be accomplished in terms of areas such as investments. They do not effectively provide a basis for assessing progress of LSP, however. A specific results framework needs to be developed and methods put in place to track the results over time. This will help to move the practice away from relying on anecdotes to having a sounder case for their contribution.
It will be important to have results targets in two areas. First, the contribution and value- added that the LSP is providing to the services and second, results with clients needs to be clearly identified and tracked. They are part of a team and attributing successes simply to LSP is not appropriate since the work with firms relies also on the Posts and ROs. The question then is what is the value added of LSP and how is it tracked?
The LSP is providing services and support to Posts and ROs to do their jobs more effectively. The tools being developed need to meet the needs of the front line people. Indicators should be developed which allow this to be assessed.
|RECOMMENDATION # 1|
|It is recommended that an agreement and a decision be reached within DFAIT on the mandate and roles to be played by the structured practices including LSP. A clear and consistent communications strategy then needs to be developed to ensure there is a common understanding both within DFAIT and between DFAIT and its partners.|
Associated Findings: 2, 4, 5, 8 and 9
|Management Responses & Action Plan||Responsibility Centre||Time Frame|
|We agree that limited financial and human resources dedicated to the launch of the sector practice pilot project resulted in identified weak capacity to communicate outside departmental headquarters on the rationale, role, and workings of the first, new sector practice.||Global Business Opportunities Bureau (BBD)|
|Communications efforts on the practice approach were initially made through PowerPoint presentations and broadcast messages. Subsequent to this early period, additional broadcast messages have been conveyed and other communications tools such as conference calls and bilateral calls, a sector practice wiki, new online community of practice and webinars have been utilized more frequently in the past year. Such intensified post and regional office engagement will continue.||Completion in 2010 but already underway|
|We agree that more coherence is still needed. In response, Global Business Opportunities and North America bureaux have jointly committed to organizing a geographic-sector practice full day meeting in the near future. The agenda will address life sciences and the other four structured practices and involve all geographic bureaux, including US sector network coordinators within the NBM context. The two bureaux have also agreed to more regular sector practice communications such as teleconferences with US posts through the US Bureau. The overall objective is to further mutual understanding, break down silos and better coordinate respective approaches in priority markets against a common set of accountabilities to avoid confusion among both employees and clients.||1st and 2nd Quarters, 2010|
|To address the mandate and role findings, there is an opportunity for follow up discussion and consensus building at the IICB and in other internal management fora to determine the extent to which the strategies should be prescriptive as opposed to indicative and who is accountable for what.||2nd and 3rd Quarters, 2010, but already underway|
|The Practice approach has received clear support from members of the business community and from the Minister's SME Advisory Board as an improved means to equip posts with sector knowledge so that they can provide more informed, strategically focused and effective business services to Canadians.|
|The role of the sector practice is to create and support the implementation of a global sector strategy which sees the world through the prism of the integrative trade model. By seeking diverse inputs as well as sharing the strategy with our other governmental colleagues, a stronger cooperative linkage is expected to berealized over time. For example, the March 2010 federal-provincial ADM trade meeting demonstrated the positive support for the concept of practice leads and global sector strategies among provincial and regional economic development agency partners. This has set the stage for a more coordinated approach abroad. The Department will need to continue to make best efforts to keep other departments fully informed and engaged so that DFAIT's international business convenor and leadership role continues to be recognized and accepted.||3rd Quarter, 2010 (Conditional on Resources)|
|A more robust communications plan has been developed but its implementation will require an allocation of adequate financial and human resources.|
|RECOMMENDATION # 2|
|It is recommended that LSP, and the other practices have access to the right skills and human resources to fulfill their mandate. Access to professional communication and change management expertise would enhance buy-in and success. Without this, the ability to provide high quality sector expertise may be undermined.|
Associated Findings: 10, 11 and 13
|Management Responses & Action Plan||Responsibility Centre||Time Frame|
|We agree. The Department's financial challenges and resulting hiring freezes during the period under review have adversely affected the timely implementation of this pilot project. These pressures have created a significant retention risk regarding those industry experienced staff we have been able to secure. These freezes continue to create challenges by preventing the use of some of the more flexible staffing tools such as executive interchange. This difficult operating environment has made the engagement of several other practice leads for new structured practices in 2009-10 particularly burdensome and time consuming. For example, the Bureau has frozen and monetized positions to fund some of the global practice lead engagements.||Global Business Opportunities Bureau (BBD)||2nd and 3rd Quarters, 2010|
|In this connection, the establishment of the Departmental EC-CO pool will need to be undertaken in such a manner as to accommodate to the extent possible some specialized industry knowledge and expertise required by the sector practice roles. BBD will consult with HR colleagues in this regard.||3rd and 4th Quarters, 2010|
|The benefit of the specialized sector knowledge is beginning to be demonstrated in the information tools, training and direct support provided to posts. Posts and Canadian companies are now registering some successes in areas of business that traditionally have not been well supported by the Department but which now fit the new, more sophisticated integrative trade model mandate. For example, contract research or clinical trials services which are more strategic business development activities compared to classic export activities. These successes, which the Global Commerce Strategy seeks to facilitate, are directly or indirectly attributable to the practice approach. Such outcomes required the specialized industry expertise of practitioners. As successes begin to develop and become known through improved communications, buy-in will increase.|
|While the practice teams do not need to specifically have investment and innovation experts within the unit, it is recommended that efforts across relevant divisions be coordinated and conform to the Sector Strategies developed.|
Associated Findings: 12
|Management Responses & Action Plan||Responsibility Centre||Time Frame|
|We will continue to consult and ensure that sector strategies are fully representative of the integrative trade model, particularly investment, innovation, and market access. In this regard, a cross functional matrix team approach around common global sectoral strategies is being taken to ensure the coherence of a virtual network across the full spectrum of integrative trade. This improved internal communications and coordination will mirror well the existing presence of external investment and innovation proxy representatives on sector practice advisory boards.||International Business Development, Investment & Innovation (BFM)||3rd and 4th Quarters, 2010|
|It is recommended that the role of the LSP Advisory Board be reviewed and rethought to ensure that their expertise is effectively used. The Board could play a greater role in areas such as strategic thinking about priorities, providing insights into global trends, and building a medium term approach to supporting life sciences.|
Associated Findings: 1 and 14
|Management Responses & Action Plan||Responsibility Centre||Time Frame|
|Terms of reference have been developed for the Life Sciences Practice and for the subsequently established four other sector practice advisory boards.||Global Business Opportunities Bureau (BBD)||Completed|
|Given its history, the Life Sciences Practice Advisory Board is still a newly formed board. Therefore, board member input continues to evolve as members become more familiar with the department and its programs, services and operations. This organizational learning will continue to be expected and encouraged. For its part, the Department has also become more aware of the life sciences and other sectoral boards wishing shift up to a more macro-strategic rather than a micro-tactical role. This is normal once members have been initially exposed to both levels of detail. The extent to which the board plays a strategic role will be mutually reinforced by the extent to which the strategies are implemented by the Department.|
One of the new structured practices that benefited from early lessons learned from the LSP pilot, the ICT Advisory Board, was recently called together by Industry Canada to consult on the international dimensions of the proposed Digital Economy Strategy. This extraordinary advisory meeting, which was requested by Industry Canada and which DFAIT welcomed, helped validate the quality of the practice initiative and the benefits of fostering linkages to related government departments and overall priorities.
|2nd Quarter, 2010 for Completion but currently underway|
|It is recommended that a results framework with specific performance measures be developed to clearly articulate and track the performance of the LS Sector Strategy in both supporting clients, and the ROs and Posts.|
Associated Findings: 3, 6, and 7
|Management Responses & Action Plan||Responsibility Centre||Time Frame|
|A proposal for a performance measurement framework specific to the sector-based approach and the Sector Practices has been developed.||Global Business Opportunities Bureau (BBD)||Completed|
|The proposed framework was presented to the Minister's SME Advisory Board in May 2010. The Board supported the measurement approach and the proposed metrics which they qualified as "business-like."||2nd Quarter, 2010|
|We plan to review the proposed framework at a meeting of the ICCB this summer and subsequently seek final approval from senior management.||2010-2011 and beyond|
|It is expected that some results and trends will start to be visible within a year. Progress reports will be made available quarterly to senior management as soon as results are supported by sufficient data.||2011 and beyond|
|The main results will be available after one year and enable the establishment of baselines for assessing results in succeeding years.||1st Quarter, 2010 but ongoing|
|Success stories is one metric being proposed. Already several Canadian companies have experienced successes through posts working with the Life Science Practice in seven different markets including Japan and in Europe. Additionally, the Life Sciences Practice was instrumental as part of a Departmental partnership in addressing successfully key policy files such as the need to increase foreign venture capital investment in Canadian life science SMEs.|