Audit of the Trade Commissioner Service’s Regional Operations

Final report
Office of the Chief Audit Executive
November 2022

Table of Contents

Executive Summary

Findings and Recommendations

1. Strategic direction
2. Service delivery
   • Identification of clients
   • Coordination with Canadian missions abroad
   • Coordination with external partners
   • Client satisfaction

3. Human resources management
   • Vacancies
   • Training and onboarding
   • Values and Ethics Code for the Public Sector

4. Data
   • Strategic use of data and tools
   • Performance data
   • Protecting confidential information

Conclusion

Appendix A: About the audit

Appendix B: Recommendations, Management Responses and Action Plans

Executive Summary

In accordance with the departmental Risk-based Audit Plan 2020-2021, the Office of the Chief Audit Executive conducted an audit of the Trade Commissioner Service’s regional operations.

Background

The Trade Commissioner Service (TCS) provides market intelligence and practical advice about foreign markets to export-ready Canadian companies to help them achieve their goals. It is a vital contributor to Canada’s economy. In the 2020-2021 fiscal year, the TCS served 10,116 Canadian companies interested in exporting, resulting in an estimated $4 billion in economic impact.

The regional offices are key points of service in the TCS network through their proximity, knowledge and links to Canadian businesses, provincial governments and other local partners. See Exhibit 1 for the TCS organization chart.

The Regional Network has a twofold mandate:

• Engage with targeted TCS clients in proactive sectors and providing sustained and customized support to foster their international expansion.
• Provide support and advice to deliver domestic outreach programs for ministers, senior-level Global Affairs Canada executives, and heads of missions (on a case-by-case basis).

Objective and Scope

The objective of the audit was to determine whether there is an effective management framework in place to support service delivery and the achievement of the TCS’s strategic objectives in the Regional Offices Network.

The audit focused on the activities of the TCS’s Regional Network between April 2019 and March 2022. This includes the six regional offices and their 27 satellite agents located in partner organizations. The regional operations activities of the Regional Network and Intergovernmental Relations Division, the High Intensity Services Division and the TCS Tools, Analysis and Performance Division were also included. The regional offices’ function of providing support and advice to ministers, senior executives of Global Affairs Canada, heads of mission, and CanExport Program management were not included in the scope of this audit.

Conclusion

The audit concludes that a management framework is in place to support service delivery and the achievement of the TCS’s strategic objectives in the regional offices. However, the TCS should make improvements in the following areas: coordination between the regional offices and the missions, and provision of complete information regarding the services offered by the TCS and the role of the regional offices.

Statement of Conformance

The audit was conducted in conformance with the Institute of Internal Auditors’ International Standards for the Professional Practice of Internal Auditing and with the Treasury Board Policy and Directive on Internal Audit, as supported by the results of the external evaluation of quality assurance.

Findings and Recommendations

1. Strategic direction

The Regional Network’s strategic direction is clearly defined and aligned with the strategic objectives of the Trade Commissioner Service (TCS) and departmental priorities. The TCS’s direction is articulated in its Strategic Plan 2018-21 and its Strategic Update 2021. In its Update, the TCS reports on its progress in the achievement of their objectives from the Strategic Plan 2018-21 and identifies the steps to be taken over the next few years.

Every year, the regional offices prepare their business plans using the Strategia corporate process. The business plans describe how the regional offices contribute to the implementation of the TCS Strategic Plan and identify each regional office’s priority sectors, key risks and associated mitigation measures.

The TCS Strategic Update 2021 highlights the critical role of the regional offices in implementing the Key Account Management program and promoting inclusive trade.

Each regional office appoints a trade commissioner as a key account manager whose job is to provide enhanced, personalized service to clients previously identified as having high potential in order to facilitate the achievement of their business goals. Trade commissioners who perform this function have access to relevant guidelines and tools and obtain support from headquarters for program implementation.

With respect to inclusive trade, the TCS provides specific support to Canadian businesses associated with groups that are underrepresented in international trade, such as businesses owned or operated by women, youth, Indigenous Peoples, visible minorities and members of the LGBTQ community. Each regional office has a trade commissioner who acts as an inclusive trade champion with a mandate to support this specific segment of the TCS client base. The champions indicated that their role was clear and that they had access to sufficient information, tools and resources to fulfill their role effectively.

2. Service delivery

2.1 Identification of clients

The regional offices identify potential clients by conducting market research, meeting directly with Canadian companies, participating in various events (e.g., trade shows) and assessing referrals from key partners. The regional offices have access to specific criteria and guidelines to help them assess the eligibility of businesses for TCS services. Trade commissioners indicated that the criteria and guidelines were clear and sufficient. Potential clients can obtain information about the TCS through the department’s website and social media. However, clients interviewed indicated that it was difficult to understand the regional offices’ specific role and the full range of services offered by the TCS as that information was not clearly communicated to them. If the TCS does not provide all the information required regarding its range of services, potential clients may be missed.

2.2 Coordination with Canadian missions abroad

To provide consistent service that meets the needs of clients, the regional offices and Canadian missions abroad need to coordinate their efforts. In this regard, it is worth noting that the department’s intranet site does not have a web page specifically about the regional offices, i.e., a page that explains their role and responsibilities and outlines their priority sectors and corresponding trade commissioners. In addition, trade commissioners in regional offices stated that missions generally do not have a good understanding of the role and value added of the regional offices, while trade commissioners in missions noted that they do not have access to enough information about the regional offices. This situation does not promote coordination of activities between the regional offices and the missions. 

The TCS uses the TRIO2 system to coordinate its activities. Two of these activities require close collaboration between regional offices and missions: Client Connection to Mission (CCTM) and Business Opportunities (see Exhibit 2).

Exhibit 2. Definition ofClient Connection to Mission (CCTM) and Business Opportunity

To meet clients’ needs and facilitate follow-up, CCTMs must be written in an explicit, focused manner. An analysis of 100 CCTMs prepared over the past three fiscal years revealed that 28 of them did not include the information required to effectively support the missions in their service delivery. In addition, some trade commissioners abroad do not always keep the regional offices engaged when taking over a CCTM. These shortcomings limit the TCS’s ability to respond effectively and consistently to service requests, which can result in dissatisfied clients. While TRIO2 is the system used for coordination, it does not allow trade commissioners to track their CCTMs. As a result, some CCTMs may go unnoticed by trade commissioners.

When a mission identifies a business opportunity with a foreign entity, it records it in TRIO2. The regional offices can then review the opportunity and refer it to one or more clients that are willing and able to respond. In order for regional offices to be able to quickly communicate business opportunities to Canadian companies and for Canadian companies to respond appropriately, opportunities must be clearly written and contain sufficient detail. A 2021 analysis of all business opportunities conducted by the Regional Office of Ontario showed that the majority did not contain complete descriptions (e.g., a brief description of the local contact and the available opportunity, deadlines) and were therefore not ready to be shared with clients (see Exhibit 3). Delays in matching clients to opportunities identified abroad can result in missed business opportunities.

Source: ROONT Opportunity Analysis

2.3 Coordination with external partners

In its Strategic Plan 2018-21, the TCS set a goal of providing an integrated, streamlined client experience through close collaboration with external partners with complementary mandates, such as federal and provincial government departments and agencies, business associations, and regional and municipal economic development organizations. Both the regional offices and external partners reported that they collaborated effectively, including taking on clients jointly in keeping with their respective mandates. However, external partners also mentioned that the role of the regional offices and the role of the missions were not always clear. The regional offices also noted that missions often contacted external partners without informing them, even if they had an established working relationship with these same partners. That can affect the relationship between regional offices and external partners and create the impression that the TCS network is not well coordinated.

Recommendation 1

The Assistant Deputy Minister of International Business Development, Investment and Innovation (Chief Trade Commissioner) should improve coordination between the regional offices and Canadian missions abroad.

Recommendation 2

The Assistant Deputy Minister of International Business Development, Investment and Innovation (Chief Trade Commissioner) should revise existing platforms to provide complete, up-to-date information about the services offered by the Trade Commissioner Service and the roles of the regional offices versus the role of Canadian missions abroad.

2.4 Client satisfaction

It is important for the TCS to collect and use client feedback to inform the design, delivery and continuous improvement of its services. To that end, the TCS has a two-pronged client survey strategy: a rapid, automated feedback mechanism that sends an online survey to all clients who have received a TCS service, and in-depth studies conducted with a sample of TCS clients on a periodic basis to better understand their needs and identify opportunities for improvement. The results of the automated surveys are provided to the regional offices so that they can analyze their performance and make any necessary adjustments. For the 2021-2022 fiscal year, the response rate was 17% and client satisfaction with the services provided averaged 90%. 

3. Human resources management

3.1 Vacancies

The regional offices have difficulties attracting, recruiting and retaining qualified staff (see Exhibit 4). They reported difficulty staffing rotational Foreign Service positions because of a perception that there are fewer opportunities for advancement in the regions than at headquarters or in missions. In addition, the regional offices said that competition between the federal and provincial governments and the private sector for the same limited pool of candidates created further challenges. Headquarters and the regional offices work together to staff vacancies using a variety of solutions, such as hiring students and casual employees, deployment agreements with external partners, and establishing pools of qualified candidates. Headquarters also developed tools to closely monitor the status of human resources in the regional offices.

3.2 Training and onboarding

In its Strategic Plan 2018-2021, the TCS committed to developing tailored training for trade commissioners. When a trade commissioner joins a regional office, he/she undergoes a comprehensive onboarding process. He/she also has access to a variety of training and resources related to service delivery. In interviews, trade commissioners indicated that the training and resources provided generally met their needs and that the onboarding process was effective. The 2021 Trade Commissioner Service Employee Survey yielded similar results.

However, several trade commissioners also mentioned that they would like more resources specific to the sectors for which they are responsible. Although each sector has its own wiki page, the detail and relevance of the information provided there varies from sector to sector. In some cases, some of the information provided, such as the sector strategy or the event calendar, is out of date. Having access to up-to-date sector knowledge and information is essential to support the work of trade commissioners in regional offices and missions.

3.3 Values and Ethics Code for the Public Sector

The nature of the trade commissioners’ work can potentially put them in conflict-of-interest situations. For example, trade commissioners may receive gifts or other types of benefits. They may also be in a position to give preferential treatment to certain clients, particularly because of their access to privileged information. In view of the real potential for conflict of interest, trade commissioners must strictly adhere the Values and Ethics Code for the Public Sector (the Code) and avoid placing themselves in any situation where there is a real, perceived or potential conflict of interest so that they can perform their duties properly.

To inform and remind employees of their responsibilities under the Code, the Department requires them to complete mandatory values and ethics training every two years. As such, trade commissioners are responsible to ensure that they complete this training within two months after they start their employment and every two years after that. Data provided show that only 33 out of 125 (or 26%) trade commissioners in the regional offices have completed the original values and ethics training course in the last two years. However, it should be noted that in the last four years, departmental employees, including trade commissioners, did not have access to complete and reliable information on completed training since there were information technology issues related to verification of completion of that course. Obtaining this key information could have allowed trade commissioners to receive mandatory training in a timely manner. As a result of this finding, all trade commissioners in the regional offices received the latest training in values and ethics as soon as possible. Ensuring that all trade commissioners complete values and ethics training in a timely manner helps to clarify the Code’s requirements and prevent trade commissioners from placing themselves in delicate situations that could tarnish the Department’s reputation.

4. Data

4.1 Strategic use of data and tools

In keeping with Global Affairs Canada’s Data Strategy and its Strategic Plan 2018-21, the TCS developed a data strategy tailored to its mandate and operations that introduces data management practices for the TCS and its regional offices. The regional offices have access to information technology tools to collect, create, store and share data. However, these tools have limitations for capturing some data, and the trade commissioners have implemented various informal collection and storage practices. However, these practices can lead to problems with data quality.

During the audit, the TCS began developing a new data governance and management framework. The data governance framework is intended to consolidate and organize data sources, improve data sharing, and foster better data oversight. If implemented properly, it should also provide a roadmap for future strategic data activities. Combined with the TCS Data Strategy, the data governance framework is expected to contribute to the achievement of TCS’s strategic objectives and service delivery in the regional offices.

4.2 Performance data

It is important for the TCS, including the regional offices, to establish key indicators, measure its performance, and monitor it on an ongoing basis to inform its decision making. To that end, the TCS developed a logic model and a detailed performance management framework with performance indicators that focus on client-facing activities (e.g., the percentage of Canadian companies that are satisfied with TCS services). The regional offices use trend reports and other specific reports to apply the key success factors in their own region and ensure that they are meeting their objectives.

4.3 Protecting confidential information

The regional offices use corporate and personal data confidentially and in compliance with federal information management, security and privacy requirements. There are rules and requirements in place to limit the collection and retention of personal information. Trade commissioners in the regional offices do not use TRIO2 to capture or store commercially sensitive information from clients. The security features of TRIO2 are consistent with the sensitivity of the information in the system.

Conclusion

The audit concluded that a management framework is in place to support service delivery and the achievement of the TCS’s strategic objectives in the regional offices. However, the TCS should make improvements in the following areas: coordination between the regional offices and the missions, and provision of complete information regarding the services offered by the TCS and the role of the regional offices.

Appendix A: About the audit

Objective

The objective of the audit was to determine whether there is an effective management framework in place to support service delivery and the achievement of the TCS’s strategic objectives in the Regional Offices Network.

Scope

The audit focused on the activities of the TCS’s Regional Network between April 2019 and March 2022. This includes the six regional offices and their 27 satellite agents located in partner organizations. The regional operations activities of the Regional Network and Intergovernmental Relations Division, the High Intensity Services Division and the TCS Tools, Analysis and Performance Division were also included. The regional offices’ function of providing support and advice to ministers, senior executives of Global Affairs Canada, heads of mission, and CanExport Program management were not included in the scope of this audit.

Criteria

The criteria were developed following completion of a detailed risk assessment, and the study considered the audit criteria for the Management Accountability Framework developed by the Office of the Comptroller General, Treasury Board Secretariat. The audit criteria were discussed and agreed with the entity concerned.

Approach and methodology

The audit was conducted in conformance with the Institute of Internal Auditors’ International Standards for the Professional Practice of Internal Auditing and with the Treasury Board Policy and Directive on Internal Audit. These standards require that the audit be planned and performed in such a way as to obtain reasonable assurance that the audit objective is achieved.

The audit methodology included, but was not limited to, the following:

• Policy analysis
• Data analytics
• Literature reviews and consolidations thereof
• Process reviews and mapping
• Interviews with departmental officials, clients and stakeholders
• Visits to regional offices

Appendix B: Recommendations, Management Responses and Action Plans