Annual Check Up: One Year Follow-Up Regarding Shared Services Canada, IT Modernization and the Impact on PSAB

1. ANNUAL CHECK-UP:
ONE YEAR FOLLOW-UP
REGARDING
SHARED SERVICES CANADA,
IT MODERNIZATION,
anD
THE IMPACT ON THE PROCUREMENT
STRATEGY FOR ABORIGINAL BUSINESS
(PSAB)
PREPARED FOR:
aboriginal affairs and northern Development canada,
Shared Services canada,
Public Works and Government Services canada,
industry canada, and
treasury board of canada Secretariat
PREPARED BY:
kelly Hutchinson, MarketWorks ltd.
RELEASE DATE:
February 3, 2015
COMMISSIONED BY:
Mishkumi technologies inc.
P u b l i c S e c t o r M a r k e t D e v e l o P M e n t

2. • w w w . m a r k e t - w o r k s . c a •
The opinions, analysis, and recommendations presented within this report are drawn from research and analysis commissioned by
Mishkumi Technologies Inc., and independently conducted and prepared by MarketWorks Ltd. (including its directors or employees or
entity associated with MarketWorks Ltd.) accepts no liability or responsibility resulting directly or indirectly from the disclosure of the
report findings to any third party and/or the reliance, either in whole or in part, by any third party on the report. MarketWorks Ltd.’s
opinions, analysis, and recommendations relate to prevailing conditions and information available at the time of printing. The sole
purpose and use of this report is to assist Aboriginal companies in the information technology field, in understanding government’s
current and transformative landscape, to better navigate it as a result, and no expressed or implied warranty is provided. Any use or
reference to any part of this report must cite MarketWorks Ltd.

3. • w w w . m a r k e t - w o r k s . c a • page 1
INTRODUCTION
in January 2014, MarketWorks published a study recognizing the important role that aboriginal it
companies play in helping the canadian government with its it requirements.
commissioned by Mishkumi, Shared Services Canada, IT Modernization, and The Impact On The
Procurement Strategy for Aboriginal Business (PSAB)1
brought attention to how the PSab had been
affected within government one year following the creation of Shared Services canada (SSc).
For the original report, MarketWorks requested information through access to information and Privacy
(atiP) pertaining to all 43 departments mandated to outsource their email, data centres and networks to
SSc. the resulting study included government departments who provided complete data sets, comparing
2011 data (before SSc absorbed departmental it functions) with 2012 data (as departments began to
transition it functions to SSc).
The study discovered three main things:
1. Department PSab targets had decreased year over year.
2. Departmental PSab spend had also decreased year over year.
3. Departments were having difficulty meeting PSab targets following the creation of SSc.
traditionally, an inordinately high percentage of departmental PSab spend had been used to procure it
products and services. However, as it functions began transitioning to SSc, it was clear that government
departments would continue to see their PSab targets impacted if they did not change how they allocated
their set-asides. that said, departments could still meet their PSab objectives by sourcing non‐it products,
services and solutions from non‐it aboriginal companies.
the study provided recommendations for aboriginal affairs and northern Development canada (aanDc),
SSc and other departments—which, in turn, would help small and medium‐sized aboriginal it companies to
succeed in the new business environment created by the government’s modernization program; and
maintain the credibility of the PSab program as a whole.
PSAB TODAY: FINDINGS
one year post-study, MarketWorks was commissioned to conduct a follow-up report to identify the state of
the PSab.
new 2012-2013 data related to PSab targets and spending was received through atiP, and then compared
with 2011-2012 data.2
the findings below can be cross-referenced to tables provided in appendix c.
1. As departments stabilize their affairs, they are realigning their targets accordingly.
Table 1 in Appendix B provides a summary of PSAB targets related to departments featured in the
previous report, including data representing calendar years 2011, 2012 and 2013.
1
http://www.market-works.ca/psab-report.html
2
Similar to the 2014 report Shared Services Canada, IT Modernization, and The Impact On The Procurement Strategy for
Aboriginal Business (PSAB), MarketWorks has concealed departmental identities in its findings for this update. therefore,
Department a in table 1 is not necessarily the same as Department a in table 2 or 3.

4. • w w w . m a r k e t - w o r k s . c a • page 2
as stated earlier, departments historically relied heavily on contracts awarded to aboriginal it companies
to help meet their PSab targets. With the creation and expanding mandate of SSc, departments can no
longer procure products, services and solutions from aboriginal it companies—at least, not to the
extent they once did.
in terms of aggregate numbers, departments featured in the previous report further reduced their PSab
targets in 2013. More specifically, 2013 saw a 6% decrease compared to the 27% decrease that took
place between 2011 and 2012, representing an overall total decrease of 32% between 2011 and 2013.
these findings demonstrate that government departments are acknowledging their PSab challenges
and adjusting targets accordingly.
2. Some departments continue to be challenged to meet PSAB targets, while others have
adapted to change more quickly.
Table 2 in Appendix B provides a summary of PSAB spending related to departments featured in the
previous report, including data representing calendar years 2011, 2012 and 2013.
it stands to reason that when departments’ overall budgets and associated PSab targets decrease, so
too does actual PSab spend. between 2012 and 2013, just like between 2011 and 2012, departments
featured in the previous report saw a year-over-year (YoY) decrease in dollars, in actual departmental
PSab spend.
overall, in terms of aggregate numbers, departments spent 42% less on PSab-related businesses
between 2012 and 2013, compared to the 37% decrease in spending seen between 2011 and 2012.
between 2011 and 2013, departments reduced spending by a total of 63%.
this signifies that some departments continue to be challenged to meet their PSab targets regardless of
adjustments made. However, four of these departments did increase their spending on aboriginal
business between 2012 and 2013, reverting back to their 2011 levels. this shows that departmental
efforts are being made to support PSab, with some departments adapting more quickly than others.
3. SSC demonstrates a strong commitment to PSAB.
While SSc’s PSab policy3
is still in its infancy, the department is signifying its commitment to aboriginal
business.
For fiscal year 2013-20144
, SSc endeavoured to award 226 contracts to aboriginal businesses valued at
$24,763,838, representing 3.8%5
of the department’s forecasted non-telecom6
spend. SSc exceeded this
target by 61%, spending $40,097,716.10 across 186 contracts in 2013-2014.
Moreover, SSc is starting to incorporate the PSab within its large procurement initiatives. this was
demonstrated in the first collaborative workshop for qualified respondents7
titled Data Centre Server
and Storage Infrastructure (DCSSI) - Physical Infrastructure on January 8, 2015, in which SSc encouraged
3
the SSc Procurement Strategy for aboriginal business directive came into effect on June 14, 2013, following the approval of
the Senior Project and Procurement oversight committee (SPPoc).
4
unlike departmental data provided in this report, which represents the calendar year (January 1 through December 31), the
SSc data provided is per governmental fiscal year (april 1 through March 31).
5
the aboriginal population of canada represents 3.8% of the total population of canada.
6
the representation of aboriginal technology companies in canada that play in the telecommunications space is small. as a
result, and because a large portion of SSc’s budget is telecom, the set-aside PSab targets were created to be 3.8% of SSc’s
budget, less telecom.
7
those that underwent the invitation to Qualify (itQ) process and are now participating in the review and refine
requirements (rrr) phase.

5. • w w w . m a r k e t - w o r k s . c a • page 3
“the use of aboriginal partners and small and medium enterprises” within the DcSSi initiative.
additionally, in a December 2014 presentation titled Leveraging Information and Communications
Technology Procurement for Socio-economic Benefits8
made to the Procurement benchmarks advisory
committee (Pbac9
, part of the information technology infrastructure roundtable10
), SSc:
• reaffirmed its commitment to “programs, policies and initiatives that seek to leverage government
procurement in order to further certain identified socio-economic and national objectives,
including…aboriginal economic development; [and] support for small- and medium-sized
enterprises”; and
• confirmed it is developing an approach that will include, among other things, “establishing socio-
economic benefit tools and processes to help select and prioritize the most appropriate socio-
economic levers to consider in a given procurement.”
4. Upon review of data from eight more departments, PSAB spending is mainly down, but the
year-over-year gap is narrowing.
Table 3 in Appendix B provides a summary of PSAB spending related to departments featured in the
previous report, as well as eight additional departments not previously featured. Data represents the
calendar years of 2011, 2012 and 2013.
Following publication of the preceding report, MarketWorks continued pursuing atiP data from
departments that had not provided PSab targets and spend prior to publication. Data was then
combined with data of departments featured in the previous report.
in doing so, MarketWorks has gained a broader perspective of the impact it modernization and
outsourcing to SSc has had on departmental PSab.
looking at both data sets, it is apparent that departments are beginning to show signs of recovery:
among the 16 departments, PSab spending decreased by 71% between the 2011 and 2012 calendar
years, and then decreased by 37% between 2012 and 2013. While overall departmental PSab spending
between 2011 and 2013 saw a total decrease of 82%, it appears that departments are continuing to
maintain PSab as a key priority.
CONCLUSIONS AND RECOMMENDATIONS
the original report, Shared Services Canada, IT Modernization, and The Impact On The Procurement
Strategy for Aboriginal Business (PSAB), was created to show aboriginal affairs northern Development
canada (aanDc), SSc and departments how government transformation was impacting the PSab.
likewise, we encourage these organizations to continue making positive strides by:
• Making PSAB an integral part of each large procurement initiative: as government continues
looking for ways to consolidate and streamline operations, it is important to ensure each new large
procurement initiative provides socio-economic benefits. organizations like SSc (who drive large it
procurement initiatives) and Public Works and Government Services canada/PWGSc (who also
implement significant real property contracts) need to ensure the PSab plays a role.
• Encouraging partnerships: Small and medium-sized enterprises are the lifeblood of canada,
important to this government as the top employer in our society. However, in times like these,
8
http://www.ssc-spc.gc.ca/pages/itir-triti/itir-dec082014-pres5-eng.html
9
http://ssc.gc.ca/pages/itir-triti/procurement-approvisionnement-eng.html
10
http://ssc.gc.ca/pages/itir-triti/roundtable-tablerond-eng.html

6. • w w w . m a r k e t - w o r k s . c a • page 4
consolidation breeds large procurement—and larger corporations tend to have a greater ability to
respond. aanDc, the office of Small and Medium enterprises (oSMe) and Government of canada
(Goc) departments must collaborate in advance to determine how to best encourage larger firms to
partner with small and medium enterprises. this will enable departments to keep PSab top-of-mind as
they continue down the transformation roadmap.
• Ensuring PSAB targets are 2% of each department’s budget and encouraging those who meet
their targets to raise the bar: aanDc must improve monitoring to ensure PSab target and spend
truly represents 2% of the budget. Moreover, departments exceeding their targets and spend should
be encouraged to consider doing more contracts with aboriginal business. in doing so, these
departments can help offset the overall decline in government PSab spending—and make a significant
impact as other departments continue to find ways to achieve their objectives.

7. • w w w . m a r k e t - w o r k s . c a • page 5
APPENDICES

8. • w w w . m a r k e t - w o r k s . c a • page 6
APPENDIX A: CLIENT RESEARCH
aboriginal affairs and northern Development canada
agriculture and agri-Food canada
atlantic canada opportunities agency
canada border Services agency
canada economic Development for Quebec regions
canada revenue agency
canada School of Public Service
canadian Food inspection agency
canadian Heritage
canadian international Development agency (now part of Foreign affairs, trade and Development canada)
canadian northern economic Development agency
canadian nuclear Safety commission
canadian Space agency
citizenship and immigration canada
correctional Service canada
Department of Foreign affairs, trade and Development
Department of Justice
Department of national Defence
employment and Social Development canada (formerly Human resources and Skills Development canada)
environment canada
FedDev ontario
Finance canada
Financial transactions and reports analysis centre of canada
Fisheries and oceans canada
Health canada
immigration and refugee board of canada
industry canada
infrastructure canada
library and archives canada
national research council canada
natural resources canada
Parks canada
Privy council of canada
Public Health agency of canada
Public Safety canada
Public Service commission of canada
Public Works and Government Services canada
royal canadian Mounted Police
Shared Services canada
Statistics canada
transport canada
treasury board of canada Secretariat
veterans affairs canada
Western economic Diversification canada

9. • w w w . m a r k e t - w o r k s . c a • page 7
APPENDIX B: PSAB ANALYSIS
to conceal departments’ identities in this report, MarketWorks listed them as Department a, Department b
and so on. note that Department a in table 1 is not necessarily the same as Department a in table 2 or 3.
as noted in the previous report, not all government departments responsible for the PSab initiative
calculate and report their PSab numbers in the same way. For the purpose of this report, MarketWorks
elected to publish numbers solely obtained through departmental atiP requests; and where there were
questions pertaining to data, MarketWorks called the corresponding department for clarification.
Table 1: PSAB Target Analysis
the following table features government departments from the previous report, and provides a year-over-
year (YoY) comparison of where they are today related to annual PSab targets.
2011
PSAB Target
$211,975
$920,000
$3,000,000
$1,000,000
$2,851,570
$450,000
$1,293,437
$189,000
$19,690,000
$1,000,000
$150,000
$192,000
$3,002,257
$33,950,239
DEPARTMENT
PSAB TARGET ANALYSIS
2012
PSAB Target
$50,000
$240,000
$1,500,000
$500,000
$1,590,904
$260,000
$974,384
$142,500
$15,520,000
$800,000
$125,000
$162,000
$2,800,817
$24,665,605
2013
PSAB Target
$50,000
$175,000
$1,500,000
$300,000
$1,590,904
$450,000
$974,384
$65,000
$15,500,000
$0
$112,500
$195,000
$2,248,651
$23,161,439
2011 to 2012
% Change
-76%
-74%
-50%
-50%
-44%
-42%
-25%
-25%
-21%
-20%
-17%
-16%
-3%
-27%
2012 to 2013
% Change
0%
-27%
0%
-40%
0%
73%
0%
-54%
0%
-100%
-10%
20%
-20%
-6%
2011 to 2013
% Change
-76%
-81%
-50%
-70%
-44%
0%
-25%
-66%
-21%
-100%
-25%
2%
-25%
-32%
Department a
Department b
Department c
Department D
Department e
Department F
Department G
Department H
Department i
Department J
Department k
Department l
Department M
Totals
Table 2: PSAB Spend Analysis
the following table features government departments from the preceding report, and provides a year-over-
year (YoY) comparison of where they are today related to annual PSab spending.
2011
Total Spend
$1,976,793
$1,934,639
$28,073
$1,102,747
$3,400,000
$586,904
$233,960
$3,261,933
$12,400,000
$24,925,049
DEPARTMENT
PSAB SPEND ANALYSIS
2012
Total Spend
$103,455
$441,706
$6,470
$260,411
$1,137,513
$271,741
$145,464
$2,449,477
$11,000,000
$15,816,237
2013
Total Spend
$618,868
$441,706
$40,873
$1,073,301
$1,137,513
$565,685
$331,266
$1,911,353
$3,041,745
$9,162,310
2011 to 2012
% Change
-95%
-77%
-77%
-76%
-67%
-54%
-38%
-25%
-11%
-37%
2012 to 2013
% Change
498%
0%
532%
312%
0%
108%
128%
-22%
-72%
-42%
2011 to 2013
% Change
-69%
-77%
46%
-3%
-67%
-4%
42%
-41%
-75%
-63%
Department a
Department b
Department c
Department D
Department e
Department F
Department G
Department H
Department i
Totals

10. • w w w . m a r k e t - w o r k s . c a • page 8
2011
Total Spend
$1,196,793
$1,934,639
$28,073
$1,102,747
$3,400,000
$586,904
$233,960
$3,261,933
$12,400,000
$2,221,931
$961,184
$839,959
$468,353,799
$51,700,000
$3,848,792
$3,860,110
$557,568
$557,268,392
DEPARTMENT
PSAB SPEND ANALYSIS, INCLUDING ADDITIONAL DEPARTMENTS
2012
Total Spend
$103,455
$441,706
$6,470
$260,411
$1,137,513
$271,741
$145,464
$2,449,477
$11,000,000
$3,843,268
$1,348,588
$234,851
$98,970,571
$40,000,000
$1,158,794
$1,920,000
$201,830
$163,494,139
2013
Total Spend
$618,868
$441,706
$40,873
$1,073,301
$1,137,513
$565,685
$331,266
$1,911,353
$3,041,745
$517,833
$258,327
$970,376
$68,961,157
$15,000,000
$3,654,349
$3,510,000
$533,770
$102,568,122
2011 to 2012
% Change
-95%
-77%
-77%
-76%
-67%
-54%
-38%
-25%
-11%
73%
40%
-72%
-79%
-23%
-70%
-50%
-64%
-71%
2012 to 2013
% Change
498%
0%
532%
312%
0%
108%
128%
-22%
-72%
-87%
-81%
313%
-30%
-63%
215%
83%
164%
-37%
2011 to 2013
% Change
-69%
-77%
46%
-3%
-67%
-4%
42%
-41%
-75%
-77%
-73%
16%
-85%
-71%
-5%
-9%
-4%
-82%
Department a
Department b
Department c
Department D
Department e
Department F
Department G
Department H
Department i
Department J
Department k
Department l
Department M
Department n
Department o
Department P
Department Q
Totals
Table 3: PSAB Spend Analysis, Including 8 Additional Departments
the following table is a combination of PSab spending data pertaining to departments featured in the
preceding report; as well as eight departments that were not previously featured.

11. • w w w . m a r k e t - w o r k s . c a • page 9
About Mishkumi Technologies Inc.
Mishkumi technologies is a canadian it company committed to providing Federal Government
clients with the technology, service, and support they need to enable government transformation
nationwide. an aboriginal technology company aligned with the Procurement Strategy for
aboriginal business (PSab), Mishkumi supports job creation and economic diversity across
canada. they deliver high-quality products and services while supporting clients in achieving their
social, economic, and environmental objectives.
FOR MORE INFORMATION CONTACT:
Benoit Benson
President
134 St-Paul Street, Suite 200
ottawa, ontario k1l 6a3
tel: (613) 745-4450
bbenson@mishkumi.com
www.mishkumi.com

12. • w w w . m a r k e t - w o r k s . c a • page 10
About MarketWorks Ltd.
MarketWorks is a marketing consulting firm focused on the canadian public sector. they help
clients bridge the government-industry gap to facilitate innovation and collaboration, and to
improve delivery of public services. MarketWorks is committed, responsive, and passionate when
it comes to helping government more effectively and efficiently serve canadians coast to coast.
FOR MORE INFORMATION CONTACT:
Kelly Hutchinson
President
1 rideau Street, Suite 700
ottawa, ontario k1n 8S7
tel: (613) 731-9328
kelly@market-works.ca
www.market-works.ca

13. P u b l i c S e c t o r M a r k e t D e v e l o P M e n t