Section II: Operating context and key risks—2016 to 2017 Departmental Results Report

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Operating context

Over the 2016 to 2017 reporting cycle, Public Services and Procurement Canada (PSPC) continued to play its critical role as a central service provider, in which it provided federal departments, agencies and Parliament with a range of services including procurement solutions, real property management and translation. In doing so, the department supported federal departments and agencies in the delivery of the government's core priorities: open and transparent government, social inclusion and diversity, inclusive and sustainable economic growth, and a safer and stronger Canada at home in the world.

PSPC facilitated the delivery of high quality programs and services and assisted federal department clients in striving towards the efficient use of resources. This achievement was made against the backdrop of PSPC's ongoing efforts to address outstanding issues with the Phoenix pay system. Many activities are underway to capture lessons learned from the rollout of Phoenix that will then be integrated into future complex projects and transformations. The department will also utilize lessons learned from the successful implementation of initiatives, such as the smooth transfer of the pension administration for the Canadian Armed Forces, during which all service levels were met or exceeded.

We demonstrated leadership in meeting the government's environmental focus through the promotion of new approaches to how we manage federal buildings, what we buy, and how we manage acquisitions. For example, our environmental remediation on surplus federal buildings makes them suitable for housing. As well, an overarching sustainable development and environmental strategy was developed to ensure that sustainability is integrated into all departmental real property activities.

PSPC continued to implement the Long Term Vision and Plan for the Parliamentary Precinct to address the deteriorated state of Canada's 19th century parliamentary buildings, meet the accommodation needs of the 21st century Parliament, and implement security measures while maintaining a balance of openness and security on Parliament Hill. Through projects such as rehabilitating the West Block and the Government Conference Centre, as well as constructing the Visitor Welcome Centre, the department improved the sustainability, accessibility and safety of the Parliamentary Precinct, while promoting innovation and offering unique opportunities for youth and Indigenous peoples.

PSPC strove to meet clients' expectations, while balancing its enduring commitment to deliver improved programs and services with integrity. Fair, open and transparent procurement processes, for example, delivered products and services in a manner that was consistent with the highest standards. The department undertook many initiatives to simplify government procurement, provide modern comptrollership and support socio-economic priorities.

PSPC continued to collaborate with federal partners to innovate its delivery of programs and services, and align its activities with government priorities to deliver clear results. These efforts led to the delivery of common Government of Canada (GC) applications, such as My Government of Canada human resources (My GCHR), the Shared Case Management System, and GCdocsFootnote 1 to support government-wide modernization. As well, internal changes, like adapting governance structures and procedures, were made to streamline processes and help deliver the highest quality programs and services to clients.

Over the past year, PSPC continued its efforts with respect to change management support for employees through the creation a Mental Health Ombudsman, a first in the federal public service, and promoting change management training to employees. The department remains focused on continued progress toward a high-performing public service that embraces innovation, transformation and renewal.

Key risks

PSPC integrates risk into business planning, decision making and organizational processes to minimize negative impacts and maximize opportunities across its diverse range of services and operations. Risk management is conducted throughout PSPC in accordance with the Treasury Board framework for the management of risk, the PSPC Policy on Integrated Risk Management, the International Organization for Standardization 31000, and the Canadian Standards Association implementation guide to CAN/CSA-ISO 31000, Risk management: Principles and guidelines.

As outlined in the following table, in 2016 to 2017, PSPC's top 4 risks were as follows:

PSPC reports on these 4 risks, as they were identified in the 2014 to 2015 to 2016 to 2017 Departmental Risk Profile and the 2016 to 2017 Report on Plans and Priorities. However, the department updated its risks for inclusion in the 2017 to 2018 Departmental Plan. For further information, please visit the 2017 to 2018 Departmental Plan – key risks section.

Risk table
Risks Mitigating strategy and effectiveness Link to the department's programs Link to mandate letter commitments or to government-wide and departmental priorities

Financial risk: PSPC's reliance on cost recovery poses risks in an environ­­ment of reduced expendi­tures on the part of client departments.

PSPC's mitigating strategies included:

  • sustaining rigorous forecasting
  • management and monitoring of revenues, as well as working closely with other departments through the client service network to identify changing requirements and their impacts on the department
  • acquisitions
  • accommodation management and real property services
  • Receiver General for Canada
  • integrity programs and services
  • linguistic management and services
  • specialized programs and services
  • internal services

PSPC priority:

  • service excellence

Complex, transformational and interdepartmental major projects and procurements related risk: There are inherent risks in PSPC undertaking and delivering complex, transforma­tional and inter­depart­mental major projects and procure­ments on time, within the approved budget and according to scope (which could ultimately have an impact on the department's service strategy).

PSPC's mitigating strategies included:

  • implementation of disciplined investments and project management processes including:
    • Departmental Investment Plan
    • development and implementation of service agreements with clear identification of responsibilities
    • sound contract management
    • early engagement with client departments and other stakeholders
  • acquisitions
  • accommodation management and real property services
  • Receiver General for Canada
  • integrity programs and services
  • federal pay and pension administration
  • linguistic management and services
  • specialized programs and services

Government of Canada priorities:

  • growth for the middle class
  • a clean growth economy

Minister's mandate letter priority:
Prioritize the National Shipbuilding Procurement Strategy to support renewal of the Canadian Coast Guard fleet and to ensure the Royal Canadian Navy is able to operate as a true blue-water maritime force

PSPC priorities:

  • innovation and modernization
  • value for money

Workforce risk: There is a risk that PSPC may not have the ability to maintain a high-performing work­force with the appro­priate skills and competencies to achieve the expected service delivery levels in support of evolving business needs.

PSPC's mitigating strategies included:

  • reinforcement of the integrated approach to talent management to support employee development and succession planning, including in the context of:
    • transformation
    • modernization of the human resources management through new systems and approaches
    • reinforcement and streamlining of internal processes to better meet clients' needs
    • focus on leadership excellence as a driver for people engagement and building an efficient workforce for the future
  • acquisitions
  • accommodation management and real property services
  • Receiver General for Canada
  • integrity programs and services
  • federal pay and pension administration
  • linguistic management and services
  • specialized programs and services
  • internal services

PSPC priorities:

  • service excellence
  • innovation and modernization

Managed services risk: There is a risk that PSPC may not always meet increasing client expectations and achieve the expected efficiencies and/or savings, or it may experience challenges maintaining service quality under the managed service approach in a context of reduced expenditures.

PSPC's mitigating strategy included:

  • providing a balanced approach between meeting the needs of client departments and demonstrating sound stewardship of resources
  • acquisitions
  • accommodation management and real property services
  • Receiver General for Canada
  • integrity programs and services
  • federal pay and pension administration
  • linguistic management and services
  • specialized programs and services
  • internal services

Minister's mandate letter priority:
Support the President of the Treasury Board in the development of a new service strategy that aims to create a single online window for all government services with new performance standards.

PSPC priorities:

  • service excellence
  • value for money 

Risk narrative

Financial risk

PSPC continued to implement a more robust financial management framework, a more rigorous approach to manage and monitor revenues, as well as a departmental client service strategy targeted at providing quality services while adapting to fluctuating business volumes.

Complex, transformational and interdepartmental major projects and procurements related risk

PSPC has a sustained commitment to the exploration of innovative solutions. Focusing on large and complex transformational initiatives presents the opportunity for delivering more effective and efficient government services and offering enhanced results and benefits for Canadians. Yet at the same time, such large undertakings demand rigorous systems and controls that contain clear accountabilities, and ensure experienced teams possess the flexibility and agility to quickly allow for course correction, when required. PSPC is establishing mechanisms to identify lessons learned from current program challenges, including the Phoenix pay administration initiative, to ensure that new approaches are well supported by effective policies, training and necessary technical expertise to succeed.

Workforce risk

PSPC must have human resources possessing the requisite skills and competencies to ensure continued delivery of service excellence. Resource capacity is affected by a number of factors, including the department's demographic characteristics and its ability to attract and retain talent. Demographics point to over a quarter of PSPC employees being eligible for retirement within the next five years. Meanwhile, the implementation of major transformation initiatives and associated challenges may impact the retention and attraction of highly qualified employees, as well as employees' need for professional development. PSPC is mitigating this situation through human resources management strategies that focus on strengthening skills and capacity, enhancing talent management approaches, and leveraging enabling technologies to ensure the department remains an employer of choice.

Managed services risk

PSPC strives to ensure that its service offerings continue to meet its evolving client departments' needs while delivering efficiencies and ensuring sound stewardship. In many cases, PSPC is reliant on third party vendors for service delivery where PSPC itself is the intermediary between the client department and vendor. This situation lends itself to the possibility of implementation and performance risks, which could lead to reduced client satisfaction. PSPC is addressing this through more rigorous contract management and enhanced client relationship management.

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