Transcript
Transcript: Leading Projects in the Government of Canada, Episode 4: Keys to Complex Project Procurement, with Paula Folkes-Dallaire
Myra Latendresse-Drapeau: Hello, and welcome to the fourth episode of our podcast series dedicated to leading projects in the Government of Canada. My name is Myra Latendresse-Drapeau, and today I'll have the pleasure of speaking with Paula Folkes-Dallaire:, the Director General of Defense Procurement at Public Services and Procurement Canada. So thank you very much for being here with us today, Paula. As many of our listeners will know, your department is responsible for leading some of the largest projects in the Government of Canada and has put in place some great practices for ensuring their success. So I really would like to hear about your experience in leading those large, complex procurement projects, programs and other major initiatives, many of which are done in collaboration with other departments and agencies. But before we do that, can you tell us a little bit more about yourself and your involvement in project management?
Paula Folkes-Dallaire: Absolutely. And thank you very much, Myra, for having me today to record this podcast. I always appreciate the opportunity to collaborate with the Canada School of Public Service. And I'm actually located at the Embassy of Canada to the United States in Washington, D.C. So I'm honoured and privileged to be on the territorial lands of the Powhatan Confederacy, whose lands stretch north to Washington, D.C., and Maryland, east to the Chesapeake Bay and south to North Carolina. My responsibilities here include managing over 4.5 billion dollars worth of defence procurement projects and managing an international co-operation program. For almost four years prior to that, I led the procurement activities for the Future Fighter Capability Project. I hold a master's degree in public administration. I've been an executive for 12 years and I'm certified as a Lean Six Sigma Green Belt.
Myra Latendresse-Drapeau: Wow, that's pretty impressive. So, clearly, large projects are not a secret for you, and we all know that the management of these large projects is very complex. So we're quite eager to hear a little bit about what you can tell us of your experience in project management, especially with regard to leading those major projects.
Paula Folkes-Dallaire: You know, I would say that every large and complex project is different in terms of the optimal balance between schedule, scope and cost. Generally, a project that is on time, on budget and on scope is deemed a success. But with large and complex projects, even those with really strong project controls, it can be difficult to keep to original projections in all three of those areas. And so, constant tracking and monitoring are really important to understand how you're performing in each of those areas, and knowing the flexibility that you have for each is critical. On complex projects, you might hear the phrase "schedule is king." I certainly do hear that a lot in my work, as we deliver on Strong, Secure, Engaged and the national shipbuilding strategy. Yeah, I would also say that, as a senior leader, it's really important to have realistic goals for your projects and to manage expectations. I think that good leaders create the space and top cover needed for your project teams to be able to do their work. I also think that good leaders aren't afraid to be transparent about when there is significant risk involved with the project or when things aren't going as planned. We've all been in the difficult position of briefing ministers and their offices and deputy ministers on future uncertainty associated with highly risky courses of action, and that can be really difficult, especially when there are public expectations to move faster. But outlining those risks is a really great way to provide the advice needed to help decision makers fully understand the implications of various courses of action without saying "no."
Myra Latendresse-Drapeau: Well, I could not agree more. I think these are great insights. So you've touched on this, Paula, but I want to bring you back to...kind of...the core of your functions, which is the procurement. The procurement part of a project, we know, is often the most challenging part of it. So what would be some of the advice that you would give to enable project managers to more easily—more efficiently, maybe—manage the procurement component?
Paula Folkes-Dallaire: Well, I think the first and most obvious piece of advice is to engage your procurement professionals early. You know, your procurement officials can give you good advice on the best procurement approach to take before you get too far down the wrong path. I've seen a number of cases where clients have planned for a competition to acquire certain capabilities only to find out that it's export-controlled and there is no competitive space for that particular commodity. I would also say inviting procurement professionals to your technical discussions can help them better understand the requirement and the technical solutions available in the marketplace. When you consider the need for open and transparent competitions and procurement-process fairness requirements, the procurement activity itself can already be quite complex, especially for those procurements that are associated with large and complex projects. You might even need to buy something that doesn't exist yet or that's not approved for use yet in your country. We saw recent examples of that, and we see that all the time. In defence, if you want to counter a threat in the future that doesn't exist yet, you don't necessarily know what you're going to need. You have to watch and see and try to forecast where the threat is going and try to stay two steps ahead.
Myra Latendresse-Drapeau: That's a great example. So if you have to buy something that doesn't exist yet, I'm trying to think, how do you do this? What's the best way to get around some of these challenges?
Paula Folkes-Dallaire: Yeah, absolutely, that's a great question, because, you know, using something that is commercial off-the-shelf is very different than if you have to build it brand new, right? It's very different in terms of the level of risk associated, the future uncertainty, but also in terms of the opportunity of really making it, you know, tailor-made to your needs. One thing I learned in that process, when you're designing something new, is that you cannot always compress engineering. OK, you know, there are some processes that cannot be compressed because of science.
Myra Latendresse-Drapeau: Yes.
Paula Folkes-Dallaire: So, you know, you do need to allow sufficient time for those engineering processes to come to fruition. So, you know, if you're buying a highly technical good that you need to build from scratch or if you're building something that is somewhat off-the-shelf, but you need to do a number of adaptations to Canada's unique circumstances, procurement lead times are going to be longer than you think. And the engineering timelines can also be quite a bit longer than you think. I would just say that overall, the more complex your project is—if it has a procurement element—the more complex your procurement will be too. And so, for some of these requirements, the lead time could be years, and you might need feasibility studies to even understand what is possible, along with fairly significant design and preplanning, engineering work.
Myra Latendresse-Drapeau: OK. So you've spoken about managing those large and complex projects, and I really can see how procurement plays a huge role in that. But now I'm thinking about how the complexity level can be increased when multi-department collaboration is required. And this is something that you have dealt a lot with, and are there any observations that you can share from that experience of working with multi-department collaboration?
Paula Folkes-Dallaire: Absolutely. In my view, interdepartmental collaboration is key for project design, implementation and governance. We do typically see this in defence procurement and other horizontal large-scale projects and for shared challenges, such as cybersecurity. The competing needs of different stakeholders, as well as the higher-risk profile of these projects and the many strategic trade-offs between cost, schedule and scope, require that multi-departmental perspective in order to be successfully managed. This is part of the rationale behind the defence procurement strategy. And so, each major project will have its own battle rhythm in terms of governance. But the most important thing to do in an inter-departmental context is to share information with your partner departments and to engage at all of the levels. So not only having your working-level working groups, but also engaging at the executive level and then, for the highest-profile projects, ensuring that that interdepartmental approach is taken at the ADM and DM level as well. It will be more efficient, you know, essentially to share information within your team and then allow that information to percolate and be shared with all the parties that need that information than to, you know, just share it at one level and expect it to go up and over and then back down. You know, you really want to make sure you have your communication paths laid out properly. Avoid U-shaped communication channels.
Myra Latendresse-Drapeau: Yes, yes, it's interesting. This is something that you put a lot of emphasis on, and it's interesting to see that this would be one of the key principles of any project, whether they be large and complex or rather small-ish. But of course, at the heart of each collaboration, there is this principle of open communications. Now, I'm very curious to get a little bit of your view on the relationship with the U.S. government, because you are based in Washington. You've been working with them a lot. We know that the U.S. government is kind of leading the way in terms of agile procurement and project management. So I'm thinking you've likely learned quite a lot from this experience. And what is it that you could tell us about how they are applying an agile model to project management, a model where scope changes, restarts, trial and errors are all embraced as part of the process?
Paula Folkes-Dallaire: I think, you know, just to answer the first part of your question, Canada and the United States have had a wonderful relationship at the working level. And certainly, there are a lot of things happening on both sides of the border. Through our international cooperation program that I lead, I have the distinct pleasure of helping to bring leaders together periodically to talk about how our nations are tackling similar challenges. All the problems that we have in procurement our allies have as well. So we are seeing agile project management and agile procurement really take hold across the United States at the federal and state levels. We know that in traditional project management, the requirements are usually fixed, and only schedule and cost are scalable. In agile project management, we are switching all of that to say that time and resources are fixed, but the requirements can change and evolve. That's completely different, right? So therefore, how you contract also has to be very different.
Myra Latendresse-Drapeau: So that is different than your traditional procurement process?
Paula Folkes-Dallaire: Absolutely. In a traditional process, once the requirement is established in the request for proposal and the bidding period has ended...it is very difficult to change the requirement after that point. You can mitigate that risk a little bit by building in the required flexibility upfront to be able to acquire what you actually need versus what you initially asked for. But that can be very challenging, and it really means managing the bidders' expectations and ensuring that they know upfront that they're signing on to participate in an agile procurement process where the requirements can evolve to meet the needs.
Myra Latendresse-Drapeau: So that must be quite a challenge. Are there other types of challenges that you encounter more in agile processes than in your traditional processes?
Paula Folkes-Dallaire: Well, for sure, convincing the authorizing agencies to be more comfortable with the fact that they will be asked for expenditure authority and contracting authority in a flexible model, right? And that they need to change as well in order to truly adopt an agile process. So, you know, if you're trying to paste an agile procurement and an agile project onto traditional culture, traditional ways of funding, traditional governance and traditional ways of organizing your project team, you're not going to have success. So from a funding agency perspective, they're very used to somebody saying, "I'm going to need exactly this much money, because I'm going to deliver you exactly this functionality or exactly this good and service on this exact date with this exact delivery schedule, with exactly this contracting period." And any deviation from those elements causes concern because, you know, we tell ministers at Treasury Board this is exactly what we're going to do. But in "agile," change is the hallmark, right, of an agile process.
Myra Latendresse-Drapeau: I was hearing you describe this process, and I can hear the Treasury Board analyst's voice...
Paula Folkes-Dallaire: [Laughter]
Myra Latendresse-Drapeau: ...in my mind asking those questions. That's really quite interesting. Are there a few things that maybe are done differently in the U.S. that you can speak to, that, maybe...you know, different ways of addressing those challenges, or even different perspectives on them?
Paula Folkes-Dallaire: So, definitely, in the U.S. over the last few years, we're seeing an increase in the use of what they call "alternative authorities and approaches," which essentially aim to build in needed flexibility and reduce barriers to contract entry. So the goal there is to really speed up certain types of acquisitions. For example, they have something called Other Transactions Authority (OTA), which is an increasingly popular contracting vehicle for prototype research and development projects. It's primarily aimed at non-traditional contractors, like those small start-up companies—right?—that have an amazing cutting edge, maybe dual-use technology, that you want to be able to get into the government as quickly as possible. But the regulations, the normal regulations would create a lot of barriers to being able to get into a contract with that company, particularly when you're at the stage of ideas, right?
Myra Latendresse-Drapeau: Yes.
Paula Folkes-Dallaire: So what they've done is, they've made some of those procurements exempt from their federal acquisition regulations, thereby making it a more flexible authority. Another example is that they've established these different tiers of acquisitions and something that they call pathways that allows for rapid prototyping and a rapid fielding to deliver capabilities in a shorter timeframe, ideally two to five years—the scrum. So the scrum is a type of agile project management that provides a framework for iterative change. I think it started in the software development world where rapid prototyping, testing and evaluation and changing requirements are expected. It can be expanded to apply to any project where you need iterative development and where the requirements and solutions evolve through collaboration between cross-functional teams. In some cases, these teams involve both industry and government working together, right? In partner...you know, partnership, together, in the same building, on the same team, working through the problems together. It's a very different way of contracting. One fascinating example I've seen is the U.S. Army's Integrated Visual Augmentation System program or IVAS.
Myra Latendresse-Drapeau: OK.
Paula Folkes-Dallaire: So the IVAS is essentially a virtual-reality and real-time data headset that soldiers can use to train, to rehearse and to fight. And the U.S. Army used these alternative authorities to contract with traditional and non-traditional vendors for the tech, and the soldiers were involved in the design and the testing of the product to great success. Moreover, the U.S. Army estimates that they developed the IVAS four years faster than if they had used traditional acquisition methods.
Myra Latendresse-Drapeau: So there's definitely huge value and huge potential in adopting these agile approaches. How do we do that concretely?
Paula Folkes-Dallaire: Well, one of the things that I see is that we're really good at breaking procurements up into phases. And, you know, we often have off-ramps post–contract award for non-performance or to pursue better value for the terms and conditions or the bases and method of payment that are more suitable for a project. We usually put the hooks in there that we need to be able to re-evaluate after we learn a little bit more about how capability is working and how a basis and method of payment is working to come to the table and re-negotiate that with a commercial supplier if we need to. We also, you know, usually collect data from those first years to understand how something is working, so that we can adjust performance measures, right...
Myra Latendresse-Drapeau: Yeah.
Paula Folkes-Dallaire: ...to make sure that we're not letting those companies off the hook with easy performance measures. And we have an approach to continually improve performance over time. We also sometimes build in options to buy more or less or none of a particular good and service, depending on how our needs change. But usually these are host contractual flexibilities. We're not that great at phasing in our RFP or phasing in our pre-contractual phase, so that we have off-ramps or the ability to make adjustments to the requirements while the procurement process is actually underway. That is very difficult under a traditional model, but it can be very useful in an agile approach. And rarely, I think, does it require any changes to the procurement rules at all; it just requires a greater understanding of procurement and legal risk and making sure that we're very clear about the flexibility that we're building in early on.
Myra Latendresse-Drapeau: So, Paula, I really like those examples from the U.S. They're very helpful for us to understand a different context and how it can eventually apply here. Is there more that you could share with us?
Paula Folkes-Dallaire: So another great example that I would share is from the GSA, which is the Chief Information Officer Modernization and Enterprise Transformation Program. They call it COMET, which was set up to provide a streamlined process to support agile delivery services. So rather than contracting for end-to-end services, COMET uses multiple-award blanket purchase agreements and single awards to contract for pieces of a large and multimillion-dollar project to modernize the GSA's backend procurement systems. So that's a really neat example of how you can break up your procurements to ensure that you're delivering value in an agile way. So I think that overall, there's a lot we can learn from our colleagues in the States. There's a wealth of information there that we can bring back to Canada.
Myra Latendresse-Drapeau: Of course, as we are talking, there's definitely a thread that runs through our conversation, and it's one around uncertainty and risk. And of course, this is, you know, at the core of all of those large projects that you are talking about. But we can also see uncertainty and risk as opportunities to learn more about what works and what does not work in this agile methodology. How have you experienced uncertainty and risk in agile project management, and how would you say that affects how you manage your projects?
Paula Folkes-Dallaire: The goal here is, I think, to not suffer from doing things right, but rather to do the right thing at the right moment. And agile procurement can help address that. As we talked about earlier, pasting an agile procurement onto a non-agile culture is a classic "square peg, round hole" problem. So it's really the responsibility of organizations and leaders to set the conditions for an agile culture, because it requires both vertical and horizontal buy-in. And it's really important that we effectively scale our successes, so that when they do occur, you know, we are able to celebrate those. And we need to also make sure that we keep in touch very closely with those areas of uncertainty and monitor them over time. That's the reason, I think, that a lot of agile and innovative procurement similarly occurs in isolation within controlled pockets of organizations, where the necessary culture and controls and authorities are baked into their existence. So just as procurement approaches are innovative, the way we think and the way we communicate and empower the acquisition workforce to utilize those tools also has to be innovative. For example, to help bridge the gap between theory and practice, the U.S. Federal Acquisition Institute provides innovative resources to the contracting workforce, such as—this is cute!—a periodic table of acquisition innovations.
Myra Latendresse-Drapeau: [Laughter] I love that.
Paula Folkes-Dallaire: So really, what it is is just a really good tool that you can refer to as a contracting officer or project manager to say, "What are the innovations that have been done before and that may not necessarily have taken hold as the status quo, but that I might be able to use and apply to a particular procurement or project in order to see it through, in order to make it successful?" And so sorry, they really give hands-on, real-life examples with associated documentation of successfully implemented agile, cloud and security-related methods for each phase of the acquisition project that you can then emulate in your new project. So it's still in beta phase, ...
Myra Latendresse-Drapeau: OK.
Paula Folkes-Dallaire: ...still being tested out, but it is meaningful and innovative, and it allows for sharing of best practices and lessons learned across the federal acquisition community.
Myra Latendresse-Drapeau: You've raised the question of culture several times. And this is one example that illustrates how some environments or...how you can build an environment that can be more conducive to agile procurement, right?
Paula Folkes-Dallaire: Absolutely. I think, in our current culture, failure is not an option, but we need to understand the difference between good failures, useful failures, smart failures, failures that are expected, right? I mean, I think that we could hack our systems a lot more, take that kind of cybersecurity and say, "All right, we have a new cloud-based document, you know, safeguarding system. Let's hack it. Let's figure out what makes this system fail."
Myra Latendresse-Drapeau: Yeah.
Paula Folkes-Dallaire: We have a new pay system. Let's hack it. Let's find out what makes...I didn't want to go there, Myra.
Myra Latendresse-Drapeau: Experimentation!
Paula Folkes-Dallaire: [Laughter] Right?
Myra Latendresse-Drapeau: Well, we kind of have to, right?
Paula Folkes-Dallaire: Absolutely.
Myra Latendresse-Drapeau: Like, it's important that we use that example, too.
Paula Folkes-Dallaire: Yeah, absolutely. You know, we have to talk about our failures. We cannot make it taboo. We've got to put that into the common discourse so that we can understand lessons learned. And so when we have those micro failures and we feed the lessons back to the proverbial drawing board, I think that that is where you're starting to move into an agile culture.
Myra Latendresse-Drapeau: I really like that idea of a controlled failure, I think. Because they're in control. There is also the idea that you are measuring it, you are monitoring it, you are documenting it, which is at the core of this idea of learning, right? Are there examples of...again...like this idea of culture and enabling functions? What are some of the things that you have seen that have helped?
Paula Folkes-Dallaire: Sure. So one of the things that I've seen the U.S. Department of Defense and military departments do that help with this issue of culture and of implementation is the creation of enabling functions. So, the Department of Defense Office for Acquisition Enablers is one example. The Black Pearl function in the U.S. Navy and Kessel Run in the Air Force, 18-F. Yeah, and the Procurement Innovation Resource Center, the GSA. These are all groups that are stood up specifically to help implement innovative procurement and project management practices like "agile" and to get the right capability for the right job at the right time. So, you know, right now I feel like in Canada, sometimes, we are doing innovation on the side of our desk. We are doing it as the moment presents itself. We have a problem. We come together, we think creatively. We come up with an innovation, we apply it. And then it never makes it into GCdocs or never makes it into RDIMS or any kind of periodic table. And it gets forgotten about, right? And then we move on to a new job. So...
Myra Latendresse-Drapeau: Yeah.
Paula Folkes-Dallaire: Creating, you know, these specific units whose job it is to just do innovation in procurement and project management is really important. I think PSPC, my department, has just very recently, in the last few weeks, actually opened up a kind of project management centre of excellence where the thought trust is going to remain. So these are...we are moving in the right direction. I think the next thing is that you need the right partners. And sometimes, finding vendors that can work in an agile fashion is not always easy.
Myra Latendresse-Drapeau: Yes.
Paula Folkes-Dallaire: Sometimes there's no domestic capacity for "agile" and you have to look for solutions outside your industrial base. And that's exactly what the U.S. has done. So some of the military services have started holding these interesting events that they call pitch days. They're kind of like mini-competitions. Some of the examples are AFWERX, SpaceWorks, NavalX and xTechSearch. They do this to attract new suppliers who might not otherwise submit a bid for a large award, because they can't necessarily compete with larger, traditional defence contractors. But on the one hand, it removes some of the barriers to entry for small companies and start-ups who often have the agile characteristics needed to allow, you know, brand new cutting-edge ideas to come to fruition.
Myra Latendresse-Drapeau: This is so crucial, right? Like it's about the ecosystem. We cannot do this alone. And as you said, we need to share it with our vendors, with our collaborators across the board. This has been a wonderful conversation, Paula. And maybe...before we split, I just want to ask you, is there any other advice that you would give to public servants who are involved in managing or leading some of those complex procurement projects and who sometimes, you know, have questions or are struggling? I think they could benefit from your wisdom and experience.
Paula Folkes-Dallaire: Well, thanks, Myra. I've enjoyed it quite a bit as well. I think the number-one thing I would say is, be kind to your future self [laughter], you know, build as much agility and flexibility into your various project phases as possible, whether it's in the project schedule, in the request for proposals or in your Treasury Board submission. Don't paint yourself into a corner, and try as much as possible to avoid self-inflicted wounds [laughter]. And, of course, again, engage your procurement professionals early, bring them to the technical discussions, help them help you deliver the complex projects successfully, and never stop being creative. See future uncertainty and risk as an opportunity to innovate, to push the envelope and make the conditions ripe for agile project management and procurement. You don't have to adopt "agile" whole scale. You can start to infuse agile characteristics and agile elements bit by bit.
Myra Latendresse-Drapeau: Yes.
Paula Folkes-Dallaire: And one day, you will have so many agile features in your processes that you can finally recognize that you've actually been doing "agile." So it doesn't have to be whole scale. You can make an incremental process over time.
Myra Latendresse-Drapeau: Small hacks to your processes.
Paula Folkes-Dallaire: Exactly, exactly. And last: keep upgrading your skills. Never get complacent when it comes to your learning. It's an investment in you, and it will help you maximize your contribution to the organization.
Myra Latendresse-Drapeau: This has been wonderful. Thank you so much, Paula Folkes-Dallaire:, for spending this time with us today. I think we've had a very rich conversation and hopefully we will hear from you again. Thank you very much.
Paula Folkes-Dallaire: Thank you, Myra, for having me. That was a lot of fun.
Myra Latendresse-Drapeau: This has been great fun. This has been the highlight of my week. Thank you so much.
Paula Folkes-Dallaire: [Laughter] Bye.
Myra Latendresse-Drapeau: Bye.
