ARCHIVED - Inter-Sectoral Partnerships for Non-Regulatory Federal Laboratories

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Section 5 – A Framework for Inter-Sectoral S&T Integration (ISTI) Involving Federal Laboratories

5.1 Input from Roundtable Discussions and Stakeholder Consultations

The Panel's consultations with a wide variety of stakeholders in government, academia and the private sector indicated a high level of interest in ISTI as a means to improve Canada's science and innovation system and its economic competitiveness, and as an important element in the Canada's overall S&T strategy. During the consultation process, a full range of possibilities were entertained, ranging from divestiture to various forms of alternative arrangement involving public-private partnerships.

The input also indicated strong support for an ongoing process of identifying opportunities for ISTI. However, there was virtual unanimity in the view that the phrase "transfer of federal non-regulatory laboratories" is problematic and that terminology should be adopted to reflect the broad scope of opportunities for inter-sectoral collaboration.

A large majority of stakeholder commentators concurred with the conclusions that:

• current patterns of inter-sectoral collaboration were, in the main, insufficient to achieve optimum synergy and complementarity;
• alternative management arrangements were needed to reach that goal; and,
• although such arrangements would need to be customized to reflect diverse patterns of S&T, the central feature of the arrangement should be an integrated program of research and experimental development that meets the needs and expectations of all partners involved and includes strong governance and accountability mechanisms.

A variety of useful suggestions were made with respect to the criteria for identifying and selecting promising opportunities for ISTI involving federal laboratories. The input validated the Panel's preliminary identification of the key elements of a possible framework for ISTI and identified desirable refinements and additional features. Among the factors viewed as critical to the success of ISTI initiatives, commentators placed special emphasis on the need for a shared vision of purpose and desired outcomes, strong and sustained commitment of partners, effective leadership and clarity of roles and accountabilities. In general, the various detailed suggestions received centred around three pillars of success: strong shared commitment; sound governance, and excellent leadership.

It was recognized that while all partners in alternative management arrangements operate within certain constraints, it is possible, through careful design of management and accountability mechanisms, to work within them successfully. It was also recognized that it would be desirable to remove or modify constraints that are no longer necessary in substance or form, respectively.

Some provincial officials expressed strong interest in, and support for, the concept of partnering in ISTI, and stakeholders recognized the important role provincial governments can play in integration initiatives.

A fuller summary of stakeholder input is provided in Appendix V – Summary of Input to the Panel on Inter-Sectoral S&T Integration. A detailed compilation report prepared by the facilitator of the regional roundtable discussions has been sent to participants.

5.2 A Framework for Assessing Opportunities for ISTI

A systematic approach is needed to guide government officials in dealing with proposed ISTI initiatives involving federal departments and agencies. The development and implementation of a federal policy framework for S&T integration can provide such guidance.

The key elements of the framework proposed by the Panel are outlined below. The applicability of the particular elements of the framework will depend on whether the initiative under consideration involves full transfer to a non-governmental entity (divestiture); or, transfer to an entity jointly sponsored and managed by government, academic and/or private sector organizations (partnering).

5.2.1 Goal, Strategies, Outcomes

The Panel's study and analysis was conducted on the basis of the goals, objectives and strategy as described by or imputed from its mandate. The Panel recommends the goal, objectives and strategy articulated be reviewed in the light of our findings. We offer the following formulation for consideration:

Overarching goal: enhanced realization of the potential of the scientific and technological capacities of government, academia and the private sector for the benefit of Canadians.

General strategy for achieving the goal: realign appropriate scientific activities of government laboratories with those of academia and the private sector so as to benefit from the potential synergies and complementarities realignment can bring.

Specific Strategy: inter-sectoral S&T integration (ISTI), through governance and management arrangements for eligible federal S&T activities that include participation of academia and/or the private sector.

Desired Outcomes:

• increased value/efficiency of federal investments in S&T;
• enhanced quality of scientific activities through fostering research excellence;
• expanded opportunities for learning and knowledge transfer; and,
• improved Canadian economic competitiveness.

5.2.2 Scope of Application: Definition of Federal S&T Activities Eligible for ISTI

The Panel developed working definitions of the terms used in describing its mandate to assist in organizing and focusing its discussions and consultations. On the basis of those discussions and consultations, the Panel recommends reconsideration of the use of certain terms.

First, the term "transfer" lends itself to the inference that the Government is intent on wholesale divestment of its non-regulatory laboratories – an inference that was not conducive to constructive dialogue with some stakeholders. However, when the topic was framed as "inter-sectoral S&T integration" and "alternatives to sole government ownership and control" the tone of the discussion was constructive and even enthusiastic. Accordingly, the Panel suggests that the phrase "inter-sectoral S&T integration" be used instead of "transfer" in describing a move to alternative management arrangements for S&T.

Second, the Panel suggests that whether federal laboratories are regulatory or non-regulatory is not the best basis of determining their eligibility for possible integration with other sectors. Instead, the Panel proposes that the federal S&T activities eligible for ISTI should be those activities in respect of which the federal government does not require exclusive ownership and operational control. On this basis, not all activities coming under the Statistics Canada definition of regulatory S&T would necessarily be excluded from ISTI; and, not all activities defined as non-regulatory would necessarily be eligible for ISTI.^[12]

Third, the premise that government is best able to perform regulatory science while the other sectors are best able to perform non-regulatory science is too broad a generalization. There are areas of vital public interest where research of a non-regulatory nature is required that non-governmental sectors are unable, unwilling or unlikely to carry out. Such areas would not lend themselves to full transfer to academia or the private sector. However, in some of these areas the government's requirements could be met through its participation in joint sponsorship, governance and management of an inter-sectoral research program.

5.2.3  Articulation of Federal Governance and Accountability Requirements with Respect to ISTI Initiatives

The level of the government's continuing interest in, requirement for and commitment to the scientific activity under consideration for ISTI is the most important consideration in determining its position in negotiating the form and substance of alternative arrangements for governing and managing that activity.

This includes:

• the determination of the ongoing role the government wishes to play in influencing the scientific agenda to be pursued under any new arrangement;
• the nature of the "deliverables" it expects;
• the continuing roles, responsibilities and accountabilities, if any, of federal scientists in relation to their respective departments and agencies, beyond those associated with participation in the proposed ISTI initiative; and,
• the temporal term of the alternative arrangement.

Analogous considerations will no doubt be important in determining the position of potential academic or private sector "partners" in negotiating alternative arrangements.

5.2.4 Criteria for Evaluating Proposed ISTI Initiatives

The criteria proposed for evaluating ISTI initiatives reflect the relevance of the initiatives to the goals and objectives of the ISTI strategy as a whole and the extent to which the initiatives contain the elements that are critical for successful implementation.

Probability of success in achieving primary objectives

• Likelihood of achieving agreement on new management arrangements that benefit all partners involved.
• Likelihood that one or more of the four key objectives of the ISTI strategy (i.e. value/efficiency, quality/results, learning/knowledge transfer, and competitive advantage) will be achieved through the new management arrangement.

Strength of commitment of parties to the ISTI initiative

• Demonstrated commitment by potential partners to the long term success of the partnership.
• Clear articulation by partners of their expectations.
• A demonstrated history of successful inter-sectoral cooperation/collaboration among the parties.

Quality of the proposed management and accountability arrangements and business plan

• Governance mechanisms and management arrangements that clearly address the expectations and collateral accountability requirements of the partners.
• Policies and procedures that deal effectively with issues such as conflicts of interest, dispute resolution, management of intellectual property interests, risk management; and mechanisms for discontinuing the initiative when circumstances require it.
• Comprehensive, forward-looking business and operating plans that take into account legal, regulatory and other conditions precedent.
• Performance evaluation principles and processes that are clearly linked to goals and objectives.

Managerial and Scientific Leadership

• Strong management and scientific leadership resources are in place to implement the initiative, including designation of managerial and scientific leaders capable of guiding complex collaborative S&T programs.

Feasibility

• Separability: Proposed ISTI initiative can be implemented without undermining the mandate of the department or agency; and, any interdependencies are understood and capable of being managed.
• Logistics: Any logistic challenges to be overcome in effecting the initiative (e.g., relocation of personnel) and means to deal with them are identified.
• Sustainability: The proposed initiative is financially sustainable over a period sufficient to achieve its objectives.
• Legal considerations: The proposed initiative can be implemented in the context of the legislative responsibilities of the federal department or agency concerned, and of any other legal constraints (e.g., land claims, international agreements, or third party interests).
• Other Constraints: Any constraints arising from federal policies and procedures on the operations of a proposed ISTI initiative can be accommodated or managed.
• Risk Assessment: No unacceptable short term or long term risks inherent in the proposed initiative, or associated with it, have been identified. Risks of not proceeding with the initiative are greater than risks of proceeding.

Impact

• The ISTI initiative is substantial enough in terms of size, scope and anticipated benefits to justify the time and effort and any additional investment required to create the conditions for successful implementation.
• The initiative addresses an area of strategic importance from an economic, social, scientific or technological viewpoint.
• Cost/benefit analysis produces a significantly positive result.
• The initiative will contribute to the achievement of other key policy priorities or to the functioning of other programs.
• The initiative will maintain or enhance the fulfillment of the national mandate of the federal laboratory involved.

Timeliness

• The proposed initiative can be implemented, and its associated benefits realized, in a reasonable time frame.
• The initiative is coincident with other events (opening up of a window of opportunity) or emergence of new policy directions or priorities to which the proposed initiative may be particularly relevant.

Implementation

A central locus of authority and responsibility is required for managing the horizontal application of the framework. The central agency's role could include:

• monitoring the requirement for compliance with policies and procedures that may flow from adoption of the framework;
• establishing processes for independent adjudication of proposed ISTI initiatives and for performance evaluation;
• facilitating the elimination of unnecessary constraints on pursuing ISTI initiatives; and,
• providing guidance to departments on the development of effective inter-sectoral partnering, including guidance on governance and management approaches to successfully accommodate the accountability requirements of the participants (see Appendix VI).

Performance evaluation

A general plan is required for evaluating the performance of the entities created as part of ISTI initiatives. The plan should include:

• identification of key performance indicators and metrics related to the objectives of the ISTI strategy in general and guidelines for establishing indicators of relevance to specific initiatives;
• a focus on outputs and outcomes, as well as process measures;
• a description of the evaluation process, including how, by whom and when the evaluations will take place; and,
• guidance on the critical data requirements for effective assessment, including pre-launch data on key indicators, as a baseline for assessing the impact of the initiatives.

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