Industrial and Technological Benefits (ITBs) play a critical role in defence procurement in Canada. With the advent of rated and weighted requirements along with increasingly prescriptive ITB requirements, the development and delivery of a successful ITB strategy and plan now requires a much more holistic, purposeful and innovative approach to achieve success.
The TACTIX ITB Strategic Advisory Services Team is your answer to developing a winning ITB proposal that meets the Government’s requirements, while respecting your business priorities and shareholder expectations. The TACTIX team brings to your challenges unique field-proven insights into the government’s defence requirements, procurement process and ITB policy, as well as best-practices from industry-seasoned experts.
In the first of our ITB Q&A series, the ITB Strategic Advisory Services Team shares some insights into what to think about when planning, developing and delivering a successful ITB proposal.
Alignment is a key factor to achieve ITB success. Historically, ITBs (or IRBs as they used to be called) were defined as successful if they “made business sense”. This is still the case today, and even more so as increasingly prescriptive ITB requirements are introduced. When ITB activities align with business priorities, there is a higher potential of those ITB business activities having long-term impact and benefits for all parties involved.
Today, the key challenge in achieving alignment is not around a single transaction, but aligning a portfolio of activities to government expectations. More prescriptive ITB requirements are demanding that industry determine how best to provide a wide array of high-value ITB activities, ranging from traditional supply chain opportunities to business and skills development, technology demonstration and pilots, as well as fundamental research. Furthermore, these activities can span a range of industry sectors and priority areas of importance to the government – the Key Industrial Capabilities. Today’s ITB portfolio is a complex balancing act between activities at different “technology readiness levels” occurring across various business line interests. More innovative and purposeful “design-level” thinking is increasingly needed to develop such complex portfolios of business activity.
Developing a strategic ITB portfolio can be best addressed through early stage planning. In fact, starting early is a necessity, given the importance of developing a consensus on potential investment and business priorities – decisions that may require board-level discussions in some instances. Developing a strategic ITB portfolio helps achieve alignment, while also identifying important opportunities for strategic alliances, international business development, and important marketing and communications messaging.
In short, successful alignment is the result of sound planning, a strategic ITB portfolio approach, and working with a world-class partner like TACTIX who brings unmatched expertise, experience and insights.
The introduction of rated and weighted ITB requirements has driven the need to span diverse business activities ranging from basic research to supply chain agreements. Unlike historical ITBs (or IRBs as they used to be called), which were predominantly composed of supply chain agreements, today’s ITBs are becoming a broad portfolio of complex, and often interrelated business activities across various business lines of interest. This leads to a key challenge for all bidders: accurately costing the delivery of the ITB proposal. Costing and accounting for risk is no longer only at the level of individual transactions, but is an exercise applied to the totality of the ITB portfolio to ensure success.
Accurate costing therefore requires insight into best practices for individual transaction costing, something many bidders are familiar with when it relates to supply chain agreements. However, when transactions become “higher risk”, such as technology demonstrations, basic research or strategic alliances, costing becomes more complex where the cost of risk incurred needs to be reflected. Rolling up individual transaction costs (and related risk costs) into a portfolio is not straightforward – total portfolio cost is not a simple summation of individual costs. Many synergies, points of leveraging and interactions need to be accounted for to gain a full picture of the ITB portfolio cost of delivery.
Best-in-class portfolio costing and scenario planning practices are increasingly being considered to capture and reflect the complexity arising in ITB plans. Effective costing is also enabled through early stage planning and engagement with key corporate decision makers who will contribute to parts of the ITB portfolio plan. It goes without saying that accurate ITB costing in response to rated and weighted ITB requirements is a critical factor in achieving success.
In short, accurate and effective ITB portfolio costing is the result of applying portfolio costing best-practices, portfolio scenario planning, accounting for risk costs, and working with a world class partner like TACTIX who brings unmatched expertise, experience and insights.
Generating socio-economic benefits across Canada has been the policy driver for ITBs (formally know as IRBs) since the policy’s inception. Although the quantitative impact of the policy has been a point of discussion, and contention, for as long as the policy has been around, small to large businesses as well as academia from across Canada who participate in various technology and industrial sectors have benefited from ITB activities. Although most ITB impacts have been assessed on an economic scale, societal benefits have also been an important measure of success.
Today, with the advent of a more prescriptive, rated and weighed ITB policy, societal outcomes are an increasingly important consideration as the policy seeks to create impactful benefits to small and medium enterprises, aboriginal-owned businesses, as well as benefit other stakeholders such as women-owned businesses and minorities. Thematically, such benefits are expected to occur in areas of Key Industrial Capabilities (KIC) identified by the Government of Canada, but may also arise in areas of policy importance to Canada, such as environment and green technology, or other areas where Canadian innovation and business aligns with corporate interests and priorities.
Corporations are well positioned to build upon and leverage their Corporate Social Responsibility (CSR) plans to deliver social benefits as part of their ITB proposal. With ITBs being rated and weighted as part of the procurement assessment process, leveraging existing CSR plans can help drive synergies with existing business activities, align priorities and help mitigate the costs associated with delivering a successful ITB proposal.
In short, leveraging existing Corporate Social Responsibility plans can help respond to the government’s social-related ITB outcomes, all the while advancing corporate goals. You can fully leverage your CSR plans by working with a world class partner like TACTIX who brings unmatched expertise, experience and insights.
Meet our Strategic Advisory Services Team
Steven C. Dover
Steven Dover develops relationships with key government stakeholders and delivers client-focused business development opportunities.View More
Paul S. Hillier
Paul Hillier specializes in risk management, advising clients across industries on how to manage reputational risks.View More
Ken Pennie’s outstanding career as a senior military leader offers clients strategic advice in global defence and aerospace operations.View More
Managing Principal ~ Owner
Howard Mains’ client-centric approach brings a high level strategic focus on key mandates.View More
Dan has a unique ability to navigate political, economic and policy issues that affect TACTIX’ clients by employing exceptional strategic advice.View More