Digital disruption: How Canadian local governments are transforming to better serve Citizens

Wendy Gnenz (00:10)
Hello, everyone and welcome to our Fireside Chat. Today we will be taking a look at how Canadian local governments are transforming to better serve citizens in their areas. We have with me here today, Dale Quaife, who works with the City of Pickering.

Before I turn the mic over to him to introduce himself, introduce himself. I will talk a bit about myself. I am a partner with MNP Digital based in the Edmonton office. And I do work exclusively with municipalities across Canada. I did have a role at the city of Edmonton, we underwent significant digital transformation over a number of years, and I led that transformation. And since coming to MNP, I’ve worked with municipalities all across the country in various aspects of their digital transformation journey. Dale, would you like to introduce yourself to the audience today?

Dale Quaife (01:10)
Sure. Thank you, Wendy. My name is Dale Quaife from the division head of information technology in the Corporate Services Department in the City of Pickering. I have many years of private sector experience in banking and insurance and also now 14 years of public sector experience with the City of Pickering.

Wendy Gnenz (01:30)
Great, thank you so much, Dale. So Dale and I did work together on the creation of a digital transformation, surveying strategy for the City of Pickering. And coming out of that work, it was very interesting to learn what the City of Pickering was doing. So, about the same time MNP thought perhaps we should look at a survey to understand what other jurisdictions are doing across the country. And to frame out our conversation today, we are going to be highlighting some key benchmarks that we found from a survey that we launched last spring.

We work closely with many municipalities, as I mentioned, and we thought, well, perhaps we can gather some intel. And in partnership with Leger and MISA, we conducted this nationwide digital transformation survey, it was focused on gathering insights around the current state of people process, strategy and technology within municipalities of all sizes, including summer villages, regions, counties, etc., as well as the larger organizations. And this research does aim to help our clients as well as municipalities in Canada, understand what sorts of digital transformations are being undertaken. We were successful in getting over 100 responses by about the end of April. And we’re going to report on some of those responses and some of the findings here today. So just a summary of where the respondents were from based on provinces. 32%, as you can see, were in Ontario. A great portion from Alberta and Saskatchewan as well. And then some in BC and Quebec. So, we did get quite a broad survey results from many different types of organizations across the country. Population size, by far, we had the most respondents, so roughly 48 of the 100 respondents were the small organizations with less than 10,000 population. But we did have some of the larger ones. So, we’ll talk a bit about some of the results that we saw from each of those areas and how some things are different between small and large.

One of the questions that we asked in order to get an understanding of where the respondents were is with respect to size, we asked about annual operating budgets. So putting capital aside, and you can see the results here. So, 36% had less than 10 million, and that aligns with our previous slide, where we talked about population size, but again, there were 10% that are over a billion dollars. So definitely did get some good representation from some larger urban municipalities in the country. We specifically honed in on as well, the annual technology operating budget. And this is interesting in that it does show that there is again a correlation with probably the larger the municipality, the more money that is spent towards technology operations.

Wendy Gnenz (05:03)
One of the things that is an assumption here is that all respondents utilize the same definition of what is technology. And what we’ve seen, certainly Dale will talk about this, and that is that technology within a municipality can be centralized more in one area, or it can be decentralized or segregated out in the business areas. So sometimes it’s hard to understand what the full operating budget for technology is without going to each of the business areas and ask them what their spend is. And again, it’s one of the different ways that we see technology is managed across the country. Number of FTEs again in alignment with that smaller technology operating budget, 78% of our respondents had less than 25 FTEs. And what we’ve seen as MNP through our work with these organizations is those individuals tend to be focused more on daily operations, maintenance, application modernization, etc., and a lot less on the strategic side or that digital transformation piece related to a municipality. That is where many organizations are augmenting their efforts with external assistance and even looking at that technology model around resourcing.

So, it’s one of the things that we’re seeing a big trend in recent years is towards how can we partner better as a municipality with vendors that are out there that might help us augment the skills that we don’t have in-house. And finally, before I turn it over to Dale, for our first question, we did ask respondents what their top technology challenges are, with respect to the municipality in the organization that they’re working in. And you can see them here. Probably not a surprise to most listeners, cyber security, and privacy is front of mind for most organizations, and as well as meeting stakeholder expectations. So, in the modern digital era, citizens and all kinds of stakeholders have many different types of needs from a municipality. And they’re looking for their municipality to serve those needs in different ways.

So, with that, I’m going to turn it over to Dale for with my first question. So, Dale, reflecting on your work with the City of Pickering and the various areas that you’re involved in, what do you anticipate will be the City of Pickering’s top technology challenges over the next five year? And feel free to reflect on some of the ones that I just went over or even add some new ones in.

Dale Quaife (08:02)
Alright, I’ll do that. Thank you, Wendy. Definitely cyber security and data privacy is top of mind for everybody nowadays. Making sure that we’re keeping our data and information secure is becoming more and more of a challenge every day, the goalposts are moving. I also thought digital transformation and service delivery, I think a digital strategy, you know, in my mind is more of a service modernization strategy. A municipality has hundreds of services that it offers to residents. And knowing which of these to move first is key a key importance and understanding taking the manual processes that we all know and love today, and transforming those into an online digital service, it can be quite daunting and time consuming. Obviously, strategic alignment and integration is important. Information Technology rarely reports directly to the CEO is typically under a finance or a corporate services function. And this creates some challenges in and of itself as far as being at the table being available to talk about critical issues or strategic issues.

Also, in my instance, I’m responsible for cyber security as well. So, I act as the CIO and the CSO. And so, trying to bring it all together can be a challenge, although we’re having some good success in Pickering. There’s a lot of work to do there. And there’s a lot of work to do across the board I think for many municipalities that I talked to. I have service modernization there and I’ve already talked to that. I also have connectivity and access to online services in certain municipalities as in ours, not every resident has high speed internet available to them. So that in combination with digital inclusion, so making sure they have the skills and the ability to work online. Our public library does a lot of work with us with I’m helping to educate mainly seniors in the use of technology. And some of them may not have an email account, or the, you know, Facebook account something like that. And they don’t, they definitely don’t have the skills to be safe online. So, with the security aspect, so that’s important, because in order for them to use our online services, we need to make sure that they’re, they’re able to understand them, they have connectivity to them, and that we can reach them as well.

You mentioned staff acquisition and retention, and this is becoming more and more competitive. We’re seeing it a lot, Pickering is sort of next to the Greater Toronto Area. And so we compete with the GTA for resources. And we really can’t compete as a municipality. The salaries and the sort of the opportunities are not as sort of built up within the public sector today, and they are getting there. But it’s difficult for us to retain and to acquire the appropriate staff.

As well, obviously, if I didn’t talk about AI, I’d be missing the boat here. What we’ve seen over the last year with GPT, and the large language models is going to change everything, it’s going to change the way we all work, it’s going to change the expectations from residents on how they want to interact with a municipality. And while we’re aware of what’s coming, it’s I’m not quite sure what it’s going to look like, little five years from now, what it’s going to look like tomorrow. So, I do know that it’s going to change, I do know that there will be an expectation on the city to use AI. But I see it more as a way to augment our staff and the experience we offer rather than replacing what everyone does, I think it’ll help everyone to work better and more effectively.

Dale Quaife (12:01)
And I think finally, I’d like to talk a little bit about the culture of innovation. Because we do need to innovate, we do need to transform. And innovation is never easy. In a public sector environment. We’re always looking to learn from others, we want to be a close follower rather than a leader. So, we’re waiting for those municipalities to really, you know, nail that the digital transformation work, and it’s not quite there. And that’s why partners like MNP are so important, because we just see internally into our organization, but you have the benefit of dealing with hundreds of different municipalities and public sector, public sector organizations, which provides you with that insight that we just can’t get. And that really helps us to streamline our processes and move things forward more seamlessly and get to market in a more timely fashion.

Wendy Gnenz (12:50)
Great, Dale, those are fantastic insights. And I love that you’ve added in and chatted a bit about AI, it’s certainly top of mind for many organizations nowadays. You mentioned as well, where does technology fit into in the organization specifically with the City of Pickering. And it was one of the questions that we asked on the survey. And interestingly, about 40% technology and data reported in or was accountable through to the CIO. Again, though, there was 22%, where it resides under the Chief Financial Officer, and only in 20% of the instances, is there a role such as a CIO, that would be accountable directly for technology and data. So we’re seeing a bit of a, I would say, a historic model in municipalities that show that tech and data doesn’t always report directly up to CIO.

So specifically, Dale, if you don’t mind expanding a bit on how it resides, where it resides in your chart within the City of Pickering, and any strengths or weaknesses, you see with the model that your organization is implementing.

Dale Quaife (14:10)
Sure. Well, the CIO is ultimately responsible for technology and everything else within the municipality. I don’t see many reporting directly into the CIO at this time, I do feel that’ll change as the importance and priority of technology and security becomes or moves to the forefront. We within Pickering, the IT division reports into the Corporate Services Department. There’s a lot of benefits to that. There’s also some areas for opportunity for improvement or weaknesses. So the strengths are corporate alignment with other corporate services initiatives and the autonomy to move things forward. I have a fair bit of autonomy within Pickering. And you know, my director provides me with that ability to just make things happen to move things forward as I see fit. And that’s, that’s a great strength for us. Weaknesses, sometimes lack of strategic alignment, communication gaps, like I said, not being at the table not hearing what’s happening not being able to know what, you know, we might apply it technology or solution for or an improvement. Budgets is also it can be the, you know, difficult not having the ability to sort of, to speak to your budget or advocate for why something’s important. Project prioritization is another one. There’s always a plethora of projects that are going on within a municipality, a lot of different service offerings and areas of focus. Having that sort of holistic overview of everything that’s happening and being able to prioritize even with its technology related projects, like software services, there’s a lot of software as a service, sort of ramping up now with cloud services. And IT is not always sort of, in the note when it comes to what’s being used and how it’s being used. So, we’re going to talk about it later.

This, this causes a lot of issues with governance, and also integration, which is a big challenge. Moving services online, means that there needs to be points of integration. And this could be for authentication for customer relationship management, for e commerce. And without that sort of tight knit framework, it’s difficult to, to know what’s happening were a strategic planning as well. Although we have a great relationship, and I’m part of the senior management team, on the strategic side, you know, we don’t get to be sort of front and center when things are happening. And we’re brought in as needed. But when other people think we’re needed, we think we might add value. So those are some of the sort of disadvantages of not reporting directly to the CIO.

Wendy Gnenz (17:06)
That’s great. Dale, thank you so much for those insights. We’re going to talk a bit now about digital strategies. So again, one of the questions that we asked was whether or not respondents had a digital strategy. Interestingly, but probably not surprising, 59% did not. So that was, we’re starting to see more organizations, more municipalities understand what a digital strategy is, and how they can actually create one, I get a lot of questions around. What is the digital strategy versus the technology strategy? I’ve been asked recently, what is an AI strategy and a data strategy? So, there’s lots of different strategies that organizations can have. But specifically focus areas around digital strategy, we asked, well, what would you put in it when you’re going to create one.

And you can see here that number one was around how to transform to the focus on digital first, the ability for citizens and customers to access programs and services in a digital medium, as well as modernization. So, updating platforms and the look and feel and how the cities or the municipalities, tools, look to the citizen is one of the things that’s really high up there. Cyber security, and privacy, of course, that citizen experience, and we’re working with a couple of counties in the country right now, around understanding what is the citizen expect from that organization? What is the link back to council priorities and goals around the citizen experience? So looking to incorporate those elements into the digital strategy as well. The only other one that I wanted to talk about on here, and it’s down the list, but I think it’s super critical is partnerships.

So, as I mentioned earlier, and Dale has talked about in this discussion, the competition for a very small set of skills that everyone needs with respect to technology, data, AI, etc. So, looking to understand what are the options for partnering with vendors or other organizations, even other municipalities in order to share resources or gain access to skills that aren’t readily available?

Alright, so, Dale, back to you. Does the City of Pickering have a digital transformation strategy? And I know the answer to that. And what are the key business drivers that you why the City of Pickering undertook for the creation of that digital transformation strategy?

Dale Quaife (20:00)
Sure. And I love the discussion about a digital strategy versus something like a service modernization strategy. And what as soon as you put digital in front of it, the thought is it’s the technology focused or technology led initiative, I see this a digital strategy or service modernization strategy or digital transformation needs to be led at the very top of the organization. And because it affects every person within, you know, the city, in our corporation, it affects how they do their jobs that affects where what they’re paying attention to. So, I really feel it needs to be led from the top of the organization down and it needs to be inclusive of everyone within the city. So that’s I like service modernization better.

The key drivers for us, obviously, our resident engagement, we want to make sure that our residents can, you know, do what they need to do with the city do business with the city anywhere, any place any time, rather than a set number of hours during the day and not on weekends, typically those sorts of things. Service modernization, I talked about that moving our manual, in person services online. And that’s got to be a driver because that’s going to result in increased efficiencies in municipal operations, efficiencies for staff and efficiency for residents, we’ll be able to do what we need to do much more quickly, we’re actually offloading some of the requirements to work with the city to residents. So they would do things online, if they want to report a problem and say, or a pothole or something like that, they would have the ability to report that submitted online, we know who the resident is, they submit the work order the work order gets processed, the work can then be done or scheduled or budgeted for. And the resident would be sort of advised of this all the way along automatically. Rather than having to come in and you know, or phone and talk to somebody and then you know, come back in, and what’s the status what’s going on. If we do it correctly online, then they’re sort of kept in the loop all the way along. Another driver for us was a new website with improved search functionality.

Through MNP and through other engagement opportunities within the City, we found that our residents are looking for improved look and feel experience with the website. And improved easier ways to find things, I keep going back to the fact that we operate almost like a line of different businesses within a municipal corporation. And we have hundreds of services that we offer. So, it may be hard to find per resident to find exactly what they’re looking for a secure and personalized resident experience. And this is something that I would love to see as a resident and someone who works for Pickering, to see that experience when you log in it knows who you are, it knows what your interests are. It knows you know, if you’re looking for an update on something, and then obviously ecommerce integration being able to transact with your municipality online for all of the services that they offer. And for Pickering, this will be a phased in implementation for e commerce integration is a high priority for us. But realistically, we can only do certain move certain steps forward with each online service, transitioning to an online service at a time. So it will take time.

Multi-channel communications is also a key driver for us. And that provides residents the ability to engage and connect with the city with the communications mechanism that they prefer. So, if they prefer phone, they can use a phone, if they prefer email, they can use an email if they want to text, they can use text and maybe through social media, those channels in the future. And obviously the in-person communications are always going to be there, so if someone wants to deal with someone in person, they can still walk into the doors when we’re open and do that. For me, a key driver is artificial intelligence and chatbots. I think it’s going to maybe replace our websites and traditional ways of finding information search engines longer term. And we’re just going to wrap in hunting and pecking for information, we’re just going to ask what we want to know and it’s going to provide us with that it’s also going to interface in the future I feel with residents directly, which will augment the services from our front desk staff and our customer care team. So and you know, it would be great if you could just talk to your chat bot and tell it what you need and it knows who you are and you can you could process a payment you could order a swimming past or set up a squash game or you know book a venue. And all you had to do is just tell me what time they’re open. Tell me what time this event is. Oh, can you sign me up for two people? Yep, you know, way to go. And it’s all done. It’s that quick. And I see that’s where we’re heading towards, but it will take some time.

Wendy Gnenz (25:10)
Great, thank you so much. So those are definitely the drivers that we’re seeing with a number of organizations. And every municipality has got its unique services and programs that are offered. But this has been a great summary for sure, Dale. So, we’re gonna go over quickly now, just a few of the responses around some of the systems.

So we ask the question, what ERP or financial system are you currently using? A lot of comments and inquiries that I get is around organizations wanting to move away from their current legacy ERP. So, you can see here that there is a wide variety of financial systems used across Canada, and many of these have are in the process of updating to what I call a more modern ERP. So, you can see again, some of these are regional based, for example, Diamond, Diamond, ethical solutions, is very predominant out in Western Canada. So, it’s one of the ones that a lot of organizations out here in the prairies utilize.

The next was around budgeting systems. Again, we were curious how many organizations actually have a budgeting system as opposed to using good old Excel. And you can see the responses here. Again, a very wide variety, showing that there is a lot of segregation across the marketplace, in vendors, and in solutions. So, it helps organizations understand if they select or if they’re putting out an RFP to select a new ERP, whether or not the budgeting system will come with that ERP or if they’re going to have to get a system as well for budgeting. And then tax management system. So, you can see, again, a huge variety being used all across the country, I would say there definitely is no one that has some monopoly on the market for tax management systems here.

And, again, finally, we asked about the productivity platform. Certainly Microsoft is the one that has got a strong, very strong hold on the market. But there are some, there are still, let’s say it’s six out of the 100 respondents that have chosen to go the Google route. And when I was at the city of Edmonton, we are, they are a Google shop as well. So that’s a very interesting use case there are large municipality having gone the Google route. GIS platform, ESRI, I would say, is probably the number one, as you can see, ArcGIS is another. But again, lots of different products are being used by the by organizations in Canada.

And finally, strategic priorities. So we did ask respondents to let us know what their top priorities are when it comes to strategy. As some of these we’ve talked about, certainly cyber security strategy and business planning that innovation that Dale spoke earlier, citizen experience. And then way down at the bottom right corner is smart city initiatives and open data. And those are two that what we’re seeing is many organizations aren’t referring to their projects or initiatives as a smart city, but rather customer service, innovation, etc. So, they are still initiatives that help the city be essentially more digitally advanced, which is often the way a smart city is defined. So, a lot of these kind of blend into each other.

And with that, I’m going to turn it over to Dale to say, to see do any of those strategic priorities on that slide previously resonate with you, and I’ll flip it back just in case you want to refer to any of these, Dale.

Dale Quaife (29:10)
I would say a great number of these do resonate with me. Obviously, cyber security and privacy is still there as a strategic priority. strategy and business planning. The City’s recently completed its latest strategic plan, and that’s going to help guide our efforts going forward. citizen experience that ties in again, I think with the digital transformation and service modernization work, recruitment and retention. We’ve touched on as far as the challenges with finding people for especially on the technology side, but I don’t think it’s limited to technology. I think other areas of the city are also having some challenges attracting staff at this point in time, technology modernization, and I liked your previous slide where it showed like the great number there, the majority of municipalities are using Microsoft as their platform.

We’re undergoing a workplace modernization Initiative to transform the way we work. So, it’s kind of like a digital transformation. But it’s, it’s for our employees. And it’s, it’s basically moving from a traditional legacy sort of file folder based on premise sort of solution to SharePoint Online, leveraging Microsoft Teams for communication collaboration platform, OneDrive for personal use for staff, and hybrid meeting room technologies. And also, Teams voice, which gives us that one sort of pane of glass, so to speak, where we can communicate, collaborate and get things done.

So obviously, employee engagement is key digital services deliveries sort of ties back in with the technology, modernization. Business intelligence and analytics is something that’s near and dear to my heart, I have a vision of a municipal dashboard, which basically shows the heartbeat of the city and how things are functioning and where we’re at, and whether it’s, you know, roads paved, or bridges built or potholes, you know, filled or permits issued, or, you know, event participation or programs attended. I think having that in one place kind of shows what’s happening, and we’re yet to get there. But we’ll get there one day, I’m sure. And obviously, risk management, that ties back into cyber security and privacy somewhat, I think, in my view. But risk management looking overall, is something where I think we need a bit more focus. And because we need to be proactive on that front, it’s not good enough to be reactive, and we need to be front and center. Smart City initiatives, we’ve done a few of those in Pickering. And the technology is evolving so quickly, it’s so hard to plan for that. But we have a couple of large capital facilities projects coming up. And we’re going to do our best to make sure that those are smart city projects, where we have, you know, public Wi Fi everywhere, LED boards, easy ways to engage with residents.

Everything’s connected, you know, even as far as smart, you know, waste bins and that sort of thing. So, our staff would know when they’re full, they could route their maps better to, you know, increase the efficiency of managing waste and those sorts of things within the municipality as well.

Wendy Gnenz (32:43)
Great, thank you so much. That’s very interesting. I hadn’t heard of SmartWay spins yet have to look that one. Sounds great. And then, I guess finally, the last question that we were going to talk about is around that the generational factors. So in any organization nowadays, there are four different generations. And we put a little summary here together around what those four generations are and what they expect. And I guess, looking to talk about generational differences, recruitment and retention, and even broader into how do you make sure that individuals the various generations are able to work well together. Dale, any thoughts considerations that you’d like to share with the audience on that?

Dale Quaife (33:35)
Sure. It is a challenge, because in government, we’re dealing with everyone, all sectors of our municipalities. And taking into consideration all of the generations and how they like to communicate and work.

From my perspective, we’re going to leave the existing methods of communication in place. So in person and telephone are not going anywhere, so people can continue to use those if they so choose. And that takes care of some of our Baby Boomer population. I’m finding the newer Gen Z’s, they want to do things online, they want to do everything online. And it’s that just in time, instant gratification, they want that connectivity and that engagement where you know, they’re not happy to write a letter and mail it in and wait three weeks to get a response. They want an instant response. They want to know what’s going on.

So yeah, I think it’s, it’s something that we need to consider and as I said that multi-channel communications approach provides from in person to text communication and being able to engage with residents that way, I think it’s important.

Wendy Gnenz (34:53)
Thank you so much Dale. And to wrap up our discussion this morning, any lessons learned or advice that you’d like to share with public sector organizations that are looking at undertaking their own type of digital transformation or transformation going forward?

Dale Quaife (35:11)
Sure. I would say it’s, it’s, it’s not easy. It’s hard. I was senior management within ING Direct for a number of years, both in Canada and the UK. At ING we were all virtual, there was no bricks and mortar, there were no, you know, facilities, everything was online, on the web, or via IVR, interactive voice response to telephone automated telephone system or over the phone. And it’s a lot of work. And that goes from, you know, the business analysis and business systems specialists and process mapping exercises that need to happen to look at your, your existing manual processes, when you want to modernize those back through to the development cycles, stakeholder leadership on what you want to get done, implementation testing, performance testing, user acceptance testing, quality assurance testing, and then the finished product that’s online, but it’s not like a set it and forget it type of thing.

There’s continuous improvement, there’s, there’s always bugs, there’s defects, there’s fixes that need to be made. And so in my experience, municipalities aren’t really set up for that. But there’s no there’s nothing out there today, as far as I know, that one stop shop that you can procure a service, and it’s going to do everything you need it to do, it’s going to be a combination of a platform, plus a lot of development and integration work for the municipality. So, I think we’re going to have to scale up to be able to do that. So, my view is, let’s understand where we’re going, break it into small chunks with a phased implementation, and work with a good partner who’s got experience in doing this, because it’s not something that municipalities do every day, it’s not something that they were they’ve been doing for a long time, it’s new to us. So, we really need that assistance in learning which way to go and what to prioritize, and, and then, you know, the soft skills, like how important governance is and how important you know, the organizational change management aspect of this is because it is change, it’s not really new. Businesses have been doing this for some time. But it is new for us. And that change can be hard for public sector.

So, one of the things that we’re still working through is, is how do we get an overarching vision of everything that’s happening? How do we align that all? And how do we communicate the change both internally with our staff and externally with residents, on why this is happening, why it should happen, what the benefits will be longer term once we’re done?

Wendy Gnenz (38:06)
Yeah, and you mentioned that change management component, which is absolutely essential. In order to implement any type of strategy, you need to make sure that everyone is on board and understands why it’s necessary and what the benefits are going to be to the organization. Thank you very much.

So, for listeners out there, if you’d like to download the full results of the survey, the QR code is here, and you can scan it and then have a read through, and we thank you for listening to us today. Take care.

Dale Quaife (38:47)
Thank you.