Question Period Note: Cisco Procurement

The procurement of Cisco Products by Shared Services Canada (SSC) has been the subject of ongoing scrutiny from industry, parliamentarians, media and Canadians.

• When SSC was created in 2011 a significant percentage of the networking infrastructure the department inherited came from one vendor: Cisco
  • To maintain existing infrastructure and maximize the value of its existing investments it is essential to acquire equipment that is compatible with existing network equipment, including Cisco equipment
  • As we move forward with network modernization, SSC is moving to compatible and more generic technologies where possible and will continue to seek competitive solutions from industry leaders
  • SSC has and will continue to make information available to industry regarding Network Modernization initiatives on an ongoing basis through the Canada.ca website

If pressed on sole sourcing:

• Controls are in place to ensure that sole source contract or Equipment Specific Procurement are based on objective operational requirements
• Occasionally it is necessary for SSC to issue a non-competitive contract where equipment must be compatible with existing IT infrastructure, but such contracts are avoided wherever possible

On February 15, 2021, SSC published the Network Modernization Way Forward document on Canada.ca to communicate our strategy and gather feedback from external parties. In the document, SSC stated that it would balance open and competitive procurements to standardize and simplify the Government of Canada network, which reduces the risk associated with maintaining, updating and building on overly complex systems.

Procurement activities undertaken where Cisco products were acquired are consistent with that strategy. SSC continues to limit tenders for Cisco products in specific instances, like growing the footprint in Enterprise Data Centres where a common network fabric is required to be maintained. However, open and competitive procurements are also done for many networking categories including Local Area Networks (LAN) and Wide Area Networks (WAN).

Some open and competitive procurements are awarded to resellers who propose Cisco solutions, while others are not.

Looking forward, SSC plans to openly compete requirements from the following categories:

• LAN;
• Enterprise Wireless (Wi-Fi);
• WAN Provider (P) and Provider Edge (PE) routing; and
• Data Centre Networks (DCN) enclaves

Additionally, SSC has established the Information Technology Infrastructure Review Board (ITIRB), a review committee to improve oversight of all directed procurements. This committee reviews all brand-specific requirements over $1M to ensure alignment with departmental priorities and the Network Modernization Way Forward, and includes independent third-party consultation.

Non-Competitive Contracts awarded for networking equipment in FY 22-23 (up to 31 Aug 22)

• Total Non-Competitive Contracts: 114
• Total Dollar Value (Pre-tax): $708K
• Total Non-Competitive Cisco Contracts: 55
• Total Dollar Value (Pre-tax): $376K

Competitive Contracts awarded for networking equipment through generic open competitive processes on buyandsell.gc.ca - Buyandsell.gc.ca in FY 22-23 (up to 31 Aug 22)

• Total Contracts: 6
• Total Dollar Value (Pre-tax): $53M
• Total Contracts to Cisco: 2
• Total Dollar Value (Pre-tax): $22M

Competitive Contracts awarded for networking equipment directed to Original Equipment Manufacturers (OEMs) through limited tendering to resellers in FY 22-23 (up to 31 Aug 22)

• Total contracts all OEMs: 91
• Total Dollar Value (Pre-tax): $72M
• Total contracts Cisco: 49
• Total Dollar Value (Pre-tax): $47M

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