System Roadmap

ITD

System Roadmap, 2008/09

International Trade Division

Craig Kuntz

September 5, 2008September 2, 2008August 5, 2008

Table of Contents

1Introduction......

2Roadmap History/Updates......

3Assumptions......

4Roadmap Drivers......

4.1External Drivers......

4.2Internal Drivers......

5Proposed Action Items......

6Action Item Calendar......

7Benefits......

8Other Known Risks......

9Maintenance......

12121418202223251...... Introduction 4

2Roadmap History/Updates...... 5

3Assumptions...... 8

4Roadmap Drivers...... 10

4.1External Drivers...... 10

4.2Internal Drivers...... 12

5Proposed Action Items...... 16

6Action Item Calendar...... 18

7Benefits...... 20

8Other Known Risks...... 21

9Maintenance...... 23

1Introduction

The purpose of the system roadmap is to provide the Architecture Review Board (ARB) the information it needs to monitor system development from a strategic point of view, allowing for planning across projects and divisions.

The mandate of the International Trade Division (ITD) is to compile, analyze and disseminate estimates of the value of Canada's merchandise exports and imports, as well as to produce price and volume indices. ITD produces trade statistics on both a Customs and a Balance of Payments (BOP) basis.

Customs based trade statistics are derived from customs administrative records: Canada Border Services Agency (CBSA) for imports from all countries and for exports to countries other than the United States; and the U.S. Bureau of Customs and Border Protection (CBP) via the U.S. Bureau of the Census (USBC) for exports to the United States (under the Canada/U.S. MOU on the Exchange of Import Data, implemented January 1, 1990). These data are supplemented by information obtained from other sources such as the National Energy Board, the Canadian Grain Commission, the Canadian Dairy Commission and exporters of railcars and locomotives. Some price data are obtained from Japan, from the U.S. Bureau of Labour Statistics (BLS) as well as from Prices Division and CANSIM in order to compute the merchandise trade price indexes. BOP trade statistics are derived from customs information to conform to SNA concepts and definitions. Adjustments include trade definition, valuation and timing, as well as macro adjustmentsto cover known gaps such as the underreporting of exports.

The ITD program has the following characteristics:

Criteria / Value
Enterprise Dimension / Program
Risk Scope/Impact / [Local, Functional or Agency]
Risk Tolerance / [Low, Medium or High]
Service / [Consumer, Consumer/Provider or Provider]
Operation / [Local, Local/Central or Central]
Support / [Local or Central]

2Roadmap History/Updates

The following is a summary of significant changes between this roadmap and the previous one:

During this last year of the three-year initiative, the corporate “Mainframe Migration” driver will continue to be the main divisional priority and primary focus behind many of the program’s action items for the remainder of the 2008/09 Fiscal Year.

ITD has taken a Due to the pragmatic approach to the division took during the ITD Mainframe Migration.to assure its timely completion, The project was initially scoped with a December, 2008 deadline in mind. As a result, a number of solutions were designed and implemented to accommodate this timeline; however not all of the solutions were optimal decisions in the long run. Some existing functionality as well as abusiness and system components will need to be revisited to address issues and risks introduced during the implementation of less than optimal solutions. A number of new and previously identified business improvements were disregarded, or more appropriately, delayed during the migration exercise.

Some of the more important business components that will have to be revisited during post mainframe migration activities include:

The development of an Importer and Exporter Register Environment (AI-01)

Due to renewed external and internal interest and funding to the increased interest maintain this program it is necessary to integrate the annual and importance of this annual business process , the development and integration of of the Importer and Exporter Registersprocess into the division’s core systems. This activity processing is scheduled to begin late in 2008.

The review and development of a more efficient Divisional Standing Order Process (AI-17)

In order to ensure that a system and process were in place to satisfy the regular submission of close to 500 standing order client requests within the expected timeframe (December 2008), less than efficient and optimal solutions were utilized.The addition of future requests and modifications to current requests will assuredly require intervention and maintenance on the part of technical CS resources.

Another and equally important business driver associated with this Action Item,also delayed due to mainframe migration, pertains to risks associated with the data integrity issues brought about changes to the HS classification overtime that could lead to potential misinterpretation by trade data clients (ID-31). ITD is proposing a complete review and standardization of the information disseminated to address this issue.

Review and development of an Analytical/Research capability (AI-16)

ForTo a large portion of the ITD staff, the corporate mainframe environment provided the necessary data and tools needed to complement and perform ad-hoc analytical type business functions required as part of their job profiles. While the focus during mainframe migration was on migrating the applications that supported the common and core business processes, temporary and less that optimal solutions were implemented to satisfy some of the higher level analytical questions of interest to subject matter officers.

A more elaborate and flexible solution is crucial to replace the losslost functionality that will occur subsequent to the elimination of the corporate mainframe environment.

As part of the prioritization of activities made by ITD management during the mainframe migration, it became necessary to temporarily or permanently drop a number of secondary but important business components from the program. They include:

The creation and dissemination of weight-based trade data. The principal client of this data is Transport Canada, however, there are a number of potential clients for this type of trade statistics. Custom tabulations based on the weight file have netted sales of more than $60K in 2007-2008 for the division.

The creation and dissemination of the World Trade Analyzer (WTA). This database component is used primarily by the academic sector and was purchased the division by boast amongst its data users of several university libraries from around the world. This standard product has been is produced annually since the 1980’s and, in 2007/08, contributedover $65K to the cost-recovery program with little or no promotion. The applications used to produce this database are resident on the mainframe and are not planned to be migrated.

While some of the business drivers generated as a result of the position ITD took during Mainframe Migration will have to be monitored and managed closely to minimize potential impact on the program’s quality, a number of previously identified business drivers postponed due to mainframe migration havenow become priority items.

ITD proposes to undertake the following major initiatives during 2009/10 fiscal year. The Action Items are described below and listed in order of priority.

The development of an Importer and Exporter Register Environment (Operational and Dissemination) AI-01

With the funding for additional business processes surrounding the Importer and Exporter Registers addressed secured (i.e., International Prices Project, Interdepartmental Letter of Agreement with three other government departments), the development of an Operational and Dissemination environment for both the Importer and Exporter Registers is expected to begin in late 2008.

Two of the components of the current annual process are mainframe-based. The last mainframe production component is scheduled to run in December 2008. The implementation of the new environment is expected to be completed in time for December 2009.

While the cost of the regular operational processes and production activities are accounted for, the development cost of the associated divisional applications beyond fiscal 2008/09 will be funded internally from the ITD budget.

The re-development of the Canada Automated Export Declaration system (CAED) AI-02.

This application was originally developed in the mid 1990’s and is nearing the end of its expected lifecycle. At the request of the ARB, ITD recently completed an investigation on the potential use of the STC-Electronic Collection Framework as a replacement for CAED. It was concluded that the ECF would not be a viable replacement.

Given that 60% of the total Non-US trade value is supplied by CAED, the impact associated with the temporary or permanent unavailability of the CAED application would assuredly create havoc within the exporter trading community and cause unwanted negative international publicity for the Canadian government (ED-06). The combination of technological issues facing the current version of CAED (ID-06) and the timelines allocated by CBSA for the implementation of a CAED replacement (ED-05) forces ITD management to consider the development of a short to mid-term solution.

Recent consultations with the ARB Technical Review Team concluded that the re-development of CAED using an infrastructure similar to the one currently in place and the corporately recognized SADF Framework would constitute an acceptable short to mid-term replacement solution to CAED.

Discussions are currently underway with CBSA regarding the possible joint funding of this important action item. An LTP proposal will be required for the 2009/10 fiscal year to account for ITD’s STC’s share of this initiative.

The review and development of all divisional BOP and Prices business processes AI-11

The business processes and supporting systems pertaining to the BOP and Prices portion of the trade program were not included or significantly affected by the Mainframe Migration exercise. The division’s inability to address important issues and risks during this three-year timeline has seriously increased the risks regarding the division’s ability to produce timely and accurate BOP and Prices related trade figures. A list of business drivers that support the review and re-development of the divisional BOP and Prices processes can be found in section 4.2 (ID-12, ID-13, ID-14, ITD-15, ID-16, ID-17, ID-18, ID-19 and ID-20). These risks are further compounded by the importance of the data to our colleagues in the System of National Accounts in the Balance of Payments (BOP) and System of National Accounts and Income and Expenditure Accounts Division (IEAD). This data is crucial to their processes and outputs. Accordingly, ITD expects involvement, input and approval from both BOP and IEAD. As a group, the divisions could define a new business process, environment and supporting system environments to stabilize this critical and core business component while reducing some of the important risks inherent to the current processing environment.

HS Reduction AI-20

The Harmonized System (HS) commodity classification has been the foundation of the International Trade program since 1988. Significant revisions to the international component of the HS structure are planned by the World Customs Organization (WCO) and occur every 5 years. The level at which these modifications are performed generates a substantial workload with respect to both the Canadian Import and Export HS classification and requires an influx of resources to handle the work load. The next WCO round of revisions is planned for 2012.

Modifications to the HS detail are also received on a regular basis throughout the year from the Canadian Department of Finance. These modifications result from modifications to the tariff level and subsequently the statistical detail. Additional statistical detail is also requested by other Government Departments on a cost recovery basis.

At the time of its inception, the import component of the program contained approximately 14,000 distinct HS codes. In 2008, a little over 19,000 different import codes make up the HS classification. This significant increase in the number of codes has had a direct impact on most of the programs business processes. The most important components include:

-Increased workload and complexity associated with the maintenance of the HS classification structure and related concordances to other classifications (e.g., SIG, NAICS) in order to ensure data integrity.

Modifications to the HS structure are planned by the WCO every 5 years. The level at which these modifications are performed generates a substantial workload with respect to both the Import and Export HS classification. The next WCO round is planned for 2012. Modifications to the HS detail are also received on a regular basis throughout the year from the Canadian Department of Finance. These modifications result from modifications to the tariff level.

-Increased workload and complexity associated with the support of commodity-based modules such as Edit and Imputation.

-Increased workload associated with maintaining client specific HS commodity lists for nearly 500 requests.

A The potential reduction of import HS codes could have a significant impact on a number of important business partners (i.e. USBC, CBSA, trade data users, etc) and would necessitate careful planning and preparation. ITD is expected to initiate, lead and fund the initial phase of a multi-year project aimed at reducing the number of HS import codes to a manageable level. This initial preparation phase is expected to begin in the fall of 2008.

While the bulk of the work will be performed by principal share of investments would be directed towards subject matter expertise and workload, some technical resources will ould be required to modify and add functionality to the existing meta-data system to adhere to the 2012 deadline.

3Assumptions

The following outstanding issues and respective planning assumptions underlie the proposed system roadmap.

The management of risks associated with planned and unexpected business/technological issues within a program of the importance, size and complexity of Trade has always been for ITD management one of its highest priorities.

For many years, a substantial number of issues and improvements have been addressed by management through the creation of well-defined and funded endeavours. Examples of projects include the Mainframe Migration, the Export Renewal Initiative and Blueprint.

The regular funding of such initiatives has allowed ITD to develop and retain a solid, effective and business-savvy pool of resources. Throughout the years, not only has this pool of resources implemented several business improvements, these resources have also assumed a critical, invaluable and lead role during unexpected production related situations. ITD management considers the retention of this change management team critical to the on-going success of the program. This team continues to play an invaluable role in addressing and managing the risks associated with the recent development/migration of a large number of business components during the mainframe migration. Accordingly, the group would also play a vital role in defining and developing appropriate business solutions for remaining high priority business drivers.

ITD management faces a formidable challenge in establishing a realistic 5-year Roadmap given the current climate:

the significance of the issues needed to be addressed by the division;

the loss of funds associated with the mainframe migration project (i.e., 750K/year);

upcoming budgetary constraints imposed on the Agency.

Elaborate on potential ITD position:

1- Obtain funding for planned endeavour.

2- Somewhat confident that ITD management could through sound HR management practices (attrition, bla. Bla. etc.) could cover for $750 budget loss. Identify impact and business risk associated with such a position.

OR

  1. Given the importance, size and complexity of the International Trade programs processing environment, the management of risks associated with planned and unexpected business/technological issues will remain the packaging and funding into focused and well defined endeavours aimed at addressing key business and/or technological improvements as solutions to vital business issues/concerns (i.e. internal and External drivers) has for many years been an intricate components of the Division’s its regular business planning activities (i.e. Road Map). Examples through the years include: Mainframe Migration, Export Renewal Initiative, Blueprint, etc.

The completion of the mainframe migration and sun-setting loss of funding associated with the project mainframe budget (i.e. $7050K/year), the budgetary situation facing the corporation for the next few years, and the importance of the items that must be addressed by ITD, poses to ITD management a formidable challenge to when establishing a realistic 5 year Road Map.

For many years the regular funding of projects endeavours such as the mainframe migration, the export renewal initiative, and Blueprint haves allowed ITD to develop and retain a strong, effective and business savvy group of divisional resourceschange management team. In addition to providing these business improvements, this pool of resources has throughout the years provided a critical, invaluable and leading role during regular and crisis production situations.

ITD management considers it a business priority to retain as critical the retention of a this change management team. This team has and would will continue to play an invaluable role in addressing and managing the risks associated with the recent development/migration of a large number of business components during the mainframe migration. They will ould also play a vital role in defining and developing appropriate business solutions for those high priority business drivers that still remain.

Elaborate on potential ITD position:

1- Obtain funding for planned endeavour.

2- The ITD management team is preparing for the end of the mainframe migration and subsequent Somewhat confident that loss of funding. We are optimistic that the loss of funding ITD managementcan be largely absorbedthrough attrition and the retirement of staff in positions identified as present incumbent only and that the Division can maintain a core change management team intact to address ongoing high priority business drivers. could through sound HR management practices (attrition, bla. Bla. etc.) could cover for $750 budget loss. Identify impact and business risk associated with such a position.

  1. While our colleagues at CBSA have announced and presented ITD with a preliminary high level conceptual export processing model that would include a replacement infrastructure for the functionalities provided by CAED, no firm timelines, commitment or action plans have yet been established (ED-05).

Given the rising uncertainties associated with compatibility and support issues regarding the current CAED software components and future Operating System upgrades, ITD considers the current and aging CAED infrastructure (ID-06) a high risk.