First Steps of the start of a new beginning of a Transformation that needs to embrace change

Finally it looks like there is a decision behind the commitment to keep Ontario Northland in public hands.  While the details behind that promise will continue to evolve as changes are implemented, it looks like there is a timeline of three years to get the plan together.
This jives nicely with the timeline of another major study being undertaken by MTO, the Northern Ontario Multi-modal Study.  The tender for Technical Consulting for this study reveals a scope that is growing, which can only mean good things for Northern Ontario.

If Ontario Northland can demonstrate its ability to create value in the same period of time, the organization stands a chance of becoming as relevant to the development of the region (expanded to all Northern Ontario) as it did in its heyday.

Many who are close to Ontario Northland must be growing weary of the call for new ideas.  That plea has gone out so many times in the past, there is not likely an idea left in the North that has not passed by the crown corporation at some point.

What is desperately needed, is a new way to evaluate those ideas.  In the past, they seemed to all be shoved through the filter of "cost reduction" before they were thrown up against the wall.  Those that showed promise of reducing the cash flow the most were propped up and given priority.  Assessment of value, seemed to rank low in the order and decisions were ultimately made by MNDM, who has very little expertise in either rail, telecommunications or development.

Their favourite target was wage reduction and to be fair, there are some examples of overpayment at ONTC.  However, there is also recognition of quality of work and dedication of the workforce, so one should be very careful about just slashing collective agreements.....in many cases you get what you pay for.

There is still a need to compare ONTC agreements with benchmarks in the relevant industry, and where a union maintains that there is value in exceeding those benchmarks, that has to be demonstrated.  There are too many sceptics in this world for a government to accept anything at face value and survive.

If anything is to be different in this, the umpteenth time of calling for fresh ideas, it must be in the evaluation process.  It will no longer be acceptable for MNDM to cherry pick through ideas and keep only the ones that reduce their cost, there must be an independent and transparent assessment of value.

The survival of Ontario Northland depends on the value they can create, judged by people who can recognize it.

MNDM needs help....desperately

The recent open letter from the Minister of Northern Development and Mines, Michael Gravelle gives some clue as to the state of ONTC transformation.

The original announcement to divest ONTC was made in March of 2012 and the subsequent change to transformation happened in April 2014.  In all that time it is most likely that ONTC management put together a plan to meet the government objectives.

Unfortunately, it is also very likely that due to the poor relationship between ONTC and MNDM, that plan was rejected outright, rather than being the foundation for a collaborative effort to bring together financial realities with government policy.  The recent departure of President and CEO, Paul Goulet, is probably a sign that exercise was unable to be concluded successfully.

MNDM is likely now relying on backroom advice from CN, the company who, under Hunter Harrison, pushed railroad efficiency to new highs.  Mr Harrison, who is now working his magic at CP, was heralded as the "best" CEO in the railroading industry for his impact on share price.  One cannot deny that Mr. Harrison understood what was holding railroads back from effectively competing with trucks.  His method of moving to scheduled service, reducing every cost that did not contribute to revenue, pushing asset utilization up and focusing on customer satisfaction resulted in short term gains that were nothing short of spectacular.

Railroading is a long term industry though, with assets that last decades, and the "Harrison effect" has not been proven over the life of those assets.  If these measures could be implemented without the culture of fear that Mr. Harrison used to effect change, and steps taken to ensure capital investments are protected, there is great potential for savings. 

CN's motives in providing advice to MNDM is suspect however....they are still interested in acquiring the ONR and will manipulate government to achieve that aim.  One only has to look at the price when CN sells rail line to the government to know who gets the better deal in any negotiation between the two.

MNDM needs someone within the organization who understands what is necessary to achieve their goals.  Anyone who knows Ontario Northland, knows that there is room for improvement and the union leaders are aware of that.  What is needed is a rail industry professional, who is committed to government policy, yet able to maximize revenue in a region that provides marginal traffic.

One would hope that Minister Gravelle is kicking that search into high gear, before the ONTC disintegrates into unrecoverable pieces before our eyes.

Creating an open and transparent government

Yesterday Kathleen Wynne made public the mandate letters written by Ministers to their Parliamentary Assistants.  Queens Park media was somewhat less than impressed and totally discounted the effort, focusing instead on existing lapses in transparency at both MaRs and Ornge. 

  Investigating and exposing the details behind those two issues is indeed important, but it is unfortunate they overshadow the progress, however slow, that is being made toward transparency and accountability.

Mandate letters are incredibly broad in scope and lacking in detail, but they put in writing for the first time, a record of the commitment from the current government for each Ministry.  As Ms. Wynne states in each Minister's letter, which is repeated to the PA's, her government is committed to increasing openness and transparency.

This written commitment, if successfully implemented, will mark a huge transformation from the currently accepted method of operation in the government.  After years of taking hits from various interest groups for every decision made, government bureaucrats have retreated into back room discussions, confidentiality agreements and public consultations that pay lip service to the notion of informed government policy.

Some people think Ms. Wynne, having made the commitment, should just direct her ministers, and through them, the public servants to embrace openness and transparency.  Unfortunately, no large and complex organization, public or private, works that way.  The public service is made up of many people with differing political views and ideas about the role of government. 

Bringing all those people to share a common belief about the benefits of an open and transparent government will take some time and require strong leadership.  It will also require many small steps toward accountability, which include releasing mandate letters devoid of any detail or consequences for failure.

Some of that accountability will come from the public asking questions about how a Ministry's actions correspond to their obligations as outlined in the Mandate letters.  

For the Ministry of Northern Development and Mines, one of those obligations relates to the Northern Growth Plan

Driving Growth in Northern Ontario

• Continuing to drive the implementation of the Growth Plan for Northern Ontario. You will consult with the Minister of Economic Development, Employment and Infrastructure and work with partner ministries, municipalities, Aboriginal communities and key stakeholders. Your goal is to ensure that priorities for the North align with the objectives of the Growth Plan.
• Continuing to work with the Northern Ontario Heritage Fund Corporation. Together, you will work to create jobs, improve productivity, promote diversification in the region’s economy — and stimulate innovation, entrepreneurship and business development investments in the North.
• Leading our government’s efforts to integrate and co-ordinate northern policy and planning activities, informed by the Growth Plan.
• Conducting a five-year review of the Growth Plan in 2016 to assess progress and achievements to date.

Hopefully that review of the Growth Plan will make assessments based on some of the Monitoring and Performance Measures contained within it.

8.4 Monitoring and Performance Measures

8.4.1   The Minister of Infrastructure and the Minister of Northern Development, Mines and Forestry will jointly monitor overall implementation of this Plan and report on what progress provincial ministries and municipalities have made to implement the policies in this Plan.

8.4.2   The Minister of Infrastructure and the Minister of Northern Development, Mines and Forestry will work with external partners to develop a set of performance indicators to assist in Plan monitoring and reporting as set out in Policy 8.4.1.

8.4.3   Success in achieving this Plan's outcomes will, in part, be measured by assessing progress in:

1. attracting investment and business growth in Northern Ontario
2. diversifying the North's economic base
3. supporting education and skills development of the North's workforce
4. increasing the involvement of Aboriginal peoples in the northern economy
5. improving the connectivity of the northern population though information technologies.

It is further acknowledged that long-term progress in these areas requires sustained, co-ordinated efforts by the Province and all its external partners.

8.4.4   The Province is further committed to the development of performance measures for ministry-specific initiatives that support implementation of the policies in this Plan.

Wide ranging mandate letters are an important step in the quest for an open and transparent government, but real measurements of the progress toward the commitments within them are going to be essential, if they are to have any meaning.