Evaluation Findings

A. Strategic Directions and Priorities

The strategic directions for the program are consistent with higher-level priorities of WD and the Federal government as well as with CFDC goals and objectives.

There are defined, clear and adequately communicated goals, objectives and service (investment) priorities for the program and, in turn, CFDCs that are reflective of desired economic and social outcomes.

A fundamental aspect of effectiveness is the extent to which there is a clearly articulated purpose, goals and objectives for a program. This strategic direction should also be documented, aligned with that of the organization and government in general, communicated and continually adjusted to reflect changes in the operating environment, management priorities, and findings from ongoing monitoring of performance.

In keeping with these two critical success factors, the state, alignment and clarity of strategic directions for the Program was examined. This assessment occurred at two levels, namely with respect to WD’s strategic intent and Federal government priorities, as well as at the CFDC level. The former involved the facilitation of a workshop with WD representatives, while the latter drew upon the interviews and document reviews that were carried out as part of the CFDC site visits.

1. Are the goals and objectives for the program consistent with departmental and government-wide priorities?

Federal government priorities include:

Support for the “new economy”.
Modernization of conventional industry.
Increasing participation of “disadvantaged groups” and First Nations in the economy.
Development of the workforce.

The strategic directions for WD encompass:

Innovation
Entrepreneurship
Sustainable communities

At a Federal government level, a number of priorities were identified by workshop participants including ongoing support for trade and ensuring international competitiveness, continued support for the “new economy” which is marked by knowledge-based businesses, and the modernization of conventional industry. Furthermore, it was reported that the Federal government would continue to invest in opportunities to enhance the participation of “disadvantaged” groups and First Nations in the economy, to renew rural and urban infrastructure, and towards development of the workforce.

As reflected in the strategy map exhibit on the following page, the strategic directions and priorities for WD can be represented as three “pillars”. The first such pillar involves the promotion of innovation through, in part, technology development and adoption. The second pillar encompasses support for entrepreneurship and promoting the viability of small businesses as well as overall industry competitiveness and market access. The third pillar addresses “sustainable and healthy communities”, including support for the transition of highly resource-based communities to ones with more diversified economies, and increased participation of First Nations.

Drawing on the interviews and document reviews, there is a general consensus that the strategic intent of the Program is to:

Provide support in building the capacity and capabilities of, and ensuring access to capital for, business owners (operators) and entrepreneurs; and
Enhance regional and community economic development, infrastructure and overall well-being.

The latter, community economic development, has grown in importance for a number of CFDCs and has been described as encompassing “capacity building”, accessing funds to support regional and local priorities, promoting diversified and new economic opportunities, and advocacy of community interests.

Exhibit 1: WD Strategy map

Primary Strategic Intent
Building an innovative, sustainable, diversified, entrepreneurial and inclusive economy in Western Canada
Three Strategic Pillars
Innovation Improve knowledge, infrastructure and capacity Increase rate of technology commercialization Enhance technology development and adoption Support community innovation Alignment of federal and provincial innovation strategies	Entrepreneurship Create community and industry based business services network Improve access to capital Target trade promotion, export readiness and investment attraction Improve business management capabilities of entrepreneurs and businesses	Sustainable Communities Support economic development of major urban centres Strengthen community capacity to promote sustainability Assist community adjustment Leverage new business investments in communities Promote Increased economic opportunity for Aboriginals
National Priorities
Canadian Infrastructure Program Softwood and West Coast Fisheries Adjustment Works Program Other national initiatives and adjustments

It is anticipated that efforts in these areas would contribute towards the development of new partnerships and collaborative ventures, increased involvement and diversity, and over the longer-term, self-reliant and stable communities.

At the same time, most respondents noted that business owner (operator) and entrepreneur education and assisting with the development of business concepts remain ongoing priorities. Drawing on the existing logic model for the Program, these areas of activity are expected to result in the creation of new, and expansion of existing, businesses, improved business management practices, greater availability of skilled individuals and entrepreneurs, and ultimately increased economic growth and diversified local economies.

As such, there does exist an alignment between the strategic directions and intended outcomes for the Program, the three pillars of WD, and ultimately a number of the priorities for the Federal government.

2. Are goals, objectives and priorities for the CFDCs consistent with those of the program, clear and commonly shared, and reflected in established agreements?

“What we do well is we work with communities” - Senior Staff Respondent

“The CFDC picks up the holes” that are not being addressed by government in terms of community services and programming. - Local Partner Respondent

“The CFDC is a community catalyst” - Local Partner Respondent

“Improve the quality of life in our region by enhancing business and entrepreneurial activity … to serve the social and economic needs of our region”. - Board Respondent

“Fill a gap in the community for those individuals requiring loans.” - Senior Staff Respondent

The operations plan provides the justification for WD funding allocations and decisions, but “does not give the whole picture of CFDC priorities and activities” – Executive Respondent

Operations plans and contribution agreements outline general directions, but there is a need for flexibility and responsiveness to community needs and project opportunities – Board Respondent

The primary document that establishes the goals, objectives and priorities for the CFDCs, and in relation to core funding provided by WD, is the contribution agreement. These agreements broadly state that the purpose of the Program is to support community economic development, creation and maintenance of small to medium-sized businesses, and generation of new employment in rural Western Canada. Separate clauses in these agreements describe supporting priorities as including, but not being limited to:

Diversifying the economy.
Supporting the creation and expansion of small and medium-sized enterprises.
Maintaining and creating new employment.
Maintaining capacity to deliver business services to rural communities.

These agreements also contain a significant number of one-year targets for measures relating to “core services”, including administration, business services, community economic development, and marketing.

Based on the respondent interviews and document reviews, the directions outlined in these contribution agreements are generally consistent with those of the CFDCs, and are commonly understood at the Board, management and senior staff level as well as among local partners. Specific responses in relation to the strategic intent of the CFDCs and the Program included:

Board and Management Respondents

Community economic development and supporting new business starts or expansion in employment.
Connecting with new emerging businesses and individuals who need assistance, in either a financial or educational sense.
Promotion of entrepreneurship through financial assistance and training.
Increasing employment opportunities by building stronger communities.
Creating a skilled workforce.
Development of the business acumen of clients.
Supporting the region by providing access to capital as well as community economic development and education.
Community development and building of business capacity.

Local Partner Respondents

Regionally based community economic development.
Community capacity building and building local partnerships.
Business development and education.
Business innovation and assisting new businesses.
Assisting individuals who require business skills.
The creation of more local employment opportunities.

Senior Staff Respondents

Economic diversification and revitalization of communities.
Sustaining rural communities and the quality of life.
Building up the loan portfolio, supporting self-employment, and community economic development.
Providing for access to funds, training and assistance to small and medium-sized businesses.
Assisting in the development of an individual’s or organization’s core skills and capabilities.
Small business development and counseling.
An entrepreneurial support organization.
Investment capital and services to small businesses.

Corporate and Regional Interview Respondents

Support entrepreneurs and sustainable development in small communities.
Small business development and counseling services.
Strengthen community partnerships.
Facilitate collaborative visioning and planning.

The manner in which these directions are translated into specific priorities, programming and service delivery at a regional and community level, however, varies among CFDCs. For example, for a CFDC in BC, explicit emphasis is placed on, “encouraging entrepreneurial, business and economic development” as well as, “serve those entrepreneurial individuals considering self-employment.” In contrast, another CFDC focuses more on community economic development and well-being, with a primary goal being to, “continue to facilitate the increased capacity of all communities within our region to achieve their own social and economic well-being.” The priority as expressed by a third CFDC is on community economic development and not social development or capacity building. Although all of these stated priorities are in alignment with established agreements, the emphasis that is placed on certain aspects of community economic development, creation and maintenance of businesses, and generation of employment and entrepreneurial opportunities differs by CFDC.

Another area of distinction between the strategic intent of the Program and priorities at a CFDC level is in the management of loan funds and pursuit of financial sustainability. Due in part to financial pressures, a number of CFDCs have reported that they are no longer strategically committed to serving as the “lender of last resort” to entrepreneurs and new business ventures. Rather, there is a growing emphasis being placed on managing loan portfolios in a balanced manner that still provides for access to capital for these client groups, responsiveness, and lowers the risk of unrecoverable debt while increasing the return on these funds. These same financial pressures have increased the need to establish alliances and synergistic partnerships as well as seek alternative sources of funding. This is addressed in greater detail in the next section.

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