2023 DEFENCE AND SECURITY REPORT

2023 DEFENCE AND SECURITY REPORT

‘DEFENCE IS HAVING A MOMENT’ Canada’s industry takes stock at a critical time

OTTAWA BUSINESS JOURNAL 2023 DEFENCE AND SECURITY REPORT SUMMER 2023 OBJ.CA

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“It was designed so they could tear the whole thing down and rebuild it somewhere else,” said Main, adding that it’s specialized projects like this that help Dymech create such a strong rapport with clients.

Similarly, in 2022, Dymech was awarded a contract to deliver over 50 of the Dymech Container Mobilizer System which allows the Canadian Army to mobilize ISO containers without the need for expensive equipment, showcasing how Dymech’s solutions can be adopted for almost any turn-key project, said Main.

“Whether it’s decorative elements, a maintenance platform for a fighter jet, or just a simple handrail, we treat all our clients with the same care,” he added.

Michael Bravo (left) and Mat Main outside Dymech’s office in Greely.

Ottawa’s Dymech celebrates 25 years in business

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t started in defence and grew from there.

Over the past 25 years, Ottawa-based engineering firm Dymech has become a fixture in the city, working on a wide range of projects for clients in the construction, commercial, industrial, defence and security sectors.

Specializing in metal fabrication and capable of delivering a project from initial concept to in-service support, Dymech has expanded its project offerings over the years, adding some more creative business verticals along the way.

They did it by focusing on two things: being good listeners, and making their clients happy.

“Companies like working with us because we give them what they ask for,” said vice-president Mat Main. “We’re good at communicating. We’re organized. We produce quality work, and we make everything easy for our clients.”

It sounds simple enough, but understanding what clients want down to the last detail has given the company the foundation to shift from working solely with military/ commercial projects, to including creative projects like art installations – starting with the flowers in Ottawa’s Cancer

Survivor Park and continuing with Canada’s monument to the victims of communism which is in fabrication.

UNIQUE SOLUTIONS FOR CANADA’S MILITARY

Canada’s military has been relying on Dymech’s work since the company’s founder kick-started the business in his garage in 1998.

Since then, the company has become synonymous with its unique metal fabrication projects.

With a wide range of metal-working tools and machines at the company’s 26,000 sq.ft. facility, Dymech’s work ranges from welding, machining, CAD modeling, CNC waterjet cutting, to surface finishing and coating, allowing them to create custom solutions for clients.

The JTF(X) unit at CFB Kingston, for example, worked with Dymech when it needed a custom firing range that could be relocated when needed.

Dymech designed, engineered, fabricated and installed this modular system as part of a new state-of-the-art facility.

SPECIALIZED AND CUSTOM SOLUTIONS

When it came to expanding the business into art installations, the team knew adding creative projects to their portfolio wouldn’t detract from their work in the defence space — it would make it stronger.

“When working with artists, our job is to bring their concept to life and make sure it will stand the test of time,” said Main, adding that Dymech has created metal art displays at Lansdowne, Lebreton Flats and the Inspiration Village, along with many others, you can’t go to a public space in Ottawa without seeing our products.

Most recently, the Phase 2 OLRT team hired them to fabricate decorative metal covers that hide the mechanics that run the LRT station elevators.

“We’re building curved, perforated aluminum metal screens that go from the platform to the roof, but also have a cool, curved shape,” said Michael Bravo, the lead engineer on that project.

“Our clients really appreciate the fact that we are technically savvy. We’re engineers, but we’re also very practical — we build stuff every day.”

Whether it’s a new art installation in the city, or a major defence contract, Dymech has built a network of happy customers – often recruiting new business through word of mouth.

This has helped the company land contracts with major players such as Marshall, Lockheed Martin and DND – but the team isn’t looking to slow down anytime soon, said Main.

“Our clients like our attitude,” he added. “They know we get it done and they can trust us with that scope of work without having to hold our hand.”

BY CHRISTYN CIANFARANI

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Christyn Cianfarani is president and CEO of CADSI.

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market abroad. Government is the main customer, but many products and services have commercial variants that we find, at times, in our own homes. Layer on top of this the challenges associated with domestic military procurement and you’ve got a steep learning curve for new entrants, especially if the expectation is to just deliver commercial-off-the-shelf.

But many companies have recognized – and continue to recognize – the incredible opportunities that exist in this domain and have answered the call to become part of something much bigger than their individual shop floors and balance sheets.

Each spring, Ottawa rolls out the red carpet for Canada’s largest trade show devoted to defence, security and emerging technologies: CANSEC. Hosted by the Canadian Association of Defence and Security Industries (CADSI), which I lead, the show attracts thousands of delegates from Canada and abroad representing

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nyone watching the news over the past 18 months will have noticed that national and international security are having a moment. For decades, Canadians have gone about their daily lives, comfortable in the knowledge that our country’s geographical size, protective ring of three oceans and mighty neighbour to the south mean we face few direct military threats.

In the wake of Russia’s invasion of Ukraine and alleged interference from China, we are waking up to a harsh reality.

Global geopolitical instability has brought the security challenges we all face into sharp focus, leading to reflection around investments linked to our Canadian Armed Forces, to the cybersecurity domain, to Ukraine, and in support of the defence of North America.

Canada’s defence and security industries – a significant portion of which are based right here in the National Capital Region – can and should play a pivotal role in our responses to these challenges. Defence is a constantly evolving sector that contributes nearly $10 billion to Canada’s annual GDP. The cybersecurity industry, whose revenues and employment ballooned by 30 per cent between 2018 and 2020, brings in an additional $3.2 billion to GDP. These industries are rich in STEM and R&D, dominated by SMEs and home to companies engaged in everything from shipbuilding to advanced simulation to artificial intelligence.

You’d probably be surprised by the sheer breadth of what we do.

National security is also a unique business environment, subject to vigilant government regulatory oversight at home and a highly managed and protectionist

OTTAWA BUSINESS JOURNAL 2023 DEFENCE AND SECURITY REPORT

This year’s CANSEC comes at a pivotal time for our industry

industry, the military and government. The show provides an annual boost to our local economy to the tune of $15 million, plus the opportunity to forge and strengthen the connections within Canada’s defence and national security communities. And let’s be honest: it also gives industry a chance to show off some cool stuff.

The theme for this year’s CANSEC – “Together on Every Front” – is both a call to action and a reminder that the protection of our nation is a collective responsibility. Over the past year, allied governments in countries large and small have recognized that they need to bolster their domestic defence industries to meet the challenges of an increasingly unstable world order. At this pivotal moment, Canada must make a strategic choice to do the same; favouring, supporting and actively promoting homegrown businesses like the 300-plus companies exhibiting at CANSEC. Done right, this will ensure a healthy and sustainable defence industrial base that’s nimble, globally competitive and contributes even more to our local and national economies.

So, yes, defence is having a moment. If we’re smart, we will rise up to meet it.

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What makes TerraNova the perfect partner for Canadian defence contracts This crack team of after-market support and manufacturing experts spans all military branches and is uniquely connected to Canadian history

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hen Len Anderson founded his telecommunications company Renaissance in 2010, he didn’t know it would one day lead to solving a big problem for the Canadian military.

But, after finding success in the aftermarket repair business – helping companies maintain the functionality of their outdated telecom equipment – the opportunity to translate those skills to a new market presented itself.

“Initially we saw the opportunity to work with military companies to upkeep their aged technology, but it very quickly became clear that we could do so much more,” said Anderson.

In 2016, he purchased TerraNova, enabling the company to develop an aftermarket repair team dedicated to growing its presence in the military space.

Taking the skills the team developed by servicing telecom equipment, TerraNova has bridged its expertise in circuit cards, electronics, cables, and interconnect to the defence sector. With the ability to adapt modern technology to fit an older machine, TerraNova is helping keep customers on land, sea and air moving.

After spinning TerraNova off into its own entity in 2022, the team has continued to grow as a trusted partner to military and defence companies.

“The functionality of mission-critical assets is a lot like telecom,” says Doug Kerwin, general manager of TerraNova.

“Every drone, ship, armored vehicle, helicopter and fighter jet has technology running throughout it, and our team helps keep that technology functional and up to date – even after the manufacturer deems it obsolete.”

Doug Kerwin, general manager of TerraNova

The TerraNova difference Not only can TerraNova help military giants like Curtiss-Wright, Babcock, GeneralDynamics and the Canadian military maintain its machinery, but it can do it in record time.

As a certified military vendor, TerraNova has cut down machine servicing time from over two years in some cases to as little as 20 days. And with the extensive civilian engineering knowledge the team has, they are capable of working on all electronics, no matter the military vertical.

“We are an intersection between new

technology solutions and old technology equipment,” says Kerwin. “We are able to be that horizontal provider for electronic and cable repair for planes, ships, tanks, you name it. That didn’t exist before.”

Kerwin also prides TerraNova on having “20/20 foresight” when it comes to predicting potential problems for the military.

“We understand the technology backwards and forwards, so we know how things will function, and also how they may falter over time,” he adds.

The company has also risen in prominence as a go-to partner for other companies looking to secure an RFP contract. As an Ottawa-based, Canadian owned company, TerraNova checks many of the boxes when it comes to compliance with government contractual requirements.

On top of being a locally-owned company, TerraNova is also a Certified Aboriginal Business by the CCAB due to Anderson’s Indigenous heritage.

Given that the government of Canada has committed to supplying five per cent of all contracts to businesses led by Indigenous executives, it’s a win-win situation for companies who partner with TerraNova, says Anderson.

“We’re in a growth period, we are open for business and looking for more opportunities,” he adds. “We have a highly skilled team of engineers on our side and we are ready to be a one-stop-shop for defense solutions.”

To learn more see www.terranovasol.com

Q:

Defence companies in the National Capital Region are quite bullish. But they often cite government red tape and regulations, talent shortages and challenges with accessing global markets as obstacles. Is there anything more the government can do to support local industry players?

A conference attendee checks out some of the tech on display at CANSEC 2022. PHOTO COURTESY OF CADSI

Current global security environment prompts important questions for Canada’s defence industry

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An interview with CADSI vice-president of business development Steven Hillier Defence and national security seem to be hot political topics right now. There’s much discussion around new investments, military capabilities and how Canada engages in international alliances. What does that translate into, on the ground, from a business perspective?

project like the Future Fighter or the National Shipbuilding Strategy. Long-term planning and visibility are important. In 2017, the government unveiled its overarching defence plan – Strong, Secure, Engaged, or “SSE” for short – and since then it’s been steadily implementing that roadmap, along with

Officially, we describe CANSEC as North America’s premier defence, security and emerging technologies trade show.

But I think, at its core, it’s a connection point; for industry, for government and for the military. It’s an opportunity for 300-plus companies to show off their latest and greatest capabilities directly to the customer. There are massive defence trade shows in Europe and the Middle East and we consider CANSEC to be a boutique version of that — distilling the best parts of those events and condensing them into two high-value, networking-packed days.

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The global security environment has deteriorated in the past 18 months and a big reason for that has been Russia’s illegal and unprovoked invasion of Ukraine. The

discussions that’s prompted are important ones. Are we ready to defend Canada in the modern era? What do we need to do that effectively? There’s a defence policy update happening right now that, in theory, could start providing a view into the government’s thinking on these questions.

But, on the ground, business cycles in defence are often measured in years — even decades. Companies will position themselves well in advance so they’re ready to jump when an RFP finally hits the street on a large

of it?

How would you describe CANSEC to someone who has never heard

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Defence is not like other markets.

It’s tightly regulated and governments worldwide often favour their defence industrial bases, so the market can be quite protectionist. Canada’s government could do more to smooth the path for homegrown companies and champion them abroad. Likewise, we could look at more partnerships between government and industry — like talent exchanges — to help address talent shortages. This need is particularly true in the cyber domain.

And finally, the industry understands that export regulations exist for a reason. But the government must ensure that it meets its service standards when issuing export permits and security clearances. These are tough challenges, but the solutions are there. And CADSI, as the voice of the Canadian defence industry, has been pushing hard for them in recent years.

OTTAWA BUSINESS JOURNAL 2023 DEFENCE AND SECURITY REPORT

advancing its defence investment plan. Last summer, some new NORAD modernization and continental defence projects were added to the list and there have been some recent, one-off acquisitions linked to the war in Ukraine. But, as always, companies will position themselves in response to the customer’s stated needs and those needs must be clearly articulated before we begin making changes to lines of business or ramping up production.

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can also recreate high-pressure situations to help students build confidence. “This often creates a faster learning process, which can save organizations both time and money.”

Revolutionizing fighter pilot training

Going virtual: How CAE is revolutionizing military training around the world

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hen it comes to training the next generation of military personnel, CAE has always had its finger on the pulse of how to prepare defence forces.

Founded shortly after the second world war by a former member of the Royal Canadian Air Force (RCAF), the Canadian company has played a critical role in developing training solutions and technologies for defence and military customers for more than 75 years.

Today, the company is continuing to revolutionize training and support solutions, by adopting and developing leading edge technologies to transform how students learn.

Focusing on personalized training and integrating state-of-the-art virtual simulators into the classroom, CAE is helping address the needs of defence and security organizations across the

air, land, sea, space and cyber domains.

“We transform training to be centered around the students,” said Phillippe Perey, head of technology, defence and security at CAE. CAE’s customized, turnkey training programs and systems are designed to help forces and crews acquire the critical skills and knowledge they need to do their job safely and effectively.

Using a mix of applications, digital courseware, virtual, augmented and mixed reality as well as high-fidelity simulators that mimic what it’s like to be on board a naval ship or engaged in air combat, students not only gain direct experience, but instructors also receive immediate performance data.

“Instructors can see how each student is performing and decide whether they need to intervene,” said Perey, adding that simulators

One of CAE’s modern technological innovations is “Sprint”, an Immersive Training Device — or ITD — that provides aviation students with a realistic learning experience as well as immediate feedback on individual and accumulated class performance.

Built around a helmet-mounted virtual reality display, CAE Sprint includes a seat equipped with the primary flight controls, the stick, the throttle, and rudder pedals that replicate what students will find in an aircraft.

“It simulates every aspect of flying a military plane,” says Perey.

In fact the experience is so real that the student is exposed to the same stress they might feel in the actual (live) situation. By monitoring biometric readings like heart rate and eyetracking, instructors can assess individual student’s stress, engagement and cognitive workload levels, and adjust training to moderate, or increase complexity, either slowing or accelerating training as appropriate.

The VR headset also gives students a 360 view of the terrain, the airport, and the landing area, ensuring an as close to real-world experience as possible.

“The students can look back and see the tail of the aircraft,” said Perey. “They can move the rudders and they can see that the tail sections are moving. They can look at their wing tips to assess if they’re coming in correctly. They can check the weather and see how much fuel they have left.”

While this technology may seem like a major shift from the traditional method of teaching, it isn’t meant to replace instructors, who Perey says “are worth their weight in gold”, but to meet the learning needs of the tech-driven, next generation.

“It’s really about acquiring the knowledge and skills,” added Perey. “To create a great pilot you need to help them acquire the right knowledge, skills, and attitudes, and technology like this does just that, efficiently and effectively.”

What are some of the benefits of the show for the local economy?

CANSEC is actually Ottawa’s biggest annual business event. Although not open to the public, its global reach makes booking a hotel in the city for the last week of May impossible. Once they’re here, those delegates are spending corporate dollars, hosting networking events all over the city, taking clients out for dinner, shopping, and more. We estimate the economic impact to be around $15 million. But many of our members bring local economic benefits to Ottawa year-round.

Q:

That’s interesting. In what ways?

Well, many defence and cybersecurity-focused companies have their Canadian headquarters in Ottawa or work closely with Invest Ottawa and Bayview Yards. The industry has always been a big driver of innovation and growth and we have government statistics to back that up. Ottawa, of course, is Canada’s government and military hub and that attracts world-class companies like

Calian, Lockheed Martin and many other advanced technology firms that call Kanata home. That type of tech cluster becomes a business ecosystem of its own, where like-minded companies will set up shop and grow their networks. Bayview Yards is another perfect example of how defence and security companies can come together and act as economic drivers.

Q:

You’ve been personally involved with the show for 15 years. How has it changed?

It’s been a privilege watching CANSEC grow into the event it is today. It used to be a small, annual Ottawa trade show where you would know everyone on the floor. Today, it’s tripled in size, attracts over 50 international delegations and top executives, and features ministers making strategic announcements on stage. As it’s grown, it’s also moved — from the Ottawa Congress Centre, to Lansdowne, to its home today at the EY Centre. And we’re bursting at the seams even now due to demand, which has become one of our selling features.

(Above and below) CANSEC provides networking opportunities with industry players.

PHOTOS COURTESY OF CADSI

Q:

So how do you think CANSEC will evolve moving forward? Could it ever outgrow Ottawa?

As we all know, the technological revolution is here and it’s happening fast.

The defence industry is not immune, especially when it comes to advancements in AI, communication systems, autonomous systems, cyber systems, and blockchains.

As the demands of a modern military evolve, the industry is evolving, too. As the

association representing that marketplace, we recently established the CANSEC Labs to showcase emerging technology companies not traditionally involved in the defence sector and that will keep growing.

We know how lucky we are to be in a strategic city like Ottawa and have exceptional partners in Invest Ottawa, Tourism Ottawa and multiple government entities. So for the foreseeable future we’re proud to call Ottawa CANSEC’s home.

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Fortifying Canada’s Cyber Defences: Protecting Critical Infrastructure and Empowering Organizations

BY JOHN HEWIE, NATIONAL SECURITY OFFICER, MICROSOFT CANADA

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wo years into Russia’s war on Ukraine, governments and analysts are still uncovering new information about the sophistication, scope and severity of the widespread cyber operations aimed at devastating the Ukrainian government, military, economy and critical infrastructure. In April of this year, the Canadian Minister of National Defence issued a stark warning for Canadian organizations – cyber threat activity by Russian-aligned actors targeting Ukraine’s partners is on the rise, and Canada is no exception. Cybersecurity remains a top priority for the defence industry.

Recognizing the significance of safeguarding critical infrastructure and protecting national security, the defense industry plays a crucial role in developing advanced military technologies and capabilities to combat these evolving cyber threats.

These threats are not part of a distant, hypothetical future. In April, the head of the Canadian Centre for Cybersecurity indicated that a cyber threat actor had the potential to cause physical damage to critical infrastructure. While no physical damage occurred, the threat to critical infrastructure is very real. Critical infrastructure refers to networks and systems that Canadians rely on for essential services, such as energy, water and utility systems, financial services and healthcare. Nation states see critical infrastructure as a desirable target to help them gather information, develop a foothold in anticipation of future hostilities and to intimidate governments.

In an advanced, interconnected economy like Canada’s, cyber threats pose an important risk. Rapid technology and digital transformation across all sectors has created new challenges. For a critical service like healthcare, security vulnerability has increased due to the evolution of medical technology and rapid transition to electronic health records (EHRs). But in many cases, breaches are caused by outdated systems and a lack of cybersecurity awareness. In recent years, the Ottawa Hospital has adopted a robust security posture following ransomware attacks that affected other healthcare

organizations across the province and country. Using cloud scale defences to quickly contain attacks and the sharing of threat intelligence with partner institutions has been a key component of their digital transformation.

While critical infrastructure is a key target for threat actors, Canadian organizations of all sizes across all industries are at risk of cyber attacks. The majority of attacks exploit gaps in the implementation of cyber security best practices. Microsoft’s latest Digital Defense Report shared that ninety-eight per cent of cyber attacks can be thwarted by basic hygiene, including these foundational best practices:

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Adopt a modern Zero Trust security framework - the traditional perimeter-focused

defenses are no longer alone sufficient to protect internal networks and data. Zero Trust is a model to address the modern challenges of securing remote workers, protecting hybrid cloud environments, and defending against advanced cybersecurity threats.

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Enable “phish resistant” multifactor authentication – Cybercriminals don’t “break in”, they “log in” and weak login credentials can provide attackers with easy entry to gain unchallenged access to corporate resources.

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Keep up to date – Mitigate the risk of software vulnerabilities by ensuring your organization’s devices, infrastructure and applications are kept up to date and correctly configured. Utilizing cloud services reduces your burden on applying software updates.

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Install and enable a modern security endpoint solution - Detect and block malware and malicious activity at a key point of entry using AI and cloud scale threat intelligence.

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of your information by limiting access to files or emails. Set “do not forward” or “do not print” restrictions where appropriate and classify documents to prevent employees from accessing them when they leave the organization. Back up your important data with cloud storage and maintain an offline copy to avoid data loss.

Protect your data – Implement information protection best practices such as applying sensitivity labels and enforcing data loss prevention policies. Protect the confidentiality

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Empower your employees with cybersecurity awareness training -

Employees are your first line of defense and boosting or enhancing end user knowledge on security threats can go a long way to help reduce the risk of data exposure to phishing and other cyber attacks.

Reporting cybercrimes plays a vital role in combating the ever-evolving threat landscape. Shockingly, only a small fraction of cybercrimes or frauds are reported to the police in Canada, presenting significant challenges for law enforcement. If you suspect you or your organization have fallen victim of a scam, fraud or cybercrime, contact your local police immediately. The Canadian Center for Cybersecurity provides detailed instructions and what to expect at www.cyber.gc.ca.

From the highest levels of government, to any one of Canada’s millions of small businesses, cyber attacks aren’t just likely, they’re inevitable. Today’s threats demand a heightened level of awareness and vigilance at every level to protect organizations and everyday Canadians from bad actors. Adopting good cyber hygiene and modern cloud solutions is our best defence and a critical step in preparing for a modern threat landscape that continues to evolve. Learn more on how to protect yourself and your organization at www.microsoft.com/en-ca/security/business/ security-101.