Frank Groenewald
October 2003
Learnerships……
Addressing multiple stakeholder needs.
Today's Business
• Strategy
• Structure
• Process
• Current status
The Strategic Context:
Different Stakeholders = Different Needs
Environment
Key features
Political
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Economic
• Sector performance solid
• Jobless economic growth in sector
• Equity markets under pressure – significant cost pressures in sector
organisations
Social
• Unemployment highritical/advanced skills supply very limited
• Exaggerated in the case of PDI’s
Technological
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•
•
•
Have seen rapid increase in capability, but..
Telecoms remain problematic
E-learning well-understood, but…
Digital divide creates entry-barriers to technological arena and constrains utility
Legal
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Equity legislation creates transformation pressure
Funding line established through SDLA & SETA
Realisation of NSDS targets being driven hard by DoL
BANKSETA mandate constrained and under pressure
PFMA compliance non-negotiable
Lifespan of SETA’s uncertain
Physical
environment
• Safety and security remains problematic
• Absence of affordable public transport means that geographic dispersion of
people remains as a constraint
Sector transformation performance and prospects under critical scrutiny
Transformation charter under construction – pressure for meaningful change
Election looming – pressure for creation of employment opportunity
Increasing costs of compliance with spirit and letter of statutory demands
Learnerships:
Problem statement
• In the context of transformation
imperatives, jobless sector growth,
pressure on internal training costs, the
challenge is to conceptualise and
implement a learnership strategy that will
enable sector learner targets to be met.
• The strategy must add business value,
satisfy political imperatives, minimise
negative business impact, comply with
legislative requirements, be economically
practicable, and must be implemented in
short time-frames.
The strategy must:
• add business value,
• satisfy socio-economic imperatives,
• maximize positive and minimise negative
business impact,
• comply with legislative requirement,
• be economically practicable, and
• must be able to be implemented in short
time frames.
Levers
• Focus learnerships on areas where
demand for skilled staff is highest as a
consequence of scale and labour turnover
• Accommodate learnership recruits within
existing recruitment patterns as far as
possible, such that learnership candidates
meet real staffing needs.
• Focus national need learnerships on a
small number of generic learnerships with
large numbers of learners
BANKSETA’s Strategic Objective
• To facilitate the rapid scaling up of
learnerships in the sector to meet identified
demands, such that negative business
impact is minimised and business benefit is
maximised.
• To achieve the above within the constraints
of available funding.
This objective can be achieved by applying strategic principles…
Different categories of learnerships and of learners exist
Learnership
Category
Characteristics
Strategy implication
National need
• Will have to focus on skills required at entry level,
where there is no intrinsic skills shortage and
where the banks have been relatively effective in
meeting their organisational skills needs
• Therefore driven primarily by socio-political
imperatives
• Unemployed PDI’s, primarily school leavers,
possibly some graduates – Sec. 18.2
• This environment represents the
greatest opportunity for driving large
numbers of learners, but will also
pose the greatest challenges to add
business value
Transformation
• Driven primarily by managerial \ leadership
transformation imperatives
• Moderate numbers required
• However, intense competition in the labour market
for these resources will mean that remuneration
will have to be well referenced to market
• PDI’s with tertiary education – Sec. 18.2 and 18.1
• Note that learnership-based qualification for this
target market will have to be carefully designed in
order to ensure that is attractive to prospective
entrants, who would be interested in career
prospects.
• Learnerships in this may represent
the greatest opportunity for
learnerships to add business value,
but present the greatest challenges
to drive numbers.
• However, in order to meet inherent
skills requirements in this arena,
routes other than learnerships may
well be more attractive – learnerships
may not yield the greatest returns on
investment. Bursaries are an
obvious example.
Niche
• Driven by skills requirements as well as
transformation imperatives
• Numerical targets in line with equity requirements,
but at discretion of organisations
• Small numbers reflected to date, although this
may change
• These learnerships will contribute to
NSDS target realisation.
• They will support BANKSETA service
delivery to stakeholders.
• Once again, alternative routes may
be more attractive.
• The current approach could be
maintained – fund start-up, but leave
evolution to market forces.
From a numbers point of view, transformation learnerships are
a subset of the national need learnerships
National need
n=5000
Transformation
n=1250
Niche n=?
Strategic Principle # 1:
Focus for impact
Challenges
• Add value
• Drive numbers
• Minimise set-up costs and the
administrative burden
• Minimise operational costs
• Minimise unemployed staff at
end of learnerships
Levers
• Focus learnerships on areas
where demand for skilled staff is
highest as a consequence of
scale and labour turnover
• Accommodate learnership
recruits within existing
recruitment patterns as far as
possible, such that learnership
candidates meet real staffing
needs, if this does not violate
the sector’s undertaking.
• Focus national need
learnerships on a small number
of generic learnerships with
large numbers of learners
Large numbers can be absorbed more easily using this approach.
A key question is however whether the numbers committed to are to be
considered to be over and above normal recruitment intake.
Strategic Principle # 1:
Focus for impact
Category
Leverage
National need /
Transformation
Niche
Limited leverage
point for driving
NSDS targets
Strategic Principle # 2: Minimise negative business impact
Challenges
• The work load associated with
such numbers of learners is going
to be onerous.
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Recruitment and selection
Orientation
Formal training
Coaching and mentoring
Assessment
Learner management and
administration
• The costs associated with such
administration will be duplicated if
carried individually by banks.
• The funds available through the
BANKSETA should be leveraged
for maximum advantage
Levers
• Provide maximised support in
each of the areas of need,
centralised at a sector level.
• Minimise the role of in-house
training providers
• Develop and utilise generic
solutions as far as possible
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–
–
–
–
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Work processes
Training providers
Training interventions
LMS
QMS
Etc.
Centralised support will create efficiencies and economies of scale,
keeping unnecessary work out of the banks themselves. The support
could be provided to all learnerships, not only the large ones.
Principle #2 presents two implementation options
Option
Pros
Cons
#1 – “Make”
a support
infrastructure
• Costs exclude margin cheaper
• Time - longer
#2- “Buy”
a support
infrastructure
• Time - shorter
• Costs include margin –
more expensive
The cost factor is likely to be the overriding consideration.
Employment & Skills Development Agency
(ESDA)
ESDA:
• Centralised support function
• Create efficiencies and economies of scale
• keeping learnership-associated responsibilities
within the banks to a minimum.
• Leverage funds available from the BANKSETA
WHY
• To facilitate the rapid scaling up of
learnerships.
• To minimise negative impact and
• To maximise potential benefits
Strategic Principle # 3: Make the detail work, not the concept
Challenges
• Understand the resource
implications
• Translating the concept into
operational reality within
acceptable timeframes.
– Identify detail of proposed
sector entity in respect of
mandate, governance and
control, operational
infrastructure and funding
requirements, etc.
Levers
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•
•
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Early adoption in principle
PLAN!
Assess feasibility
Action only once understood –
‘failure to plan is to plan for
failure’.
• Ensuring that the risks associated
with the imitative are identified,
fully understood, and properly
mitigated
Outsourced resources should be used in order to achieve focus,
appropriate competency deployment, and quick turnaround.
Funding
Category
Funding arrangement
National need /
Transformation
• Funding priority – budget allocation over 3
years.
• Cost must be understood in detail
• Value of this initiative is traded-off with other
possible initiatives.
Niche
• Capped allocation of funding for start-up on
an annual basis.
• R300 k per learnership from strategic grants,
capped annually by council decision.
Funding
• The initial projection…..R267 000 000.00
• 50% …….
• BANKSETA:
– 80% of the sector strategic fund over a three
year period ( Approved)
– R6 000 000.00 from the 2002/3 sector
strategic fund ( approved)
• 50%….…
• The BANKSETA will seek a grant from the NSF
for the remaining cost – R138 000 000.00
( in process R 25000.00 per learner)
• Graduates subsequently employed by the banks
will incur a cost.
Summary
Strategic Principle
1.
Focus for impact
Recommendations
•Make an impact by focusing on the optimal
leverage point for intervention – ‘national need
learnerships’
•Drive numbers by focusing efforts on a
limited range of sector wide learnership
initiatives
•Simplify each learnership by using whole
qualifications, and using primarily distance
learning for delivery
2.
Minimise negative
business impact
•Create a dedicated sector delivery vehicle
3.
Make the detail work
• Appoint consultancy to produce detailed
business plan and feasibility analysis for
early adoption
Agreements thus far…
• The Accelerated Learnership Initiative will:
– Develop 5000 learners over a 3 year period
– Develop Matriculants and Graduates at a
75% to 25% ratio
– Focus on ‘whole’ qualifications and not Unit
Standard based qualifications
– Source qualifications in line with the sector
priority skills need
– Ensure the inclusion of entrepreneurial and
generic business skills in the qualifications to
allow for cross sector deployment of learners
on completion
Agreements thus far…
(continued)
• The BANKSETA will facilitate the process on
behalf of the banking sector by:
– Obtaining commitment for the project
targets from all stakeholders (DONE)
– Assisting the Institute of Bankers (IoB) to
be registered as an Employment and Skills
Development Agency (ESDA) (In process)
– Agreeing with the banks to provide for the
workplace component of the learnership.
(DONE)
– Accepting overall responsibility for project
delivery. (DONE)
• Allow for changes in banking operating
environment
General
• Way forward
• Time lines
• Process agreements