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Skills Development Legislation – Challenge or Opportunity?

Skills Development Legislation – Challenge or Opportunity?

By Florus Prinsloo

Assessment College www.assess.co.za

Cutting Edge Newsletter www.cutedge.co.za


# Introduction

In the April issue of Cutting Edge, Russel McDiarmid’s article ‘A Management Perspective on the Implementation of the NQF’ started out by stating that the ‘NQF provides both challenges and opportunities for business in South Africa’. In line with that sentiment I would like to add that in fact from a global competitiveness perspective, the ‘challenge’ for business in South Africa is to transform the Skills Development Legislation process into an ‘opportunity’.

From the perspective of many years’ experience in business at strategic planning as well as operational levels I can easily see numerous opportunities that will develop from implementing the new legislation.

Although many might not agree with my views, I hope that at least I can stimulate thought processes into a more positive approach to this whole issue. I refer especially to those at senior levels within companies, who have simply shrugged off the new skills development levy as an additional tax that can be paid and forgotten about.

Even worse, some managers simply want to recover the levy through a price increase of sorts. I mention this as I have actually heard many managers verbalise those exact feelings.

Opportunities abound in this new process for all of the stakeholders in business. In my article I look at the major groupings only, but I am sure there are many others who can benefit. So what are the opportunities for management, SMMEs, labour and employees?

# Strategic Opportunities

>> Determine strategic priorities

The first opportunity for management structures within large companies is that management is required to indicate the ‘strategic priorities of the organisation and what these will require in relation to skills development’. I refer to Section B2.1 on Page 16 of the Regulation Gazette No. 6729 dated 7 February 2000.

What is significant is that management need to spend some time together to think about where the company is going: What is core, what is non-core and what are all those strategic issues that are vital to the growth of companies but often not considered? Once the company path is determined, the next thought process needed is very simply: ‘What skills do we need to realise that path?’

If senior managers are honest with themselves, most have probably all participated in the first step but hardly ever extended the process into the second step. And yet without the right people with the right skills, how could a company go down any strategic path!

>> Incorporate legislative requirements

So why not use the workplace skills plan already designed as a tool for adding value to the strategic planning process. Successful organisations consider all legislation during strategic planning by using that good old MBA tool called the PESTLE Analysis. This new legislation is no exception.

When a management team reviews the skills development process during strategic planning, a second opportunity starts to develop quite naturally: To develop a broader view of all labour related legislation, as the skills development implementation process is not possible in isolation. I do not believe I really need to detail the laws I refer to here but I list acronyms only. The following acronym self-test will soon indicate if you are up to date or not. Included as a minimum requirement are the LR Act, BCE Act, EE Act, SD Act and the SDL Act.

Most companies will have their own in-house experts in all of these legal fields or have access to consultants that guide them. However, the South African manager will greatly benefit from understanding the basic concepts of all these labour-related laws, especially in day-to-day dealings with their staff. Again the skills development implementation process can be the catalyst to helping management with this education process.

You will note that opportunities for management teams facilitated through the skills development implementation process relate to the ability of individuals in senior management to learn more about their own companies.

>> Develop a workplace skills plan

The third opportunity for a management team is even more of a learning opportunity, as companies that develop what the legislation calls a ‘workplace skills plan’ give themselves an excellent structured document that details concisely the strengths and weaknesses of the human resources within their company.

In this regard I stress in particular the requirement for many organisations to align their employment equity ratios to relevant legislation. The skills development implementation process is integral to an effective employment equity implementation process. In simple terms, a company can use the skills development process to develop employment equity candidates in a way that will prepare them to be effective employees in the future, and not just ‘window dressing’.

Again my reaction to this opportunity is: ‘Why not use this vehicle?’ It is after all a pre-designed tool from the Department of Labour, the same body that will be monitoring the employment equity process. The synergy between the legislation is obvious.

>> Operational opportunities

So far I have dealt with strategic opportunities that the skills development implementation process offers. In addition, there are many operational opportunities, of which the most important is the development of proper standards for the measurement of the knowledge, skills and attitudes of employees.

>> Enhancing performance

Were you to offer any manager a choice between rewarding people simply for ‘attending’ work, or rewarding them on the basis of performance, most would opt for the latter choice.

The problem has always been and still is the need for a recognised standard to measure performance against. The skills development implementation process is founded on the NQF. This framework is in my opinion not only a world class instrument based on the best methodology in the world, but has as its basic objective the establishment of workplace standards that are up to date, user friendly and have direct relevance to actual work requirements.

In essence we have the opportunity through participation in the skills development implementation process to have standards that will form the future basis for a solid performance-based reward system. Part of the design of the system for standards generation is a very high level of quality assurance. The benefit will be that performance standards will thus be continually upgraded to ensure optimum levels of work standards.

# Desirable assessment practices

One of best definitions of the secret of effective management that I have come across is the one described by Arnold Mol in his book The Myths of Management that reads ‘The secret of effective management is to be hard on standards and soft on people’.

The skills development legislation provides management with standards that they can use to be ‘hard on’. They need not back down in terms of quality, speed or cost.

At the same time the highly interactive assessment/moderation process for identifying future skills development needs of individuals is a ‘softer’ process designed for people. Candidates are fully informed all the way and never ever ‘fail’. Learners are declared not yet competent, affording opportunity to try and try again. Those who do not ascribe to this ‘soft’ approach have never had a child who battled to study and get through exams!

# Other benefits

A bit of brainstorming with some positive colleagues will soon deliver other opportunities that the skills development implementation process can provide to management teams.

These could include getting closer to labour through education and training committees, recovering some money in the form of grants (a very basic need), a further reason for asking for discounts from your HR system provider, using your in-house training facilities as an external private provider to other companies to make training a profit centre, and so on.

The last option has a major impact on companies that are at last able to run training like a business and not just an overhead of the cost centre. Why not try the exercise? You will be surprised.

# Skills development facilitators

Before I address a few specific benefits that SMMEs could get from the skills development implementation process, just a note on the skills development facilitator required by the legislation.

I believe that management teams who appoint a senior member of the organisation, preferably one of their peers, as their skills development facilitator, will get the maximum benefit out of the process. Skills development is a strategic issue first and foremost. Do not just hand it over to the training department or the financial department as part of their function. Effective skills development will be done on the shop floor.

General managers, operations directors or production managers are best suited to drive this portfolio, because they drive the value chain in any business. The value chain is where we want the best skills, not in the peripheral service or staff overhead sections like human resources, finance, or IT.


Opportunities for SMMEs

Use this opportunity

I have included an "opportunity" section for SMMEs as they have agility and flexibility that larger companies do not have. All of the above factors that relate to larger companies also relate to SMMEs, with one major difference.

I would very definitely suggest that the owner of an SMME seriously consider taking on the role of the SDF himself or herself as he or she could probably knock together the workplace skills plan and subsequent reports in next to no time. It is becoming apparent that some of the SETAs are considering issuing pre-formatted electronic versions of the workplace skills plan schedules that can be down-loaded, filled out and sent back to the SETA on e-mail – making it an even less onerous task for SMME owners.

An SMME owner might initially need some help from a consultant (look for an independent one – cheaper) with the SDF role, but once up and running the ongoing monitoring and planning work is minimal.

>> Opportunities for SMME private providers

A tangential possible benefit for SMMEs could be a new growth path in terms of becoming private training providers. This might sound like a strange benefit for an SMME and one that is more suited to large companies with their own in-house training centres. However, I believe that many successful SMMEs have become successful because of the entrepreneurial skills that they have and that is an area where many could assist others in developing.

The simple process of setting up a business, marketing your products and the follow-up service experiences in real life are not be sneezed at. There are many South Africans who want to go it alone but do not know how. This is especially true if you can share this knowledge in one of the many African languages.

>> Opportunities for Trade Unions

On the opposite side of the table, when it comes to the skills development legislation implementation process, is labour, in most cases represented by an organised trade union. I would venture to say that all of these organisations should be very pro implementation. After all, being against the process would be going against one of the basic reasons for the existence of a labour union – the need to develop workers.

>> Consultative forums

For those companies with more than fifty employees I believe the most significant benefit for labour is the gazette requirement for the establishment of a training committee. Ever since the advent of the new labour legislation in 1995 there have been ongoing attempts to establish forums for discussions between management and labour that address real work issues. Forums for discussion such as the workplace forum and the equity committee have sadly not been developed fast enough.

This new gazette requirement could be the beginning of a significant co-operation phase between two traditional antagonists within the workplace, especially since this forum needs to consult with regard to the selection and work that the skills development facilitator carries out.

Imagine the situation wherein the SDF is a senior executive manager with some real decision-making powers. On a regular basis he or she consults with the Education and Training Committee and together with them make decisions that relate to strategic skills development. Such a forum automatically has buy-in from the top of the organisation as well as the shop floor. There is now no need to ‘sell’ the idea to senior management or to the staff.

I hate to introduce a negative issue at this stage, but it would be negligent not to sound a warning at this stage to members of an education and training committee. Objectivity must be the watchword.

To explain what I mean, take the example of a woman appointed by her peers to serve on an employment equity committee. During the numerous meetings that she was involved in it became very obvious that the only issue she was interested in discussing at the various meetings was her own personal study goals. She continually lobbied the committee for ongoing financial support for her own studies. She eventually resigned from the committee when, for policy reasons, her request for an in-service bursary was denied. Objectivity was not her watchword. She was only interested in self-development.

Education and training committee members need to participate in a positive way to develop the skills of all relevant employees, not just their own. It seems that in this South Africa, the ‘me first’ culture is extremely dominant. Chairpersons of an ETC need to beware of this potential problem.

>> Line management

Line management, that layer of people between the shop floor and senior management, are under pressure from both sides to implement skills development initiatives. In my experience it is at the line management level where initiatives succeed or die. I do not believe I need to reiterate in this day and age that real training, on-the-job training is not a function of the training department. Line management makes it happen or makes it fail.

So for labour the choice is easy – implement as fast as you can. Line management, many of whom were and probably still are members of labour unions – especially supervisory or team leader management - can be great assets in the process. They obviously need to be well represented on the education and training committees.

>> Opportunities for Individual Employees

Without a doubt the group that stands to benefit the most from the implementation of the skills development implementation are the employees.

I am not going to expand on the need for a highly skilled workforce to be able to compete within the globalisation culture we hear so much about. I am going to assume that those reading these words not only understand that need but are prepared to help as much as possible to realise it.

# Staff motivation

What I would rather spend time on is the need for motivation among employees. I have spent a great deal of time among all types of workers who continually moan and groan about their position in life. Those individuals that are happy at work are few and far between, and to be happy at work is the most basic of all motivational factors a person can find.

Money, teamwork, goals, a good spirit, leadership, pride, prospects, etc. are all symptoms, not causes of, motivation. Motivation is when a person carries out a task with dedication because he or she enjoys doing it. In other words, motivation stems from intrinsic factors. Movement, and not motivation, stems from extrinsic factors.

How does all of that relate to skills development legislation? When employees are involved in some development process or a learning experience of any sort, they receive a very clear message from a company. That message is: ‘we appreciate you. We want you to do better. So we are arranging for you to learn to do better’. No skills development sends out a very negative message: No happiness, no motivation.

Many people have wondered why a company like GEC worldwide continues to be prosperous. I read somewhere that GEC has been a Fortune 500 company for over one hundred years. I wonder if this can be due to the fact that they stress education and training so much, that they even have their own university (as do numerous other global companies such as Motorola and more recently Ford).

# Employee Development

The skills development legislation has embedded in it a very clear spirit of helping each and every adult South African on a pathway towards greater knowledge, skills and thereby a positive attitude in life. Sometimes I believe it almost immoral for companies not to offer such an opportunity to their employees.

Take for instance the very simple, very clever ‘recognition of prior learning’ (RPL) principle that considers what an individual has learnt in the workplace over the years which is assessed through an internal or external assessment process.

Once the assessment is complete, an individual is pegged at a certain level on the NQF and it becomes very easy to work out a sensible career path. This allows for a total removal of barriers to entry for education and training and gives every individual the opportunity to move through developmental stages at his or her own pace.

Many people will applaud the removal of barriers. I can still remember the frustration I had for many years in trying to get onto degree programmes in this country, being continually refused entry simply because I had no matric. Ultimately I went offshore and studied long distance for an MBA that I treasure more than any local degree, simply because I had to struggle so hard for it. I really do not believe we need to put adults in South Africa through the same agony.

# Synergy between education and training

A final word on benefits to employees that many of you might not have picked up is the one of synergy between education and training. The implementation of the skills development legislation will affect all those that are involved with the NQF. The exact same system of outcomes-based education and training is used for children in their education processes.

Both parents and children therefore are very ingeniously put on the same track as they learn, albeit in different settings. So father and son can both be at NQF Level 4, the former through recognition of prior learning and training at work, and the latter through his doing his Further Education and Training Certificate at Grade 12 (the old matric).

Who in his right mind would want to keep that sense of achievement from Dad?

# Conclusion

So the cliché ‘to be or not to be involved with the skills development implementation process’ is the question top management teams, SMME owners, labour unions representatives and employees all have to consider.

To date the drivers of the economy, my definition of government, are going down this road cautiously with a participative, friendly approach. They are asking business to support the whole new labour initiative. How long this approach will be maintained remains to be seen. I wonder how business would react to a 10% levy in 2002 as opposed to the 0,5% for this year. Frightening?

The drivers in business are ultimately the management team. That is the nature of business. If you as a team or individual have already decided to dump this whole skills thing as a nuisance, why not use this article purely to facilitate the thought processes at the next company planning meeting you have, even if you are the only person at the meeting?

If you can honestly say that that none of the above benefits applies to you or your employees even in the slightest, then I apologise for wasting your time. However, I hope you are rethinking your decision.

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Gary Watkins

Gary Watkins

Managing Director


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