“ The final component is to address urgently the black holes in human development that afflict many areas of the Middle East. This is not only an Arab responsibility but also an international responsibility, because providing grassroots opportunity and a better quality of life for the people of this region is guaranteed to ameliorate our shared problems of instability and conflict. We have a critical need for long-term projects and initiatives to eliminate poverty, improve education and health, build infrastructure, and create economic opportunities. Sustainable development is the most sustainable answer to terrorism.
Our region is home to more than 200 million young people. We have the opportunity to inspire them with hope and to direct their energies toward improving their lives and the lives of those around them.”
Mohammed bin Rashid Al Maktoum is Vice President and Prime Minister of the United Arab Emirates and the Ruler of Dubai discussing one the three components required to changes attitudes regarding the attraction of ISIS.
The Australian Financial Review Tuesday 30 September 2014
“All this is sorely testing governments, beset by new demands for intervention, regulation and support. If they get their response right, they will be able to channel technological change in ways that broadly benefit society. If they get it wrong, they could be under attack from both angry underemployed workers and resentful rich taxpayers. That way lies a bitter and more confrontational politics.”
The Economist October 4th 2014 p 4 on the impact of the digital revolution and technology on workers
Window of opportunity for Australian Vocational Educational Institutions to address the skilling needs of the global economy
Delivering Online Skilling to Hundreds of Millions of Learners
Background
A perfect storm of events is occurring globally creating a critical need to provide both new job opportunities and the associated job skilling for millions of workers annually.
Vocational training is an area in which our domestically focussed vocational education institutions excel and more recently has seen some success delivery this capability internationally.
As a nation we have the potential to meet this significant and growing requirement providing a new approach to aggregating and delivery training can be identified and introduced.
In short this for Australia this is a rare window of opportunity that represents:
- a significant new export opportunity – potentially billions of dollars,
- a new and important economic diplomacy opportunity for our Posts, and
- a preventative defence and security issue opportunity
A Perfect Storm - Looming Global Demographic Challenges, Mobility and the Unemployed
All societies aspire to a level of prosperity that can provide a better quality of life for their citizens.
A major key to the attainment of a better life for those societies is the creation of industries capable of providing meaningful, safe and sustained employment.
Traditionally this was so for the rapidly growing young and unemployed male demographic in many developing economies but it is also known that enabling opportunities for women to enter employment or start businesses can quickly transform the prosperity and security of a society.
The size of populations requiring employment though is unprecedented. As Mohammed bin Rashid Al Maktoum Vice President and Prime Minister of UAE indicates young people - men mostly - that are not equipped to find employment may become disengaged from mainstream society which can then present its own set of social or security issues.
Another major change occurring is the significant ‘regional to urban population migrations’ happening within the big communities of the world – more than 600 million people on the move across India, Africa and China alone over the next 10 years (120,000 a day globally). These migrations are placing great stresses on urban services and facilities and dealing with large, new groups of unemployed people in already crowded cities is a major challenge for government authorities and fellow urban citizens. As a result in cities such as Manila, Mumbai and Dhaka there has been an explosion in slums. Across Asia there more than 500 million slum dwellers and this is set to spiral to 840 million by 2020 .
Added to this is mastering the challenges associated with the increasingly critical nature of the energy-water- food security nexus and its potential impact on the critical human needs for these societies. A wide range of sector skills are required immediately to increase efficiencies and productivity in both domestic food production, storage, transportation and management of wastage plus regulation for the better use of energy (and harnessing energy revenue to other productive sectors), and water sustainability and management.
Continuously Evolving, New Global Industrial Environments
It is now understood that skilling and new technologies don’t create more jobs in ‘old style’ industries.
The US economy's recovery from the 2008 GFC is often called the jobless recovery where low skilled jobs in manufacturing (mostly undertaken by men) for example never returned as the economies other indicators moved forward.
And McKinsey claims that 140 million jobs in the US in the next decade are at risk from ‘creative destruction’ as a result of new digital service delivery capabilities provided by companies like Uber (versus the taxi industry) or Airbnb (versus the hotel sector) or 3D printing(versus the current medical devices and or auto manufacturing sectors?).
Despite a decade of significant investment in the vocational and higher education sector in Gulf countries, those governments are now critically aware of the need to better align their graduates (both domestic and international) to industry needs. Several drivers of this include a) foregone return on education investment – where graduates fail to find valuable work in sectors they are skilled in; b) skills mismatch – where graduates are trained in sectors not currently or projected to provide ongoing employment and c) the concomitant loss of productivity to the economy based on a) and b).
That is it’s not just vocational training cannot be just for training's sake. Training must leads to jobs in industries that are capable of growing and surviving in the global economy.
Developing economies are also known to experience the ‘middle income gap’ where the low cost advantage they offered at the outset gets overtaken by the wage and working conditions demands of workers realising what they are delivering to their industries has more value than what they are receiving. Protests regarding child labour in South Asia and more recently OH&S issues in China are good examples of this.
The institute for Advanced Study in Princeton, New Jersey also refers to a new ‘effect’ caused by technology as ‘premature deindustrialisation’. That is technology has ‘created a growing reservoir of less skilled labour expanding the range of tasks that can be automated. Most workers are therefore being forced into competition both against each other and against machines.” (The Economist Oct 4th 2014 p 10 ). The Trump Presidential campaign focus and even the Australian auto sector reflected this. For example Ford Australia could not maintain a value proposition in auto assembly but could with its R&D operations facilities in Melbourne which have designed two new global Ford cars – one manufactured in Thailand and one in China.
Therefore when referring to any new global skilling demand educational institutions must take into account in any target market the future of industry for that market; that is, what is wanted plus how it will be serviced and then how it will be sustained as prosperity – or technology - takes away the lowest cost of production advantage .The ‘skilling paradox’ then is that quality vocational training may mean less jobs if new service industries or capabilities are not also created through a concerted government-led effort to innovate and preparing the working population for participation in the global economy.
But this is a very particular dilemma for developing countries with a very large and growing youth demographic and especially in regions like the countries of Africa that will have a population of four billion by 2100 with an average age less than 20 years old.
Which is why this scale of skilling need is a significant opportunity for the first international VET authority to demonstrate to these economies that they understand how to mitigate against the ‘creative destruction’ and ‘middle income’ traps that will otherwise confront their industries and in the long term impede their economic growth.
New Levels of Global Communications and Multimedia Access via Mobility
A big evolution has occurred in communications access over the last decade. Social media, mobile and internet access has now penetrated every economy in the world.
It is expected that 4.55 billion people worldwide will use a mobile phone in 2014. Mobile adoption is slowing, but new users in the developing regions of Asia-Pacific and the Middle East and Africa will drive further increases. Between 2013 and 2017, mobile phone penetration will rise from 61.1% to 69.4% of the global population, according to a new eMarketer report, “Worldwide Mobile Phone Users: H1 2014 Forecast and Comparative Estimates.”
The global smartphone audience surpassed the 1 billion mark in 2012 and will total 1.75 billion in 2014. eMarketer expects smartphone adoption to continue on a fast-paced trajectory through 2017. Nearly two-fifths of all mobile phone users—close to one-quarter of the worldwide population—will use a smartphone at least monthly in 2014. By the end of the forecast period, smartphone penetration among mobile phone users globally will near 50%.
The smart phone uptake implication is that online or blended learning (a combination of online and face to face) and free online open source courses can now reach this previously inaccessible market; that is even young unemployed people – the target demographic - have mobile phones and can access free or fee paying training materials (using mobile phone payment technology)!
But to meet prosperity aspirations in some instances the young and or unemployed are aspiring to migrate to other markets instead – legally or illegally – including to Australia.
As such meaningful, safe, reliable and fairly paid work is not only an issue that concerns individual countries, but is an issue that affects us all.
In essence then, the size of the new mobile and internet accessible demographic in emerging economies wanting to be employed, their mobility in seeking employment, and the immediacy of the pressure their circumstances, has placed on finding new work in urban environments or delivering the needs of human critical needs in food production or water sustainability, is unprecedented.
Impact of Changes
As a consequence of these changes in demography, access and aspirations there has been no other point in time where more societies and their economic planners have the need to be more efficient in their current industries but simultaneously create more jobs through new industries, with a concomitant need for more skilling, for more vocations, made more accessible, more affordable, and required to be delivered with a greater sense of urgency and speed, to the sectors that need it, than now.
What is the opportunity?
Along with Germany, Australia is considered world’s best practice in terms of curriculum development, student assessment and certification, and the course delivery of Vocational Education and Training (VET) in particular. Many countries inquire about, or study, our capability and often ask Austrade or TAFE Directors Australia for support to deliver something similar in their countries.
An opportunity that now exists is for the immediate delivery of high quality vocational skills training to meet the unprecedented demographic driven demand for 10 to 50 million students a year - and in more international markets than Australia normally focuses on.
An aspirational target for Australia could be 100 million students or learners per annum by 2022 and this requires a quantum change in the way Australian educational institutions are currently approaching this.
Not all training is equally sort after. There is a greater need for some types of courses over others – retail, IT, nursing, hospitality, building and construction lead most. A recent Indian skills study reflected the following needs:
Many markets are looking for this vocational skilling capability but no global provider of VET has yet addressed this opportunity in a non-traditional way.
Put simply, to meet such a huge requirement Australian education institutions can no longer deliver old things in old ways - or even new things in old ways. What is required is a ‘disruptive’ solution – think ITunes and MP3 to vinyl album record sales or Google to Yellow Pages or Amazon to retail.
But while the opportunity to deliver skills training to these new markets is unheralded in terms of scale what is obvious is that aside from some limited international forays no VET providers have yet worked out how to:
a) prepare for the future and sustainability of industries and their skilling requirements,
b) then manage the volume of course and content required,
c) by retaining course quality,
d) whilst managing global delivery on scale and e)and do so profitability.
Therefore a ‘prime mover market advantage’ is open to any international VET authority with its content provider community that can globally deliver to markets the skilling capability to meet this level of demand.
How has this been approached to date?
A point of differentiation between VET and higher education is that the very vocational nature of a skilling course requires more instructor to student face to face ‘hands on’ instruction in the classroom. This is not so much a matter of the ‘campus experience’ promoted by universities but ensuring that the student clearly understands and can demonstrate how to use the equipment, tools or machinery associated with the course – think hospitality, mechanics, driver training, hairdressing.
Typically vocational courses are generally short, single modules – rarely longer than six weeks, can be completed part time, are very low cost ( @ $150-$2000 range) but intended to address the needs of a significantly larger student market than higher education.
Currently to attract international student registrations the VET sector has used the following models:
- Model 1 - Students study in Australia
Recruit overseas students to study at Australian based campuses with the following implications:
- Very expensive,
- Subject to visa integrity issues,
- Finite capacity at campuses,
- Private providers more successful.
- Model 2- Australia VET Provider sets up offshore
Australian institutes establish offshore in wholly owned market campuses with the following implications:
- High risk, high cost model that can only be targeted at the most lucrative markets,
- Scale is required meet significant bidding requirements such as for one hundred new TAFE’s in Saudi Arabia.
- Model 3 – VET Campus Joint Venture offshore
Establish hybrid-partnering arrangements with other offshore providers for in market delivery of Australian courses with the following implication:
- Major effort required to source and manage partnering providers,
- But presents a pathway opportunity to deliver a stream of students to Australian based higher education providers through 2+2 articulation arrangements (2 Year Diplomas articulating to Year 2 of a Bachelor Degree).
- Model 4 – Appoint Regional Training Organisations (RTO)
Australian Government or private industry approval to accredit in market Regional Training Providers to deliver Australian based – but not accredited courses - with the following implication:
- Provides an ability to move into greater volume but effort required to manage RTO’s and ensure accurate delivery of course qualification as approved Department of Industry approval to license Australian Regional Training Providers to deliver Australian based courses with the following implications:
- Based on the Australia’s brand as a premier vocational education delivery provider;
- Avoids the some of the less relevant aspects of Australian qualifications to local arrangements;
- Reduces the costs of face to face delivery
- Provides an ability to move into greater volume but effort required to manage RTO’s and their local partners and ensure accurate delivery of course qualification as approved
Potential for a Global ‘Disruptive Technology’ VET Delivery Model
So the characteristics of VET delivery to attain scale are: global need, unprecedented volumes, training for current and future industries, very low per student per course price, new methods of mobile and internet access, courses created and verified from Australia but delivered in market.
The Australian VET model for course creation, accreditation, certification and delivery is considered by many countries to be world’s best practice but is not designed to scale to the needs of millions of students.
There is a potential way to do this and it’s via a scalable digital delivery and distribution and accreditation model comprising:
- Core Intellectual Property(IP). The core IP for Australian VET is the State wide systems and processes for:
- Identifying market needs for training,
- Management of Course certification and award of associated qualifications, and
- Awarding third party training provider accreditation.
This is the ‘secret source’ for Australian VET and must be protected at all costs.
- Course design. Australian providers are very capable and highly regarded in the designing of curriculum, course content and testing materials for both online delivery and classroom delivery.
- Instruction. Australian vocational instructors are amongst the best in the world. Training the trainers for global markets skilling training is an opportunity in itself.
- Delivery. Australian private and TAFE providers already develop online learning material for Australian students – but it is on a TAFE by TAFE, faculty by faculty basis, and is limited to what that particular TAFE or faculty specialises in, or it’s capable of producing for its existing level of demands.ie they are not geared for scale.
How could this be managed?
Option 1 – Fully owned and operated system managed by Australian VET Sector
- Management and Delivery options:
- Centralised ownership, management and control of the core IP by a VET Council or authority of some description established and coordinated by Federal and participating State Governments.
- Handoff of ownership of Delivery of Australia course to in market RTO’s.
- A standards based web space and capability to aggregate, store and distribute digital materials from Australian providers on a permission basis to approved offshore training providers. Aggregation should be done in such a way as to be able to find material and enable it to be delivered or distributed in accordance with any rights or permissions granted. This mechanism should be able to manage the equivalent of tens of thousands of courses and perhaps millions of learning objects used in course material.
- The creation of an in market Regional Training Provider(RTO) identification, qualifications accreditation and competency framework and ongoing management system and process to enable scalable in-market delivery, adoption of courses and course material for local application, and surety in the protection of Australia core IP.
International standards already exist for learning content repositories and these are described at Annex A.
Option 1: Scalable Australian Owned and Operated VET Core IP Authority and Content Repository Approach
VET-RTO Business Model
In market RTO’s are provided courses or course frameworks that will offer Australian qualifications.
RTO’s can be licensed by territory, or by sector, and be issued licenses that could include a Right to Use and or a Right to Modify condition in their agreement. This is not dissimilar to many global software company agreements for localised delivery, training and technical support. IP theft is the (significant) risk in this equation. RTO’s course delivery performance would be externally audited annually.
All RTO rights would be subject to a license fee. All courses delivered would be subject to a royalty fee. Fees and payments would be based on the dollar value and volume of courses to be provided.
The critical component of this model and what makes it attractive to prospective RTO’s is the ability to deliver highly prized Australian accredited courses and course material.
In a Right to Modify agreement extra revenue could be earned by the RTO by adapting course materials for local requirements (whilst protecting originating content providers from IP theft).
Australia providers would be given an ability on the Portal to offer their content – in whatever form – curriculum, tests, course materials, courseware – and to make that searchable and sellable to approved RTO’s. There may also be an opportunity for Australian providers to adapt courses for local regional requirements.
Should this ever scale to thousands of course or tens of thousands of courses to tens of millions of students the new full and part time direct and indirect jobs available for Australia course designers and contractors could be between 10,000 and 30,000.
Benefits of this Scalable VET Core IP Authority and Content Repository Approach
For the Australian Government Option 1 offers a full service business model and can be seen as a services export opportunity, an economic diplomacy opportunity, and industry skills issue, or a Defence policy issue - or any combination of all these aspects.
An another opportunity for Australian Economic Diplomacy would be to support through advice , partnering and consulting with market policy makers and economic planners to identify and mitigate against the creative disruption and middle income gaps effects in making either existing industries more efficient, or new industries more sustainable, over the long term.
This would enable a long term focussed delivery of critical vocational training for both the short and long term.
This paper has already outlined the opportunity to gain prime mover advantage to meet the critical global needs of an increasingly demanding young demographic through:
- Affordable localised skilling
- Reaching the students and RTO’s in a way that enables their participation – not just what suits Australian providers needs
- Provide ‘worthwhile’ training and qualifications in key industry-led industries where employment is near guaranteed
- Create a ‘disruptive’ RTO accreditation model that enables their effective delivery of training( and still maintains Australian standards) at scale
- Meeting the needs of today’s industries and well as understanding and delivering job skilling for tomorrows industries and opportunities
Option 2 – Third Party Delivery of Course Content with Australian Brand
This option would license Australian ‘branded’ courses but relies on the delivery to a third party like Apple or Google or Amazon with the following advantages:
- An online IT provider takes a long-term approach to the global demand and can invest considerable capital in developing an IT platform that will deliver tailored training online to offshore government agencies or private companies at a fixed price and free online learning to individual students as with the current MOOC method.
- The business model is that Australian providers can license tailored education solutions to the online IT provider at a base cost plus a per student license fee;
- The IT provider can charge a commercial fee to train students enrolled by either governments or companies;
- Charge students who access the training for free an assessment charge to get a certificate of completion.
The key to this model is that the training is skills based – it’s not a formal Australian qualification (i.e. without the high costs of delivery associated with Australian standard qualifications and it can be tailored to meet local conditions) and delivered on a massive scale due to the internet resources and existing global reach.
The second key is that while these aren’t formal accredited Australian qualifications, they are branded as Australian using the Australia Future Unlimited brand. Using the Future Unlimited brand and licensing of institutions may discourage IP left and leverage off the global standing of Australia’s formal qualifications.
There is little economy diplomacy benefit to Australia. This is a simple business content licensing transaction.
Option 2 – Third Party Delivery of Course Content with Australian Brand
Conclusions - An Opportunity for Whole of Government and Industry
If Australian Governments can help establish Option 1 Scalable Australian Owned and Operated VET Core IP Authority and Content Repository Approach then not only are we creating an enhanced export revenue model – that in itself can scale over the next 10, 20, 30 years – Australian Government could provide an important contribution to those societies that are feeling the pressure of both economic development, security and quality of life for all its citizens.
This has budget benefits to Australian State and Federal Governments, it will create jobs, it maintains our role in producing goods that have intellectual capital and we are producing our very own new generation knowledge jobs of the future and export industry. In all likelihood, those with Australian accredited training and skilling may also articulate to bachelor or graduate-level courses in Australian universities, providing future income generation.
Option – delivering Australian branded course material through a third party can deliver new licensing revenue to educational institutions but will not create an environment where Australian know how and IP is being retained, managed and developed as a core industry where we are already regarded as having excelled.
Engaging Australian governments to consider the Australian owned and made solution using our secret sauce core IP of course qualifications is the preferred course.
End
Annex A : Technical Understanding of a Web Based ‘Scalable VET Content Repository’
Technical Understanding of a Web Based ‘Scalable VET Content Repository’
A content repository is a store of digital content with an associated set of data management, search and access methods allowing application-independent access to the content, rather like a digital library, but with the ability to store and modify content in addition to searching and retrieving.
Advantages provided by repositories include:
- Common rules for access allow many applications to work with the same content without interrupting the data.
- They give out signals when changes happen, letting other applications using the repository know that something has been modified, which enables collaborative data management.
- Developers can deal with data using programs that are more compatible with the desktop programming environment.
- For data access and usage model the content repository has scriptable access and publishing permissions and rights for all users based on the contractual terms relating to the course provider, RTO or student or developer.
‘Scalable VET Content Repository’ Features
A content repository may provide the following functionality:
- Add/edit/delete content
- Hierarchy and sort order management
- Query / search
- Version control of content
- Access control
- Import / export
- Locking
- Life-cycle management
- Retention and holding / records management
This is not necessarily a complete list.
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