Thursday, May 19, 2016

The Changing World of Work and How To Think About Skills Training

The conversation started with a question: What would you do if you have to re-imagine Skills Training in India? It was prompted by, no doubt, my posts in the past regarding the trajectory of skills training sector in India, which, I argued, took the eye off the ball - the demands of real workplaces - because the Government was throwing so much money into it. The correspondent, a retired Senior Executive with portfolio interests in skills training businesses, had a clear idea of both sides - he knew the changing nature of work and he knew the demand for skills education and its challenges - and he and I found ourselves in perfect agreement that government-funded skills training almost always changes priorities, from the student-centric priorities to one of pleasing bureaucrats and winning grants. This is a persistent problem in all countries - the education providers in the UK are no exception - but the absence of other safeguards, consumer rights of students, health and safety standards, standards of contractual arrangements and trust and ethical standards in general, poses particular challenges for skills education in India. 

However, this conversation is about particular challenges for India and not universal ones. On the same token, my broader point that employers and trade unions are much better placed than education providers, who often do not have access to skilled 'masters' and only have a theoretical understanding of the changing workplaces, may also be set aside. What is more relevant perhaps is that we are entering a phase of globalisation when the earlier dispersion of jobs - the big outsourcing wave that India has benefited so spectacularly from - has stopped and being reversed. This is perhaps quite obvious in India already, as the job growth in the country over the last several years came from sectors driven by domestic demand - retail, beauty and wellness, healthcare, banking and insurance, automotive, education, real estate and telecom - rather than export demand. However, at the same time, growth of the domestic demand itself was closely linked to the urban prosperity and growth of the cities, a large part of which can be attributed to the large and maturing industries such as IT and IT Services, which, with earnings in stronger currencies, had a disproportionate effect on middle class consumption compared to the number of jobs they created. 

The conversation about skills training, therefore, should start with an appreciation of these broader economic factors. And, as evident, there is global aspect of all this, as well as domestic implications. The Indian Skills Development agenda so far has ignored the globalisation aspect, as if it did not happen, primarily because it focused on jobs created by domestic demand. However, this needs to be readjusted in view of the changing needs of the export-facing sectors (IT and IT Services, but also modern manufacturing, with the current government has made the linchpin of its development plan) as well as to accommodate the global transformation of the sectors such as retail. For example, India has become the world's fastest growing e-commerce market, creating a whole new range of skills demand, which the national skills development policies, despite identifying retail as a key sector, mostly overlooked.

The basic premise of Indian Skills Development policies, which has shaped the focus of skills training businesses in India, is the transformation of Indian workforce from unorganised to organised sector, and consequently, focused on the transition of rural, casual workmen into urban workers in a factory setting. The underlying assumption here is that the Indian Economy will go through a transition just like the Nineteenth century industrial economies (an assumption that frames other policies of the Indian state, including those towards environment, education and health). This, however, leads to the problem of ignoring the role of the skills training in a rapidly globalising economy facing the full force of automation and technological transformation, both in export-facing sectors and in domestic demand. 

To conceptualise this, my proposal has always been to stop viewing skills training as a supply side phenomena - a pipeline to transform rural folk to urban workers - and start imagining it as a demand creation tool - a skilled workforce facilitating expansion of economic activities, creating demand and expanding jobs and growth. This would need a redefinition of priorities in policy-making, but if that is driven by political considerations of rural vote bank, we already know the solution to India's bulging demographics does not lie in unorganised-to-organised sector transition, important as it may be for the functioning of the welfare state, but in the expansion of the urban economy and jobs. This is what informs the government policy towards entrepreneurship development and campaigns such as 'Make in India' and the skills policy should be seen in line with these broad economic measures.

To return to the question we began with - how should one build a new skills training business in India - one should look beyond the dictates of the government policy and be guided by economic fundamentals. There is always an incentive for private investment backed education businesses to chase the existing pots of money - and follow the government mandates however misdirected they may be - rather than crafting a strategy around economic fundamentals of a changing economy. However, this is why private education businesses, more often than not, fail to create long term value for its investors, as a business aligned with government priorities may create value for its primary customers, government itself, but not for learners, whose fates are more tied to economic fundamentals.

Therefore, we are talking about creating a skills training business that is aligned with long term trends of the Indian economy, which will be equipped to create long term value for its investors. I shall propose five principles in designing the business model for this.

First, I shall design it as a platform that can engage employers flexibly, rather than a close-ended education provider. So, instead of a 'college', one is building the equivalent of an external 'HR Business Partner', a service provider who aligns with strategic needs of a large employer and designs a range of solutions, encompassing immediate as well as long term needs, for identification, recruitment, development and retention of talent.

Second, this platform would, at its heart, have a framework that takes a broader perspective of 'skill'. In today's workplaces, it is not enough to know 'how to', because 'how to' is constantly changing and always facing disruption from technological change, but also 'why' and 'what'. So, to use a metaphor, every mason needs to be able to visualise the cathedral they are building, or at least the corner of the spire that they are building themselves. This may be common sense, but this is hardly promoted when one seeks to divide between Education and Skills Training, confining the latter to the limited scope of 'How To' knowledge.

Third, this platform would be founded on workplace realities of our time: Collaborative Work, an appreciation of available and emerging technologies, global outlook and appreciation of competitive environment, and the changing nature of workplace relationships and contracts. Because skills training is often run with outdated assumptions about working relationships and environments, the learners miss out an appreciation of what work would be like in real life. Many Indian skills training providers complain that their learners do not find jobs because they are not ready to move, or that they have unreal expectations about their contracts etc. One can blame the social realities of India, and in this, there is some justification; but that the skills training completely usually miss the subject of what is to be expected at the end does not reflect well on the sector.

Fourth, this platform should recognise an important reality of the Indian workplaces - that ability to speak fluently in multiple languages is one of the, perhaps the most, valuable skill in the Indian workplace. For most cases, it is English which makes a difference; but in other cases, for jobs focused on domestic consumption, speaking in Hindi or one of Southern tongues (or in all four major Southern languages) create an immense advantage. Depending on the job/ sector, language training, alongside the attendant behaviours and professional abilities, should be an essential part of the proposition.

Fifth, one of the reason college students do not transition well into jobs because they continue to think of themselves as 'students' longer than they should: This is a persistent complaint one hears from large employers of graduates in India. This is indeed a global problem: That the environment education providers create, and the expectations they place on their learners, are often defined in terms of mastery of given knowledge, but not sufficiently focused on development of their professional identities (other than as academics). If this is an annoying problem with formal education, in skills training, this is a deal-breaker. The objective of skills training is to develop the 'Working Identity' - my favourite term borrowed from INSEAD's Herminia Ibarra - and the whole environment should be geared towards creation of this identity for the learners, through performance of real life work, through interactions with practitioner mentors and through partnership in appropriate communities.

So, what would a skills training business look like if constructed around these principles? It would look like a Service, rather than a chain of training centres, for sure. It would work in partnership with owners of training facilities, which is a well-established model, but this partnership would operate with certain parameters, rather than a current, free-for-all model that has turned the model into a MLM business. The core competencies of this business would be strategic engagement with the employers and ability to structure experiences leading to the mastery of high demand and emergent skills. The key assets in this business model would indeed include technological capability to own the learner experience over the full life-cycle, as well as complete control over the value-creating levers such as the mentors and the activities that the learner performs. The objective of the business would be to develop the learners' 'working identities', which is an aggregate of job related abilities, career mindset, softer skills, technological literacy and professional language skills. This model would fit perfectly with the current conversation in India to create clear educational pathways from vocational to academic credentials, and while I do not subscribe to the oft-stated view that one should be able to do a Ph D in Plumbing (I have heard this many times as an illustration of the portability of vocational qualifications into the academic world, but this reflects a complete ignorance of what either Ph D, or Plumbing, is about), I believe that recognising Professional Skills within an academic framework is eminently possible and many Indian universities are very keen to create such pathways and many employers looking for skills are often constrained by contract terms to hire degree holders.


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