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This section of the report highlights the SPI and sector council delivery results. The delivery results have been organized according to the following categories:
3.1 Satisfaction with the SPI Agreement Approval Process As noted in the formative evaluation, while some sector council representatives expressed frustration with the overall clarity of the policy and its administration, opinions about SPI management and staff are very positive. The SPI representatives are viewed as very efficient, professional and helpful. Generally it was indicated that HRDC staff had made a valuable contribution to their council's development. There were, however, a number of areas of concern regarding the SPI process and sector council needs that could be addressed by SPI, especially a lack of clear guidelines. At the time of the formative evaluation, SPI's senior management had indicated that these problems stemmed from the fact that this Initiative was a learning process for them. The SPI process has evolved over time and was not based on a static program model. There is a desire to remain as flexible as possible in administering the SPI; the fewer hard and fast rules there are, the more readily the SPI can remain flexible to meet the variety of situations that may arise. In addition, subsequent changes in the reporting structure within HRDC integrated all sectoral components: sector studies, sectoral data development, sector councils, occupational standards, skills upgrading, sectoral youth internship and national sectoral adjustment service. There is no updated information, however, on how these changes have affected new sector councils. The length of the developmental process, particularly the HR studies, was a problem for some of the sector councils. While the developmental stage was sometimes described as drawn out, there was also a recognition that the process helped establish the partnerships necessary to effectively implement the operational phase. During the sector study, partnerships are forged and working relationships become established. The transition period between the HR study and the developmental agreement is a crucial time to formalize partnerships, prepare potential strategies, etc., before entering the operational phase. 3.2 Adequacy of the Sectoral Agreements The sectoral agreements provide relatively precise statements of expected delivery results, but as mentioned previously, there is a lack of statements pertaining to the SPI objectives. For example, the SPI has objectives related to improving the employability of workers, but specific statements of employability objectives are absent from the sectoral agreements. There were also virtually no provisions for evaluation of the councils' activities in the agreements. This is in marked contrast to the YIP agreements which contain very specific statements about the obligation for evaluation and also provide funding for the sector councils to conduct evaluation studies. While there may be mixed views regarding the sector councils undertaking their own evaluations, the provision of funding for evaluation activities, even if it is just to pay for resources necessary to participate in an evaluation, may be a vital motivator for evaluations by third party delivery mechanisms. 3.3 Design and Structure of the Sectoral Councils The early sector councils, such as CARS, CSTEC and SSC, arose out of a search for a better approach to occupational projects using a sector studies approach (Fletcher, 1996). Observing the success of the IAS project funding of CSTEC and the establishment of downside adjustment services, it was decided that this approach could be used for sector studies. The sector study process resulted in a conference on the issues and the establishment of the SSC. A similar process led to the establishment of CARS. The emphasis of the sector studies now became less of an occupational projection exercise (this was still done) and more of a problem-solving process (Fletcher, p. 10). Essentially the process became more important than the product. This belief in the importance of the process is still a crucial feature of the SPI approach. Other lessons that could be learned from the early experiences were the early and clear classification of the compelling issues that draw management and labour together to resolve HR issues. The participation of large corporations which account for large segments of the labour market is essential. These major players are important to establish the credibility of the initiative and also to provide financial support and other resources essential to early development of the sector councils. Similar to the IAS process for downside adjustment, avoidance of collective bargaining issues was a key feature of the success of these early initiatives. Isolating the HR issues from collective bargaining issues helped reduce tensions and allowed labour and management to learn how to interact in a non-adversarial setting. Finally, strong leadership within the labour-management board of directors and the council executive was another feature that the early sector councils had in common. One feature of the early successes that was overlooked in the initial planning, was the need for true partnerships based on HR issues that compel labour and management to work towards common solutions. The original operational goal for SPI was to implement 55 sector councils within the first five years of the initiative. This was not a realistic goal if true partnerships were to be forged. As Gunderson and Sharpe (CSLS, 1996) correctly point out, one cannot force feed the creation of a sector council even if sector characteristics appear favourable (page 41). Perhaps fortunately, the intended target of 55 sector councils was abandoned early in the implementation of SPI when it became apparent that this target was unrealistic as a result of early difficulties. The sector councils are very heterogenous in their approach to HR issues within their sector, however, they tend to share many features. First, with few exceptions, these are national sector councils. The only council that is not national in scope due to program design features is SSC, which, because of the use of a trust fund, is currently restricted to Ontario. There are some councils which are not national due to the regional distribution of the industry. For example, the automotive parts sector is almost exclusively concentrated in Ontario, while Ontario has virtually no fish harvesters. A sector council cannot be expected to be national in scope if the sector itself is not. Virtually all sector councils represent either traditional (based on existing SICs) or emerging sectors (e.g. software), however, some are not based on sectors at all. Some councils are based on occupations and are cross-sectoral, such as FITT (Forum for International Trade Training) or Logistics. WITT (Women in Trades and Technology) on the other hand represents a non-specific target group within selected sectors. The uneven distribution of sector councils across the range of potential industries has been cited as a weakness of the SPI approach (c.f. Smith 1996, CSLS 1996), since some workers will have access to the benefits of SPI while workers in non-participating sectors will not. The same authors conclude, however, that the strengths outweigh this weakness. One of these strengths, the national scope of the programs and services, is especially important in an era of devolution. All sector councils have joint labour management representation, however, the mix of business, business associations, unions, occupational associations and worker representatives is uneven across the sectors. This varied assortment of partnerships can, and has, adversely affected the products developed and subsequent take-up of the programs and services. For example, focusing on only one product can leave a council exposed if this product is not well received in the marketplace or, likewise, is perceived to be appropriate or valuable by only a sub-segment of the sector. Similarly, developing products for smaller businesses without seeking the support of the large companies that dominate the sector can be problematic. In some cases, the failure to get the appropriate mix of labour and management partners has proved to be a critical error. According to some key informants, one of the main causes for the collapse of Impression 2000 was the fact that the management representatives came from small companies with virtually no experience in union relationships, while the labour representatives were virtually all from larger unionized companies. Unfortunately, independent of ideologies, there can also be a clash of personalities among board members. These personality conflicts can be crippling if they occur at the level of co-chairs. Unless there is willingness to review the appropriateness of the leadership on the joint labour-management board, these personality conflicts can remain unchecked and adversely affect the progress of the council. HRDC may be able to play a role by providing an independent review of the situation and recommending options to the board of directors. The progress of a sector council is often dependent upon champions or true believers; that is, individuals or firms who take leadership and responsibility for the activities of the sector council. These individuals find reasons for implementing plans, testing new products, negotiating new partnerships when there are always numerous good reasons for not taking action. Having major corporations take a lead role in implementing council products or services such as standards and training can have a major impact on the likelihood of medium-sized and small firms participating in the future. The role of the executive director is another critical success factor, according to the key informants interviewed. The executive director must have the confidence of the labour and management representatives on the board, be a skilled negotiator and mediator, posses strong business skills including marketing, be able to manage projects and bring products on stream in a timely and cost-effective manner, and be able to adapt to changing circumstances. There has been a high degree of turnover at the senior levels of the sector councils. This level of turnover may not be substantially different from other senior level positions, however, it may have impeded progress in some circumstances. Others have stated that changes were needed in these positions. It is possible that the skills required in the early formative stages of a sector council may not be the same skills necessary for the operational phase. One sector council, APSTC, used co-managing directors rather than one executive director. According to some key informants, there were drawbacks to this approach including being more expensive and tending to fragment responsibilities. The different focus of the various sector councils in terms of representation on the councils, the target groups for programs and HR problems addressed have been criticized in the past. While improvements to the coverage or representation within the sector councils and the target groups is possible and desirable, to some extent this problem is the very nature of the program — a voluntary partnership designed to address issues of common concern. The sector councils themselves should be motivated to ensure that their infrastructure reflects the sector they serve, otherwise they risk losing touch with their target markets and creating products that will fail in the marketplace. Virtually all of the sector councils have representation from provincial governments and educational institutions. While this has not always been the case, the sector councils have learned that partnerships with other organizations can yield benefits in terms of additional resources, cost sharing, and developing new markets. In the case study of APSTC, key informants highlighted the problem of unrealistic goals. The targets established for program take-up were, after a more realistic exposure to market potential, unrealistic. These goals were not formally reassessed. The result was to undermine responsibility for participation since the objectives could not be met. A more aggressive approach to program performance monitoring may have been implemented if new, more realistic goals had been established. 3.4 Sector Council Programs and Services Before examining the delivery results for the sector councils, we will provide a brief overview of the sectoral delivery mechanisms, services, products and programs. A crude description of sector council products and services may be based on their focus on standards and/or training. Most sector councils are involved in the development of occupational standards. Typically, a training curriculum is identified or developed to support the standards developed. Some councils design their own training courses, others rely on existing training courses or the willingness of educational/training institutions to develop the necessary training. The same is also true of training delivery, with some sector councils providing training delivery while others act as training brokers. In a few cases, funding for participation in training is provided to leverage contributions from industry participants. For CSTEC, for example, out of $17.6 million in training expenditures eligible for funding in 1996/7, only $2.7 million was government funding compared to $14.9 million in company contributions. Testing, certification and accreditation is also a feature of many sector councils. While there are many similarities between the products and services offered by the sector councils, one of the most interesting aspects of sector council design and structure is the diversity of the products and services developed, including the following:
This enormous diversity is viewed by most observers as a key strength of the SPI approach. A multitude of approaches are used to deal with the unique challenges within each sector. In addition, this provides an opportunity to consider the strengths and weaknesses of various approaches before they are applied in other sectors. This diversity will likely lead to a greater number of failures or less fruitful ventures than the traditional HRDC top-down national standards/training programs, although the sectoral industry-driven approach will also likely result in more industry-relevant and innovative solutions to HR issues. For many of the projects, it is still too early to provide a definitive statement on the advantages and disadvantages of a given approach, although there are valuable lessons that can be learned now and as the various products and services receive more exposure in the marketplace. One potential threat is the duplication of efforts across the sector councils. It is extremely important that the sector councils continue with their regular meetings and investigate other methods of communicating their activities and experiences (e.g., web sites) to other sector councils and stakeholders. However, as the number of councils and activities of the councils expand, it may be exceeding the ability to communicate the level of detail necessary through informal communication among the sector councils. Although some centralized information exists through HRDC and the CLFDB (Canadian Labour Force Development Board), there is a need to communicate in greater detail on learning experiences from the development process, resources and contacts, take-up rates, revenues, satisfaction levels, perceptions of the sector council of the strengths and weaknesses/lessons learned. There would have to be a commitment on the part of the sector councils, however, to provide the information on a periodic basis. 3.5 Awareness and Take-Up One issue to be addressed in the evaluation concerns the level of awareness and outreach sectoral agreements (councils) have achieved. The sector councils have used a number of methods to promote awareness of their products and services. This includes the following activities:
In too many circumstances, however, product testing and marketing occurred after full production and entry into the market with products and services. Although the design of products and services are typically directed under the guidance of industry stakeholders, pre-production market/user tests should be conducted. Some councils have implemented market testing and have contracted out or hired marketing expertise. Unfortunately these marketing initiatives often occurred after problems in the marketplace became apparent. Marketing can present unique challenges. CARS managed to turn an adversarial situation into a marketing opportunity when magazine publishers charged that a magazine CARS was producing was unfair competition due to government funding. As a result of these discussions, CARS eliminated their costly magazine publication and, for a fraction of the cost, provides an insert to an existing publication. CARS cut costs and reaches the same audience more frequently. Awareness levels and take-up vary substantially across the sector councils. The Round One surveys conducted indicated relatively low levels of awareness of the sector councils and their activities. In some cases, one would expect low levels of recognition for the sector council, but one would anticipate that either at the firm level or the employee level (depending on how participants are targeted) there should be recognition of the specific products. Although we have information from a limited number of sector councils where surveys were conducted of participants and non-participants, these results confirm a relatively low level of awareness for products and services offered by the sector councils, typically below 20 per cent. Based on documents reviewed and analysis of administrative data, take-up rates were also estimated to be relatively low, less than 5 per cent of the potential target market. Not all of this take-up was incremental. When asked about the training sponsored by the sector councils, over half the participants surveyed (Software, FITT) indicated that they would have obtained the training elsewhere. However, in the case of CARS, there was little difference in the incidence of formal automotive-related training (excluding CiiP) between participating and non-participating employers, suggesting that this training was incremental. Weak marketing efforts may explain some of the short fall between the take-up levels expected by the sector councils and the actual take-up, although building awareness does not always translate into high take-up. There are numerous barriers to the take-up of sector councils' programs and services, including:
In general, a lack of flexibility in the delivery of the programs and services can severely restrict take-up rates. For example, the requirement to take the APSTC certificate course in full one-week blocks and not spread over time according to peaks and valleys in production, was considered to be one of the barriers to take-up among the firms. Another related consideration is the role of unions in the delivery of programs and services. Union involvement, as representatives of labour, is essential to ensure that the interests of the workers are reflected in the design of council programs and services. However, for some sectors it may be equally essential to have a non-union labour interface as an option for the delivery of programs and services. Concerns about union involvement, particularly at the firm site, is perceived to be threatening for non-unionized firms and is a barrier for take-up among these firms. 3.6 Satisfaction with Sector Council Programs and Services Consistent with earlier results, all stakeholders express a high degree of satisfaction with the products and services offered by the sector councils. The sources of information for this observation includes feedback obtained from key informant interviews and surveys of participating firms and employees. Most respondents could offer suggestions for improvements, but this did not detract from their overall satisfaction. It is interesting to note, however, that despite the high levels of satisfaction, in at least one case the results indicated that the participating firms were equally, if not more satisfied with training from other sources. The fact that employer or employee participants choose sector council training may reflect the unique access provided or the opportunities for standards and certification that may be lacking in the other options. Among the more flexible options, is computer-based technology. This type of training, however, is self-directed and it is important to ensure the nature and content of the materials is clearly understood, including the skill and motivation required by the learner. For one project, which was a pilot implementation of Internet-based training, the satisfaction ratings were relatively lower than ratings observed for types of training provided by a few other sector councils. This may be simply due to the pilot nature of the test and some of the unique issues related to the internet (e.g., security, time to download material, an Internet culture that resists paying for products on the Internet), however, it a could be reflection of the problems associated with self-directed training. In self-directed computer-based training (CBT), such as Internet training or CD-ROM training packages, self-motivation may be a very significant factor. There may be more initial inappropriate participants since there is often no screening process as might exist in a workplace. The self-directed methods such as Internet-based training or CD-ROMs have great potential for outreach and cost-efficiencies, however, there are likely going to be more non-completers/non-participants or long delays between sign up/acquisition and the actual training. It is very important that the nature of the content, skill requirements and commitments are specified in advance to help prospective clients better assess the suitability of the methodology to meet their needs. One feature of training often cited by surveyed employees and employers as an area for improvement was the quality of instructors. As noted earlier, highly technically skilled colleagues may not be very effective teachers. The skills sets are not mutually exclusive, but definitely more difficult to find in combination. This highlights potential problems with the train the trainer approach. The train the trainer system may be a highly cost-effective approach and may also be a means of introducing changes to the training culture at the firm level. However, it is important that the effectiveness of these trainers be tracked and ineffective trainers be provided with new training or replaced with new graduates from the train the trainer programs. 3.7 Systemic Change One SPI objective is to fundamentally change the way in which HR practices are designed and implemented within industry. The SPI process, specifically the joint participation of labour and management, is a profound shift in the way in which HR practices have been developed and implemented in the past. With the increasing inclusion of educational institutions as partners in the sectoral process, there have been some fundamental changes in the role of educational institutions and the functioning of the Canadian learning system. An example of how jurisdictional boundaries have been changed is the participation of educational partners in the development of transferrable credits. The ability to transfer college credits for sectorally developed training is a significant change in the way the educational system has responded to the needs of industry. There has even been a recognition of workplace based learning by the community colleges. The sector councils have also influenced how schools and colleges develop curricula. The SPI process has resulted in schools and colleges modifying their courses to make them more relevant to the needs of the sector and participating in sectorally developed accreditation programs. The process of using nationally representative sector councils for developing national occupational standards is another important change. In the past, standards development often began at a provincial level and then efforts were made to derive national standards from these provincial standards. The systemic change can be traced through the flow from the development of standards, to training standards, to curriculum development to training. Another example of systemic change was the ability of SHRC to facilitate a revised process for recognition and approval of immigrants with software experience. 3.8 Effective Partnerships A key element in the SPI is the development of partnerships. Compared to when the data collection was completed for the formative evaluation, there has been an increase in the number of representatives from educational institutions and provincial governments on sector council boards of directors. Partnerships bring significant direct and in-kind contributions to sector councils in the form of the time of partners, contributions toward operational expenses, as well as direct contributions to development and training costs. The limited 1996-97 information available for this evaluation report concerning several operational councils included in Round One, suggests that these industry expenditures can range from $300,000 to as high as $14.9 million for a one-year period for a sector council (each extreme representing a single case). These new partnerships have also not only contributed to improving the quality of products developed, but they have opened up options for joint development and implementation of products and services. One innovation that has gained prevalence is the co-development of training products and services. The development costs of the products are sometimes jointly funded by the sector council and a third party organization, frequently a private sector organization. The sector council and the third party organization may then share in the subsequent revenues that are generated. This is an effective methodology for the sector councils to leverage funding and take advantage of the strengths of other organizations. For example, SHRC and Logistics partnered with firms specializing in CD-ROMs to develop training packages. The agreements between the councils and the private sector partners include sharing costs and revenues. Another example is CSTEC, which originally developed their own training courses but, as a result of their partnership with the colleges, is now having courses developed by colleges with limited costs being incurred by CSTEC. CARS has undertaken several joint ventures with other councils, including an emissions control certificate that was jointly undertaken with the Canadian Council for Human Resources in the Environment Industry. In some cases, the third party joint participation is not for profit, but frequently revenue sharing is an important element in the partnership. As these relationships have become more common, it is important to note the downside aspect of this relationship. The main disadvantage is the issue of ownership. Unless the sector councils wish to lose control of the product they have developed, there must be clear statements in the contractual agreements on how to resolve disagreements over product development, marketing, and implementation. Ownership of not only the product and any trademarks is crucial, but so is access to client lists, participant information, etc. The contracts must clearly state how these issues will be handled in the event of a dissolution of the partnership. 3.9 Self-Sufficiency There are several rationales for implementing the three year self-sufficiency clause in the sectoral agreements, including:
HRDC has formally defined self-sufficiency referred to in the sectoral agreements as pertaining to basic administrative costs only (i.e., core operational self-sufficiency). This is a formal recognition on the part of HRDC that not all aspects of sectoral council activities may be capable of becoming completely sustainable on their own. As mentioned above, part of the rationale for core operational self-sufficiency is to enable the program to support numerous sector councils using a limited pool of funds. Core operational self-sufficiency is one means of achieving outreach to numerous sectors (originally the plan was to implement 55 sector councils). As sector councils achieve core operational self-sufficiency, funds would be available to fund new sector councils. This rationale cannot be easily extended to complete sector council sustainability (i.e., breaking even including program development/delivery expenses). Striving to break even completely could, in some cases, compromise other objectives. For example, in pursuit of this larger goal, eliminating council funding to companies which were implemented to increase training activity through leveraging training funds, would likely mean a decline in the amount of training. As well, the charging for services, products and programs offered by the sector councils may restrict access according to the ability to pay. Of the seven operational sector councils included in the Round One data collection (two of the councils selected had ceased operations and therefore were not operational) CSTEC, CARS and Software had achieved self-sufficiency. Those councils that had achieved self-sufficiency were still conducting projects consistent with the SPI objectives, in fact, they were all still receiving project funding under SPI. The two councils that ceased operations, Impression 2000 and APSTC, essentially terminated operations due to disagreements between labour and management and lack of commitment to sector council products. These differences of opinion were obviously going to have an impact on the sector councils' self-sufficiency, but the source of the problems were not financial. The ongoing project funding has been crucial to the operations of several sector councils, paying for staff to plan and implement new or existing programs and services. How councils will adapt if and when project specific funding ends is unclear at this stage. In order to deliver quality products in a cost-efficient manner, some sector councils have entered into joint development agreements with private sector organizations. Royalty and copyright issues have become important. In some respects, however, the issue of copyright is a difficult one and can conflict with the broader SPI mandate. It is very difficult to copyright training materials, some would say nearly impossible, but at least one can protect the trademark which may have significant marketing investments. Anecdotal evidence indicates that some individuals/firms, to reduce their own costs, may have obtained training materials, modified them for their own purposes and then made the revised course available to others at no cost or a lower cost. In these situations, the broader objectives of SPI are met — increased training activities/improved quality and relevance of the training. The self-sufficiency goal, however, would compel the sector council to attempt to protect its copyright and get the non-paying users to cease their activities or make payments. The area of copyrights and royalties is a complex area and this topic may be worthy of a special meeting of the sector councils to share common experiences and bring in experts to assist with technical issues.
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