The value of experienced consultants to skills development

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The value of experienced consultants to skills development

The value of experienced B-BBEE consultants to Skills Development

The impact of strategic skills development is an often-overlooked function of a business.  My experience has been that many managers and business owners believe that skills development is a simple and easy to understand activity which is implemented reactively once a year, just before the end of the skills year.  This reactive approach most often leads to wastage of scare resources like time and money and very seldom yields the results looked for. The right partner in skills development operations can have a major impact on your experience with the skills development industry.

The wrong approach

Due to various different legislations impacting skills development it is not a secret that many managers and business owners loath all things related to skills development. To remedy the problem, they often hire a specialist skills development consultant or service providers. However, due to a lack of knowledge of what this consultant should be managing, the areas of responsibility are not clearly communicated.  As a result, the two parties make different assumptions regarding who is managing which parts of skills development and therefore the skills function is not well aligned to a strategic goal.   Often this will playout in one or more of the following scenario’s:

  1. The goals set under the skills development element of B-BBEE is not achieved
  2. The company is not in compliance with the Skills Development Act
  3. Much of the training budget is not recognized as training expenses under B-BBEE
  4. Easy and affordable points on the B-BBEE scorecard was missed out on.
  5. No tax grants or any other financing mechanisms were made use of to finance the training expense.

The end-result is frustrating to everyone involved and ultimately the industry is blamed for being non transparent, unnecessarily complex and non professional.  

A practical guidance to the right approach

The above situation can be avoided if we take away the following lessons:

  1. Clearly define whom is responsible for which area of skills development – more on this to follow (*)
  2. The different elements of skills development need to work together and not as separate silos.
  3. Rank your goals for the skills function in order of importance i.e. Compliance, B-BBEE or skills transferal
  4. Assign an individual whom is to coordinate the skills function as a whole while taking into consideration your goals
  5. Take a pro-active approach to skills development and not a reactive approach

Compliance with the various different legislations which affect skills development in a company is complex.  The following are the main areas which you need to ensure you are being correctly advised upon.  (*)

  1. Compliance with the Skills Development Act

Generally, this is the realm of a Skills Development Facilitator (SDF). The SDF’s role is to plan, track and approve training while assuring compliance with the Skills Development Act.  The responsible person(s) will advise the company on the relevant scarce and critical training required within the sector.  This function needs to be aligned with the primary training goals of the company.

  • Compliance with B-BBEE:

In small and medium sized organisations this will usually be an external B-BBEE consultant.  They are responsible to advise senior management on the amount of training spend required and also the makeup and demographics of the required training interventions to achieve the maximum number of skill points on the sector scorecard.  

  • Financing:

There are various mechanisms available to finance skills development.  The main sources for funding are through tax benefits, SETA grants and business assistance deals.  Business owners can be informed of these solutions by tax practitioners, some SDF’s, financial managers and also consultants who specialise in this knowledge field.

It is very important that business owners and managers are advised on all three these areas to maximise the benefits of skills development. You could make use of three different advisors, but that will most often result in a siloed approach, which is not ideal.  Businesses should rather make us of an advisor who has knowledge of at least the above three areas to oversee the skills function. 

Specialist knowledge around the application of skills legislation, combined with knowledge around B-BBEE scorecards and an in depth understanding of the financial mechanisms available to both these areas, can significantly benefit the bottom line – maximize B-BBEE points and improve cash flow.  

What are the risks of having the wrong BEE and Skills Development partner?

  • Without specialist advice on finance, the skills function will be very expensive. 
  • Without B-BBEE advice you will be spending money which might not give you any recognition on the scorecard or it could have been much more efficiently spent. 
  • Without advice on compliance with the Skills Development Act you may get no points at all for skills under B-BBEE, thereby losing mandatory grants which are paid out to all businesses for their compliance.

In summary

I would advise making use of experienced advisors with in-depth knowledge and experience around the three areas of skills development highlighted above. The B-BBEE targets should give the structure within which the other areas need to operate in as it provides good structure to any skills budget.  An experienced skills advisor especially one with a solid grasp of B-BBEE legislation can calculate the exact costs, tax benefits and, what the B-BBEE recognition will be for a given skills plan.  This allows for business owners to make informed decisions to optimally structure skills development initiatives and expenditure.  

Contact Training Portal Online to talk to one of our experienced consultants who can assist you with implementing an effective skills development solution. Contact Jean at jean@trainingportal.co.za

Author: Jean du Plessis

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