The real value of apprenticeships

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Think ‘apprenticeships’ and one could easily be inclined towards thinking of young men and women in overalls learning the skills of a trade perhaps of fixing cars, wiring plugs or laying bricks. We have become accustomed to a narrow, ‘trade’ definition, despite the fact that apprenticeships in financial services, banking, insurance etc. are now part of established best-practice.

And now there is an even wider definition of ‘apprenticeships’, and a wider reach into the industries they serve, thanks in no small way to the Government’s reformed Apprenticeships initiative which includes a compulsory Levy for companies who have a payroll of £3m or more. For levy paying companies this is a tax which can be turned into an investment in the business and when managed effectively will support your existing talent management and development strategies.

Recently I came across a very helpful seven-point plan for turning the Apprenticeship levy into an investment in the business.

  1. Get to know the levy, the rules and how they will affect your business
  2. Identify the job roles and job families which might be offered as apprenticeships either internally as development pathways or to support recruitment.
  3. Review your current investment in learning and training and identify whether any of that spend contributes to the delivery of apprenticeships.
  4. Research the new apprenticeship standards and map your roles.
  5. Set up the resources to deliver apprenticeships including researching Approved Apprenticeship Providers.
  6. Build apprenticeships into your business operations.

It is not always appreciated that there is no upper age limit to an apprenticeship, and neither are this new generation of apprentices necessarily starting at the bottom rung of the ladder.   As long as the employee is gaining substantive new skills and the training is materially different from any other training previously provided, then they qualify. It allows employees not only to move up but also across your business into new areas and with new opportunities to develop.

Firms who pay in to the levy will only see that money returned to them if it is effectively channelled into approved apprenticeship

Significant benefits
From an employee perspective, the new scheme has significant benefit, and a can provide a real chance to progress. But it also has significant benefit to the employer since a more engaged workforce is invariably more productive, and an individual who is continuing to learn, and to see and realise new career development opportunities, is easier to retain. Apprenticeship standards in many cases can provide access to highly-regarded professional and degree level qualifications. This can make apprenticeships attractive to both long-established members of the workforce who require certification to fulfil the requirements of senior management roles or to make step changes into a different area of the business.

But perhaps the greatest advantage to this new initiative is how it supports existing learning and development plans, and enables you to maximise your existing talent streams. Firms who pay in to the levy will only see that money returned to them if it is effectively channelled into approved apprenticeship training. Departments who may at one time have been reluctant to spend budget on training now have a central ‘pot’ from which to draw down funds. Since the levy is paid as a ‘tax’ on a ‘use it or lose it’ type of arrangement, Financial Directors have literally nothing to lose and everything to gain. It is an initiative where there are simply no losers.

Within my industry of debt collection, a number of specific apprenticeship standards have been created that will be offered and supported by the CSA. These range from the new standard in Financial Services Credit Controller/Collector through to the most advanced Senior Compliance/Risk Specialist Apprenticeship standard, and supporting and advising companies on routes for more specialist roles in IT, HR and Legal.  It serves as a very tangible illustration of the broad nature of the training now available. It also serves to show how debt collection can provide a challenging and fulfilling career.

What the apprenticeship levy is also doing, beyond its practical purpose, is challenging HR/Learning and Development/Organisation Development functions to take a strategic view and demonstrate some measurable returns on investment. This is combined with the need to think strategically on the role of HR in assuring the implementation of the SMR, and 2017 will be a busy year for this function of the business. They are responsible for developing and maintaining the skills and cultures that drive to the very heart of a company’s moral and ethical values and behaviours.

Areas to consider
So, if you are a levy paying firm and have been given responsibility for delivering on apprenticeships in your business, here are some key areas to consider when creating a programme:

  • External recruitment – if you are planning to use apprenticeships as part of your recruitment plans, you need how and where you are going to promote the opportunities to ensure that you attract the candidates you want. This might open up new and cost effective recruitment strategies for your business.
  • Selection – whether you are using apprenticeships as part of your external recruitment and/or your internal development plans, again you need to consider how you are going to identify the right candidates?
  • On-boarding – Focus on the on-boarding process and consider how you are going to maximise your retention and reduce attrition rates.
  • Training and learning – will your in-house team /learning resources provide some of the training or do you need external delivery partners? If the latter, how will they be selected?
  • Performance and supplier management – how are you going to manage the performance of your apprenticeship suppliers and programmes?
  • Success measures – how will you demonstrate to the business that they have received value from the investment in apprenticeships.

Measuring Return on Investment (ROI) is always notoriously difficult especially when we are measuring the impact of development in what are deemed ‘soft skills’. The soft skills, of course, are the foundation of the business in terms of how you demonstrate that you are a values-driven organisation that does what it says it is going to do. This is fundamental if you are going to show your clients and regulators that your conduct codes and ethics are more than just pieces of paper or a tick in the box.

Apprenticeships offer a unique opportunity to show value-add and for many HR Directors and those in charge of learning and development, demonstrating ROI from the Levy is critical. A focus, therefore, on how apprenticeships deliver real measurable outcomes ensures the engagement and support of the whole organisation, from operations to finance. Outcomes include:

  • Reducing recruitment costs
  • Improving staff retention
  • Reducing attrition
  • Improving productivity
  • Improving levels of certification and qualifications held within your workforce.

With some strategic planning and a clear link to key business priorities, the Apprentice Levy should not be seen as a drain on resources, but rather as an initiative that can add real long term value to the business.

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About Author

The Credit Services Association (CSA) is the only National Association in the UK for organisations active in the debt collection and purchase industry. The Association, which has a history dating back to 1906, has 300 member companies which represent 90% of the industry, and employ 11,000 people. At any one time its members hold up to £60 billion for collection, returning nearly £3 billion in collections to the UK economy per annum. As the voice of the collections industry, our vision is to build confidence in debt collection by making the entire process clear, easy to understand and less stressful for all those involved. Further information on the CSA can be found at: http://www.csa-uk.com

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