Industry led sharing of
Knowledge - the future of hi-tech education?
Ó Karl-Erik Sveiby 1999. All rights
preserved.
What can Western education
systems learn from a Malaysian experiment in vocational training?
The answer is: A lot.
The Penang Skills
Development Center (PSDC) is an industry-led training center for the
manufacturing industry on the island of Penang in northern Malaysia. In
September 1987, the American Business Council met to discuss the skilled
manpower shortage problem for the manufacturing sector in Penang. The then
Chief Minister of Penang, Tun Lim Chong Eu, initiated a series of meetings with
the CEOs of major manufacturing companies to discuss how a training center in
Penang could be accomplished. In April, 1989, a Management Council was elected
for the Penang Skills Development Centre, PSDC. The council obtained the
support of 24 companies, which agreed to become founding members of PSDC. PSDC
offered its first 16 courses in 1989 with 309 participants. Today ten years
later PSDC will graduate more than 10,000 students annually. Some of the
founding main sponsors members were Advanced Micro Devices, Hewlett Packard,
Intel Technology, Motorola, National Semiconductors, and Sony Electronics.
PSDC's short-term
objectives are to:
- Meet the immediate training needs of PSDC's
members.
- Establish a mechanism to coordinate and utilize
resources available from industry and institutions.
- Position PSDC to be the leading training
institution in Penang and to be self-sustaining financially.
- Work closely with the state and federal
governments on the implementation of the Human Resource Development Fund.
Its long-term objectives
are:
- Provide pre-employment training for school
leavers.
- Promote vocational and technical careers.
- Position itself as a leading training
institution in the Northern region and establish strategic alliances with
other training organizations
PSDC has three main
activities.
- It offers courses for workers to continually
upgrade their skill level to keep pace with technological progress in
factory automation and manufacturing processes.
- It provides pre-employment training to prepare
the future workforce for occupational competence.
- It provides training consulting services.
Four lessons
Unlike most other efforts
around the world to address shortage of vocational skills PSDC is industry-led
and self-financed. The education supplied meets a customer demand. How much of
government-led education supply follows actual demand? This is the first
lesson PSDC teaches us.
The second lesson is embedded in another unique
feature of PSDC: A number of otherwise fierce competitors agreed to contribute
one "best practice" or "best technology" each to PSDC and
to continuously keep it updated. This has given PSDC access to industry's
competence development and it guarantees that each engineer trained at PSDC has
got access to state-of-art knowledge. Western style tax- financed and
government led education does not stand a chance to keep up with today's change
in technology. The few investments that the cash stricken education departments
make are doomed form the outset. Six months after a new computer lab in a
school is proudly announced it is already obsolete.
The third lesson is that knowledge sharing is
profitable for all involved. By giving one of their best technologies or
processes to PSDC the original 8 founders ensured not only their own engineers'
access to 7 other best practices, but also that the new workers they would hire
would be up-to-date.
The fourth lesson is the amount of trust that the
founding fathers of PSDC were able to draw upon in order to pull together. The
unique level of trust between otherwise fierce competitors was the platform
that made PSDC possible. The trust is also crucial for keeping the technology
updated. This the crucial issue that will determine the success or failure of
PSDC look-alikes. The PSDC model is now being exported to other countries. The
formal model is simple. The crucial feature will be the trust between the
participating businesses and the government. Without trust no knowledge
sharing.
Other features of PSDC
Some other features of PSDC
are less unique but important nevertheless:
Industry is accountable.
Drawn from
industry, the accountable persons include the director and staff, who report to
the board. Although PSDC has been making a profit since its first course, PSDC
feels financial success is not as important as whether PSDC's programs provide
adequate support to industry.
Evaluation of teachers
and training courses.
PSDC trainers often come from industry. Students at the end of their courses
evaluate them. In addition, certain trainers are evaluated by BTEC, the
certifying body that evaluates trainers for the Diploma in the Engineering
program. This ensures that instructors are both engaging and technically
correct. The industry members who are part of PSDC assess the quality of the
centre's performance by two criteria: first, by the student evaluations at the
end of each course; second, by the performance of member firms' employees. The
performance is assessed by means of pre- and post-training evaluations.
All stakeholders are
invested. All
stakeholders have some investment, and thus some interest, in PSDC. Students
pay course fees or receive industry sponsorship. Member employers contribute
equipment and teachers. Employers are often members of PSDC and are,
accordingly, highly invested in its success. Members pay a one-time fee to join
PSDC. Full members pay RM20,000 (approx. US$8,000). They may also supply
equipment, supplies, and course instructors. Nonmember employers may also
provide equipment and supplies. Member companies provide input into PSDC course
offerings based on their projected needs. Government contributes tax
concessions and a small amount of money to cover expenses (<20% of PSDC's
total budget)
Needs analysis keeps up
with emerging skills requirements. Once a year, PSDC holds a conference of its members to look
at future trends and training needs. A training needs analysis is conducted and
used to prepare a training calendar which is presented to the training
committee, and ultimately, to the management council for final approval. The
presence of so many different kinds of employers in PSDC's consortium ensures
that skills in courses will be applicable to different types of work.
PSDC a model to be replicated
PSDC has been replicated in
11 other Malaysian states. In addition, the concept has been exported to
Mauritius, Mexico, and Thailand. It is considered a strong model for demand
driven (industry) training that is focused and cost-effective.
Return - at least 230%
PSDC trained some 6% of the
workforce in Penang 1998/99. All graduates get jobs and the economic impact of
the PSDC education is visible in the Penang region. For instance, a basic
machining course (1 year of training) raises a worker's yearly income from
RM8,400 (US$3,360) to RM12,000 (US$4,800). An advanced machining course (an
additional 6 months of training) would raise a worker's income to RM15,600
(US$6,240).
So, for every worker in 6
months of vocational training PSDC adds approx. RM1,800 - RM3,600 to the Penang
economy, which amounts to no less than between 16,483,000 (US$6,593,000) and
32,967,000 (US$13,187,000) in 1998/99. Total cost for the PSDC is RM4,916,000
(US$1,966,000) in 1998/1999, so for every RM1 in costs PSDC adds between RM3.3
and RM6.7, a return of minimum 230%, possibly as high as 570%. Not a bad
investment by any standard.
Sources:
Interviews May 1999 with RS
Moorthy. Motorola Schaumburg and Boonlar Som Chit, CEO PSCD.
Cathleen Corbett 1996:
Report. Center for
Workforce Development at Education Development Center, Inc., 1996
More information about PSDC:
Contact CEO Boonlar Somchit PSDC, 1 Jalan Sultan Azlan Shah, Bandar
Bayan Baru 11909 Bayan Lepas Penang, Malysia.