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A Business Case for Commerce & Industry Support for Technological Education SATN 2010 Annual Conference 01 October 2010 Ossie Franks Pr Eng CEO ECSA

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Universities at the heart of leading economies <ul><ul><li>“ If we are to remain preeminent in transferring knowledge into economic value, our system of higher education must remain the world’s leader in generation scientific and technological breakthroughs and in preparing workers to meet the evolving demand for skilled labour ” </li></ul></ul><ul><ul><ul><ul><li>Alan Greenspan </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Chairman, U.S. Federal Reserve </li></ul></ul></ul></ul>

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Partners in Economic Development Competititveness Competitiveness <ul><ul><li>Links between technology education, productivity, and economic growth never been clearer </li></ul></ul><ul><ul><li>Universities offer more than education and research – they contribute to broader economic & social aspects of communities </li></ul></ul><ul><ul><li>Research supports the impact which universities make on regional economies </li></ul></ul>(spending impacts & knowledge effects)

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Recognition from Business leaders <ul><ul><li>Business leaders acknowledge the contribution that universities make in providing competitive advantage through : </li></ul></ul><ul><ul><ul><li>Highly skilled workers (↑ human capital) </li></ul></ul></ul><ul><ul><ul><li>Advanced technology ( ↑ competitiveness) </li></ul></ul></ul><ul><ul><ul><li>Cutting edge knowledge ( ↓ product life cycle) </li></ul></ul></ul><ul><ul><ul><li>Innovation and practical know how (↑ productivity) </li></ul></ul></ul>

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Links between innovation, productivity, & competitiveness <ul><ul><ul><li>Source: Porter’s (2003) </li></ul></ul></ul><ul><li></li></ul>Productivity Innovation Efforts Competitiveness Prosperity

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Decisions on business location “To move or to stay” <ul><li>Two key factors influencing this decision are: </li></ul><ul><ul><ul><ul><li>Access to specialized workers </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Ability to benefit from knowledge spill overs from research, innovation, and specialization. </li></ul></ul></ul></ul>

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Actual and DHET targeted graduates Source: DHET September 2010

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National Skills Pipeline <ul><li>Components of the skills pipeline includes: </li></ul><ul><ul><ul><li>Schooling in MSE </li></ul></ul></ul><ul><ul><ul><li>Higher Education </li></ul></ul></ul><ul><ul><ul><li>Post graduate training or candidacy phase </li></ul></ul></ul><ul><li>Each part of the skills pipeline has a unique set of challenges </li></ul><ul><li>Any proposal to address the skills shortage must consider the pipeline that delivers the skilled practitioners, starting at school, moving through higher education, to post graduate training and experience. </li></ul>(opportunities for funding & or support )

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The evolving nature of the relationship between funders and institutions <ul><li>Historically commerce and industry supported institutions through grants, gifts, or donations in the belief that: </li></ul><ul><ul><li>institutions contributed to the greater good of society, & </li></ul></ul><ul><ul><li>Good corporate citizenship required such donations. Parasitic Model </li></ul></ul><ul><li>The relationships between institutions and funders has evolved to that of a mutually beneficial relationship </li></ul><ul><ul><ul><ul><ul><li> Symbiotic Model </li></ul></ul></ul></ul></ul><ul><li>Funders are willing to “invest” in the institution on the expectation that there will be an appropriate return on their investment . Prerequisite for sustainability </li></ul>

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Mutually beneficial support initiatives which could yield positive results <ul><li>1. Commissioned Research </li></ul><ul><ul><ul><li>Potentially lucrative </li></ul></ul></ul><ul><ul><ul><li>Very competitive </li></ul></ul></ul><ul><ul><ul><li>Dominated by small group of more experience researchers </li></ul></ul></ul><ul><ul><ul><li>High pressure with tight deadlines and budgets </li></ul></ul></ul><ul><li>2. Technology Station Initiative </li></ul><ul><ul><ul><li>Innovative programme </li></ul></ul></ul><ul><ul><ul><li>Challenges the conventional systems of the institutions </li></ul></ul></ul><ul><ul><ul><li>Requires the institution to be flexible </li></ul></ul></ul><ul><ul><ul><li>Great opportunity to contribute to local development (SMEs) </li></ul></ul></ul><ul><ul><ul><li>Staff gain knowledge application experiences </li></ul></ul></ul>

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Mutually beneficial support initiatives which yield positive results (continued) <ul><li>3. Dual Appointments </li></ul><ul><ul><ul><li>Skills shortage results in poaching of academic staff </li></ul></ul></ul><ul><ul><ul><li>Short term solution with is not beneficial in the long run </li></ul></ul></ul><ul><ul><ul><li>Dual appointments by a company and institution could offers a </li></ul></ul></ul><ul><ul><ul><li>potential solution </li></ul></ul></ul><ul><ul><ul><li>This model is not without challenges, however, is effectively exploited in parts of Europe. </li></ul></ul></ul><ul><li>4. Secondment of staff </li></ul><ul><ul><ul><li>To industry and from industry </li></ul></ul></ul><ul><ul><ul><li>Creates opportunity for staff to update there skills & knowledge </li></ul></ul></ul><ul><ul><ul><li>May be resisted by complacent staff </li></ul></ul></ul><ul><ul><ul><li>Requires the institution to be flexible </li></ul></ul></ul>

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Mutually beneficial support initiatives which yield positive results (continued) <ul><li>5. Shared cost of capital intensive facilities </li></ul><ul><ul><ul><li>Capital intensive equipment which has spare capacity </li></ul></ul></ul><ul><ul><ul><li>Production machine shop equipment which is not fully utilized </li></ul></ul></ul><ul><ul><ul><li>Staff and students gain access to expensive production equipment which is also used for production purposes. </li></ul></ul></ul><ul><ul><ul><li>Not without challenges and requires flexibility </li></ul></ul></ul><ul><ul><ul><li>PPP for student residences </li></ul></ul></ul><ul><li>6. Structured training programmes </li></ul><ul><ul><ul><li>WIL opportunities for diploma students </li></ul></ul></ul><ul><ul><ul><li>Graduate training to meet the requirements for registration </li></ul></ul></ul><ul><ul><ul><li>Learnerships </li></ul></ul></ul>

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Mutually beneficial support initiatives which yield positive results (continued) <ul><li>7. Some more traditional support mechanisms </li></ul><ul><ul><ul><li>Industry funding for research including THRIP </li></ul></ul></ul><ul><ul><ul><li>Funding for specific facilities: laboratories or equipment </li></ul></ul></ul><ul><ul><ul><li>Sponsorship of lecture theatres </li></ul></ul></ul><ul><ul><ul><li>Bursaries for students </li></ul></ul></ul><ul><ul><ul><li>Endowed chairs </li></ul></ul></ul><ul><ul><ul><li>Event funding </li></ul></ul></ul>

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Concluding remarks <ul><li>1. There is a compelling case for industry & commerce to support technological education </li></ul><ul><li>2. Key criteria which potential funders use </li></ul><ul><ul><ul><li>Return on Investment (ROI) </li></ul></ul></ul><ul><ul><ul><li>Mutual benefits enhances sustainability </li></ul></ul></ul><ul><ul><ul><li>Link between the funding and the improvement it makes </li></ul></ul></ul><ul><ul><ul><li>Transparency in operations </li></ul></ul></ul><ul><ul><ul><li>Must be seen to be meeting its broad mission </li></ul></ul></ul><ul><ul><ul><li>Engaged with its communities </li></ul></ul></ul><ul><li>3. Private contributions should be incentivised through a instruments like tax breaks </li></ul>

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Thank you