Why be an Enterprise RTO

Why are we an Enterprise RTO, what purpose does it serve?

This was a question I have asked of me recently by a number of people both inside and outside of the organisation, and in answering it I realised that while I and probably a handful of other people in the organisation could actually explain what purpose it served for us to be our own RTO, we did not as an organisation have this purpose articulated in any of our learning documents.

So what is the answer well here is what it now says in our Organisation Learning Framework:

4.0 RTO Training

4.1 Objectives

UCC operates as a Registered Training Organisation to instantiate the organisations learning objectives.  The prime purpose of the RTO is to provide accredited training outcomes for staff and volunteers and the staff and volunteers of other UCQ Service Groups and to support the Organisational Learning Model.  Operating as an RTO provides the organisation with the ability to control and contextualise the content and delivery of these outcomes in a way with meets both legislative requirements and organisational need to ensure the best possible outcomes for both staff and volunteers and the organisation as a whole.  Where appropriate and when capacity is available the organisation may choose to utilise the RTO to deliver accredited training to external parties.

As an RTO UCC seeks to:

  • Become a leading provider of Training and Organisational Development services across its core business areas to both internal and external stakeholders;
  • Ensure that any training provided meets and exceeds the expectations of those individuals and organisations to which it is provided; and
  • Maintain the highest possible standards with respect to content, facilitation and the development of training.

I have underlined what I think are the two main reasons, the purpose for us having and maintaining our RTO status;

  1. To provide Nationally accredited training for our staff and volunteers; and
  2. control and contextualise the content and delivery to meet organisational need.

Now you might say, but you can achieve both of those outcomes without being an Enterprise RTO, you just need good partnerships with good external RTO’s who are willing to do those things and to some extent you would be right, however, in my experience when the rubber hits the road on these sorts of things very very few external RTO’s are actually willing to do number two.  A lot will say that they are but very very few actually will.

There is another reason though, which I think is far more compelling and that is one of knowledge and experience.  We are one of the largest community services organisations in Australia and have a relatively diverse business across three main stream, Children and Families, People with Disabilities and Crisis support, and we have some of the best and most experienced people in the world working in the organisation.  I often joke with people that if I need to know something about one of the areas of our business I just have to walk out of my office and turn left.  I have experts with years of actual experience in their respective fields I can access in our Head Office alone, without looking into the actual services, programs and regions and most of them have training qualifications.  So why would we go to a TAFE or a private RTO to have our people trained, it is highly unlikely that the trainers have the same or better experience than the people we have within our own front garden and when you add to that an experienced and dedicated L&D team who can package the content provided by our own subject matter experts, there seems little reason to go outside.

When you think this way about why we have an Enterprise RTO it also does something else, it informs us of what our scope should be and when (and we do) we should partner with external RTO’s.  You wont (and probably never will) find Cert IV in FLM or TAE, or the Diploma of Business on our scope, despite the amount of staff who may ask for it.  Why, because it is not our core business, our core business is Community Services and to a smaller extent Health and that is where our scope sits.

And it is that idea of core business and doing what you are good at that really explains why we are an Enterprise RTO.

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About pauldrasmussen
Paul Rasmussen is one of Australia’s most widely read Vocational Education and Training Commentators. He provides deep, unbiased analysis and insights not only on topical issues, but also on the underlying structure and policy which supports the industry. His writing and analysis has been praised for its uncompromising and thought provoking style and its ability to focus on the issues of real importance to the sector. He has advised various government departments and ministers, training providers, public and private organisations, not for profits and small to medium enterprises on the VET sector and the issues and opportunities facing it. He is one of Australia’s most awarded learning professionals and a regular speaker at a range of conventions and forums. His extensive experience in vocational education, and learning and development coupled with formal qualifications in philosophy, ethics, business and education management allow Paul to provide a unique view of the road ahead and how to navigate it.

5 Responses to Why be an Enterprise RTO

  1. Enterprise RTO’s are excellent, we set up many of our clients as Enterprise RTO, for many of the reasons listed above.

    What we also talk about with Enterprise RTO;s is their life cycle.

    This varies from Enterprise to Enterprise, we have clients with stable workforces and very little “churn”, we also have clients that have their staff continuously “poached” by the mining companies.

    If you are running an simple traineeship of say a years duration, and your workforce is stable, then for the first year the Enterprise RTO is going flat out, assessments everywhere, learning going on, all is well, but by the second year, when 90% of the workforce is finished their traineeships, and now you are only managing training for stragglers and for new starters, the RTO falls away from the spotlight.

    You are now only doing ROT compliance part time, you are not loosing interest. It is time to bite the bullet and go back to outsourcing your training to a local quality RTO, I said quality, that will deliver what you are looking for to a standard that your are looking for.

    The other RTO, where their is a significant amount of churn, just bubbles along doing the business.

    In my experience, most Enterprise RTO’s are more the former than the latter.

    Remember to ask when considering going down the Enterprise RTO pathway, what is the expected Life Cycle of this RTO?

    Rod O’Donnell
    RTOsupport Pty Ltd
    http://www.rtosupport.com.au

    • pauldrasmussen says:

      Rod, I agree with what you are saying, and something very similar happened with one of the other arms of the business, they had a separate RTO and it was virtually flat out for about 3 years and then it really slowed down to a crawl and became financially unsustainable and a burden on the business and was closed. A lot of businesses look at the concept of an ERTO and see it as a method of making additional revenue for the business either through the training of internal staff or through providing external training. This is almost always a recipe for financial unsustainability.

      We do have a fairly high rate of churn but we also have a workforce of about 17,000 across all of the service groups but for us the RTO is not about qualifications it is about backing the training that we already provide to staff with accredited outcomes in the form of Units of Competency. For us it is about creating competency in our staff across a range of skill sets and being able provide evidence of that competency. If this results in, or the staff member wishes to complete, a qualification then that is a bonus. It is also about us only delivering in our core business areas, where we have the expertise and where we as an organisation need to be confident of the competence of our workers.

  2. Neville Coward says:

    Interesting topic Paul. I have seen a number of ERTOs come and go including those based in major corporations. Unfortunately, for many (like so much in the VET sector), funding plays a significant part in the decision to form an ERTO. Business units determined to become an RTO, often for all the right reasons, have used funding to argue the cost benefit and return available compared to doing what they already do (the often unmeasured or externally unrecognised) training that already takes place.

    Another factor at times is also the enterprise EB agreements -where you are encouraging or required to promote qualifications linked to career and wage progression.

    As Rod rightly points out – The ERTO life cycle should be a major consideration up front – as would any other expansion or investment in the business. My version is this:

    ERTOs usually birth on a sunny spell with an internal training and development strategy. This progresses through infancy into there early puberty stage getting more funding, doing more training and building a bigger team of people. People cost money as does compliance as it begins to cloud over.

    So they begin to get questioned over the rising cost of the T&D unit and whether there is sufficient ROI for the enterprise. The ‘never say die’ approach kicks in and they progress from puberty to their teenage years and realise they can blossom if they can deliver externally ( based on generous funding availability and opportunity for revenue to offset costs). Sometimes it may be just to to assist less capable enterprises in the same sector.

    Next iteration is ‘scope creep’, likes as you identify, the cert IV in FLM, Why? Because, now in the young adult period, ‘because we are bold and because we can’. Add to this changes in L&D management over time bring new ideas and perspectives on how things should work.

    Then the twilight years – hard economic times – government policy and compliance is overburdening, the unit is suddenly recognised as carrying a ‘over represented % of FTE staff and cost. So lets look at this – is this core business? Perhaps a move back to to internal only training only or do the sums – if might be more cost effective to outsource some or all of these services. Training & HR & Marketing departments usually first nail. Finally, the $ rules and the funeral notice appears in the paper.

    Now do not get me wrong. I have a great deal of respect for ERTOs and . I agree that the best expertise is often within the enterprise not the RTO. So why not do it yourself? Potentially because of the ERTO life cycle.

    I have a strong belief in partnering with RTOs – which clearly already do partner as well. (I am not an RTO by the way) My point is this…

    Partnering is poorly constructed and enacted by both RTOs and enterprises mainly due to a lack of expertise in identifying, negotiating and setting clear objectives and measurable outcomes – the requirements to put an effective partnership together. Sadly this is one factor that costs the VET sector and industry dearly.

    An organisation of your size should be able to negotiate clear terms to an RTO. If an RTO will not contextualise (in the true meaning of the term) they are not worth their salt. It is not a one way street however!

    An effective partnership requires investment from both parties. For example and RTO embedding a person within your organisation that effectively become ‘staff’ with the purpose to observe, research and develop a thorough understanding of your operations. This can be was jointly funded as well – where the learning and development strategy, TNA and workforce development plans became a joint venture – capitalising on technical expertise within the of the enterprise and applying the Training/Learning expertise from the RTO.

    Maybe I am being unrealistic – perhaps the sector is too complex to establish long term, viable and productive partnerships. There is a place for both but the ERTO life cycle is a must to consider for any business.

  3. Tarnya Cruickshank says:

    I work for an enterprise RTO and I think you have captured the essence of the purpose of an enterprise exceptionally well. I like the wording on your learning framework.

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