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					                   13th Annual Vocational Education & Training
                               Research Conference
Tweed Heads 13 – 16 July 2004

                    Southern Cross University, Brett St., Tweed Heads




                          Insights From Interviews With
            Private Registered Training Organisations
                                    In Victoria




                                                                        Joan McPhee
                                                              PhD student RMIT
                                                          Harvard 2– 11.00am – 11.45am
                                                                 Thursday 15th July 2004
Abstract................................................................................................................................................ 3
Introduction........................................................................................................................................ 3
The interviewees .............................................................................................................................. 4
  Type of RTO ............................................................................................................................ 4
Characteristics of interviewees .................................................................................................. 4
  Title/Length of service .............................................................................................................. 4
     Gender: ................................................................................................................................ 4
     RTO structure ....................................................................................................................... 4
     Size ...................................................................................................................................... 4
     Table 1 – Size* of RTO’s interviewed by Type ....................................................................... 5
Reasons for registration ................................................................................................................ 5
Client groups ..................................................................................................................................... 5
Where were these RTO’s operating? ....................................................................................... 6
     Location of RTO’s ................................................................................................................ 6
     Where delivery of training occurred ....................................................................................... 6
     Interstate delivery ................................................................................................................. 6
What were these RTO’s doing? ................................................................................................. 7
  Scope, Australian Qualifications Framework (AQF) level and proportion of accredited training: .... 7
  Table 2 – Type of courses offered by RTO’s ............................................................................... 7
     Australian Qualifications Framework (AQF) levels ................................................................. 8
  Table 3 – Level of AQF qualification by size of RTO interviewed................................................ 8
     Proportion of training which was accredited............................................................................ 8
How are these RTO’s operating? .............................................................................................. 8
     Delivery strategy ................................................................................................................... 8
  Diverse staffing arrangements .................................................................................................... 9
     Industry providers ................................................................................................................. 9
     Commercial providers ........................................................................................................... 9
  Competition/Co-operation ....................................................................................................... 10
  Marketing ............................................................................................................................... 11
  Membership of peak bodies ..................................................................................................... 12
  Extent of government funding .................................................................................................. 12
Conclusion........................................................................................................................................ 12
Acronyms.......................................................................................................................................... 14
Bibliography .................................................................................................................................... 14
Appendix 1 ....................................................................................................................................... 15
  Semi-Structured questions for interviews with .......................................................................... 15
  selected registered private providers ......................................................................................... 15
Appendix 2 ....................................................................................................................................... 17
  Summary of Training Packages which RTO’s indicated, at interview, were regularly delivered and
  at what AQF level. .................................................................................................................. 17
Appendix 3 ....................................................................................................................................... 18




                                                                                                                                                        2
                   Insights From Interviews With Privately Owned
                    Registered Training Organisations In Victoria
                                                                                            Joan McPhee

Abstract
Between October 2003 and February 2004, interviews were conducted with the Chief Executives or
nominated senior managers of 21 Victorian Registered Training Organisations (RTO’s) which had
been accredited within the Vocational Education and Training (VET) system prior to 1994. The
interviews were limited to privately owned RTO’s including enterprise, industry and commercial
providers.

The interviews were undertaken as part of PhD research and represent work in progress. The working
title of the PhD is currently ‘The open training market in Vocational Education and Training in
Victoria – Fact or Fiction?’

This paper analyses qualitative and quantitative aspects of the interviews to assist in identification of
the impact of these providers on the VET system. It identifies, amongst other things, the similarities
and differences in the level and type of courses offered, the client groups, the extent of government
funding, marketing approaches and the extent of diversity of these RTO’s.

Introduction
This paper analyses 21 interviews with privately owned Registered Training Organisations (RTO’s)
conducted between October 2003 and February 2004. The analysis is very much ‘work in progress’.
It represents part of research being undertaken for a PhD presently entitled ‘The Open Training
Market in Vocational Education and Training in Victoria – Fact or Fiction?

The purpose of presenting at this conference is to seek comment and feedback.

Appendix 1 sets out the semi-structured interview questions which were used as a basis for each of the
interviews. These questions had been pilot tested with three RTO’s prior to their use with the selected
interviewees. Some minor adjustments were made as a result of the pilot.

Each interview lasted approximately one hour with some extending a further half an hour. Five
privately owned RTO’s which were approached refused to be interviewed.

At this stage, a decision has not been made whether interviews will be conducted with additional
privately owned RTO’s. However, it is anticipated that interviews will be conducted with other
institutions and/or ‘significant participants’ in the VET system.

The following discussion details
    characteristics of those who were interviewed,
    the reasons they gave for becoming RTO’s,
    the client groups of these RTO’s,
    where the RTO’s were operating,
    what courses were being delivered and at what level of the Australian Qualifications
        Framework (AQF) and
    aspects of how these RTO’s operated.




                                                                                                            3
The interviewees
The interviews were conducted with the Chief Executive Officers (CEO’s) or a nominated senior
manager of each Registered Training Organisation (RTO). All of the privately owned RTO’s had
been registered either prior to or during 1994.

Type of RTO
The number and proportion of each type of RTO interviewed in the categories were:
    10 commercial (48%);
    7 industry (33%);
    4 enterprise (19%).1

These proportions are roughly in line with the break up of privately owned RTO’s which were in these
categories in the VET system, in Victoria, at the end of June 2002.

Characteristics of interviewees
Title/Length of service
Twelve of those interviewed were CEO’s. Five of these had formed the Company and remained its
CEO. Twelve of all those interviewed had been with the organisation for ten years or more, the
longest serving person had been with the organisation for twenty-seven years. The shortest service of
any of those interviewed was four months.

Although not all organisations were asked when they commenced operations, eight of the commercial
RTO’s interviewed had been in business prior to 1990. The other two commercial RTO’s had been
established in 1991.

Gender:
Five of the RTO’s interviewed had female CEO’s. Six additional women who were interviewed had
been nominated to act as substitute for the CEO or the name of the contact person (sourced from the
National Training Information Service (NTIS) web site). Of the 21 interviews undertaken, over half
of those interviewed were women.

RTO structure
All 21 RTO’s were incorporated – as a proprietary company, a public company, company limited by
guarantee or were industry associations.

Size
As Table 1 below indicates the RTO’s interviewed represented small, medium and large providers.
Size was determined by the interviewee’s response to question 18 (see Appendix 1). It requested an
estimate of the number of Statements of Attainment and/or Certificates issued to participants each
year (referred to as ‘throughput’ in the definitions of size below).




1
  Commercial providers are defined as registered providers that deliver accredited training ‘for profit’ – or in the
words of the STB Report for 1992-3 ‘provide fee-for-service programs to the general public’ (State Training
Board Victoria, 1993, p. 25).
Enterprise providers are organisations which provide accredited training to their own employees or suppliers.
The State Training Board 1993 (p. 25).
Industry providers cover those which provided ‘training to an industry sector’ and include industry associations,
professional associations and other bodies not fully funded by Government (p. 25). Group training companies
are also included in the industry provider category.
                                                                                                                   4
                               Table 1 – Size* of RTO’s interviewed by Type

                    Type of RTO               Small   Medium            Large
                   Commercial                  2        4                 4
                   Industry                    1        0                 5
                   Enterprise                  2        0                 3
                   Total                       5        4                12
* Definitions used of size in terms of throughput:
          Small –               less than 100 p.a.
          Medium –              up to 250 p.a.
          Large –               more than 250 p.a.

Three of the four industry RTO’s were classified as large. Although all the enterprise RTO’s
interviewed were large companies with workforce numbers in excess of 1000, the classification of two
enterprise RTO’s as small was a consequence of the definition used.

Reasons for registration
Each person interviewed was asked why the organisation had decided to become a Registered Training
Organisation (RTO). The term ‘RTO’ was adopted to describe accredited private providers initially in
1997/8 (State Training Board Victoria, 1998, p 7.) but has been used synonymously with ‘private
providers’ in this paper. In summary, reasons included the following –
to

         gain access to government funding (labour market programs, training guarantee
          implementation and traineeship funding)
         increase the credibility & professionalism of their training
         ensure quality control & quality recognition
         gain a competitive advantage
         have its training recognised so students did not have to repeat the training at TAFE
         enable students to gain Austudy and travel concessions
         industrial agreements and to improve quality
         gain CRICOS registration
         keep up with its industry
         control its own ‘destiny’

Client groups
Of all the RTO’s interviewed, only two commercial RTO’s had a significant number of overseas
student enrolments. In each case these RTO’s had strong connections with tertiary institutions which
enabled their overseas students to move from the VET system into the university system with
comparative ease. One commented that only 20% of its total enrolments were local Victorian students
– the remainder being from a variety of overseas countries, mainly China, Korea, Indonesia and
Eastern Europe.

Two of the commercial RTO’s with their own permanent training facilities catered for full-time and
part-time student enrolments.

As indicated below, nine RTO’s delivered most of their training in the workplace to full-time
employees of client companies – the roles of employees involved in training ranged from
operational/shop floor employees through to senior managers.




                                                                                                     5
The four enterprise RTO’s which trained their own employees indicated that they did not necessarily
limit training opportunities to so-called permanent full-time employees. At least two of the four
provided accredited training for both casual and temporary workers.


Where were these RTO’s operating?
Location of RTO’s
Only one of the RTO’s interviewed was located in regional Victoria (a Group Training Company in
the industry organisation category). Three were located in the central business district (as defined by
Melway, maps 1A/1B). The remaining seventeen were located in suburban Melbourne.

Where delivery of training occurred
Of the 21 RTO’s, eight stated that their delivery was mainly at the workplace of their client companies
or their own enterprises. This did not necessarily mean these RTO’s only delivered on-the- job
training as the work sites had classrooms and a variety of delivery methods were employed. In some
cases delivery occurred on a 1:1 basis or in a small group.

The large enterprise RTO’s used the term ‘blended solutions’ to describe the variety of training
delivery they were providing for their employees. This term was used by the interviewees to describe
a combination of on-the-job training and assessment, formal classroom sessions, computer based or e-
learning, short sessions using employee experts, Recognition of Prior Learning (RPL), on-the-job
coaching by supervisor or others, providing materials on CDRoms, ‘block’ training in workshop
sessions away from the workplace. The examples provided also included distance learning where pre-
reading was required prior to classroom sessions.

Nine of the RTO’s operated at their own permanent locations where all their training was conducted.
This excluded the four enterprise RTO’s, as their core business was not training but all had training
facilities in each of the States in which they delivered training to their employees.

The distance education RTO indicated that it had students in regional and country areas. Its material
was in print format but students could enrol on-line. Email was used for communication between the
tutor and student. This RTO did run some corporate training and in these instances, used face-to- face
as well as distance education materials.

One commercial RTO hired appropriate facilities near airports. The airports were needed for the
fieldwork part of the training. One industry organisation auspiced accredited training which
appropriately qualified teachers delivered, mainly in secondary schools or similar organisations.

The variety of arrangements found in the 21 RTO’s interviewed suggests a high degree of flexibility
exists in the delivery of VET courses. In discussing the reasons for the choice of delivery, a frequent
comment was that the RTO was fitting in with the business needs of its client or it suited the type of
participant in the training.

Interstate delivery
Of the 21, nine did not train in other States. Of the remainder, four were enterprise RTO’s which were
all national companies and all trained in other States. Four of the commercial RTO’s had national
clients for whom they trained interstate as required. As already mentioned, the distance education
RTO had interstate participants, mostly on the eastern seaboard.

The industry RTO which auspiced teachers to deliver the training, operated throughout Australia. It
estimated that interstate clients represented approximately 30% of its total throughput. The other
industry organisation that had trained interstate said that it represented a very small proportion of its
total training.




                                                                                                            6
One large commercial provider had training facilities in both New South Wales (NSW) and
Queensland in addition to its Victorian operation. In fact, its enrolments in NSW outnumbered those
in Victoria.

One of the small commercial RTO’s acknowledged that half of its training activity for national
companies took place outside Victoria, mainly in NSW. Only one other commercial provider
indicated it had significant interstate activity which was mostly in NSW and Queensland.

What were these RTO’s doing?
Scope, Australian Qualifications Framework (AQF) level and proportion of accredited
training:
The responses in relation to the Training Packages or courses and the level at which they were offered
have been analysed. Table 2 below provides details and illustrates diversity in the type of courses on
the scope of registration of these RTO’s.

                        Table 2 – Type of courses offered by RTO’s
             Type of RTO      Training Packages   RTO’s own       Victorian or other
                              (TP) only           accredited      ‘crown copyright’
                              (units of           short course or qualification
                              competence or       qualification   and/or short
                              different levels of                 course
                              courses from TP)
             Commercial                 1                 4                5
             Industry                   1                 4                2
             Enterprise                 4                 0                0
             Total                      6                 8                7

                Note: Some of above RTO’s offered Training Packages as well as their own accredited
                curriculum but in these instances the count focused on the RTO owned or Victorian ‘crown
                copyright’ courses offered.

Appendix 2 identifies the actual Training Packages which RTO’s indicated they were regularly
delivering. Of the nineteen Training Packages identified as being regularly delivered by the RTO’s
interviewed, Business Services BSB01and Assessment & Workplace Training BSZ98 were the most
cited. Nine RTO’s were delivering Business Services and eight RTO’s were delivering Assessment &
Workplace Training.

Appendix 2 lists the other seventeen Training Packages being delivered on a regular basis and
illustrates the diverse range of training packages on the scope of the RTO’s interviewed. At
interview, RTO’s were asked to identify which Training Packages on their scope they regularly
delivered, and to what level. Two of the RTO’s regularly delivered four of these Training Packages.
One provider had nine Training Packages on its scope and stated that it regularly delivered six of
these. Six of the 21 RTO’s did not have any qualifications or units of competence other than those out
of Training Packages.

A number of RTO’s had curriculum accredited at State level, either in addition to Training Packages
or as part of a variety of courses offered. Eight RTO’s had short courses and/or qualifications which
were owned by them as a private provider and which were being delivered. In five of these instances,
no Training Packages were listed on their scope.

A few RTO’s also delivered qualifications developed by other private providers, from whom they had
sought permission and also some of these RTO’s were delivering courses which were ‘crown
copyright’.




                                                                                                           7
The above findings suggest that a substantial number of this group of RTO’s operated in specialist or
niche markets rather than endeavouring to ‘be all things to all people’. The data also reflected the
underlying popularity of Business Services and Assessment and Workplace Training Packages.

Australian Qualifications Framework (AQF) levels

As Table 3 below shows, of the 21 RTO’s interviewed, two delivered up to Advanced Diploma,
eleven delivered up to Diploma, five delivered up to Certificate IV and two delivered only up to
Certificate III. One provider offered only short courses. Interviewees were asked to confirm whether
the upper level at which they were delivering programmes corresponded with the highest AQF level
listed on their scope. Analysis of the responses indicated that four were not delivering to the level for
which their courses were registered.

Six of the large RTO’s were delivering up to Diploma but the remaining five RTO’s delivering at that
level were both small and medium sized organisations (see Table 3 below). Size of an RTO did not of
itself indicate to what AQF level an RTO provided training.

              Table 3 – Level of AQF qualification by size of RTO interviewed

           AQF level                   Small          Medium        Large          Total
           Advanced Diploma                 0              1              1              2
           Diploma                          3              2              6             11
           Certificate IV                   0              1              4              5
           Certificate III                  1              0              1              2
           Short Course                     0              1              0              1
           Total                            4              5             12             21


Appendix 3 reproduces the data relating to the AQF level of all privately owned RTO’s which were
registered on or before the end of 1994. (McPhee, 2003). That data showed 44% of those RTO’s had a
Diploma on their scope. This is a slightly lower proportion than that found to exist amongst the
RTO’s interviewed. Appendix 3 data also showed that fifteen (17%) of the providers in the earlier
analysis owned their own programs. In contrast, eight (38%) of those interviewed for this research
had programs which they owned on their scope.

Proportion of training which was accredited
Two thirds of those interviewed identified accredited training as representing at least three quarters of
their training. At the other end of the scale – one RTO had no accredited training taking place at the
time of interview, five believed it would represent somewhere between 25% and 33% of total training.
One group training company (an industry RTO) estimated that its accredited training represented no
more than 1% of all its training.

How are these RTO’s operating?
Delivery strategy
The ways in which the RTO’s delivered programs have already been covered on page five under the
heading ‘Where delivery of training occurred’. The reasons for the choice of the different types of
delivery were sought during interview. Those not already mentioned above, are summarised below:
     Three RTO’s used technical specialists or experts to deliver part or all of their training because
        this ensured that it had relevance to the needs of the participants.
     Another identified the need to provide greater support for the students who came straight out
        of school compared to those studying part-time and in the workforce – even so this
        organisation had a heavy emphasis on project work and hands-on learning using its
        technologically up-to-date facilities.


                                                                                                            8
       All of the large enterprise RTO’s identified the possible use of e-learning as a cost efficient
        way to deliver training; for example employees could be engaged in learning during slack
        times. However, it was acknowledged that the cost of development was high and that it was
        not suitable for all employees as their computer skills would not necessarily be sufficient.
        One of these enterprise RTO’s felt that some of the training should be in a classroom or group
        situation to enable the employees to discuss their learning. In the two large enterprise RTO’s
        whose employees were spread throughout all States, the development of some on-line learning
        was perceived as a way of ensuring consistency in training across all employees.
       Two of the smaller commercial RTO’s maintained that company priorities have made it more
        difficult to have employees attend block training off the job. One CEO commented that he
        found attention spans of operational and shop floor employees tended to be short and training
        needed to be adapted to ensure that the enthusiasm of the trainee was maintained.
       In contrast with the above comment, however, a number of the RTO’s provided their training
        in ‘blocks’. One central business district RTO provided daytime training in blocks and
        evening or part-time courses over three nights in a week. However, this format had been
        tailored, in its view, to the needs of its client group. One of the industry associations ran
        training in day time ‘blocks’ and provided evening classes as well. It maintained that up to
        90% of its participants came to daytime training. Yet another industry association offered
        courses in combinations that included weekends. This last mentioned RTO provided a
        timetable which enabled the participants to have two weeks away from training sessions
        during the course to enable them to complete their assignments.


Diverse staffing arrangements
A variety of staffing arrangements operated in the 21 organisations interviewed.

All the enterprise RTO’s used their own trainers to deliver their accredited courses and these were all
‘permanent’ company employees.

Industry providers
The arrangements in the industry RTO’s varied, with the two group training companies employing
‘permanent’ training personnel to deliver the courses they had on their scope. One of the large
industry providers had forty staff employed in its training area. Many of these were operational
personnel who had been sent to an external RTO to obtain their ‘train the trainer’ qualifications.

Another industry organisation had only two employees on the staff, one of whom was a trainer.
However, innumerable trainer/teachers were auspiced to deliver the accredited program the
organisation had developed with its industry members. This program had been developed for delivery
mainly in secondary schools.

The remaining industry providers operated in a variety of ways – one had training staff and also used
industry experts on annual contracts to deliver the training. Another sub-contracted the delivery of its
accredited training to a TAFE Institute and had only two people working in the training area in the
organisation itself. The last of this type of provider employed a mixture of staff in its training area,
including writers, project officers, management and administration personnel. It also used both
internal and external industry experts to deliver its training and indicated that additional sessional
trainers were used from time to time.

Commercial providers
Of the seven smaller providers interviewed, the CEO’s delivered most of the training. In the majority
of these cases, an additional administrative or accounting officer was employed, usually on a part-time
basis. However, if required, these RTO’s subcontracted trainers to meet the demand.

Five larger providers worked with a variety of arrangements. The two providers which had niche
markets in specific areas employed office staff but nearly all trainer/tutors were industry experts,
contracted on an annual basis. Sessional staff were brought in to meet specific needs or peak demand.
Not all staff employed under these various arrangements were necessarily full-time employees.
                                                                                                       9
The number of trainers and administrative and/or management staff employed to support the training
activities of the RTO’s varied in accordance with the amount of training provided by that RTO –
whether it was accredited or non-accredited. Estimates of total staff employed to deliver training in
these RTO’s varied between a maximum of 80 in one commercial RTO down to a single trainer/CEO.

All the providers interviewed had been in business either before 1991 or had been operating as
accredited providers before the end of 1994. This may be a pointer to the perceived quality of the
services they offered by their clients.

The use of contractors who were industry experts and/or brought in to meet increased demand allowed
a greater flexibility in the operations of these providers than would be possible in the larger TAFE
Institutes.

Competition/Co-operation
Although seeking the opinions of the interviewees about the extent to which they faced competition
would not enable determination of the extent to which the training market is competitive, a goal
identified in the conclusion in a previous paper on RTO’s in these grouping (McPhee, 2003), it seemed
important to ascertain their views on competitors.

Not surprisingly, the four enterprise RTO’s did not see competition as a relevant issue in relation to
delivery of training as their own employees were their clients. Furthermore, these large enterprise
RTO’s used other private providers and TAFE Institutes to meet those training needs which fell
outside their scope of registration.

In many of the larger RTO’s, evidence of collaboration and cooperation was apparent, with TAFE
Institutes and other providers being used to ensure their total training needs were met. A metropolitan
group training company used a number of TAFE Institutes, other RTO’s and universities with TAFE
divisions to deliver appropriate training programs in trade areas to its group employees.

The only commercial RTO which claimed it had virtually no competition maintained that it had 80%
of the market in the niche field in which it operated. Having said that, however, it cited TAFE and
other private providers as being ineffective competitors because it believed it was better organised and
responsive than these institutions.

Two of the industry organisations interviewed did not see themselves as facing competition as they
subcontracted their accredited training to TAFE Institutes and, in one case, to other private providers,
to deliver accredited training for their group employees or their client membership. The other
industry organisation believed that generic business programs offered by a variety of institutions
competed with it in relation to the specialist small business program it had contracted to a TAFE
Institute to deliver on its behalf.

Other RTO’s interviewed felt they faced some form of competition. One specialist industry
association perceived TAFE as being in a monopoly position in relation to that industry’s specialist
field. However, that association offered training courses up to diploma level using accredited
curriculum which it owned.

Two other specialist industry organisations felt they faced competition from other organisations in the
same field. In one instance the RTO believed it would be beneficial for them to collaborate more in
the future with its competitors. In the other, it recognised its inability to ‘be all things to all people’
and, as already mentioned in relation to enterprise RTO’s, had arrangements with TAFE Institutes for
delivery of some accredited courses for its members.

The last of the industry organisations in the group did not perceive TAFE as a competitor but thought
it faced insignificant competition from other private organisations. This would be partly because,
prior to the development of a training package in the field, it had its own accredited program in its
specialist field.

                                                                                                         10
In the remaining nine commercial organisations interviewed, five believed their main competition
came from TAFE. Different attitudes prevailed in the other four – in the distance education field, a
direct competitor was cited. One of the big business colleges interviewed cited private business
colleges rather than TAFE as its main competition.

A smaller RTO cited Adult Multicultural Education Services (AMES), a large specialist RTO, as its
main competition. While yet another specialist small provider identified other small private providers
as competing in some of the fields in which it operated.

Those commercial providers which cited TAFE as their significant competitor perceived it as being
able to compete on price and on volume as well as status and resources.

Marketing
Even in the enterprise RTO’s, marketing of one kind or another occurred.

In one manufacturing company, the unions were used as a conduit for encouraging employees to
undertake accredited training. In another, a web site on its intranet contained details of courses and
provided a search capability. In a third, internally circulated published material provided a major form
of communication together with promotion and publicity of its graduations. In the fourth enterprise,
no specific marketing approaches were identified in the interview.

In three industry organisations marketing was directed at their members using posters, flyers, the web
sites and/or direct mail. However, all three of these RTO’s commented that they intended to focus
more of their marketing beyond their membership in the future and would develop their databases and
use daily papers for advertising, where appropriate.

In other instances, the client group cited was to be sourced mainly from schools (group training
companies & the specialist industry organisation mentioned above), so attendance at career nights and
other methods of promoting to schools were cited as methods of marketing.

The other specialist industry organisation used email, word-of-mouth, bulletin boards and its managers
to promote its accredited programs. It also indicated that career progression depended on ongoing
training and development so that gaining sufficient trainees or participants did not appear to be a
problem.

Commercial RTO’s might have been expected to have a more focused and sophisticated approach to
marketing. Three of the small RTO’s relied on word-of-mouth although one did advertise in daily
papers or use direct contacts in industry. Another of the commercial RTO’s which operated in a
specialist field relied mostly on direct mail.

One of the specialist RTO’s used the Victorian Tertiary Admission Centre (VTAC) guide, careers
nights and referrals, but identified word-of-mouth as also being important as a source of new students.
Another of the larger RTO’s used newspaper and radio advertising. The RTO with a focus on distance
education used telemarketing and television in regional areas. Another RTO advertised in a specialist
magazine associated with the area in which it offered courses.

The two RTO’s with international students had full-time marketing staff and/or sent their senior staff
overseas to help market their courses. One also used local newspapers, the other believed its web site
was its important marketing tool.

As the above discussion indicated, a variety of approaches to promotion have been used. A number of
RTO’s identified word-of-mouth as a major means of marketing. This could help explain why this
group of RTO’s continue to be successful.




                                                                                                       11
Membership of peak bodies
In a previous paper (McPhee, 2003), the extent to which private RTO’s belonged to Australian
Council of Private Education & Training (ACPET) was raised as a matter for further exploration. One
question in the interview asked each RTO whether they belonged to the ACPET. Only seven of the 21
RTO’s interviewed responded in the affirmative at the time of interview (three being industry and four
being commercial organisations). Two were uncertain of their membership status. The remaining
twelve indicated they had not joined. Of these, four were enterprise organisations. One of them had
belonged but had ceased to remain a member as it felt that ACPET could not represent its interests.

Extent of government funding
Of the 21 RTO’s interviewed, sixteen stated they did not currently receive government funding
through the Victorian government Priority Education & Training Program (PETP) or Apprenticeship
Traineeship Training Program (ATTP) schemes. Five of these sixteen RTO’s indicated that they had
received this type of Victorian government funding in the past but had not applied in more recent
times.

The CEO of the RTO whose main client group enrolled in distance education programs expressed the
opinion that it would be too difficult to apply for this type of funding as it would not be possible to
identify the nominal hours and time limits – and furthermore, that the hurdles were just too high for
obtaining government funding to justify investing the time in trying to gain it. This latter view was
also partly why the five RTO’s which had received such funding in the past had failed to seek funding
again.

Other types of funding received by RTO’s included
    the Workplace English Language scheme (WEL) funds which two commercial RTO’s and
        one enterprise provider had gained,
    Youth Employment Scheme (YES) funds which one industry provider mentioned
    ‘leverage funding’ – gained by one enterprise provider.

Another industry provider received substantial training funds, approximately 40% of total training
budget from an industry fund which was set up by government legislation. In another industry
organisation, a ‘redundancy fund’ was providing considerable funding for it and other RTO’s in the
industry to run a specific Occupational Health & Safety short course for its members

In discussions on funding, it was apparent that in the past, a number of the RTO’s had received high
levels of funding through Federal government labour market programs. Three of the industry RTO’s
also indicated that they had received direct government support for careers or project officers and/or
for development of training materials.

User choice funds paid to their client companies as incentives and subsidies by the government were
mentioned by two RTO’s. However this funding did not flow directly to the RTO from the
government but came as fee-for-service from the client company.

Of the remaining five companies which identified funding sourced through either ATTP or PETP, all
but one maintained it represented a small proportion of their total training activity – in one instance it
was as low as 1%, in another 2% and yet another, which had received this funding in the past indicated
it had not applied for it in 2004. Only one of all the RTO’s interviewed indicated that this type of
funding represented a significant portion of revenue, being somewhere between 50% and 60% of its
total training.

Conclusion
This paper does not cover all questions asked at interview. In particular, no analysis has yet been
undertaken of those relating to the extent of networking, innovation, relationships with government,
perceptions of costs and benefits of being providers, or identifying what they felt the future held for
VET and accreditation.


                                                                                                          12
It is intended to use the data collected in these interviews to make comparisons with results of surveys
published in relation to RTO’s. (Anderson, 2002; Kell, Balatti, & Muspratt, 1997)

The impact of a small private provider is not necessarily determined by its size. Four operated in
niche markets where relatively little competition was apparent. Others, although small, had been in
business for many years and word-of-mouth’ recommendation had resulted in their business being
maintained at a level with which they were satisfied, even if the volume of throughput did not expand
significantly over time.

The RTO’s formed by industry associations had a relatively captive market for their programs from
their membership. The fact that it was being provided by industry for the industry would possibly have
made it more acceptable to those undertaking such training. It would also make it more likely that the
training was specific to that industry.

The outcome of the interviews with the 21 privately owned RTO’s has
    indicated that the reasons for becoming RTO’s have not been uniform
    demonstrated that a variety of approaches exist for delivering training and marketing the
       product
    confirmed the operation of these RTO’s on the national scene through interstate delivery
       although not all those interviewed were working in other States
    suggested that flexibility is apparent in the way in which trainers are engaged and used
    identified considerable variety in the Training Packages being used and the ongoing use of
       RTO owned curriculum and ‘crown copyright’ courses
    shown that more than half of these RTO’s were delivering up to Diploma level
    identified the extent of direct government funding received through ATTP & PETP programs
       and, in a more general sense
    helped to identify why some of these organisations have successfully remained in business
       throughout the 90’s.

    It also points to the need for more information to be obtained from the many privately owned
    RTO’s which have not sought government funding and therefore whose outcomes and student
    successes have not found their way into the statistics.




                                                                                                      13
Acronyms
     ACPET                 Australian Council for Private Education & Training
     ANTA                  Australian National Training Authority
     AQTF                  Australian Quality Training Framework
     AQF                   Australian Qualifications Framework
     ATTP                  Apprenticeship Traineeship Training Program
     CEO                   Chief Executive Officer
     CRICOS                Commonwealth Register of Institutions & Courses
     CTO                   Commercial Training Organisation
     EO                    Enterprise Registered Training Organisation
     IO                    Industry Registered Training Organisation
     ITB’s                 Industry Training Boards
     NTIS                  National Training Information Service
     OTTE                  Office of Training & Tertiary Education
     PETP                  Priority Education & Training Program
     RTO                   Registered Training Organisation
     STB                   State Training Board
     TAFE                  Technical & Further Education
     VQA                   Victorian Qualifications Authority
     VET                   Vocational Education & Training
     VTAC                  Victorian Tertiary Admission Centre
     WEL                   Workplace English Language
     YES                   Youth Employment Scheme



Bibliography
Anderson, D. (2002). The Training Market: A national overview of impacts on RTO's. Paper presented
         at the VET: Connections, Costs & Contradictions, Melbourne.
Kell, P., Balatti, J., & Muspratt, S. (1997). The Private, Public & Open Training Markets: A Study of
         private training providers in regional North Queensland. Australian Educational Researcher,
         24(No. 2), 43-57.
McPhee, J. (2003). The Victorian Vocational Education & Training system: Focus on the Private
         Provider (Work in Progress). Paper presented at the 12th Annual Vocational Education &
         Training Research Conference, Perth.
State Training Board Victoria. (1993). Annual Report 1992-93.
State Training Board Victoria. (1998). Annual Report 1997-98.




                                                                                                  14
                                           Appendix 1

                       Semi-Structured questions for interviews with

                              selected registered private providers
1.    Confirming information:
      You became a private RTO according to the data I have recorded in my research in 1/12/93
      Can you confirm this for me?
2     What is your formal position title?
3     How many reports are there between you and the CEO of the RTO?
4     How long have your been working in this organisation? (yrs)
5     Were you working in the organisation when it became registered as an RTO?
6     If you were, do you know who made the decision to become an RTO?
      If yes, insert name of person
7     If you were working in organisation and know, please state reason why decision was made
8     Do you think those reasons still apply today?
9     If not what has changed in the meantime?
10    If you were not working here at the time, do you know who would be able to tell me why the original
      decision was made? If yes –
11    Accredited training significance:
      Can you tell me what proportion of your total training (either in student contact hours or in relation to
      total revenue) is devoted to accredited training (i.e. training which delivers some part of training
      packages or other courses which form part of the VET accredited program)? If yes express as %
11b   Has this proportion changed significantly since the organisation became an RTO?
11c   If yes, has it increased or decreased?
11d   Could you tell me why you think this?
12    Scope of registration:
      Of the qualifications on your scope –
      Which have been regularly delivered (i.e. main part of your accredited training delivery)?
      Which have rarely been delivered (i.e. no more than twice)
      Which ones have never been delivered?
13    Delivery strategies:
      Tell me about your delivery strategies (how you deliver training – it may include the method as well)
13a   Are there particular reasons for using the ones you describe?
      If yes, can you tell me about them?
13b   Can you tell me more about that?
14    Client Group:
      Can you tell me about the client group to whom you deliver programs?
14a   Are they usually employed?
14b   If yes, are they mainly part-time/full-time employees
14c   Can you tell me more about this client group? (entry level, managers, overseas, unemployed, etc)
15    AQF Level:
      What is the highest level the RTO has delivered in accredited training?
15a   According to my data you have up to (insert) but have you actually delivered to that level?

16    Please nominate 3 (or 4) training packages which you have found to be the most popular (from your
      scope)
16a   Which of the ones you nominated has been the most successful in meeting the needs of your client
      group, in your opinion?
16b   On what basis do you make that judgement?
17    Innovation:
      Is there anything you can tell me about you being innovative in terms of the delivery or design of
      courses or any other aspects of your operations as an RTO?
18    No of S of A issued and/or Certificates:
                                                                                                     15
      To gain some idea of your student throughput over a period can you tell me how many qualifications
      issued to students on an annual basis or over the last two or three years compared with the first two or
      three years of your operations.

19    Training in other States:
      Do you deliver training in other States.
19a   If yes, what proportion of your total training do you estimate this to be? – on revenue or student contact
      hours basis
19b   Why have you done this training in other States?
20    Competitors:
      What about other competitors?
      Who are they?
      How do they compete?
21    Marketing:
      Can you tell me something about your marketing – how you gain your business; whether you advertise
      or use other methods of keeping your name in the marketplace.
22    Government relations:
      How would you describe your relationship with government? Are there particular segments or parts of
      government that you would differentiate this relationship? (i.e. State/Federal) eg grants, tenders,
      subcontracting
22a   Have you received funding from Government funding have they ever received any?
22b   If yes, how significant in relation to total training?
22c   Reasons for seeking it?

23    Networks: Can you tell me something about the networks you use and why you use those in particular?

24    Inter-institutional or business relationships: Do you have any kind of business relationships with other
      institutions involved in the sector? E.g. ITB’s, other RTO’s,
24a   What do you think can be gained from these relationships?
25    Staffing issues:
      Trainers – methods/criteria for recruiting
25a   Type of arrangements (employee, contractor)
25b   Number of trainers employed or used
25c   Other employees or contractors e.g. accountant, administrator, managers
25d   Determining rates of pay, rewarding performance, contractual arrangements
      Costs/Benefits:
26    What about costs of being an RTO? Can you identify those for me?
26a   Have they changed significantly?
26b   Can you explain why changes have occurred?
27    What about benefits of being an RTO? Can you identify those for me?
      Have they changed significantly?
28    AQTF:
      Has the implementation of the new AQTF had any effect? Direct or indirect? Good or bad?
29    Organisations/Associations:
      Do you belong to Australian Council for Private Education & Training (ACPET)
      If yes, why did you join? If no, why did you decide not to join? Uncertain – discuss what it is
30    Views about the future: What is your view about the future of RTO’s, accredited training and the
      training market generally?

31    Is there anything else you would like to mention which I have omitted to touch on in all of the
      questions raised above.




                                                                                                    16
                                                  Appendix 2
Summary of Training Packages which RTO’s indicated, at interview, were regularly
delivered and at what AQF level.
Name of Training Package   Levels at which Training           No. of RTO’s
                           Package were delivered          delivering Training   Total No. of RTO’s offering
                                                            Package at each        this Training Package
                                                                   level
Assessment & Workplace
Training BSZ98             Certificate IV only                     6                         8
                           Cert IV & Diploma                       2
Business Services
BSB01                      Certificate II or III or both           4                         9
                           Up to & including Cert IV               3
                           Up to & including Diploma               2

Beauty
WRB99                      Certificate II or III or both           1                         1

Community Services
CHC02                      Certificate II or III or both           1                         1

Engineering
MEM98                      Certificate I/II &/or III               2                         2

Public Services Training
PSP99                      Units of competence                     1                         1
Food Processing
FDF03                      Certificate II or III or both           1                         1

Music
CUS01                      Certificate II or III or both           1                         1

Property                                                                                     1
PRD01                      Up to & including Diploma               1

Tourism
THT02                      Up to & including Diploma               1                         1

Financial Services
FNB                        Up to Diploma                           1                         2
                           Advanced Diploma                        1
Information Technology
ICA99                      Up to Certificate IV                    1                         2
                           Diploma                                 1
Manufactured Mineral
Products                   Certificate I & II                      1                         1
PMC99
Retail
WRR002                     Up to Certificate IV                    1                         1

General Construction
BCG98                      Certificate II or III or both           1                         1

Automotive
AUR99                      Certificate II or III or both           1                         1


Electro technology UTE99   Certificate III                         1                         1

Telecommunications
ICT02                      Certificate II up to Cert IV            1                         1

Hospitality                Units of competence only                1
THH02                      Up to & including Diploma                                         2
                           Advanced Diploma                        1
Total packages 19


                                                                                                          17
                                             Appendix 3



An analysis of the highest level of training offered by all the RTO’s which had been registered prior
to the end of 1994, indicated that of the 90

       2 had a Graduate Certificate as their highest qualification (2%)
       9 had Advanced Diplomas as their highest qualification (10%)
       40 offered a Diploma as their highest level of training, (44%)
       18 offered a Certificate IV qualification as their highest level (20%)
       2 had Certificate III as the highest level, (2%)
       4 had Certificate II as the highest level (4%)
       15 had their own accredited course or qualification, (17%)
(McPhee, 2003)




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