It’s the economy…! Uncertainty regarding literacy and numeracy funding

crystal ball

Here are my thoughts on the economic environment right now:

Government spending on education increased from $9 billion in 2008 to around $11.6 billion in 2012. From 2012 we have seen a slowdown in education spending from $12.3 billion in 2013 to a projected $12.3 billion again in 2014, and up to $12.4 billion in 2014 with incremental increases forecast each year.

Dedicated funding to adult literacy and numeracy seems to have mirrored this trend with government interested in the benefits of increasing the literacy and numeracy levels of the wider population, but perhaps cautious about expanding funded programmes due to the lack of rigorous evidence on the benefits of training and whether it materially affects economic performance.

There is certainly a good case to make for adult literacy and numeracy training with regards to increasing workforce productivity. Also, foundation-focused literacy and numeracy skills development should impact on the uptake of other technical qualifications. However, without a research basis for this it remains a largely untested assumption.

The current Tertiary Education Strategy (2014-2019) includes improving literacy and numeracy as a priority. The strategy recognises that basic skills in literacy, language, and numeracy are essential to participate fully in the modern world, particularly due to the increasingly based nature of jobs.

From our perspective as a non-SAC funded provider there is a lot of uncertainty around the ALEG funding that we receive, particularly if there is a slowdown on relevant funding.

Currently, it seems that this fund will continue into 2015. Our 2015 investment plan submission later this year will give us an indication of what the funding situation will look like for the next 12 months.

The ALEC (Anti) Marketing Plan

content marketing

I’m terrible at marketing. At least in the normal sense that people use the word. I recognise that now.

In the past we have spent a lot of time and money, including working with a professional marketing company and using online advertising to market ALEC’s education products and to develop marketing plans.

Mostly, this time and money has not generated much of a return on the investment. In fact, it’s been money wasted.

Our approach to marketing is now much more basic. We focus on

  1. Creating the best products and experiences that we can. We are specialists and we only deliver training and credentials for embedded literacy and numeracy. This means that our attention is not directed anywhere else.
  2. Working closely with our biggest customers to generate repeat business with them. For example, in 2013 and 2014 we’ve worked closely with the Department of Corrections and NorthTec to tailor our face-to-face delivery to meet their needs.
  3. Supporting the TEC’s infrastructure for literacy and numeracy. We actively promote the Learning Progressions, Pathways Awarua and Assessment Tool in our NCALNE (Voc) training and delivery.
  4. Taking an active role in the literacy and numeracy sector. This includes through blogging, attending and presenting at industry conferences, and taking part in special interest groups like the NZQA working group for the review of the ALNE qualifications.
  5. Maintaining an active online presence through a variety of social media channels. We are represented online through ALEC’s:
  6. Maintaining a good relationship with the TEC and keeping a close watch on their activities in the literacy and numeracy space.

This means that our best marketing comes from referrals including via our graduates, but also others working in industry, government departments, and in the education sector generally.

That’s how we do marketing… Got any better ideas? Let me know.


Using the Business Model Canvas: What are ALEC’s Value Propositions?

value proposition

When you analyse your education business model using the Business Model Generation Canvas you need to start thinking in terms of what your business’s value propositions are.

Value propositions are the bundle of products and services that create value for specific customer segments.

What are ALEC’s Value propositions?

Tell me if we’re on the right track…

ALEC provides training and assessment for the NCALNE (Voc). According to the Tertiary Education Commission’s Plan Guidance for providers, from 2015 this qualification will become the minimum compulsory qualification for tutors delivering Student Achievement Component (SAC) funded or Youth Guarantee (YG) funded training. It’s already an expected qualification for all training either at or below level 3 on the NZQA qualifications framework.

In summary:

  • ALEC provides NCALNE (Voc) training, assessment, and credentials.
  • The ALEC brand is recognised in the wider tertiary education sector as representing quality training and assessment with regards to the NCALNE (Voc).
  • We do it in a way that is practical, “hands on”, and informed by good practice and current research.
  • Our training helps tutors teach anything, improves their students’ learning, and shows them ways to do their jobs better.
  • This work helps tutors and their employers meet government expectations and solves some literacy and numeracy-related compliance problems.
  • We take things that are potentially complex such as the frameworks for analysing literacy and numeracy and make them comprehensible for our learners. This is a very self conscious feature of our approach to designing content and assessment.
  • The NCALNE (Voc) is a vehicle for transmission of the government-mandated infrastructure for literacy and numeracy including the Literacy and Numeracy for Adults Assessment Tool (LNAAT) and Pathways Awarua.
  • Through our professional development work we are actively shaping the sector that we work in.

In terms of what we need to add moving forward:

  • An ALNE focused consulting tool, like a kind of organisational literacy and numeracy “health check” or “warrant of fitness” that would allow us to expand our consulting role, and identify multiple professional development pathways within organisations for a wider range of staff.
  • We need to create much more online and video-based content. Our analysis of current education trends both in Aotearoa New Zealand and worldwide indicate that education companies need to make a shift to thinking of themselves more as online media companies.
  • For our face-to-face and blended delivery we need a still more “hands on” approach again than what we’ve currently got. While we already have a very practical focus which has met the needs of the trades and vocational trainers and tutors that we’ve always worked with, we see the need to continue to push our practical approach in new directions.
  • In terms of the online approach, in addition to more video we also need more of a self-service and perhaps automated or semi-automated approach. We can increase our cost effectiveness by pushing more content online, and perhaps automating several aspects of the assessment process as well. Technological solutions here may enable us to remain profitable, but offer lower cost delivery in the future.

What do you think…?

How does ALEC’s business model work?

ALEC Education Business Model for blog bmg

ALEC’s business model is something that we have given a significant amount of thought to, especially in recent years. As a government-funded training organisation we are fortunate to have access to a dedicated funding stream for our main education product, the National Certificate in Adult Literacy & Numeracy Education (Vocational/Workplace) – otherwise known as the NCALNE (Voc).

The funding stream for this is known as the Adult Literacy Educator Grants (ALEG) and currently subsidises a big chunk, but not all, of the costs of the training. We pass on other training costs to the organisations we work with as fees for training and assessment.

The level of uncertainty around this funding has increased in recent years. And while we have a product that is in demand, our increasing lack of confidence in the existing funding stream has forced us to consider ways to drastically reduce our fixed costs and become a much leaner organisation.

We use the Business Model Canvas to describe, visualise, and assess our existing business model. You can see the latest version (May 2014) above following our recent restructure which included closing our local offices and shutting down our local Intensive Literacy and Numeracy (ILN) programme that ran from 2010-2014.

Click the image if you want to see the detail. Yellow sticky notes represent what we’re currently doing or working on, and pink stickies are area where I think we can grow, improve, or develop.

Any thoughts?


Everybody smokes their own crack (Or reasons why we’re a winning team)


To borrow a phrase from one of my internet heroes: “Everybody smokes their own crack”. Obviously, we’re biased but we think we have a winning team at ALEC.

Here’s why. We are…

  • Small, agile, and continuously improving our delivery content.
  • Experienced and qualified academically, but practically focused due to the often “hands on” requirements of our learners.
  • Responsive to broad trends impacting education, especially in relation to technology.
  • Excellent at taking complex material and making it easy to understand for others, especially non experts.
  • Always looking for ways to support the wider sector including New Zealand’s national infrastructure for strengthening literacy and numeracy.
  • Able to work with specialists and experts and leverage technological solutions to scale our delivery up or down depending on fluctuations in the demand for training or supply of TEC funding.
  • Now able to operate with very low fixed costs.

What do you think? Anything we can add here? Disagree?

ALEC Purpose, Vision, Mission, Values

white alec rgb

Some tweaking going on here for the latest version of our business plan… Any comments gratefully received:

Purpose: Why do we exist?

ALEC exists to provide innovative solutions, expertise, professional development and training in adult literacy and numeracy education to industry, communities, government, and our own sector.

Vision: Where are we going?

ALEC’s vision is to be the leader in adult literacy and numeracy education and consulting in Aotearoa New Zealand and internationally.

Mission: What are we trying to do?

ALEC’s mission is to:

  1. Provide remarkable adult literacy and numeracy education products.
  2. Serve our learners, stakeholders, and communities through practical approaches to education and consulting which are grounded in best practice and current research.
  3. Become the adult literacy and numeracy education provider of choice for industry, learners, organisations, and government agencies.

Values: What are we on about?

The following whakatauki or proverb embodies many of ALEC’s values:

Mā te huruhuru te manu ka rere – It is the feathers that enable the bird to fly.

We believe that our approach to embedding literacy and numeracy into adult education can help tutors and trainers teach anything, improve learning, and help their students achieve better outcomes.

In providing our education products we strive for simplicity, clarity, good design, passion, innovative approaches based on experience and application.

Show me the numbers! NCALNE Market saturation

show me the numbers

This is interesting… Data is from the NZQA data set for NCALNE qualifications as reported in the Tertiary Education Targeted Review of Qualification (TRoQ) needs analysis. Data is for 2012.

  • 485,000 NZers with no qualifications in 2012.
  • 310,000 NZers currently in work with no qualifications in 2012.
  • 254,000 assessments carried out using the Literacy and Numeracy for Adults Assessment Tool.
  • 250,000 jobs ceased to exist in any given year.
  • 250,000 new jobs are created in any given year.
  • 101,000 learners assessed using the Literacy and Numeracy for Adults Assessment Tool.
  • 55,000 people aged 15-24 not in employment, education or training in 2013
  • 35,000 full time equivalent staff employed by recognised tertiary organisations.
  • 27,000 actual tertiary education teachers, learning facilitators, and assessors working in 2012.
  • 16,000 tutors and teaching staff to whom pre-degree teacher education qualifications of any kind may be relevant in 2012.
  • 2,570 graduates in total from NCALNE (Voc) and NCALNE (Educator) from 2009-2012.
  • 2,198 NCALNE (Voc) graduates in total from between 2009-2012.
  • 1494 NCALNE (Voc) graduates from 4 private training organisations including ALEC as well as Te Wananga o Aotearoa.
  • 373 NCALNE (Voc) graduates from Institutes of Technology and Polytechs (ITPs).
  • 372 NCALNE (Ed) graduates from 2009-2012.
  • 210 NCALNE (Ed) graduates from Literacy Aotearoa.
  • 35 providers offering the NCALNE (Voc) between 2009-2012.
  • 5: Number of providers delivering the NCALNE (Ed) between 2009-2012.
  • 0: Number of universities or ITPs requiring a teaching qualification as a pre-requisite for appointment as full time staff in 2010.

Aside from the fact that this data is now out of date by two years, thoughts anyone…?