This paper presents seven different social enterprises located in Southern and Eastern Africa, India and Latin America. All chosen projects distinguish themselves through an innovative business approach and provide vocational skills development services to people from a disadvantaged background. An in-depth analysis of every project’s business model allows the identification of several success elements, which then leads to the composition of common best practices and breakthrough innovations. The paper also takes into account different forms of cooperation between development agencies, project implementers, beneficiaries as well as the private sector. With reference to the Swiss Agency for Development and Cooperation (SDC) Format Finder, this paper also discusses potential roles of the SDC within the chosen projects as well as recommendations for future engagement with similar project models.
Worldwide, around 71 million young people are affected by unemployment and over 150 million young workers live in poverty. This stems partly from a widespread lack of basic education as well as relevant skills training: Only 11 percent of all secondary students in the world are enrolled in any form of vocational education and training. To make matters worse, the social acceptance of such vocational education is still rather low among vulnerable societal groups and is often perceived as an unattractive training offer. Academic education still remains one of the leading paradigms in educational matters. These predominant conditions lead to two different consequences. On the one hand, young people’s entry to the labour market is being impeded. On the other hand, the situation is substantially influencing the social stability within the society. (SDC, May 2017) Vocational skills development, short VSD, aims at addressing these issues and building a bridge between the provision of training and the requirements of labour markets. Thereby, the effects of overcoming major gaps in labour market relevance and quality of training are threefold. First of all, vocational skills development has a direct impact on poverty reduction.
After completing their vocational education, young people have higher chances of finding a paid job. Earning a higher income then enables workers to lift themselves out of poverty and live a decent life. A second impact of vocational education would be its contribution to the economic development of a country. Skills training strengthens a nation’s workforce, companies benefit from highly-skilled workers and become more productive and competitive through the employment of paid workers. Hence, vocational skills development is a driving force for economic development. The third effect focuses more on the sociological component of vocational training. As mentioned above, prospects of a lack of work among large parts of the population might endanger the social stability within a society. Vocational skills development, however, enables people to escape the poverty trap and improve their living conditions. Hence, such skills training has a direct bearing on the social developmentof a country and can be perceived as population empowerment. (Employment & Income, June 28, 2017)
Vocational skills programmes can be provided by many different actors, one of them being the private sector. In the current SDC strategy for education, further implementation of engagement with the private sector in the field of vocational skills development is a central objective. To find new models that fit this approach and to enrich the SDC catalogue of “successful VSD models” with a focus on the private sector and social entrepreneurs, this paper involved the task of identifying some highly successful and innovative VSD models.
Besides our contact with the SDC and extensive desk research, we collaborated with Ashoka, New Ventures and LeFil Consulting in order to collect projects matching our criteria. In the following, we conducted interviews with selected social entrepreneurs to deepen our understanding of their business models and extract their innovative elements.
This paper elaborates on the most promising results of the extensive research done on innovative VSD models and introduces some key elements for success found within the projects. Thereby, the paper is structured as follows. To give some general orientation, we will first talk about fundamental principles such as the concept of Engagement with thePrivate Sector, short EPS, in vocational skills development. Also, we will present the methodological framework used for the analysis, namely the SDC Format Finder and the SDCTypology Tool. After laying this groundwork, we will then present seven models that have been identified as innovative during our research, namely CampoAlto, Trabajo y Persona,Young Africa, Unnati, Laboratoria, Samasource and hola<code>. These projects and their identified best practices will then be followed by a discussion of the potential role of the SDC in future VSD engagement, specifically in new approaches such as Social VentureInvestment, Social Impact Bond and Social Impact Incentive SIINC. Lastly, we will synthesise our findings and present several key elements identified as innovative in the business models we analysed.