Freight Forwarding and Customs Broking

Skills strategy 20102013

December 2010

This document has been written for the Freight Forwarding and Customs Broking industry of New Zealand by Tranzqual ITO together with representatives of the Customs Broking and Freight Forwarding sector.

New Zealand Commercial Road Transport Industry Training Organisation Incorporated (Tranzqual ITO) PO Box 923 Wellington 6140 www.tranzqual.org.nz ph 04 917 3369 or 0800 478 257 (0800 4QUALS) fax 917 3390 All text contained in this strategy document is freely available for anyone in the Freight Forwarding and Customs Broking industry to use, copy, reproduce or store. Images contained in this strategy document are the sole property of Tranzqual Tranzqual images have full protection given by the Copyright Act 1994. Images may not be copied, reproduced or stored in any information retrieval system without the prior written agreement of Tranzqual.

Contents
Foreword Context Skills strategies Principles Commitment to Partnership Why have a Skills strategy? The collaborative process
Survey Report

1 2 2 3 4 45 6
7

Glossary Three-year Action Plan Appendix 1

Productivity OECD analysis of productivity

88 9

10 13

Appendix 2
The Freight Forwarding and Customs Broking industry 15

Appendix 3
Freight Forwarding and Customs Broking Industry survey 16

Appendix 4
PESTLE Analysis SWOT Analysis 18 21

Appendix 5
Leitch Review of Skills (UK report 2006) 22

Freight Forwarding and Customs Broking | Skills strategy 20102013

Productivity growth isnt everything, but in the long run it is nearly everything.
Paul Krugman The Age of Diminished Expectations

Foreword
Under the Industry Training Act 1992, Tranzqual has responsibility for a number of functions, the key ones of which are: providing industry leadership on matters relating to skills identifying current and future skill needs setting national training standards for industry The Customs Brokers and Freight Forwarders of New Zealand (CBAFF) is the primary organisation promoting industry careers. representing the interests of people working In other words a skills focused approach (sitting in the customs broking and freight forwarding within a broader productivity challenge) that can industry in New Zealand. be deployed to achieve industry-wide benefits beyond those which might be undertaken by any The aims of CBAFF include: one company alone. promoting the industry in the wider environment This Sector Skills strategy has been established procuring and disseminating information through a solid industry consultation process and relevant and helpful to members this led firstly to a number of observations and educating less experienced participants in then secondly some recommended actions. the industry The results of the consultation process are laid encouraging and facilitating continued training in Freight Forwarding and out through the early sections of the document. Customs Broking At its heart is the section titled Three-year Action establishing a Code of Ethics that will assist Plan. Included within the list of proposed actions is a regular six monthly update back to industry members to perform in a cohesive and players on progress against this strategy. professional manner to the benefit of the overall image of the industry. Our intention is that this is a living document subject to change and addition as some of the options are explored more fully. Our longer term wish is that this Sector Skills strategy process, and the associated regular updates, over time become to be seen as a genuine industry lever. Hopefully that in turn will promote a further flow of ideas for the next sector skills strategy to be developed in late 2012. This Sector Skills strategy 20102013 has been developed by key players in the Freight Forwarding and Customs Broking industry with support from Tranzqual ITO. The document outlines a range of proposed actions to be taken or explored more fully over the three year period 20102013.

Wayne Smith Chief Executive Officer Tranzqual ITO

Willie van Heusden President CBAFF

Freight Forwarding and Customs Broking | Skills strategy 20102013

Context
The Freight Forwarding and Customs Broking industry in New Zealand consists of more than 200 companies employing more than 5,000 people. The majority (60 per cent) of these companies are located in Auckland. The proportion of males in the sector (63 per cent) is higher than the national level of 53 per cent. The median age of workers in the sector is 35 which is five years lower than the national median. Qualifications: The current suite of freight forwarding industry qualifications (see Appendix 2) is currently under review by Tranzqual.

Skills strategies
Skills strategies identify and prioritise the education and training activities required to meet the current and future skill needs of an industry. The process of developing the plan provides a focus for assessing current training provision, analysing gaps and weaknesses, and recommending priorities, objectives and proposed solutions. There are compelling reasons why close attention should be paid to the kind of skills required by an industry and the firms that comprise that industry. But this consideration should go beyond just describing the skill sets required; it should also include the reasons why the identified skills are desirable. For example, improved performance. The Freight Forwarding and Customs Broking Skills strategy (20102013) has been designed to address the following six questions:
Why have a skills strategy? The mission What do we want to be? The vision Why? values How do we get there? The skills sTraTegy How do we make sure we get there? The accounTabiliTy regime How do we make sure weve got there? The key success facTors

Principles
The development and delivery of qualifications and the supporting skills strategy should be supported by a set of principles. In this case the principles are that all Tranzqual national qualifications should be: developed with strong industry involvement designed to encourage learner uptake and enhance business outcomes future focussed flexible with respect to: structure delivery modes. With respect to the skills strategy itself, this should have clear points of action including milestones. Tranzqual is committed to listening to and collaboratively working with its industries to identify skills requirements and seek solutions that will contribute to greater performance. Examples of this commitment are the introduction of workplace partnership agreements (WPA) and the development of industry skills strategies.

These six questions relate to the specific exercise itself in other words the development and implementation of the skills plan itself. Question 5 (How do we make sure we get there?) is included in the list above because we know that the single most important contributor to failures in strategies is the inability or unwillingness to implement the strategy. One of the main reasons for failure to implement strategies is the absence of a sound accountability regime. Note: it is not the intention to attempt to impose or include an accountability regime on individual businesses. The only reason to include this component is to draw

attention to the fact that in the absence of a sound accountability culture there is a high risk that even the best strategic plan will not be implemented successfully.

Freight Forwarding and Customs Broking | Skills strategy 20102013

Commitment to Partnership
The primary purpose of adopting this approach is to develop an effective and durable partnership between Tranzqual and the various industry groups it serves. The principal benefits are: It provides an opportunity for industry groups to drive the future direction of skill development Joint participation through the spreading of costs and shared expertise associated with the development and delivery of programmes will ensure the sustainability of these partnerships Tranzqual will be better placed to respond much more rapidly to the needs of its industry partners, resulting in fit for purpose training programmes The industry partners will enjoy a greater sense of ownership to the entire process It will ensure that investments in new initiatives will be made in response to demonstrated demand. In discharging its mandated leadership role and consistentcy with its strategic intent as mentioned above, Tranzqual has adopted the approach of leading but not dictating the Freight Forwarding and Customs Broking Skills strategy. This strategy is an industry strategy not a Tranzqual strategy. Tranzqual is aware that much of the implementation of the strategy will fall on the organisation and is fully committed to achieving the best possible outcomes. In considering this commitment to partnership, it needs to be recognised that the strategy would not be complete without including the New Zealand Defence Force (NZDF). While there is a considerable commonality in freight forwarding between the military and civilian settings, there are also significant differences. The reality is that the current qualifications in freight forwarding do not fully fit the requirements of the military. This is an important issue because it is the NZDFs policy that it is highly desirable that military personnel working in freight forwarding should hold qualifications that in addition to meeting the militarys requirements, are also fit for purpose in the civilian workplace. Tranzqual recognises this policy and is working directly with both the military and civilian freight forwarders to achieve this objective. This work is timely as Tranzqual is currently reviewing two freight forwarding qualifications.

Why have a Skills strategy?

Apart from the legislated requirement to identify skills needs, both present and future; and develop skills strategies, there are compelling reasons why close attention should be paid to the kind of skills required by an industry and the firms that comprise that industry. But this consideration should go beyond just describing the skill sets required. It should also include the reasons why the identified skills are desirable. While there are numerous ways to measure the success of any business venture one of the most compelling measures is performance. In addition to leadership and management, the development of skills is a key component in building a more productive workplace. This in turn should lead to greater business success. The methodology used in developing the strategy was designed to be as simple as possible and towards that end the structure contained two basic elements: 1. An Industry Strategic Planning Group 2. An External Stakeholders Reference group

Freight Forwarding and Customs Broking | Skills strategy 20102013

The collaborative process

The planning process itself was conventional in its approach. This involved: researching background information on New Zealands economy researching high level background information on the freight forwarding industry surveying the skills development and training attitudes and practices across the Freight Forwarding and Customs Broking industry. This was done by conducting a series of structured interviews with operations managers, human resources and training managers across the sector (see Appendix 2) 1 conducting a PESTLE analysis . This involved the identification of issues under the headings: Political, economic, social, Technological, legal and environmental. convening a Strategic Planning group which, through a facilitated process identified the skills and training required by the industry both currently and in the near future 2 conducting a SWOT analysis compiling a draft Skills strategy document. This document identifies the recruitment, skills and training needs for the Freight Forwarding and Customs Broking industry as well as specific actions intended to meet those needs. circulating the draft Skills strategy document to external stakeholders for consultation. completing the Skills strategy having taken into account feedback from the consultation process. Industry Strategic Planning Group: The key elements of the skills strategy were undertaken by this group which consisted of senior people from within the industry. External Stakeholders Reference Group: This group included all those people/ organisations that have an interest in a particular strategy. The group included: Tertiary Education Commission (TEC) New Zealand Customs Customs Brokers and Freight Forwarders Federation of New Zealand (CBAFF) Conference of Asia Pacific Express Carriers (CAPEC)

PESTLE Analysis: The purpose of PESTLE analysis is to capture the main external factors that provide opportunities and present threats to the freight forwarding industry. Those factors can be classified under the headings: Political, Economic, Social, Technological, Legal and Environmental (PESTLE). The outcome of this analysis is contained in Appendix 4.

2 SWOT Analysis: SWOT analysis is a device used to summarise the results of strategic analysis. SWOT stands for Strengths, Weaknesses, Opportunities and Threats. SWOT analysis helps to identify strategic aims and areas for action by asking the following five questions: Can the strengths help us to address the opportunities? Can the strengths help us to overcome the threats? How can we eliminate weaknesses that will stop us exploiting opportunities? How can we eliminate weaknesses that will worsen the impact of the threats? Can we counter the threats or convert them into opportunities? note: Strengths and weaknesses have an internal focus while opportunities and threats are external to the industry.

Survey Report
Background to the report
The interviews:
The interviews were structured around: information about the firm training practices within the firm attitudes towards qualifications trainers and assessors literacy and numeracy training needs and challenges facing the business.

Industry findings
The following observations have been gathered from the consultation with industry, both by way of a series of structured interviews and a planning day with key industry names. Sources of advice on training tend to be patchy. There is a low level of awareness of the industry. This makes it difficult for the industry to recruit school leavers. There appears to be very little, if any training for trainers. There are numerous calls for a careers or qualifications pathway built around structured training. The Modern Apprenticeship system should be part of this. A system that recognises current competencies would be welcome. More use should be made of Recognition of Current Competency (RCC). With respect to the customs broking Pin qualification, there are some concerns about the quality, relevance and currency of this qualification.

There is a long list of suggested topics for inclusion in a qualification in the Freight Forwarding and Customs Broking area: Maths Geography Excel General business Insurance Law Legislation (for example Carriage of Goods Act, Dangerous Goods) Liability Documentation Business writing Awareness of aircraft type Knowledge of the shipping industry Generic skills: Communication Leadership Time management Customer service Conflict resolution

Note: a copy of the survey used is contained in Appendix 3 of this document.

Freight Forwarding and Customs Broking | Skills strategy 20102013

Glossary
gDP iag iTf iTo lcP moe nc nZQf nZQa oecD PesTle rcc skills smT sWoT Tec WPa Gross Domestic Product Industry Advisory group Industry Training Federation. This is the peak body for Industry Training Organisations Industry Training Organisation Limited Credit Programme Ministry of Education National Certificate New Zealand Qualifications Framework New Zealand Qualifications Authority Organisation for Economic Cooperation and Development Political, Economic, Social, Technological, Legal, Environmental Recognition of Current Competency The ability of an individual to perform a set of tasks and to fulfil the technical requirements of an occupation Senior Management Team Strengths, Weaknesses, Opportunities, Threats Tertiary Education Commission. TEC is a Crown entity which manages the Crowns funding component of tertiary education and training, including industry training. Workplace Partnership Agreement

Three-year Action Plan

Proposed action 1 2 3 4 5 6 7 8 9 10 Tranzqual to investigate the viability of a nationally recognised, competency based suite of qualifications in customs broking. These qualifications should include the means to be registered (not licenced) as a customs broker. This component of the suite should sit at Level 4. Tranzqual to investigate the viability of developing a Level 5 National Diploma aimed at running a business as a logistician. Tranzqual to research the equivalent programme in Germany to gain an understanding the structure of their qualifications. The preferred structure of the level 4 qualification is to have a core component with strands in freight forwarding and customs broking. Give consideration to appropriate titles to the qualifications. Tranzqual to produce a proposal regarding the most flexible delivery methods possible for this qualification. Tranzqual to explore flexible delivery modes to ensure that participants outside Auckland can have access to the qualification in ways that suite their needs. Tranzqual to discuss delivery options with respect to the above qualifications with the New Zealand Maritime School at Manukau Institute of Technology. The concept of a competency-based nationally recognised qualification in customs broking to be promoted to New Zealand Customs, CBAFF and CAPEC. Tranzqual to explore with the industry the desirability/feasibility of practising customs brokers to undergo some periodic requirement in order to remain current. The focus of the Freight Forwarding Modern Apprentice programme should be at levels 3 and 4. Develop a plan to promote the benefits of a career in the sector to schools. Tranzqual develop a marketing plan to promote all freight forwarding and customs broking qualifications through schools careers officers and/or CBAFF. Tranzqual to consider promoting careers in the freight forwarding industry to people graduating from Institutes of Technology and Polytechnics with Diplomas in Business. Refer the previous recommendation to the Tranzqual schools strategy which has a focus on targeting freight forwarding at selected schools using the Gateway programme. Tranzqual, in reviewing the current freight forwarding qualifications, will work with the NZDF and the civilian freight forwarding industry to ensure that military personnel working in freight forwarding can gain qualifications that meet the requirements of both the military and civilian environments without in any way compromising the needs of either sector. By when

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12 13 14 15

16

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Appendix 1
Productivity
Productivity growth isnt everything, but in the long run it is nearly everything.
Paul Krugman The Age of Diminished Expectations

in the value of output per hour worked. How can this be achieved? Is it a matter of working harder?

What contributes to productivity?

Productivity is about a lot more than just working harder. Its really about working smarter. This involves maximising the use of a whole range of factors. These factors include: skills development, training, technology, workplace organisation, innovation, leadership, management, worker engagement etc. The experts tell us that any one of those factors on their own is not likely to have a significant impact on productivity, it is the combination of those factors that makes the difference.

The big picture

Successive governments have long been concerned about the growing gap in living standards between New Zealand and Australia, so it is not surprising that the present government aspires to close that gap. But how can this be achieved? It is not yet clear what strategy the government will adopt to close this gap but whatever it is, one thing is certain; productivity will be a key element. All experts would agree that the gap cannot be closed unless the level of productivity in New Zealand is raised above that of Australia and that performance is subsequently sustained over a long period. In short, whatever else is done, productivity has to be the key component.

How does New Zealand perform in productivity?

Not well (see page 12). By whatever measure, New Zealands performance with respect to productivity is modest. Our productivity has consistently lagged behind that of Australia for at least the past 15 years. This relatively poor performance mainly accounts for the growing gap in living standards between New Zealand and Australia. We must do better if that gap is to be closed. Before considering what may need to be done with respect to improving our productivity performance we should consider one of the key components of productivity, skills.

Productivity: what is it?

Productivity is the measure of output from a productive process from a unit of input. One way to show this is to calculate the value (in dollar terms) of what a worker can produce per hour worked. An increase in productivity therefore would be demonstrated by an increase

10

What are skills?

The Leitch Report defines skills as: Skills are capabilities and expertise in a particular occupation or activity. Basic skills, such as literacy and numeracy, and generic skills, such as team working and communication, are applicable in most jobs.
1

What has this got to do with Industry Training Organisations?

One of the key components of productivity is the development of skills. Indeed the Leitch Report states:

Productivity is increasingly driven by skills. The ability of firms to succeed in the face of In addition the Skills for Scotland Report (2007) growing international competition depends suggested that basic skills would include (but not increasingly on the skilled labour force they can be limited to) the following: draw from. Effective time management. Skilled workers are better able to adapt to new Planning and organising. technologies and market opportunities. Higher Effective oral and written communication level of skills drive innovation, facilitate investment skills. and improve leadership and management. The ability to solve problems. For innovation to be effectively implemented, Being able to undertake tasks or make businesses must be able to draw on a flexible, submissions at short notice. skilled workforce. The ability to work with others to achieve

common goals. The ability to think critically and creatively. The ability to learn and to continue learning. The ability to take responsibility for professional development. Having the skills needed to manage, or be managed by others (which draws on many of the other skills in this list).

Skills are a key lever within our control to improve productivity in the workplace- one fifth or more of the UKs productivity gap with countries such as France and Germany results from the UKs 2 relatively poor skills. Skilled labour, therefore is an essential component in the search for greater productivity. Since Industry Training Organisations are in the skills business they must have a key role to play in achieving productivity improvements.

Prosperity for all in the global economy World Class Skills (2006) 2 Prosperity for all in the global economy World Class Skills (2006)

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Why do we consistently lag?

New Zealand is not performing well in the area of productivity. While the drivers of productivity are well known, for some reason we are not adopting and applying those drivers. There may be a tendency for us to see this as a macro level problem which can be addressed by government providing the right regulatory environment. If that is the case then the drivers of productivity are not well understood, even if they are well known. Perhaps we lag behind because the true importance of productivity and its drivers is not understood widely enough. Yes, government is important as is the regulatory environment but it is only part of the picture and in any event productivity has to happen at the enterprise level, organisation by organisation, firm by firm, department by department, individual by individual.

What do we have to change to do better?

Any change requires leadership. So, if New Zealand is to close the gap with Australia (or indeed anybody else) then it must change what it is doing and that requires leadership. Where will this leadership come from? It must come from a multitude of sources. To name just a few sources: politicians are important, industry leaders are important, trade unions are important, industry training organisations are important and training providers are important, There are others.

And the answer is?

Not simple. There is no simple magic bullet that will improve productivity. The answer involves a lot of people in a lot of workplaces dedicating themselves to focusing on the key drivers of productivity. It is essential that all of these people know what they are doing and why. None of this will take place without effective leadership.

What is effective leadership?

Many people believe that leadership involves no more than confidently showing the way and ordering subordinates into action. Effective leadership is a lot more than that. It involves a whole range of desirable characteristics including such things as: integrity, reliability, judgement, confidence, optimism, humility, energy and the ability to focus on results. There are others.

Conclusion:
Most people would agree that the pursuit of productivity improvement should be a high priority. Making this happen, however, is no simple task. It involves high levels of skill and commitment in thousands and thousands of organisations and enterprises across the country. This effort needs to be focused and it needs to be relentless. This change, like any change requires a high level of leadership. It is not enough that this leadership is exercised at just the national level, politicians, community, business and union leadership, etc. It needs to be evident in every organisation and every enterprise and at all levels in every organisation and every enterprise. 12

OECD analysis of productivity

The tables below show that in terms of international comparison New Zealand does not perform well when measured against other developed countries. This comparison should serve to push productivity and performance towards the top of the agenda for any business if it is not already there. Productivity in the oecD 2007 GDP per hour worked, current prices in US dollar
80 70 60 50 40 30 20 10
Slovak Republic United States New Zealand Portugal Greece United Kingdom Czech Republic Australia Finland Germany Denmark Canada Ireland Austria Luxembourg Norway Belgium Netherlands Switzerland Japan Sweden Iceland Hungary Poland France Spain Mexico Italy Korea Turkey

80 70 60
Euro-zone average: 45.6 OECD average: 40.3

50 40 30 20 10 0

Source: OECD StatsExtracts

long Term labour Productivity levels

Real output per hour (US$ purchasing power parities)

50 45 40 35 30 25 20 15 10 5 0 1998 Ireland New Zealand 1999 2000 2001 2002 2003 2004 2005 2006 2007

United Kingdom Poland

Australia Japan

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Factors affecting labour productivity

In a survey of manufacturing growth and performance in Britain, it was found that: The factors affecting labour productivity or the performance of individual work roles are of broadly the same type as those that affect the performance of manufacturing firms as a whole. They include: 1. physical-organic, location, and technological factors A joint Department of Labour/Industry Training 3 Federation report stated that: [workplace productivity] involves exploring all the ways that workplaces can do things better and smarter. The report then revealed that: 2. cultural belief-value and individual attitudinal, motivational and behavioural factors 3. international influences for example levels of innovativeness and efficiency on the part of the owners and managers of inward investing foreign companies 4. managerial-organisational and wider economic and political-legal environments

Research has confirmed that the highest productivity gains are found when complementary changes are made in skills, 5. levels of flexibility in internal labour markets innovation, workplace organisation, management and the organization of work activities capability, and employee engagement and for example the presence or absence of motivation. traditional craft demarcation lines and barriers to occupational entry and Another key finding from research is that: 6. individual rewards and payment systems, and ... on their own, any one intervention is likely to the effectiveness of personnel managers and have limited impact. others in recruiting, training, communicating with, and performance-motivating employees 4 In short, therefore, the benefits of productivity on the basis of pay and other incentives . can only be achieved by organisations making changes across a number of key areas. The report Conclusions: goes on to suggest how these changes can be Productivity gains can only be achieved by affected: the use of numerous interventions, any one intervention will have limited impact change has to begin with company leadership Change, across a number of areas is critical and supervisory staff in such areas as how in achieving productivity gains to conduct effective conversations with and Leadership is a critical factor in achieving engage their staff before specific improvement these (or any other) changes. programmes can gain any traction.

The Skills Productivity Nexus (2008)

The Skills Productivity Nexus (2008)

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Appendix 2
The Freight Forwarding and Customs Broking industry
The freight forwarding and customs broking industry consists of more than 200 companies employing more than 5,000 people. Almost seventy per cent of those employees work for companies employing more than 20 people. These companies represent just twenty percent of all companies in the industry.

TEC Statement of Intent (SOI) 2009 2012

The government has established three new education priorities:

A high-trust and high-quality tertiary funding environment. All students leaving the education system with worthwhile qualifications and. An appropriately trained and competent workforce

Industry Training Organisations

Industry Training Organisations (ITOs) are required by legislation to undertake a leadership role for the industries within their area. S10(2)(e) of the Industry Training Act (1992) states the activities of an ITO shall include: Providing leadership within the industry on matters relating to skill and training needs by (i) Identifying current and future skill needs (ii) Developing strategic training plans to assist the industry to meet those needs; and (iii) Promoting training that will meet those needs to employers and employees In addition to the leadership requirement within the Industry Training Act, ITOs are expected to respond to the governments priorities. The current set of priorities are set out in the Tertiary Education Commissions Statement of Intent.

Minister for Tertiary Education, Hon Anne Tolley

Looking specifically at ITOs, the government has three requirements: That they enable working New Zealanders to complete nationally recognised qualifications. That they create clear pathways towards advanced trade qualifications at level 4 and above on the Register of Quality Assured Qualifications. That they build and maintain strong support from the industries they serve.

Qualifications
The current suite of qualifications for the freight forwarding industry is:

National Certificate in Freight Forwarding (Freight Administration) [NZQF* 1243] National Certificate in Freight Forwarding (International Freight Forwarding) [NZQF 1244]

Note: the above qualifications are currently under review. This review is being managed through an Industry Advisory Group (IAG) under the management of Tranzqual. *The National Qualifications Framework (NQF) was officially replaced by the New Zealand Qualifications Framework (NZQF) as from 1 July 2010

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Appendix 3
Freight Forwarding and Customs Broking Industry survey
Part 1: General business questions
Purpose of questions To gather demographic information about the organisation and develop a profile of current training practice. 1. How many employees does your firm have? 2. How long has your business been operating? 3. How many staff here undergo training? third party training provider? If so, who?

3.1 Which qualifications are 6. Does your current training most commonly used in provision meet your this organisation? organisations needs for training your staff? 3.2 What is the completions rate for training in the 6.1 How could training last 4 years? provision be improved on? 4. Where do you currently go for information about 6.2 Are there any areas training? where your business requires more training 5. Do you train your staff support? internally, or do you use a

Part 2: Qualifications
Purpose of the questions: Determine if the content of specific qualifications is relevant to training requirements in their organisation Determine ideal methods for delivering training in their organisation. 7. Do you train staff in your organisation towards a national qualification? If not why not? When training your staff do you teach only the prescribed course content or is there other skills and knowledge that you include?

9.

Are there any other skills not currently included in the qualifications that would benefit your business?

12.1 Why? 13. Do you provide any training for your in-house trainers? 14. Do you use outside assessors? 15. If so do you any difficulty sourcing these assessors? 16. Do you have any plans to train your staff to become assessors? 17. If so, how do you train them?

10. Are there aspects of the current qualifications that are particularly relevant to staff training in your business? 11. Similarly, are there any aspects of the current qualifications that are not relevant to training in your organisation? 12. In terms of delivery of training, what are the most effective methods for training staff in your organisation?

8.

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Part 3: Literacy and Numeracy

Purpose of the questions: Assess current state of literacy and numeracy in the 18.1 Is there any organisation; is it a problem assessment of and what, if anything, are existing employees? they doing to address it? What would they like from 18.2 If so, what? Tranzqual to assist with literacy and numeracy 19. Are there any literacy or training? numeracy issues within your organisation?

18. Does your organisation carry out any preemployment assessment of new staff for literacy and numeracy?

20. [If relevant] What measures, if any, do you have in place to address these issues? 21. [If relevant] What is the ideal scenario for addressing literacy and numeracy issues in your organisation? 22. What do you think Tranzqual could do to assist your organisation to address these issues? 26. Is there anything we have not yet discussed that you think Tranzqual could provide to your organisation, which would assist with training your staff?

Part 4: Looking ahead

Purpose of the questions: Whats the ideal scenario for training in the future and 24. How do you think your what can Tranzqual do to training needs will change assist developing this ideal? in the future? Industry changes for the next 35 years and 25. What do you see as the effect this will have major challenges for your on your business and business in the next 5 training requirements years? in the industry.

23. Do you think the current training options meet the needs of your business? Why/why not?

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Appendix 4
Freight Forwarding and Customs Broking: PESTLE Analysis
The purpose of this document is to capture the main external factors that provide opportunities and present threats to the Freight Forwarding and Customs Broking industry. Those factors can beclassified under the headings: Political, economic, social, Technological, legal and environmental (PESTLE).

Political
The Government has told TEC that it wants it to focus its financial contribution to the system on certain priority groups and types of study where success offers significant economic and social returns.

I would like to refer to an important piece of research produced by the Ministry of Education which looks at completion rates for industry training and Modern Apprenticeships.

...it is clear that improving completion rates in some parts At the TEC, this means it is of industry training and Modern considering how best to support Apprenticeships is a high providers to: priority. support learners under 25 The Ministry of Education to engage in education research referred to by the ensure Mori and Minster reveals that: Pasifika learners achieve at higher levels only 35 per cent of industry trainees complete their build literacy and qualifications within five numeracy skills. years. This compares with TEC has published comparable those learners within TEO educational performance polytechnics and PTEs. information for students, It also compares with employers and TEOs. It has international findings developed ways to link funding Those most likely to with performance. complete come from: Painting contractors The following are quotes from Joinery the previous Minister of Tertiary Education, Hon Anne Tolleys Local government address to the ITF Research Printing Forum, 22 April 2009: Flooring ...Bill English has made it clear Completions depend on: The employer that he expects value for money Industry type ITOs Some ITOs have much higher completion rates than others

Older learners are more likely to complete qualifications but the MoE questions the value added by older learners Completions are more likely at higher levels With respect to Limited Credit Programmes (LCPs): This is the most likely type of programme to be completed They appear to be used as stand alone learning Most LCP learners do not go on to attain a national qualification.

Note: the MoE questions whether LCPs should continue to be subsidised at the same rate as other programmes on the grounds that they appear to be used for compliance reasons only and the employer is the main beneficiary.

Conclusions:
It would be reasonable to assume that: the government will develop a position on completions funding levels for LCPs will come under close scrutiny funding levels for Modern Apprenticeships will come under close scrutiny.

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Tertiary Education Commission (TEC) Statement of Intent (SOI) 2009 2012:

The government has established TECs Performance measures include: three new tertiary education priorities: Increasing the number of people engaged in literacy 1. A high-trust and high& numeracy provision quality tertiary funding Increasing the number environment, of people completing 2. All students leaving the qualifications education system with Improvement in workplace worthwhile qualifications literacy and numeracy. and, 3. An appropriately trained and competent workforce.

Productivity Commission
A new Productivity Commission will be set up early 2011 to help boost New Zealands economic performance across the public and private sectors. In announcing the Commission the Minister of Finance said: Examples of Australian Productivity Commission inquiries include energy efficiency and the economic impacts of migration and population growth. The new Productivity Commission will be headed by up to four part-time commissioners and will provide independent advice on ways to improve productivity in areas identified by the Government.

It is essential that we increase our economic growth if we are to create the jobs, higher incomes and opportunities New Zealand families deserve. Our main challenge is to ensure this growth is based on private sector investment and exports, rather Its main functions will include: than the unsustainable increases in government Inquiries into productivity-related matters spending and borrowing of the past decade. and reporting back to Ministers. One-off reviews of existing regulations. The Commissions roles and functions are modelled closely on the Australian Productivity Commission, Reviews of the efficiency and effectiveness of regulatory agencies. which has been operating for more than 10 years. The Government intends to enact legislation Regulatory impact analysis of a small number of proposed new regulations. setting up the Commission by the end of this year so it can be up and running by April 2011. Research into productivity-related matters, to build up its institutional knowledge. The independence of the Australian Productivity Promote public understanding of Commission has ensured that important public productivity-related issues. policy issues have been tackled in a nonpolitical way.

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Economic
The recovery from recession The tax package in Budget 2010 has a significant impact on the is expected to be gradual economic outlook, although the (Treasury)
After a fall of 1.4 per cent in the March 2009 year and 0.3 per cent in the March 2010 year, real output is expected to grow at around 3 per cent per annum: 3.2 per cent in the March 2011 year; 3.1 per cent the next year; 2.9 per cent in the March 2013 year; and 3.0 per cent in the March 2014 year. These growth rates are higher than our estimate of potential growth over these four years of around 2.8 per cent per annum. The positive outlook is supported by the lagged impact of an easing in monetary conditions since mid-2008, a stronger global environment and associated higher demand for exports, high confidence levels, the hosting of the Rugby World Cup in late 2011 and the tax package.

exact impact will depend on the responses of numerous firms and individuals and is therefore uncertain. At the economy-wide level, the main impacts are assumed to be: The level of real output is expected to be 0.9 per cent higher in the long run. By the June 2014 quarter, the economic forecasts incorporate a level of real output that is 0.4 per cent higher than in the absence of the tax package. This impact takes time given the amount of spare capacity The Treasury in the economy currently. Therefore, in the mediumterm projections in the Fiscal Strategy Report, a further impact of 0.5 per cent is expected by June 2017.

The tax package is also forecast to cause volatility in output growth in the second half of 2010. Real output is expected to grow strongly in the September quarter and fall slightly the next quarter as some consumer spending, particularly on durable goods, is brought forward before the increase in the GST rate on 1 October 2010. The tax changes are expected to boost incomes, help encourage more saving and reorient investment towards more productive parts of the economy.

NZIER Consensus Forecasts: June 2010*

outlook: nZier consensus forecasts*June 2010 (years to 30 June)

The economy is on the path Percent (%) 2009/10 2010/11 2011/12 to sustained and sustainable GDP Growth 0.4 +2.8 +3.0 economic growth, according Investment 10.7 +3.8 +8.3 to economic forecasters in the latest NZIER Consensus Forecasts Unemployment 7.0 7.0 6.3 Survey. The broad consensus is of Exports 0.7 +1.7 +4.5 a rebalancing from consumption Imports 12.4 +5.6 +5.6 and housing towards exports, and Private consumption 0.2 +1.7 +1.8 a return towards trend growth. Interest rates 5.7 6.0 6.4 However, there is considerable Govt. Operating Balance (June year) 6.2 -$7.2b -$7.0b divergence of views on the residential construction sectors recovery, the exchange rate and *compiled from: ANZ-National Bank, BNZ, NZIER, UBS, ASBBank, Deutsche bank, RBNZ, Westpac, BERL, Treasury the current account deficit.

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Social
The industry is part of the total supply chain management system. There is a low level of understanding of the sector from the schools and the public generally. Occupations such as travel and tourism are perceived as being more attractive than freight forwarding.

SWOT Analysis
Strengths: The depth of knowledge across the industry People tend to stay in the industry The industry is cost-efficient The relatively light regulation in New Zealand provides flexibility The service will always be needed. Weaknesses: It is too easy to gain entry to the industry The value of existing regulatory authorities such as IATA ids not always recognised Some of the learned behaviour is learned from people who themselves have inadequate knowledge Too many errors being made. Opportunities: The industry could look to international best practice and tap into international expertise. Threats: The growing role of multinational companies The influence of large shipping companies.

Technological
Information and communication technology (ICT) is playing an increasingly important role in the industry. It has even been suggested that in the foreseeable future perhaps most Customs Broking functions could become automated.

Legal
While the sector is not heavily regulated, or likely to be, legal considerations will become increasingly important.

Environmental
Increasing environmental compliance demands will impact on the sector The increasing requirements to deal with the carbon credits regime will require new knowledge.

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Appendix 5
Leitch Review of Skills (UK report 2006)
Summary
This summary is intended to capture the key elements of the report which may be relevant to a New Zealand context, in other words most references that have a particular UK context have been ignored. Note: much of this extract, while written specifically in a UK context, could easily have been written to describe the New Zealand situation. all of the material below is taken verbatim from the report, although the extracts are not necessarily presented in exactly the same order as in the report itself. Without increased skills, we would condemn ourselves to a lingering decline in competitiveness, diminishing economic growth and a bleaker future for all. Developed nations are relying more and more on their capacity to innovate to drive economic growth. The ability to do this depends upon the skills and knowledge of their people.

Productivity:
Skills are a key lever within our control to improve productivity in the workplace one fifth or more of the UKs productivity gap with countries such as France and Germany results from the UKs relatively poor skills.

Definitions:
Skills are capabilities and expertise in a particular occupation or activity. Basic skills, such as literacy and numeracy, and generic skills, such as team working and communication, are applicable in most jobs.

Productivity is increasingly driven by skills. The ability of firms to succeed in the face of growing international competition depends increasingly on the skilled Skills is the most important labour force they can draw lever within our control to from. Skilled workers are create wealth and to reduce better able to adapt to new social deprivation. technologies and market opportunities. Higher level of The population is ageing, technological change and global skills drive innovation, facilitate investment and improve migration flows are increasing. leadership and management. For innovation to be effectively There is a direct correlation implemented, businesses must between skills, productivity be able to draw on a flexible, and employment. Skills were skilled workforce. once a key lever for prosperity and fairness. Skills are now The UKs Skills Deficit: increasingly the key lever.

Global changes:

The Organisation for Economic Co-operation and Development (OECD) stresses that, as For developed countries who emerging economies start to cannot compete on natural deliver high skills at low cost, resources and low labour costs, success demands a more the OECD countries must themselves reform their skills service-led economy and high st value-added industry. In the 21 policy. As the global economy Century, our natural resource is changes, an economys our people- and their potential prosperity will be driven is both untapped and vast. Skills increasingly by its skills base. will unlock that potential.

The previous system was focused on asking employers to collectively articulate their future skills needs and then trying to plan to meet these needs. Too often, collective articulation of future skills needs has been an ineffective and inefficient mechanism. As a result, too much provision has been supply driven, based on trying to predict and provide.

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Consequently, employers were reluctant to contribute toward training costs because they did not have confidence in the quality of training on offer and felt frustrated by the lack of influence over qualifications. At the same time, they felt let down by poor levels of basic literacy and numeracy resulting from a failing school system. The reviews analysis shows that previous approaches to delivering skills have been supply driven, based on the Government planning supply to meet ineffectively articulated employer demand. This approach has a poor track record it has not proved possible for employers and individuals to collectively articulate their needs or for provision to be effectively planned to meet them. Recent reforms in England have attempted to develop a more demand-led system,

responding to demand rather than trying to plan supply. The Review has concluded that this sort of approach must be established across the system so that providers only receive funding as they attract customers.

Skills projections for 2020:

History tells us that no one can predict with any accuracy future occupational needs. The Review is clear that skill demands will increase at every single level. Better skills will be required at higher levels to drive leadership, management and innovation these are key drivers of productivity growth. Intermediate skills must be improved to implement investment and innovation. Basic skills are essential for people to be able to adapt to change. People lacking basic skills will be most at risk of exclusion in a global economy.

As the global economy changes and working lives lengthen with population ageing, adults will increasingly need to update their skills in the workforce. There is a pressing need to raise the rates of skills improvements among adults the UK cannot reach a world class ambition by 2020 without this. Increase adult skills across all levels. Progress towards world class is best measured by the number of people increasing skills attainment. The raised ambitions will require additional investment by the State, employers and individuals.

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Increase peoples aspirations and awareness of the value of skills to them and their families. Create high profile, sustained awareness programmes. Focus on economically valuable skills. Skills should be demand-led. The skills system must meet the needs of individuals and employers. Vocational skills must be demand-led rather than centrally planned. Increase employer engagement and investment in skills. Strengthen the employer voice. Increase employer engagement and investment in skills building on international evidence of successful sectoral approaches in Australia and the Netherlands and examples of excellence from existing Sector Skills Councils (SSCs).

Reform, relicense SSCs to focus on: Taking the lead role in developing occupational standards, approving vocational qualifications; Taking the lead role in collating and communicating sectoral labour market data; Raising employer engagement, demand and investment; and Considering collective employer action to address specific sector skills needs. note: this recommendation basically supports the New Zealand ITO model. Build on existing structures. Dont always chop and change.

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