Incubating the Industry Employment Initiative highlighted the importance of knowing where you’re headed, using measurement and evaluation to improve rather than prove, and finding strategic funders who are willing to take risks.

Since 2014, SVA has been incubating a model for demand-led employment called the Industry Employment Initiative (IEI). The model aims to create sustainable employment for disadvantaged job seekers, while helping employers meet their recruitment needs and corporate responsibility objectives.

The IEI is a collaboration between Social Ventures Australia (SVA), Brotherhood of St Laurence, Jesuit Social Services and Mission Australia. It is supported by the Business Council of Australia.

The model is being tested with unemployed young people through the IEI Youth Pilot. This pilot has been new territory for SVA in a number of ways; it has involved testing a new collaboration and a new co-funding model, and working directly in employment service delivery for the first time.

Our experience with this pilot demonstrates the importance of:

• knowing your endgame and what stage your pilot is at on the journey
• taking an iterative approach in the start-up phase
• managing to outcomes and using measurement and evaluation to improve rather than prove, and
• finding funders who are willing to take risks and learn along the way.

Here we reflect on insights from the IEI Youth Pilot that can be applied to other incubations or pilots.

The background to the IEI

Over half a million Australians have been out of work for over a year despite actively seeking employment, or undertaking activities to improve their employment prospects.^[1] At the same time, 42 per cent of Australian employers report difficulties filling vacancies.^[2] This disconnect between large employers and disadvantaged job seekers not only puts a large number of entry-level roles out of reach for disadvantaged job seekers, it leaves a huge pool of potential talent untapped.

The IEI was designed to build on these programs to create a scalable solution.

The Brotherhood of St Laurence and Jesuit Social Services have been addressing this disconnect through the Given the Chance^[3] and African Australian Inclusion^[4] programs for migrants and refugees with good results. The IEI was designed to build on these programs to create a scalable solution.

As a demand-led model, the IEI starts with an employer’s needs and works backwards from there. SVA works closely with the employers to co-design highly supported training and employment pathways which include pre-employment training that blends foundational and vocational skills; work exposure and work experience; and individualised post-placement support for job seekers.

The IEI Youth Pilot launched in 2014. Its aim was to train 125 long-term unemployed young people, supporting them into work with three national employers, and building an evidence base from which to advocate for this model. SVA’s role was to lead the collaboration, employer engagement, and project management. The consortium partners were to provide service delivery expertise.

Jointly funded by seven philanthropic foundations, the pilot has allowed SVA to test and iterate the IEI model. By June 2016, we had worked with nine employers and four service providers to give 75 young people training and work experience linked to a real job. By December 2016, a further 40 young people will have participated in the program.

Working towards the endgame: the importance of knowing your starting point

In the Stanford Social Innovation Review article ‘What’s your endgame?’, Alice Gugelev and Andrew Stern urge non-profits to consider their ‘endgame’ – the specific role they intend to play in the overall solution to a problem. They  suggest a shift in focus from scaling up to enabling impact. (See also ‘The importance of defining your endgame‘.)

The Australian employment services system costs $1.2b per year.^[5] Nearly all job seekers who are receiving unemployment benefits will interact with it in some way. With 5.6 per cent of the Australian population unemployed and a further 8.7 per cent underemployed,^[6] the IEI fits with Gugelev and Stern’s government adoption endgame; the scale of delivery required to confront the issue is such that government involvement is indispensable.

… it became clear that the IEI was in neither the proof of concept nor the early scaling stage.

The IEI was designed so that adoption into the Federal Government’s employment services system (currently jobactive) would be feasible without a complete system overhaul. However, as the IEI Youth Pilot progressed it became clear that another endgame – replication – would be necessary to deliver results at the scale required to make the case for government adoption. Replication is ‘defining a replicable operating and impact model that is easy for other organisations to adopt and deliver’.^[7]

Having identified this, SVA has delivered the IEI Youth Pilot with both replicability and government adoption in mind. In hindsight, a bigger challenge than articulating our endgame was articulating our starting point.

The IEI had originally been conceptualised as a proof of concept initiative, with the Brotherhood of St Laurence and Jesuit Social Services’ existing programs considered to have served as the model’s start-up phase. However, some stakeholders saw those existing programs as proof of concept, and saw the pilot as early scaling. This led to different benchmarks with regards to, for example, cost and employment outcomes.

Once the pilot had begun it became clear that the IEI was in neither the proof of concept nor the early scaling stage. For various reasons – such as the time taken to build our partners’ trust at the operational level, the change in cohort from skilled migrants to youth, and the shift from our partners’ central management and delivery models to the IEI’s more collaborative one – the IEI was in fact still a start-up. (See Figure 1.)

An iterative approach to the start-up phase

 “Innovation within complex systems often uncovers issues, challenges and opportunities that would never have been identified through a detached analysis or a standard theory of change. The reality is ‘we don’t know what we don’t know’.” – Rodney Greene, Burnie Works backbone leader, ‘A collective impact learning lab’

Originally, we had planned to work with three employers over the course of the pilot, with each employer providing up to 50 jobs. However, it became clear that until we were able to ‘get some runs on the board,’ employers would not commit to such a high volume of positions. Because of this, we are working with more employers, with fewer job seekers per employer.

Each program in the pilot has served as a small experiment allowing us to gain a deeper understanding of what works …

Greene’s insights describing learning by facilitating small ‘experiments’ reflects the IEI experience. Each program in the pilot has served as a small experiment allowing us to gain a deeper understanding of what works and what doesn’t work, and to improve the model accordingly.

It was also through these iterations that we built our credibility with our partners, and we now have deeply collaborative relationships. Despite early intentions to collaborate, these relationships were developed through the pilot’s roll out; that is, they became collaborative as operational staff worked together, rather than because the Steering Committee stated its intentions in a memorandum of understanding.

In hindsight, our original plan of running just three programs would have prevented the opportunity to continually adjust the model according to what we were learning. So, although the IEI’s adoption of an iterative approach was pragmatic rather than planned, it was an effective method of incubation.

Managing to outcomes in the start-up phase

As the IEI’s emergent nature became clear, so did the need to adapt our indicators of success. Our measurement and evaluation (M&E) framework had been intended to evaluate a fully-designed program through a proof of concept lens. Action learning (adapting the model in real time) was embedded in the framework, but as a start-up we needed to be even more flexible than we had anticipated. We needed to do more than just adapt our model towards our pre-determined indicators; we needed to adapt the indicators themselves.

For example, we had originally envisaged a linear pathway of pre-employment training, followed by work experience, followed by employment. We therefore set a participant’s transition from work experience into employment as the indicator of success.

 … it is equally important to keep an eye on whether the indicators you have selected are adequate, and to be ready to adapt them if necessary.

However, we found that work experience was more effective when integrated into pre-employment training, as it provided more immediate feedback for improvement for our participants. This meant that it was not just those who completed training who were counted as having commenced work experience. Participants who took other pathways after training, such as education or a different industry, were also considered to have commenced work experience. This led to a ‘negative’ outcome when they did not then start work with the IEI employer. It became clear that this indicator needed to be more nuanced. We began to collect additional data to capture post-IEI destinations and outcomes more meaningfully.

Given the time it had taken to identify the IEI’s start-up status, we were delayed in identifying the need to adapt our M&E framework. Although additional data was collected in later programs, it was difficult to do this retroactively for the earlier programs as too much time had passed. Had we been more agile, earlier, we may have been able to collect a larger volume of the additional data and therefore to adapt the program more quickly.

It is important to start any project with clearly identified outcomes, and to continuously manage towards these outcomes. However, it is equally important to keep an eye on whether the indicators you have selected are adequate, and to be ready to adapt them if necessary.

Taking risks: the role of philanthropy

Inherent in testing a new model is the risk that it might not work. The level of accountability needed in government-funded programs makes this a difficult risk to take. This is where philanthropy has an important role to play; innovation requires a collaborative effort between funders and program managers to take risks while still managing to outcomes.

The IEI was fortunate to be funded by seven innovative philanthropic foundations – The Ian Potter Foundation, William Buckland Foundation, R E Ross Trust, Jack Brockhoff Foundation, Collier Foundation, NAB and a private foundation. As well as providing ‘program funding’, these funders provided ‘innovation funding’, allowing for the development and iteration of both the IEI model and its M&E framework.

… our funders provided the ‘risk capital’ needed to take the IEI to the next stage.

The IEI funders allowed us to standardise our reporting, reducing the subsequent costs and allowing us to focus resources on delivery. The funders met with us every six months to discuss the IEI’s successes, challenges and lessons learned. They invested in more than just the training and employment of 115 young people; they funded the design, testing and iteration of a new model, and learned alongside us.

As an example, the results of our first IEI program failed to live up to our expectations. Employment outcomes were high, but so was attrition. The program had been funded by the first tranche of a grant from one of the foundations, with the second tranche dependent on our results. When it became clear that the program had not succeeded as hoped, we had an open conversation with our funders as to why. We discussed what had gone wrong, what we had learned, and how we planned to adapt the program in the next iteration. The foundation then gave us the second tranche so we could try again.

If all of our funding had been dependent on achieving our predicted outcomes, we may not have had the opportunity to adapt based on the lessons learned. However, we did remain accountable for looking closely at what didn’t work and determining how we would improve. Ultimately, our funders provided the ‘risk capital’ needed to take the IEI to the next stage.

Leveraging the IEI Youth Pilot

The IEI Youth Pilot has shown us, firsthand, the need to identify and articulate your starting position relative to your endgame. As a start-up, the IEI needed to go through a period of iteration and be flexible in managing to outcomes. Crucially the funders were willing to invest in innovation, support the consortium to learn and iterate to improve the program, and learn alongside the program themselves.

We are now feeding lessons from the IEI into the High Growth Jobs – Talented Candidates initiative. In this project, SVA is supporting the Australian Network on Disability and the NSW Department of Family and Community Services to roll out a demand-led model to build employers’ capacity to employ people with disabilities.

We are also rolling the IEI out at greater scale in Victoria in partnership with Jesuit Social Services, funded by the Jobs Victoria Employment Network (JVEN), in the next step towards our endgame of government adoption.

Carlita Bevege was SVA’s Project Manager for IEI from 2014 until mid 2016.

For more information contact Simon Crabb on scrabb@socialventures.com.au

Notes

[1] Department of Social Services [DSS], Labour Market & Related Payments April 2016.

[2] Manpower Group, 2015.

[3] Given the Chance, Brotherhood of St Laurence

[4] African Australian Inclusion program, Jesuit Social Services

[5] Entity resources and planned performance, Department of Employment, Portfolio Budget Statements, 2016-17,

[6] Unemployment rate only telling half the labour market story, ABC News.

[7] What’s your endgame?, Alice Gugelev & Andrew Stern, Stanford Social Innovation Review.