Avoid becoming the next 3AAA
How to avoid becoming ‘the next 3AAA’:
lessons and top tips for independent training providers
The implosion of 3AAA continues to shake our industry, with investigations by FE Week adding fuel to the fire. From experience, I know that rapid expansion in a college or an ITP can put enormous pressure on a company and its systems. It’s also hard to maintain the culture of an organisation as you assimilate large numbers of staff – even if they’re fantastic professionals, as the outpouring of support for 3AAA’s staff demonstrated that they were.
In our businesses, the pressure to create successful outcomes for learners can tempt individuals to cut corners. Managing this human behaviour is really tough part of educational leadership: it’s never easy and it’s often lonely. Part of management’s job is to catch problems before they put the whole organisation at risk; intervening where people are heading towards doing this is a challenging but crucial part of a manager’s job.
In the case of 3AAA, it seems that the manipulation of data uploaded to ESFA was a major contribution to their downfall. Many colleges and ITPs have weak data governance and IT system design. It’s alarmingly common for these organisations to have almost complete data separation between their Management Information System (PICs or Maytas) and the e-portfolio and other data systems that run the operational side of the business. This makes it incredibly easy for rogue members of staff to manipulate the data in MIS systems without anyone spotting it: the people who know that learner X didn’t pass their Maths Functional Skills test don’t have access to the MIS system; the people who do have access don’t know the learners, and so can’t easily question the data.
So, is there a way to protect your business from this kind of risk? In short - yes.
Join up your systems
Deal with your data silos. The more transparent your systems are to all staff, the more difficult it is to make mistakes or deliberately defraud the system. Have joined up systems across your business – or invest in one system that covers both the claim and operational activity. It’s also more effective and efficient for your business.
Give everyone access
Firstly, make sure all staff have access to all parts of your joined-up IT system. Fraud thrives in environments where “confidentiality” is the overriding concern. If staff can see all the data about a learner, it makes it very difficult to make fraudulent claims without arousing suspicion. Systems can be built with an audit trail function, so every change by every member of the team can be seen and reviewed.
Secondly, do not have your key financial and performance data sat in a system that only three people know how to use, and therefore hold massive power over the rest of the management team. It’s both inefficient and risky.
Fix the problem before you scale up your business
This scandal has been so big, so catastrophic and so visible at a sensitive time that there will undoubtedly be a knee-jerk reaction from both ESFA and Ofsted following their latest intervention. Regulation is bound to clamp down in response to continued media and industry scrutiny. But a great joined up IT system is not a costly project, and it’ll reduce your costs. If you’re looking to scale your business, astute investment in well-designed technology can increase your profit margin by creating efficiencies that you would not manage with traditional methods.
Develop your own understanding
Finally, develop your own IT confidence so you can make better decisions about how to organise the IT systems in your own business. Think about recruiting a high quality part-time IT director to help you sort things out. Do not scrimp on the necessary financial investment. Take this stuff seriously. Otherwise this could happen to you. And, as we’ve all seen, it isn’t pretty when it does.
Be Astute can help
Funded training provision is a complicated market. With thirty years’ combined experience in the learning, assessment and training market, we understand these requirements inside out – and we can help you manage them better to make your business more profitable and efficient by:
- helping you manage your business better
- relieving your admin burden
- helping you offer the best for your training and learners
Do drop us a line – we can offer you a free initial business review to identify your key issues, potential solutions and action points.