The Dissemination of Public Policies on Technical Training for the Textile and Clothing Industry in Ecuador

  1. Introduction

1.1 An approach to the diffusion of public policies

 With the North American current proposed by Laswell after 1951, it became aware that “policy process, its elaboration and realization, is the object of study in its own right.” That is, with Laswell and the so-called “political sciences” there is a need to “know” the policy process, as well as the “decision process” itself, based on seven stages: intelligence, invocation, application, termination and evaluation [1]. In his proposal, Laswell sought to explain ” an (interdisciplinary) systematic science and a (democratic) government decision” and thus respond to the fragmentation of the social sciences and the need for greater knowledge by the government in its public decisions [2].

For Aguilar, in the “normative sense, public domain has to do with needs, interests and projects of general scope” [2]. It also refers to a manifest nature, to the principle of free access, transparency and openness … to public resources, to tax revenues “among others, thus creating” precisely because of its public nature … a range of strategies of corresponding actions between the government and society “[2].

Public policy refers to “Governmental decisions that incorporate the opinion, participation, co-responsibility and money of private entities in their quality of citizens, voters and taxpayers” [2]. For Lahera, excellent public policy corresponds to courses of action and information flows related to a political goal, defined democratically; those which are developed by the public sector and, frequently, with the participation of the community and the private sector.  A public policy of quality will include orientations or content, instruments or mechanisms, definitions or institutional modifications and an anticipation of its results [3].

In terms of the cycle of public policies, the Guide for the Formulation of Sectorial Public Policies in Ecuador (2001) are defined as the following [4]:

  1. Preparatory and Diagnostic Stage
  2. State of defining policies, programs and projects
  3. Passing of sectorial policies and inclusion in the system
  4. Diffusion of policies, programs and projects to the population

For this research, Phase 4 will be taken into account, which represents the diffusion of public policies.  There are some theories which present the perspective of the diffusion of public policies linked to the theory of the diffusion of innovation.  Rogers believes that this is the “process by which an innovation is spread through certain channels of communication over time between members of a society” (Rogers [5] quoted by Osorio and Vergara [6]). In this way, the diffusion of public policies can be understood as “the process in which information about new policies or institutions is communicated through certain channels in time between members of a social system” [6].        In terms of the mechanisms of diffusion, they present the understanding of the objective after the adoption of a determined policy. There are then four mechanisms: coercion, emulation, competition, and learning. These help to distinguish how it should be carried out.  However, the idea of who adopts the policy should not be overlooked,  making it necessary to “clarify at least who is involved in the processes and what their competencies, capabilities and motivations are”, considering variables such as the type of political regime, institutions, ideology, and gross domestic product, among others, that together explain or determine if a public policy is adopted or not[6].               The mechanisms used by Ecuador to disseminate public policies are: a) sector policy document that includes a list of policies and sectorial actions; b) the publication of the sector policy document; c) dissemination to public servants of the institutions and; d) dissemination of the document through the media, forums and other means of communication [7].               In the case of Ecuador, the National Secretariat for Planning and Development is the public institution responsible for conducting national planning and for managing and coordinating the National Decentralized System of Participatory Planning, through the planning cycle, with a national, sectorial and territorial approach.  Thus, it articulates the public investment towards the established objectives and goals, with the respective processes of: monitoring and evaluating their compliance [8].

Thus, according to Article 280 of the Constitution of Ecuador, the National Development Plan, or the National Plan for Good Living, “is the instrument to which public policies, programs and projects will be subjected; the programming and execution of the State budget; and investment and allocation of public resources (…) will be mandatory for the public sector and indicative for other sectors “[9].

While it is true that there is a clear institutional framework when planning, formulating, coordinating and evaluating public policies, it is necessary to add to the debate whether diffusion is a factor to be considered in any of the phases of public policy, or, how the State’s communication policies intervene when it comes to socializing the different public policies that it has implemented, implements or will implement.

1.2. The Model of Systemic Competition (MCS), Meso Levels and the Proposal for Technical Formation

               Ecuador, in its Constitution, defines in Article 284 that its economic policy will have, as “objective 2”: “To stimulate national production, productivity and systemic competition”. Likewise, in its National Plan for Good Living 2013-2017 (hereinafter PNBV 2013-2017), it states in objective 10: “To promote the transformation of the productive matrix”, and more specifically in line 10.9, ” the conditions of competition and systemic productivity necessary to make the transformation of the productive matrix feasible and the consolidation of more equitable structures for the generation and distribution of wealth “[10].

The model of systemic competition and its application in Ecuador is the result of the development proposal of the Economic Commission for Latin America and the Caribbean (ECLAC), which gave rise to Latin American structuralism, founded in the 1950s with Prebish, who proposed the conception of the center – periphery system and the theory of endogenous development and regional substitution industrialization. In this context, ECLAC “proposed to modify the outward development, based on the increase of exports of primary goods, to the inward development, based on the expansion of industrial production” [11]. To increase the latter, the model required an increase in investment that would be stimulated through the incorporation of protectionist measures. However, what was proposed by ECLAC and implemented in Latin American countries did not achieve the expected results, as the impact of the endogenous development process, according to Ocampo [12] cited by FitzGerald [13], “was less evident than it was thought to be, because it could not be incorporated into an effective policy “.

In the late 1980s and early 1990s, a new stream of thought called neo structuralism began to be developed at ECLAC. The failure of so-called structural adjustment policies and development experiences in Southeast Asia created a favorable environment for the emergence of alternative paradigms [14].

As such, the Systemic Competitiveness Model emerged (hereinafter MCS),  proposed in the 1990s by Esser, K., Hillebrand, W., Messner D., & Meyer-Stamer, J. of the German Development Institute. For the authors of the model, after the 1980s, structural adjustment programs were designed to encourage economic modernization processes through a repositioning of market forces and a reduction in the scope of government intervention. However, they did not take into account that developing countries were characterized by fragile companies and markets, governments that were omnipresent and weak at the same time, and weak social actors. They started from this premise to ask: “What should be the starting points for developing countries that want to establish competitive industries at the international level, or provide international competition to existing industries? What measures should be applied first? “[15].

In order to answer these questions, they define industrial competition as the product of the complex and dynamic interaction between four economic and social levels of a national system, being: the micro level of enterprises, those seeking efficiency, quality, flexibility and speed of reaction simultaneously, many of them being articulated in networks of mutual collaboration; the meso level, corresponding to the State and social actors, who develop specific support policies, encourage the formation of structures and articulate learning processes at the level of society; the macro level, that analyzes the market and the macroeconomic conditions; and (…) the target level, which is structured with solid basic patterns of legal, political and economic organization, to achieve a sufficient social capacity of organization and integration as well as a capacity of actors for strategic integration.

According to the aforementioned definition, industrial competition is the product of a complex and dynamic interaction pattern between the State, companies, intermediary institutions and the organizational capacity of a society. The parameters of competitive relevance at all levels of the system and the interaction between them is what generates competitive advantages. The competition of the economy is therefore based on objective measures, articulated at four levels of the system, and is also based on a multidimensional concept of conduction that includes competition, dialogue and joint decision-making by the relevant groups of actors. Therefore, the competition of each company is based on the organizational pattern of society as a whole. Thus, competition is “systemic” [17]

According to the MCS, the government and industry will institutionally structure specific services for the sector, being the meso level. These “services” are translated into specific policies, one of them being the policy of technical training. The main postulates of the policy are [17]:

Postulate 1. Orientation of education towards values:The new mass production demands a type of flexible, cooperative worker, committed to producing quality and accustomed to learning, with autonomous capacity for professional action, able to relate causes to effects and who is a very skilled communicator.

Postulate 2. Increase in social effectiveness:If there is a corresponding demand, the vocational qualification can be adapted to the specific requirements of the informal sector, to vocational-technical vocational training or to the training of skilled workers in economic segments oriented to competition.

Postulate 3. Preparation for new profiles for qualifications: In the phase of reorienting  the economic policy, the task of intensifying training and improving work in the company almost always comes to fruition. Firms applying new organizational concepts intensify training. As the required vocational qualifications are high and continue to grow, it is important that the competition-oriented economic segments soon begin training apprentices. In addition, specialization will be based on training defined by “learning by doing”.

Postulate 4. Regulation with a view of system integration:Educational reforms will be guided by international standards, as well as requirements emanating from the new concepts of organization and production, though taking into account the structures and specific needs of each country. The gradual approach and timely approaches should be integrated from the outset with a view of creating systems, for example, a system of vocational training.

Postulate 5. Gradual development and priority areas: The educational system must be gradually developed in close coordination with the needs of the economy. For example, vocational education in economic sectors with a strong demand for skilled workers is a priority, as is the interest of business associations to participate in the design and financing of institutions.

Postulate 6. Mutual relations between State and productive sector:The new requirements of the economy can only be satisfied through close cooperation between the State, educational institutions and private industry: the development of an educational system structured on the basis of cooperation.

Postulate 7. Concrete cooperation between education, research and the productive sector:According to the authors of the IAD, concrete cooperation contributes to bringing vocational training closer to economic needs, rapidly recruiting university graduates in production, jointly improving dialogic techniques, to form networks and improve international business competition.

As indicated above, the Ecuadorian State presents in the Constitution of 2008 and the National Plan for Good Living (PNBV 2013-2017), “the transformation of the productive matrix” [10] as a priority, being one of its pillars fostering the productive development of sectors, industries or productive activities with strong positive externalities: creators of higher value added and job seekers [18]. Among the industries prioritized by the Ecuadorian State is the textile and garment industry, which is the second generator of employment in Ecuador after the food processing industry.

In the Constitution of 2008, consistent with the MCS, it is pointed out that the “State will develop labor training programs, depending on one’s vocation and aspirations” [9]. In Objective 4 of the National Plan for Good Living 2013-2017, it is pointed out that the State will guarantee the right to education / technical training,  centered on human beings and the environment. Specifically, Policy 4.6 stipulates: “To promote the reciprocal interaction between education, the productive sector and scientific and technological research, for the transformation of the productive matrix and the satisfaction of needs”. On the other hand, in Objective 9, policy 9.5 of this same document, it is indicated that the State will tend to “Strengthen the schemes of occupational training and training focused on the needs of the work system and the increase of labor productivity” [10].

According to the Agenda for the Productive Transformation of Ecuador, in accordance with Training Policy 8.8, the capacities of the public and private training agencies and the articulation mechanisms between the institutions that are part of the National Training and Professional Training System will be strengthened. Additionally, vocational training with a labor competencies approach, aimed at the economically active population and priority attention groups, in tune with the needs of the productive sector [19] will be promoted.  This policy requires the prioritization of sectors for vocational training and identification of training needs with a productive chain approach, especially in the strategic productive sectors that have been prioritized by the national government. In order to achieve effective national coverage in vocational training services, a territorial approach to service provision should be used, in accordance with the new system proposed by the National Secretariat for Planning and Development (SENPLADES).

Given that the job segment that receives less training in the development of their skills and abilities is that of micro and small enterprises, permanent training plans should be focused on the most vulnerable workers and priority attention groups. Companies, especially micro and small enterprises, should also be encouraged to draw up training plans annually for their workers in a complementary way with public policy.

In terms of institutionality, the policy establishes that there will be close coordination between the Ministry of Coordination of Production, Employment and Competition (MCPEC), the Coordinating Ministry for Social Development (MCDS), the National Center for Training and Vocational Training and the Ministry of Labor Relations (MRL), to reduce the level of informal work and focus training on the most vulnerable groups. It should be mentioned that Ecuador has a Technical Secretariat of the National System of Professional Qualifications, which seeks to “increase access to certification and training of workers both employed and those with their own businesses, popular and solidary economy, priority attention groups, public servants and citizens in general “[20].

Policies are institutionalized through an important range of tools, for example: “professional profiles will be developed with a tripartite conformation and with the productive and social sectors in the different territories that contribute to reduce the gaps between the required profile and the existent profile of the workers “; “To redesign the vocational training programs towards a system focused on labor competencies”, “educate the population on the importance of certification of labor competencies”, “encourage the incorporation of research and development results generated in the country “to establish differentiated accreditation mechanisms for providers of training and vocational formation services” “to strengthen the permanent system of monitoring and evaluating the results and impact of vocational training and formation”, ” strengthen the mechanisms of public-private articulation for the detection of training demands through sectorial and territorial research processes in accordance with the goals of productive transformation “,” articulate the processes of professional training the population uses and to encourage the creation and integration of local providers of training and vocational formation services as well as the mobility of those who have the capacities to meet the needs of the territories, “to promote the training and professionally formation that consider aspects of corporate social responsibility as well as ancestral and traditional knowledge existing in the different sectors and territories “; “To design and implement a strategy for the permanent dissemination of training and professional formation at the national level” [19].

As for the incentives provided by the State to promote technical training, the Organic Code of Production, Trade and Investment, in its second section, indicates that: for the business sector, while calculating income tax, during the period of 5 years from the first year of creation, the medium-sized companies will be entitled to deduct the additional 100% of the expenses incurred in the following category: Technical training aimed at research, development and technological innovation, productivity, and ensuring the benefit does not exceed 1% of the value of expenses incurred by salary and wages in the year in which the benefit is applied [18].

According to all of the above, this research aims to determine if the technical training policies proposed by the Ecuadorian State from the adoption of the methodological model of productivity and systemic competition were correctly disseminated and implemented in one of the prioritized sectors: the textile and clothing industry.

1 Materials and Methods

In order to determine whether the technical training policies proposed by the Ecuadorian State since the adoption of the MCS were correctly disseminated and implemented, a total of 174 surveys were carried out in the county of Antonio Ante and 156 in the county of Ibarra to owners / managers of the different companies of the textile and clothing sector, from May to July 2017.

The patent databases of the textile and clothing sector, prepared by the Decentralized Autonomous Government of Antonio Ante (2016) and the Decentralized Autonomous Government of Ibarra (2016) were used to classify companies according to the International Standard Industrial Classification (ISIC) in the case of Ibarra; not so much for Antonio Ante, which uses a different classification criterion. The number of surveys was determined using the formula for obtaining the sample for finite populations, specifically the stratified sample design; using the criterion of affixation proportional to the size of each stratum according to the classification of the aforementioned patent base. The survey tool consists of three parts; the first one inquired about the profile of the companies; the second was based on its knowledge and perception in reference to public policies on technical training, adopted by the Ecuadorian State starting in 2008; in the third and final part, information was requested on the training requirements of entrepreneurs. The information requested was disaggregated according to the organizational levels of the company: workers, operational staff and management staff. The information obtained was complemented by the analysis of public policies in its diffusion phase.

3 Results

Imbabura is a province in the northern Andes of Ecuador, and its counties of Ibarra and Antonio Ante are historically based on the textile industry.  It is in this context that the survey was applied and obtained the following results. The type of predominant business in both countries is microbusiness which, according to the classification of businesses by the Superintendent of Companies of Ecuador, is characterized by having 1 to 9 employees, a brute value of annual sales less than or equal to $100,000 USD and an amount of assets up to $100,000 USD.

In terms of age, the majority of microenterprises surveyed in Antonio Ante were registered for 10 years or more, while in Ibarra the majority were registered from 4 to 6. In both counties, the origin of the company equity is mostly family-based. Regarding the destination of the production, according to the respondents in Antonio Ante, it is directed towards the local market (30.9%) and local and national market (30.3%), whereas in Ibarra its production is directed mainly to the local market (74.1%) and the regional market (13.5%).

The representatives of the companies were asked about the prioritization of training. The majority of respondents answered that the priority is “moderate” in the two counties, with the difference being that in Antonio Ante the option that is in second place is “high”, while in Ibarra the second place option is categorized as “low”, because microenterprises that are especially dedicated to sales, indicate that there is no need to train their staff, or do not have staff to train. The factors determining the choice of a staff training program were discussed. In Antonio Ante before the criterion “content” is the most important factor, while in Ibarra it is the “price”; both counties agreeing that the factor “method” occupies second place. In reference to the problems that prevent a training program from being effective, the respondents from both counties, for the most part, responded with “lack of time”; “poor training” and “lack of links with the textile sector”. As for the annual investment made by entrepreneurs to train staff, the results are as follows:

  1. a) Workers: for the training of workers in Antonio Ante, according to what is mentioned by most of the entrepreneurs surveyed, there is an annual investment of between $1 and $ 200 (39.1%); the group of entrepreneurs seeking free training (25.9%) is included in this percentage; in Ibarra, the majority of respondents answered that they do not invest in training for the workers,
  2. b) Operational staff: most companies surveyed do not have personnel at this level, however, in the county of Antonio Ante, there are companies that invest from US$ 1 to 600 (14.4%), in Ibarra this percentage is 3.6% ,
  3. c) Management staff: In the “Management Staff”, Antonio Ante’s entrepreneurs invest annually between $ 1 and $ 200, followed by the group of those who seek “free training”, while in Ibarra 37.6% of entrepreneurs “do not invest”; but those who do, invest between $401 and $600, saying that as production companies, they must have adequate training to face competition.

The survey also asked about theincentives that companies give to retain trained staff; most of them do not give incentives.  Of those entrepreneurs who answered yes, they mentioned offering the following: public recognition, schedule flexibility, commissions or bonuses.

Entrepreneurs were asked if they had obtained certifications from the National Qualifications System. Only 4% of Antonio Ante’s companies obtained certifications in subjects such as: cut and clothing, skilled workers, continuous improvement and industrial safety; in Ibarra they obtained certifications in subjects such as: customer service, neuro-marketing, marketing and fashion design.  The rest of the companies in the two counties have been trained without obtaining certifications and did not remember the subjects. It is important to note that, according to the respondents, neither county has received training from the government on tax benefits for training staff; though 1% in Ibarra did receive the training. Therefore, most companies have not made use of this benefit. Regarding the proposals of the government for the implementation of programs of training in corporate social responsibility, ancestral and traditional knowledge and in association with the popular and solidarity economy, the majority did not know about these proposals.

                Likewise, the majority of entrepreneurs in the two counties did not know that Universities offer training. It was asked if they knew about other offers, and both in Antonio Ante and Ibarra the businesspeople surveyed indicated not knowing about the providers of training services. In general, their common practices to train the staff are: a) the owners of the companies are trained and then become multipliers of the knowledge, thus decreasing the expense of training; b) in the moments of crisis of the industry, the costs of training are eliminated; c) there are no relevant mechanisms to encourage and retain trained staff. Currently the textile and clothing sector of the counties under study are not organized and associations, networks, etc. are not formed. It is important to indicate that this local reality still exists, even though the Ecuadorian government has invested significantly in education since 2008.

4 Conclusions and Recommendations

In terms of the capacity of the State to disseminate policies, according to the different tools available: Guide for the Formulation of Public Sector Policies and the Proposal of General Guidelines for Decentralized Territorial Planning [4] a strategy of promotion and diffusion of the Plans at the different levels (national, provincial, cantonal) must exist, leading to the “appropriation by the citizens”, which is developed through the formulation of a communication strategy that includes the diffusion of material, making it possible to transmit the goals to the public, along with the results and proposed procedures, conveying messages that consider the different population groups that inhabit the area [22].  It is evident from the surveys that among the factors that have made technical training in the textile and clothing sector difficult in the counties of Antonio Ante and Ibarra is the lack of knowledge on the part of the owners about the means of production, training and state policies in this area.

Another element to be considered is the lack of knowledge of the owners / managers, even of the incentives provided by the State to promote technical training, which, as mentioned, once calculating income tax, during the term of 5 years from the first year of creation, medium-sized companies will be entitled to a deduction of an additional 100% of expenses incurred in the following category: Technical training aimed at research, development and technological innovation, improving productivity. The benefit does not exceed 1% of the value of expenses incurred by salary and wages in the year in which the benefit is applied [18].

The systemic competitiveness model (MCS) proposes the creation of an environment capable of boosting, improving and increasing the efforts of companies to train a worker accustomed to learning and oriented to competitiveness. Therefore, training human talent to be able to generate new knowledge, and improve their skills and techniques will determine the competitive position of the industry.

In this context, it is imperative that the Ecuadorian government, the textile and clothing companies in Antonio Ante and Ibarra counties of the province of Imbabura (duly organized), the universities and technical institutions and, in general, the actors involved in the education / training system design a policy focused on generating a learning system adapted to the needs of the sector; integrating professional training and technical specialization at all levels of the company.

The system will be duly planned and will ensure that all companies based in the territory have the same opportunity for access to technical training; one objective being the mass dissemination of the taught information.  Universities and industries will contribute with resources so that the system operates, for example, the assignation of teachers who teach subjects according to the training plan and the industry can contribute with scholarships so that their workers are trained on specific issues.

The government, through the Ministries and Departments of Economic Development of the Decentralized Autonomous Governments, will carry out the diffusion regarding the application of the regulations for training, focused mainly on public incentives that are given to the companies that train  personnel. The entities that generate the aforementioned learning system will be fully aware of the regulations and will coordinate in order to apply it in a way that maximizes its benefits. The learning system will be generated by the textile and clothing companies, organized in associations / networks. This first level of organization is the basis for stimulating learning processes and collective action and the following actors will be included: public institutions, funders, foundations, public or mixed companies, universities and social organizations that will promote the formation of human talent. Associativity will allow the organization to have joint training plans, minimizing training costs, but will also seek specific training in accordance with the strategic lines of each company.

It is important to change the way entrepreneurs think in the textile and clothing sector; training must go from having a low priority to a high priority, especially if Ecuador’s goal is to become a “knowledge society”.

If companies are already making an effort to partner and create a learning system for the textile and clothing industry, the second goal is then to think about how to retain trained personnel, not only in companies but also in the area. The strategy will be to create incentive schemes, which will include monetary and non-monetary incentives; for example, the design of compensation systems based on the skills and techniques applied to work at each level, bonuses for seniority or through indicators of productivity, support for fellowships, or creating merit promotion programs.

The learning system of the textile and clothing sector of the territory itself should develop the capacity to participate in the design of policies, to implement them and especially to disseminate them among the actors.

5 Bibliographic References

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