Mexico First – Closing the training gap in the IT industry through public-private partnerships

 Figure 1. Training Programs offered by MexicoFirst Source: MexicoFirst (www.mexico-first.org)

One of the main challenges that many developing countries find when trying to promote their local IT industry is the lack of appropriate skills among the population, both in terms of quantity and quality. Programming and engineering are not among the most popular careers in most countries, and on top of that, there is usually an important gap between what the industry requires and what universities produce in terms of IT skills. For IT-enabled services (services that, due to the advances in connectivity and IT can be provided off-shore and/or by third parties), “soft” skills that can go from negotiation to management to foreign languages (mainly English, but in some countries French, Portuguese and Spanish apply) are also scarce and become a serious bottleneck.

Mexico, despite showing impressive growth in the industry throughout the last decade, is no exception. Companies that hired recent graduates from IT programs would have to invest in training to bring the talented students up to speed with the latest technologies. It is no surprise then that, when the Prosoft Program, led by the Ministry of Economy, implemented the Prosoft Fund in 2004 to support local IT industry, most of the resources were allocated to training. 

Despite the amount of training that was done through the Prosoft Fund, training grants were demand-driven and little economies of scale were created in the training process. Moreover, quality among different providers was not homogeneous and certification as a percentage of trainees was relatively low. In essence, the training program helped close the gap between demand and supply, but could be improved to take advantage of the Funds and the scale of the training grants.

In 2008, the World Bank signed the IT Industry Development Project with Mexico. The project is aimed at creating initiatives that could be self-sustainable in the long-run and to identify and address the main bottlenecks that hinder the development of the IT/ITES industry in the country; and IT skills was among the most important issues.

As part of the project, MexicoFirst (www.mexico-first.org) was created specifically to address the training gap in a more effective manner. MexicoFirst is a non-profit organization led by CANIETI , the IT industry chamber; and ANIEI, the Association of Educational Entities with IT Programs. The objective of MexicoFirst is not only to address the gap, but to do so in a way that maximizes the resources provided by the Government of Mexico through the Prosoft Fund. Moreover, by having CANIETI and ANIEI in its Board, MexicoFirst is aimed not only at “filling” the gap with high-quality, high-value certifications that are demanded by the industry, but also at “reducing” the gap, by providing information to universities on trends and industry demands.

Operation and Partnerships

It could be said that MexicoFirst is in many ways a “smart training broker”, formally supported by the industry, the academia, and the Government. It is not intended to become an education entity itself but to provide the best relevant certifications at the lowest prices to the industry. In doing so, it follows a two-folded strategy: (i) understanding the demand from State Governments and local Industry Clusters; and (ii) negotiating with leading global companies on the best training programs available in the country.

Demand from States and Industry Clusters

MexicoFirst has a continuous dialogue with State and Industry Clusters around the country to gather the demand that these institutions have with regards to training for the IT-related professionals and/or students. Additionally, they talk to industry analysts to better understand the trends in the global IT-enabled services market. With this information, they can review the list of courses and providers they have agreements with to include those that may become part of future requests from the industry.

Global Partnerships

Simultaneously, MexicoFirst negotiates with technology providers taylor-made training courses and discounts on certifications demanded by the industry. Being supported by academia, industry, and the Government, MexicoFirst has achieved important discount for high-demand certifications, in some cases up to 70%. Since the Prosoft Fund will provide support only on the basis of certifications, MexicoFirst negotiates with providers for additional training hours and more opportunities for students to take certification exams. In many cases, the negotiations made by MexicoFirst represent the highest discounts given on any country by technology providers.

MexicoFirst matches industry demand with the appropriate training entity, and coordinates the schedule and venue for the program to be delivered. Rather than having its own facilities, MexicoFirst relies on that from companies, trainers, and/or universities to provide the courses. Course duration is varied and can last from several weeks to several months.

Interaction with the Prosoft Fund

Training projects (presented by different states and clusters to MexicoFirst and then aggregated and presented to the Fund) can receive up to 80% from the Fund, with an average closer to 50%. This means, for example, that students and companies could end-up paying less than 10% of the market-price for a certification provided by an authorized certification partner for technologies that are included in the program.

MexicoFirst is in fact an institution supported by the Prosoft Fund. 80% of the seed capital was provided by the Fund, and both CANIETI and ANIEI provided the remaining 20%. Given the demand for courses, it is expected that in the short term MexicoFirst will become self-sustainable through a small mark-up on the training provided.

Results

MexicoFirst has become the main provider of training grants for the IT industry in Mexico since its creation in October 2008. As of December 2010, more than 6,000 and more than 9,000 people have been certified and trained, respectively, through this entity. Prices for courses taken with MexicoFirst are on average two thirds of market prices. Companies and students pay even less for those courses that are included in requests to the Prosoft Fund. MexicoFirst only has 8 employees.

In an industry where the training gap between university graduates and industry needs is always changing, MexicoFirst has become a viable mechanism to address it, capturing demand directly from the industry and providing feedback to the academia. It’s governance structure (being a non-profit with CANIETI and ANIEI in its Board) guarantees its focus on efficiency and effectiveness; and its partnership with technology providers ensures the provision of training and certification by trusted partners.