ILO Education and Skills Training project Proposed Framework for Entrepreneurship Education Draft Concept Note for

Discussion

I. Background: Why entrepreneurship education?

Despite registering a growth rate of 6.2 percent in 2008, amidst a global financial crisis, GDP increase has not translated into a sufficient number of jobs to absorb the new cohorts of Indonesian youth on the labour market. Indonesia faces an open unemployment rate of 8.39 percent and an underemployment rate of 27.8 percent,1 and 61 percent of unemployed Indonesians are between 15 and 24 years old. Every year close to two million young women and men enter the Indonesian labour market. A combination of lack of labour market opportunities and lack of skills results in many young people being unable to secure a job in the formal economy. Many of them end up working in the informal economy, but their productivity is limited owning to inadequate preparation in schools.

Indeed, the fact that a large number of Indonesian students will end up making a living from the informal economy is not fully reflected in the in-school and out of school learning and training modules. Most of the schools in the country do not provide any entrepreneurship education that youth would need to either start a business, join and increase the productivity of an existing family business, or more generally develop a more proactive and entrepreneurial attitude in their professional career.

The current theories on economic development include entrepreneurship education as an important tool for the development of a vibrant micro and small enterprise sector. In Indonesia, micro- small and medium enterprises (SMEs) contribute 53.6 of national GDP,2 and employ more than 91.8 million people. Despite the role small enterprises play in the economy, many of these businesses are unable to grow owing partly to lack of well trained human resources.
1

Trends of the selected socio economic indicators of Indonesia, BPS, March 2009 BPS

Encouraging entrepreneurial spirit among students and young people will not only contribute in reducing unemployment, but will also help to boost productivity and competitiveness in the SMEs.

There have been numerous attempts to conceptualize entrepreneurship education, but no consensual definition has emerged so far. For the purpose of this note, entrepreneurship education means within the framework of lifelong learning, the process of providing individuals with the concepts and practical skills to recognize opportunities, marshal resources, and possibly initiate and manage a business. The definition includes entrepreneurship education aiming both at business creation and at improving the student attitude towards his/her professional life. Entrepreneurship education is viewed as part of a lifelong learning process in order to ensure that individuals can progress coherently in acquiring entrepreneurial competences and improving their entrepreneurial attitudes within and outside the education system.

Limits of entrepreneurship education should also be noted: Not everybody can become an entrepreneur. Entrepreneurship education aims both for individuals at becoming entrepreneur and entrepreneurial. It is not aimed exclusively at business creation. The aim is also to foster attributes like creativity, autonomy, and initiative in an individual (as part of life skills). To be effective in terms of business creation, entrepreneurship education should be accompanied by a strong component of after training support / coaching / mentoring and/or linkages with business development services. To maximize employment opportunities, entrepreneurship education should be part of a broader focus on strengthening micro and small enterprises in Indonesia, in conjunction with efforts to improve the business environment.

This note is divided in six parts. The second part describes the main initiatives being implemented so far in the country in entrepreneurship education. The third part attempts to draw preliminary lessons from this experience, and the fourth part list seven policy recommendations for a comprehensive entrepreneurship education framework in Indonesia. The fifth and the sixth

parts make further recommendations for respectively the training of teachers, and monitoring and evaluation.

II. Outline of current entrepreneurship education system in Indonesia

A. Entrepreneurship Education in Vocational Secondary Education (SMKs) The Ministry of National Education (MONE) has been implementing entrepreneurship education since 1994 in Vocational and Technical Secondary Schools. The introduction of entrepreneurship curricula at the vocational secondary schools was seen as an opportunity to combine entrepreneurship learning with technical skills in order to encourage students to become entrepreneurs. In addition, many SMK schools are implementing a Production Unit which is an actual business unit run within the school to generate income for the schools and to provide students with a first work experience. It is to be noted however that most students do not get involved in the business aspect of the Production Unit but focus on practising their vocational skills. The Directorate of SMK development (PSMK-MONE) has also initiated an extra curriculum activity for entrepreneurship, whereby selected school students benefit from (a) a one week intensive business start up course (with ILO Start Your Business training package), and (b) start up capital for a group based business in the school.

B. Entrepreneurship Education in the Polytechnic System

In the polytechnic system, ASPI (The Polytechnic Association of Indonesia) is implementing the Entrepreneurial Skills Development Project (ESDP) which funded by NUFFIC of Netherlands. The project aims, among others, to mainstream entrepreneurship through the development of entrepreneurship curricula and the establishment of Entrepreneurship Training Units (ETU). The entrepreneurship curricula is developed by TRIODOS FACET, drawing on ILOs Know About Business training package, the ILO Business Games and GTZs CEFE package. The International Training Centre of ILO in Turin is providing technical assistance for the
Ministry Of National Education ILO Entrepreneurship Education pilot projects at a glance The ILO worked with the Ministry of National Education, particularly, the Directorate of Vocational Secondary Education since 2002 through a pilot test of Start Your Business Programme (SYB). The SYB has now been used across Indonesia, and a network of SYB trainers is available in eight provinces. In 2005/2006, MONE and ILO introduced the Know About Business (KAB) entrepreneurship training programme in the vocational and technical secondary education system in Indonesia on a pilot basis. Indonesia joined the group of 30 countries using the KAB training package. To ensure the sustainability of the project as well as national ownership, the ILO has enhanced the capacity of Vocational/Technical Education Development Centres (P4TK) in providing entrepreneurship training. 33 Master trainers from Six P4TKs are currently using KAB as part of their regular institutional training programme.

establishment of the ETU.

C. Entrepreneurship Education in Higher Education Several state and private universities have been using entrepreneurship curricula as a mandatory subject for one semester. In addition to this, since 2007 the Directorate for General of Higher Education provides selected universities with funds to assist students to start their businesses.

D. Entrepreneurship

Education

in

Vocational Training Centers. Several state vocational training centers (BLKI) such as BLKI Lembang, Bekasi, BLK Lombok, and South Sulawesi have been using the Start Your Business curricula for students who are interested in starting their business. For

example, BLKI Lembang introduced the Start Your Business program for the agriculture sector while BLKI Bekasi used the SYB programme for their students who were being considered for jobs in Japan.

E. Entrepreneurship Education for out of School Youth The entrepreneurship education for out of school youth is mostly aimed at assisting young people to start their own business. The government is actively promoting programmes to stimulate the creation of new businesses for youth. For example, the Ministry of Youth and Support under the Deputy Minister for Entrepreneurship has been actively promoting entrepreneurship targeting youth in rural areas. The government provides financial support to institutions who train youth on vocational and entrepreneurship skills. In addition, start up capital is also provided to assist youth to start their businesses. The Ministry of Cooperative and Small Medium Enterprise has similar schemes such as the Youth Entrepreneurship Programme through Cooperative Movement and Agro-business. The Director General for PNFI of the Ministry Of National Education is also in the process of integrating entrepreneurship education in the training institutions for out of school youth. It is aimed at providing students with entrepreneurship attitude, skills and knowledge.
The ILO Start and Improve Your Business Programme The Start and Improve Your Business programme is subdivided into three: i) Generate Your Business Idea, ii) Start Your Business, iii) Improve Your Business. The SIYB programme has been implemented in more than 90 countries with more than 80 Master Trainers and 4,500 Trainers. It has a strong quality assurance system, with a centralised certification body at ILO International Training Center in Turin. In Indonesia, the programme was introduced in 2002 in collaboration with the Ministry Of National Education. Six master trainers, more than 230 trainers and 35 partner organizations are actively promoting and implementing the SIYB programme, including KADIN and APINDO.

F. Entrepreneurship Education adapted to specific groups. The migrant workers organizations and BLK Malang have been implementing the SYB Programme targeting domestic workers who have returned from overseas. The training also includes members of the migrant workers family. In total, there are 39 SIYB trainers working with organizations supporting migrant workers and their families to make use of their saving productively. KSBSI Aceh is using the SIYB Programme to provide support to their members who will retire or are expected to be laid off. In Surabaya, UKM Center of Dinas CSME trains retired workers of one of the cigarette company on SYB to enable them to start their business using their saving or severance payment. Several Business Development Services Providers also

use SYB programme training prisoners who will be released from detention. There are also examples of Business Development Services Providers marketing entrepreneurship education in drug rehabilitation centres including for people living with HIV&AIDS. In Papua, ILO has been working with provincial and district Governments to train Papuan communities, also relying on local traditions (adat).

III. Lessons Learnt

These are the main lessons learnt from entrepreneurship education initiatives in Indonesia:

Need for an overall framework with specific responsibilities - There has been a lot of emphasis on developing and upgrading entrepreneurship curricula. For example, PSMK (the Ministry of National Education Directorate for Vocational Secondary Education Development) has been revising its entrepreneurship curricula every four years (1994, 1999, 2002 and 2007). ILO has also helped by adapting and piloting international training modules. However, fewer resources were used for rolling out the training for teachers and instructors, as part of a comprehensive plan. Most entrepreneurship education activities were so far initiated by the Central Government, while only few provincial and district Governments contributed financially in teachers training.

Entrepreneurship education requires a paradigm shift in teaching methodology - In those cases where training of individuals was student centred and accompanied by coaching support, and linkages with the private sector, a greater impact was noted in terms of: (a) use of interactive and practical approaches, (b) number of students considering opening a business in the future, (c) number of students able to establish a linkage between their current learning and future occupations.

Youth need more assistance in formulating a business idea, encouragement and motivation, while adults need more assistance in terms of business management (source SIYB evaluation in Aceh).

In school entrepreneurship education works better with an all school approach Experience has also shown that it is important to train teachers along with the school principals, education inspectors, parents committees, and/or a representative from the private sector in order to implement a successful and dynamic entrepreneurship module.

An integrated approach namely access to practical skills training, business management knowledge and access to financial institutions is an effective approach for business creation - The Start Your Business Impact Assessment in Aceh 2007 found that around 41.5% of total respondents started a business (27%) or an income generating activity (14.5%). Challenges faced by most of the respondents in starting their business included attracting customers, getting raw materials, managing finances, and access to external finance. The involvement of Business Development Services was directly linked to the sustainability of the micro-enterprises.

IV Seven Proposed Policy Priorities for Entrepreneurship Education

o Ensure political support across ministries and throughout provinces and districts for entrepreneurship education as a key competency for all Indonesians, as part of a comprehensive policy to reduce under-employment, and provide support to micro and small enterprises. This wide based political support should result in sustained and coordinated funding for the programme, a generic enterprise education model to be customized with cultural differences at provincial level.

o Set up clear goals of what is to be achieved, through lifelong learning process including for in-school and out of school youth, for dismissed or retrenched workers, with related budget and impact indicators. Practical incentives are needed, particularly since schools and teachers have a greater autonomy under the current system (Kurikulum Tingkat Satuan Pendidikan). It

is important that the school management and teachers are convinced about embarking on these activities and that school environment is favourable to entrepreneurship education.

o After a review exercise of past experiences and based on agreed competencies (see draft in annex 1), recommend curriculum as part of SMP (Junior High School), SMA (General Secondary School), SMK (Vocational Secondary School) and out of school youth, and for retrenched / dismissed workers, review how entrepreneurship can be mainstreamed within existing subjects;

o Set up innovative public - private partnerships with (a) training providers, (b) enterprises wishing to sub-contract part of their production / distribution, and (c) trade unions (for workers education). As part of the same recommendation, it is important: To recruit participating agencies for entrepreneurship for out of school based on their performance and capacity rather than on their status (PKBM, LSM, private..); to recognise and maximize the role of educators other than teachers (parents, practitioners, entrepreneurs, students themselves); establish incentives for companies contributing time and resources to enterprise education, attach students to real companies and to business people, in order to ensure a close mentoring / coaching relationship with business practitioners.

o Build the capacity of entrepreneurship teachers and decide on a certification system for the same. Capacity building of teacher should focus on learning by doing. It should not be limited to one time training but include coaching and after training support, secondment to small companies and study visits to successful schools in order for teachers to truly engage, and develop their competencies. The role of educators is conceived as providing an environment allowing the individual to feel empowered to take risks, facilitating the change of attitude among student towards a more dynamic approach to the world of work and his/her own professional life.

o Establish within a P4TK one or more decentralized Units for Entrepreneurship Education, with provincial focal points in charge of: stimulating innovative ways to deliver entrepreneurship education through targeted block grants, carrying out tracking studies and documenting impact, documenting, validating and disseminating specific lessons learned through online communities of practice, granting the label entrepreneurial school to schools having shown remarkable achievements.

o Support school business projects and business incubators, in partnership with the private sector, whereby students are involved in concrete business activities both at production and management level (with due care for Occupational Safety and Health concerns), giving due recognition of their performance through marks and competition.

V Proposed Teachers Training and Certification

Qualified master trainers are a key factor for the effectiveness of entrepreneurship education in the country. Using the ILO experience, it is proposed to have three level training systems to create a pool of experts on entrepreneurship education. These are 1) master trainers, 2) key facilitators and 3) facilitators (teachers). Each will have to be trained and supported with coaching and regular skills upgrade trainings, to carry out their respective tasks. The proposed tasks for each are as follows:

a. The role of master trainers in P4TK should be: to ensure that key facilitators are using student centred teaching methods when conducting entrepreneurship training to teachers. to establish innovative teaching methodology on entrepreneurship education for classroom and extra curricula.

to collect good practices on the effectiveness of entrepreneurship education, and to disseminate them through various medias.

b. The role of key facilitators at provincial level: to promote entrepreneurship education training programme for schools and teachers and market the programme to provincial/national government. to train teachers on entrepreneurship education using students centred learning activity. to provide after training support to teachers such as new teaching skills on entrepreneurship, coaching, etc.

c. The role of facilitators/teachers to implement student centred learning activity in their classrooms. to conduct regular monitoring on student satisfaction who participate in the entrepreneurship education programmes. to motivate students to establish student business club, etc.

According to the government regulation No. 74/2008, there are two ways of acquiring certification for teachers, namely: 1) competency test through portfolio assessment, and 2) direct certification for those who have postgraduate and doctoral degree.

The assessment of portfolio covers 1) academic qualification, 2) training and education, 3) teaching experiences, 4) learning plan and implementation, 5) assessment from supervisor and superintendant, 6) academic achievement, 7) professional achievement development, for example, conducting a research, 8) participation in the workshop, 9) organizational experiences related to education and social issues, and 10) awards relevant to the education. These components of the portfolio cover four core teacher competencies namely 1) Pedagogic competency, 2) Personal competency, 3) Social competency, 4) Professional competency.

Each year, the Ministry Of National Education sets a target for teacher certification which covers all teaching subjects. Teachers working on entrepreneurship should be encouraged to register

themselves for certification. Their participation in the international entrepreneurship training such as KAB and SYB will contribute to give them higher scores.

No

Component of portfolio

Proposed criteria for certification of entrepreneurship teacher

Academic qualification Diploma IV or S1

Teachers should have minimal academic qualification as required. MONE may need to assist teachers who do not have the current minimum academic qualification to obtain at least Diploma IV qualification.

Training and education

Teachers must participate in entrepreneurship training programme focusing more on modern teaching methods. The KAB Training programme may be used as reference for teacher training institutions.

3 4

Teaching experience Learning plan

NA and School principals/ management ensure that the teachers prepare learning/session plan using modern teaching methodology.

implementation

Assessment superintendants schools principals

from There are two areas which can be assessed related to the and teaching style. Superintendants and schools principals can play an important role to review entrepreneurship teachers on: Teaching innovation and creativity on

entrepreneurship. 6 Academic achievement Communication skills. Networking skills with businesses and associations. Score may be given if teachers are able to assist students winning skills competition on entrepreneurship 7 Professional Achievement Teachers should be encouraged to write articles in newspaper on success stories on entrepreneurship Teachers should be encouraged to conduct research on entrepreneurship

Participation workshop

in

the -

Encourage provincial/district education office to make regular knowledge sharing workshops on

entrepreneurship. 9 Organization experiences Encourage teachers to establish or participate in the Association of Subject Teacher (Musyawarah Guru Mata Pelajaran) Encourage teachers to establish business clubs on entrepreneurship. 10 Awards relevant to the NA education subject

related to education and social issues

6. Monitoring and Evaluation

In order to guarantee a rapid and sound development of the Entrepreneurship Education, it is proposed to establish a standard system for Monitoring and Evaluation, to allow national and provincial decision makers, schools management, teachers and others to assess its impact and adapt the strategies accordingly. The proposed indicators are summarized in the following matrix.

Programme Performance Indicators Focus Students Schools of students Number of Key Facilitators (P4TK, LPMP3) trained Number or provinces on where a key facilitator is available Number of key

Number

receive entrepreneurship teachers education programme Number Scale participate of students in entrepreneurship education

the Number of teachers facilitators working on attaining teacher entrepreneurship

students run enterprise

Lembaga Penjamin Mutu Pendidikan (Education Quality Assurance Body)

certification Number of provinces where entrepreneurship education is available Students satisfaction Schools

education activities

programme

satisfaction Teachers

satisfaction

with services provided with the availability of with training and after by teachers and school Quality Students satisfaction services and materials training satisfaction. provided facilitators by support key

with materials produced (business games,

textbook, workbook) Students Impact changed attitude Percentage of schools change to conducive

Personal Entrepreneurial learning environment Competencies improved Transition education to from work

facilitated and applied Cost Cost-effectiveness per teachers Cost per

(training, after training organisation/facilitator and certification) linked to a measure of

linked to a measure of impact impact Percentage of teachers National Sustainability and schools actively quality systems for

control,

implementing student continuous support and centred learning training of facilitators

Continuous support from provincial/national government

Tools used for monitoring purposes may include Focus Group Discussion with students to review pre and post training entrepreneurial attitudes, evaluation of the teaching process (preparation, methodology, students participation..).

Annex 1 Proposed Entrepreneurship Competencies by Target Audience Target audience Key Competencies Modules piloted in For Indonesia SMP Know about role of enterprises entrepreneurs society SMA Demonstrate entrepreneurial characteristics Understand skills required to start a business Modified About Business. Know To develop and in action immediate

curricula as part of the career life skills,

guidance,

or local content. To continuous capacity building for teachers in provide

particularly developing conducive learning environment. -

To link schools with the private sector.

To link schools with Business

Development Services Providers

SMK

Demonstrate

a Know About Business -

To

provide

dynamic entrepreneurial spirit Demonstrate understanding the structure of

continous capacity building teachers particularly developing conducive learning environment. To link schools with the private sector To link schools with Business in for

business planning.

Development Service providers for future interest. Higher Education Demonstrate a To develop pilot modules using

skill to translate problems acceptable opportunities. Able to apply of relation into

hands on practical learning students. To continuous training lecturers developing for in provide for

principles human

management Demonstrate application of

hands-on practical learning environment. To build stronger cooperation

technical skills in entrepreneurial context Is able to design a

business plan

between universities business communities, particularly small and medium and

enterprises. To business incubators. GET Ahead4 Generate Your develop

Out of school

Understand entrepreneurial characteristic

To enhance the capacity business development services on of

Business Ideas Start business and Improve Business Your Your

Understand skills required to start a business.

entrepreneurship and business

Understand

demonstrate skills required improve business Is able to develop business plan to a -

management training programme. To certification process for define

trainers/instructors in with
4

cooperation Badan

GET Ahead is a training package for poor women engaged in or wishing to start a small-scale business. It differs from conventional business materials as it highlights entrepreneurial skills from a gender perspective. GET Ahead aims to strengthen the basic business and management skills of trainees. It shows women how to develop entrepreneurial skills and to obtain support through groups, networks and institutions dealing with enterprise development. Please contact ILO Jakarta for more
information.

Nasional Sertifikasi Profesi (teh Body Professional Certification) and Ministry Cooperative Small of and National for

Medium

Enterprises. To build stronger cooperation the NGOs with and

private sector5 for better outreach. To linkage financial institutions explore the establish with

possibility of pool funds for credit guarantee for start up businesses

owned by youth.

For example with Indonesia Business Link, British Council, Sampoerna Foundation, etc.