When you look at today’s technology-enabled workforce, there are a huge number of certifications available. We just finished doing a study comparing some of the most successful certification programs, their role in the job market, and their importance to the training industry. We did this study because we’re hoping to convince Google to transition to an authorized training model which leverages affiliate training providers along with authorized content. We’ll keep you posted on that. In the meantime, comparing these certifications yields some interesting insight about how they impact skills and earning power.
So to establish some context for studying useful industry certifications, let’s break them into a few basic categories:
- Some are small but important specialties. These certifications are very useful, but not very widespread. These credentials are highly specialized and difficult to earn, demonstrating expertise in specific but critical fields. They are high earners for those who hold them. An example of such a credential would be Cisco’s CCIE.
- Others are small certifications brought to market by sponsors who simply want to make money. These certifications often rely more on promotion than on real expertise, and are little more than false credentials to make an individual appear more qualified than they might actually be. Acceptance criteria are generally easy, and the certifications grant little or no earning power.
- Finally, you have some very big certifications – widely adopted and equally respected – that truly demonstrate how a successful certification model works. Examples would be PMI’s PMP, Cisco’s CCNA, and CompTIA’s A+ credential. Those are the types of certifications we’re primarily interested in.
Let’s drill down on this third category. Although the other categories certainly contain useful credentials, it’s this third group that offers real potential for transforming entire sectors of the labor force and offers real money-making potential to the sponsoring body. So let’s take a closer look.
What we see right away is that all three of these professional credentials saw widespread adoption in a relatively rapid timeframe. So not only were the certification programs successful, but the sponsoring companies for them (Cisco, PMI, and CompTIA) all achieved huge wins in terms of capturing market share, because the programs indoctrinated the labor market with skill sets that directly tied to their products.
Example: The Project Management Institute
One of the earliest and most established certifications in the technology workforce today is the Project Management Professional, (PMP) from PMI, the project management institution. Founded in 1969, PMI was led by businessmen and project champions who realized the need for a structured standard of methodology in the field of project management. They introduced the PMP certification in 1984. Ten years later the certification had been adopted by about fifty thousand professionals.
But then, as systems projects grew ubiquitous, credential numbers shot into the hundreds of thousands. Today, they stand at around half a million. Each and every person who became certified paid an exam fee to PMI. The fee here is $450-600, depending on membership in PMI. That fee amount, combined with the numbers of people adopting the credential, obviously generates quite a revenue stream.
But besides the straightforward question of revenue, today PMI has set themselves up as the de facto governing body for the entire industry – and that’s the real win for any company who is seeking to And it’s an important industry. Three percent of the American workforce say their jobs are somehow related to project management. Running a job search on any of the big job search aggregator sites reveals that there are around 14,000 job listings which mention “PMP” in the description. So we can see that PMI has been very successful, and that the PMP certification is very widespread.
Now let’s look at a major technology player who has also been a powerful force in the world of certifications: Cisco.
Cisco knew early that they needed to manage the way in which technicians, vendors and industry in general disseminated the skills associated with their products. Now, Cisco had the added advantage of getting into networking at just the right time for their products to be widely adopted. Their product push coincided with the rise of the internet and the tech boom. But they had something else going for them which allowed them to dominate the competition: their disciplined control over how learning on their products and toolsets was implemented.
Early on, Cisco introduced a certification known as the CCNA (Cisco Certified Network Associate). This credential in basic networking was rapidly adopted, and the skillset engendered by the CCNA became a de facto global standard to employers who knew they needed professionals with networking skills. Because of this employer demand, Cisco’s products were themselves able to rise as de facto standards. Along with learning content published by Cisco, they created a program for authorizing independent training companies who could provide Cisco’s technical skills for their own profit.
In this model, the training companies paid a hefty fee and Cisco provided a branding standard by which they could authorize or advertise that they were official partners, and their courses were tied to official content and exams. Because of this ownership over both the training content and training channel for Cisco skills, Cisco positioned itself perfectly to take advantage of the fact that employers in the market will gladly pay a premium when they can get a skills guarantee for their workers. This relationship between employer demand, technology products and the training market sets up perfect conditions for a profitable arrangement between workers, employers, trainers and technology providers.
Conclusion: A properly implemented certification program can drive higher demand for your credentials and skills in the workforce
Just by taking a look at the history of a few of the most successful training certification programs in recent decades, we can immediately see that there is a tangible multiplier effect as a result of rolling out a credible certification. When it comes to a skilled technology labor force and the inherent demand of employers for guaranteed skills in a given area, companies like PMI, Cisco, and CompTIA have achieved major increases in demand for their products and services by successfully introducing and marketing their certifications. As these certifications took hold, employers began to require them because they knew they were a reliable guarantee of a skill set. As employer demand for the credentials grew, so too did demand among workers for the credentials themselves. Along the way, the companies sponsoring these credentials cemented themselves as leaders in their sector simply by being the organization at the heart of a successful credential.
Next time we’ll take a closer look at the logistics of actually establishing a successful certification model, and how technology companies can benefit from leveraging the many independent firms in the for-profit training world.