Manufacturing: a sector in need of major surgery

Many manufacturing companies lack faith in current skills training provision in their sector and want major reform.

This is made plain in a recent report by manufacturer’s group, the EEF. Called Learning to Change – Why the UK Skills System Must Do Better, it claims there are serious flaws in the current manufacturing skills training system. It wants wholesale change, including a merger of the Learning and Skills Council (LSC) and the Sector Skills development Agency (SSDA).

It says that too many initiatives – some sector-led and some regionally-led – have made the system far too complex, and that poor communication between the organisations involved has led to excessive bureaucracy and duplication of services. It claims this has, in turn, resulted in confused and disengaged employers.

Stephen Radley, chief economist at the EEF, says the report shows employers lack confidence in the current system. “We are meant to have an employer-led system, but our members feel disengaged. Companies struggle to understand how the system works and don’t have the time to find out. They are also sceptical that it will make a difference if they do take time to learn about it.”

Sector-led system

The EEF report sets out several recommendations to address the stubborn skills gaps that it claims blight the sector. However, the key reform is to move to a sector-led system.

“A regionally-led system does not work and makes it horrendously complicated,” says Radley. “Different sectors of the industry have been around for hundreds of years and have common issues. Regions are just admin areas created by the government. It can be misleading to say there are area-specific needs. For example, the South West includes high growth areas, such as Bristol and the M4 corridor, but also Devon and Cornwall, where tourism is the main industry.”

This is a reform that shadow minister for vocational education, John Hayes, also supports. “The businesspeople I talk to say the regional structure of the LSC is not helpful. Some employers are based in one locality. Big companies span the whole nation. The regional structure just does not reflect this reality,” he says.

The EEF proposes that the current system should be streamlined by cutting the number of sector skills councils and combining the LSC with the SSDA to create one body. The idea is that having fewer organisations involved should mean resources are used more efficiently.

According to Hayes, resourcing is currently a big problem, particularly for the LSC. “More than £1bn of the LSC’s annual budget of £10bn fails to reach any of the bodies that actually provide training. Between 2003 and 2006, the LSC chose to spend £20m on management consultants alone,” he says.

But above all, the reform aims to provide a greater focus on sector-specific skills issues. Radley says: “At the moment, all 25 councils are dealing with the same work around general issues, such as IT and management. If we had fewer councils – roughly half – they would be better resourced to look at the particular needs of the sector they are serving.”

The feedback

So what do the SSDA and the LSC think of the proposals?

“I don’t think anyone could disagree with the principles behind the EEF’s report,” says Margaret Salmon, chair of the SSDA. “The call for a sector-based skills system with employers in the driving seat is echoed by employers, providers, government and its agencies alike.”

However, she says she is keeping an open mind until the completion of the Leitch Review later this year – a report commissioned by the government to identify the UK’s optimal skills mix in 2020.

“The network of sector skills councils is awaiting the publication of the report. We hope this will give fresh impetus to the calls from employers for a simpler, more streamlined system,” she says.

As for the LSC, its national director of skills, David Way, agrees that the EEF’s report should be welcomed, but stresses that the LSC is already working closely with manufacturing firms to help close skills gaps. He says that the recent launch of its Train to Gain initiative is helping employers find out about training resources more easily.

“The service has been specifically designed to deliver the skills training that companies want, in the workplace, with minimum disruption. A network of impartial and independent skills brokers visit businesses, listen to their skills requirements and advise them on the best education and training available to meet these, whether with colleges or training providers,” he says.

Way insists that early reports indicate employers are extremely pleased with this skills brokerage service and that it is enabling them to focus on making the right investment in skills, often with the support of government funding.

Another initiative aimed at improving skills is the government’s Manufacturing Advisory Service (MAS).

Launched in 2002, the service is delivered through 10 regional centres covering England and Wales, and provides information, advice and follow-up support on all manufacturing-related issues – including training. It provides employers with access to a network of organisations, such as technology institutes and training centres, and provides training and workshop activities for manufacturers across each region.

But the EEF says MAS needs to broaden its remit to help firms take a more strategic approach to training. “It needs to widen what it does and think through some of the skills implications of what it wants to achieve,” Radley says, “At the moment, it is more focused on management techniques, but it needs to broaden this to areas such as energy efficiency and innovation.”

The Manufacturing Institute delivers MAS in the North West. Its director of programmes, Mike Niblett, says it is already delivering a strategic approach to training.

“We are already putting into practice one of the EEF’s recommendations by embedding training into the strategic support mix offered to businesses. Results-led educational initiatives to address the full skills range – from shopfloor to boardroom – are ensuring that manufacturers develop the talent they need to drive forward and sustain improvement,” he says.

Accreditation needed

Niblett says programmes such as the institute’s professional diploma in manufacturing and MSc in manufacturing leadership are already helping manufacturers ‘build future-proof enterprises’ and ‘compete in a global economy’.

But Radley says that to drive the quality of the delivery and content of courses, an accreditation system is needed. “If certain courses were accredited, employers would be confident they were choosing the right training and this would encourage them to invest,” he says.

With accreditation in mind, another of the EEF’s proposals is to promote the benefits of achieving the Investors in People (IIP) national quality standard (see box). “Our research shows that companies who go through IIP tend to achieve much greater results,” says Radley.

Nicola Clark, director of marketing at IIP, says that to achieve the standard, firms need to look at how they can improve and then make sure staff have the skills to make it happen. “The by-products are countless, but are based on employees having a sense that they are involved and so feel pride in taking strategies forward for the organisation,” she says.

Radley is not expecting all bodies to agree with the reforms set out in the EEF’s report. He says it is important to recognise that the time and money already invested into the current training system could act as a barrier to change.

“The view in some quarters is that employers are not doing enough training and the answer is to slap a levy on them. Some also feel that the skills councils have not had long enough to prove themselves. There is also a lot of vested interest in the current system. However, we remain confident in our aims. There has been a lot of change already, so this time we need to get it right,” he adds.

Investors in People

The Investors in People (IIP) standard is designed to improve an organisation’s performance through its people.

To achieve the standard, organisations have to meet the same criteria as other organisations, but in their own way. It does not prescribe any one method, but provides a framework to help firms find the most suitable means for achieving success through their people.

Part of this is achieved by reaching learning and development standards. For example, managers have to be able to explain the organisation’s learning and development needs and be able to plan how to meet them, while staff have to be able to describe their own learning and development needs, plan how to meet them and explain what it achieves for them and the wider organisation.

Quality centres in every region provide support and advice, master classes and seminars.

For an information pack on how to get started, e-mail, or call 020 7467 1946.

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